2017 Tax Year Questions

[konapoppy]

Post yours here!

audette

[konapoppy]

Our 2015 and 2016 taxes are being audited due to a family membwr’s estate that trickles down to us. There is a carry over loss that we can claim in 2017, but I am not sure it is worth claiming it if it means 2017 will have to get audited too. Thoughts?

[audette]

This will be our first year filing a 1099-R. Anything special we need to know about it?

Also, it's been a long, long time since I had to file a part-year resident state income tax. Our address stayed the same, but when DH retired from the military, I couldn't claim the military spouses thing that lets me take our residency from DH's home state. Any tips for that would be helpful...

[silva]

Is there anything I should know about claiming taxes on foster children? We've had our daughter since May and I wonder if I should be digging through receipts.

If I claim her as our dependant? Do I need to let her parents know?

[konapoppy]

Jan 22, 2018 15:28:04 GMT -5 silva said:

Is there anything I should know about claiming taxes on foster children? We've had our daughter since May and I wonder if I should be digging through receipts.

If I claim her as our dependant? Do I need to let her parents know?

leviosa might know (I think she is American?)!

[ohgillian]

I'm going to get an accountant this year, but in the meantime:

I'm the trustee for a new family trust and I guess I need to issue K-1s, etc. Any good websites to give me some guidance?

[mrsfarmer]

Jan 22, 2018 15:28:04 GMT -5 silva said:

Is there anything I should know about claiming taxes on foster children? We've had our daughter since May and I wonder if I should be digging through receipts.

If I claim her as our dependant? Do I need to let her parents know?

Check with your social worker, they should have the SSN's that you need; we were able to claim our girls when they were our foster children. 

[mmmomof2]

This might be basic knowledge I have missed along the way, but wrt 1099s: I do contracting work and I have a client that mailed a check to me the last week of the year so I didn't receive it until 2018. I'm assuming they are going to include the check on my 2017 1099. Since I'm a cash basis filer do I have to include it in my schedule C? I see there's a way to document why your stated income might be different than the 1099, but does that trigger an audit? It's not a huge amount, but our marginal tax rate will be lower in 2018....

[Deleted]

We file married filing separately for purposes of my student loan income-based repayment. But because we're in a community property state, I have to report my income as 50 percent of my income plus 50 percent of H's, and he does the same. How do we handle a dependent in this situation? Do we each claim half the credit?

[silva]

Jan 24, 2018 15:26:32 GMT -5 leviosa said:

Jan 23, 2018 4:13:51 GMT -5 konapoppy said:

leviosa might know (I think she is American?)!

I am!

@silva  You can claim her on your taxes if she has been with you for more then six months.  You just need her social security number and you will list her as a dependent.   We were never required to let the parents know.  Here CPS tells them.  

You shouldn't have to dig through any receipts.   Our accountant asked for a copy of our placement letter, just for proof of when she was with us.  It didn't need to be sent in, but he liked to have it in case of audit. Or if the bio parents tried to claim her as well, he'd have the proof for the IRS that she was in fact our dependent. 

If you're case goes to adoption, you may need receipts for proof of what you paid toward her adoption costs.  But if it's a special needs adoption (most adoptions from foster care are) then you won't even need it for that.

Good Luck!!

Thank you! I was able to get her SSN so that is a step and I have all of our other paper work.  Is that the only thing I can claim with her? Are there any other tax breaks we may qualify for?  This is all new to me and I would hate to miss anything.

Our case won't go to adoption, her case is heavily on reunification which is great! We're just there to provide a home in the meantime.

[bullygirl979]

I am claiming a home office for 2017 as I began working from home. When I initially loaded in the numbers my refund skyrocketed. When I clicked through them again, all my money "went away". I'm wondering if there is a threshold you have to hit to write off a home office?

[oswin]

Jan 26, 2018 9:11:16 GMT -5 bullygirl979 said:

I am claiming a home office for 2017 as I began working from home. When I initially loaded in the numbers my refund skyrocketed. When I clicked through them again, all my money "went away". I'm wondering if there is a threshold you have to hit to write off a home office?

IIRC, it's really tricky to claim a home office. I've only ever just filled out the forms myself, so I don't know what TurboTax or whatever was showing, but make sure you read through what is required to claim a home office. DH and I both work from home (we're remote employees) and I'm not planning to claim a home office on our taxes. There's some info on it here: www.irs.gov/businesses/small-businesses-self-employed/home-office-deduction I only use like 1/4 of my bedroom as my office space, and I swap back and forth between using my desk for personal use on the weekends and business use during the week. I think it's easier if you can claim that you use an entire room in your house 100% for business use and nothing else. Anyway, I'd just say be careful.

[bullygirl979]

Jan 26, 2018 10:22:09 GMT -5 oswin said:

Jan 26, 2018 9:11:16 GMT -5 bullygirl979 said:

I am claiming a home office for 2017 as I began working from home. When I initially loaded in the numbers my refund skyrocketed. When I clicked through them again, all my money "went away". I'm wondering if there is a threshold you have to hit to write off a home office?

IIRC, it's really tricky to claim a home office. I've only ever just filled out the forms myself, so I don't know what TurboTax or whatever was showing, but make sure you read through what is required to claim a home office. DH and I both work from home (we're remote employees) and I'm not planning to claim a home office on our taxes. There's some info on it here: www.irs.gov/businesses/small-businesses-self-employed/home-office-deduction I only use like 1/4 of my bedroom as my office space, and I swap back and forth between using my desk for personal use on the weekends and business use during the week. I think it's easier if you can claim that you use an entire room in your house 100% for business use and nothing else. Anyway, I'd just say be careful.

Thanks. I have a dedicated office that is not used for anything else so I'm not worried about that. But given I only used it for part of the year, I'm not sure if that's why it went away.

[silva]

I always to a pre liminary run on my return around this time. I just ran into something that is giving me pause.

So I have multiple donations to Goodwill.

I'm using the find values tool in turbo tax. I cleaned out my basement back in september and donated a bunch of stuff. I have a documented list as well as photos of the donations...It came close to $1400 donation. I'm freaking out. Will that be something they may flag for an audit?

Advice?

eta:  I redid it and did the lower values on most of the stuff and it still came to $1000.

[dcn]

Jan 28, 2018 16:55:03 GMT -5 silva said:

I always to a pre liminary run on my return around this time. I just ran into something that is giving me pause.

So I have multiple donations to Goodwill.

I'm using the find values tool in turbo tax. I cleaned out my basement back in september and donated a bunch of stuff. I have a documented list as well as photos of the donations...It came close to $1400 donation. I'm freaking out. Will that be something they may flag for an audit?

Advice?

eta:  I redid it and did the lower values on most of the stuff and it still came to $1000.

Maybe, but if you have good documentation then I’d include it.

I once did someone’s taxes who wanted to claim close to $100k of donations. She had totally redecorated her house and donated everything she got rid of.

So, I probably wouldn’t worry much about $1000!

[meredithblake]

Lurker here with some basic questions.

1. I put all of our itemized stuff into turbo tax and the standard deduction is still the better option. We have 3 kids, a mortgage, some low student loans, and are able to claim medical expenses. Does this sound right? I was just surprised. If it matters our income is about $60,000. Our current estimated refund is $4,600 total, but I'm still waiting on a $5,500 w2 which will probably lower it. 

2. We stand to have the same income for next year and are having another baby in June. Should I have my husband add an extra withholding to his primary job? 

Thank you for your patience! I know these are basic questions that I should probably know the answer to. 

[LoveTrains]

Jan 28, 2018 19:00:49 GMT -5 meredithblake said:

Lurker here with some basic questions.

1. I put all of our itemized stuff into turbo tax and the standard deduction is still the better option. We have 3 kids, a mortgage, some low student loans, and are able to claim medical expenses. Does this sound right? I was just surprised. If it matters our income is about $60,000. Our current estimated refund is $4,600 total, but I'm still waiting on a $5,500 w2 which will probably lower it. 

2. We stand to have the same income for next year and are having another baby in June. Should I have my husband add an extra withholding to his primary job? 

Thank you for your patience! I know these are basic questions that I should probably know the answer to. 

Student loans are deducted below the line, which means they aren't part of your itemized deductions. Depending on how much interest plus property taxes plus state income tax, it's possible the standard deduction might be better for you.

[idahome]

I make almost double my husband's income, but we have a lot of expenses (neither of us are great with money). Right now we owe a little over $2,200. I'm wondering if we should seriously consider looking into filing separately.

For those who file separately, what was your deciding factor? I'm terrified of being audited.

[puppylove64]

Jan 28, 2018 21:47:05 GMT -5 idahome said:

I make almost double my husband's income, but we have a lot of expenses (neither of us are great with money). Right now we owe a little over $2,200. I'm wondering if we should seriously consider looking into filing separately.

For those who file separately, what was your deciding factor? I'm terrified of being audited.

If you use an accountant, it is usually very easy for them to key all your info and then ask the software if mfs is better. It is usually just a click of the button and the return separates.

[Roc A Bee]

I keep getting an error because a CA form isn’t available. When is CA going to get it together?

[keweenawlove]

We bought a house last Feb so we paid mortgage payments starting in Feb which we've already taken into account. We also paid rent in Jan and Feb which is an allowable write off for our Wisconsin state taxes. Are we fine claiming both?

[smile715]

Lurker with a question about being a Lyft driver... my husband drove a few weekends a month for 3 months and made about $1200. I put the income in and the miles he drove to take the mileage deduction. The tax software I’m using asked if the car was sold during 2017 and it was but I can’t figure out how much to put in for the value for the time he drove. The car dealer gave us $12,500 as a trade. Is it possible to hire a tax accountant to just help with one question?

[mmmomof2]

Jan 29, 2018 20:34:04 GMT -5 smile715 said:

Lurker with a question about being a Lyft driver... my husband drove a few weekends a month for 3 months and made about $1200. I put the income in and the miles he drove to take the mileage deduction. The tax software I’m using asked if the car was sold during 2017 and it was but I can’t figure out how much to put in for the value for the time he drove. The car dealer gave us $12,500 as a trade. Is it possible to hire a tax accountant to just help with one question?

Why would the value of the car matter? The mileage deduction is the same whether you drive a Civic or a Mercedes. Were you taking depreciation on the car too? If not, I would personally just check no I didn’t sell the car. But I’m not a tax professional.

[mainelyfoolish]

Jan 29, 2018 20:34:04 GMT -5 smile715 said:

Lurker with a question about being a Lyft driver... my husband drove a few weekends a month for 3 months and made about $1200. I put the income in and the miles he drove to take the mileage deduction. The tax software I’m using asked if the car was sold during 2017 and it was but I can’t figure out how much to put in for the value for the time he drove. The car dealer gave us $12,500 as a trade. Is it possible to hire a tax accountant to just help with one question?

Since you traded the car in on another car, I don't think you need to worry about the value of the car. 

See page 24 of this publication: www.irs.gov/pub/irs-pdf/p463.pdf

(Also not a tax professional. This advice is worth what you paid for it. LOL)

[smile715]

Jan 29, 2018 22:10:29 GMT -5 mmmomof2 said:

Jan 29, 2018 20:34:04 GMT -5 smile715 said:

Lurker with a question about being a Lyft driver... my husband drove a few weekends a month for 3 months and made about $1200. I put the income in and the miles he drove to take the mileage deduction. The tax software I’m using asked if the car was sold during 2017 and it was but I can’t figure out how much to put in for the value for the time he drove. The car dealer gave us $12,500 as a trade. Is it possible to hire a tax accountant to just help with one question?

Why would the value of the car matter? The mileage deduction is the same whether you drive a Civic or a Mercedes. Were you taking depreciation on the car too? If not, I would personally just check no I didn’t sell the car. But I’m not a tax professional.

I guess it’s depreciation, but I have no idea how that works either. Saying we didn’t sell is probably what I will do.

[smile715]

Jan 29, 2018 22:41:42 GMT -5 mainelyfoolish said:

Jan 29, 2018 20:34:04 GMT -5 smile715 said:

Lurker with a question about being a Lyft driver... my husband drove a few weekends a month for 3 months and made about $1200. I put the income in and the miles he drove to take the mileage deduction. The tax software I’m using asked if the car was sold during 2017 and it was but I can’t figure out how much to put in for the value for the time he drove. The car dealer gave us $12,500 as a trade. Is it possible to hire a tax accountant to just help with one question?

Since you traded the car in on another car, I don't think you need to worry about the value of the car. 

See page 24 of this publication: www.irs.gov/pub/irs-pdf/p463.pdf

(Also not a tax professional. This advice is worth what you paid for it. LOL)

Thanks. This is all too confusing and I’m glad I will not have to deal with Lyft on our taxes for 2018.

[puppylove64]

smile715 you can either take mileage or depreciation and expenses. It is probably asking you both to give you the best results. I would just stick with mileage. You can’t swap back and forth and mileage is usually better for a small amount of work mileage. It also keeps you from having to keep up depreciation and paying gain/loss every time you sell. I take mileage every year for Dh as a W2 employee

[yentl]

I'm going to talk more with my accountant but I'm considering changing from a solo proprietor to llc/s corp. Trying to figure out of it's worth the additional complications for tax savings.
ETA: This is for moving forward.... I'll be comparing my 2017 return to help figure this out, though I suppose!

[puppylove64]

nevermind

[orval]

I changed to an S Corp from a sole proprietor. I saved about $8k in taxes the first year. It is a major pain in the ass to have to fill out all of the tax forms for my salary and pay quarterly payroll taxes. I am the only employee of my business. With the sole prop., I was paying almost 50% of what I made in self employment taxes.