Tax Season

mac5155
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Tax Season

Postby mac5155 » Mon Jan 04, 2021 10:12 am

a. are you sure it is a trust and not an estate

b. he should receive a k-1
Yes it was a trust (I guess when I said "estate" what I was really saying was "sold her house/final possession")

What triggers the K1? The attorney who did the closing on the house called him today asking for the EIN of the trust, that's what prompted this question. I wasn't sure why they'd want/need that. The house sold in April.
Last edited by mac5155 on Mon Jan 04, 2021 10:14 am, edited 1 time in total.

dodint
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Tax Season

Postby dodint » Mon Jan 04, 2021 10:13 am

For the last several years wife and I have used turbo tax to file state and fed taxes and have managed okay. We have simple taxes with some small investment profit/loss from E trade as the one outlier.

In 2020 however we sold a house, bought a house, relocated with my company to a new state (although effective 1/1 so no state tax from old state), and had a baby.

With several large life events happening to us in 2020 would it be recommended to go to an HR block type of place or try to find a tax person locally, or would turbotax be adequate for this type of events this year?
My sister is a tax accountant and I have zero regrets turning my challenging tax years over to her. The year we inherited some money that 4x'd our normal annual income TurboTax had us paying a fairly high amount out of pocket, whereas my sister got us a refund on our return. I would seek out a local shop rather than HR Block but they're both going to be better than TurboTax.

I think now that I have a Schedule C and anticipated payments I'm just going to hire my sisters firm to do them all moving forward.

We made a mistake in 2020. My wife was unemployed and took several weeks of the enhanced federal unemployment. I didn't realize it was taxable at the federal level, as income, so I'm already in a hole from that. We could have elected to have 10% withholding taken out, but I don't recall the state website mentioning that, it's something you have to file separately with the IRS. :(

MrKennethTKangaroo
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Tax Season

Postby MrKennethTKangaroo » Mon Jan 04, 2021 10:15 am

Well moving deductions aren't a thing right now. It was a victim of Trump's tax law. Taking away a tiny deduction used by normal human beings is a fantastic way to close a colossal deficit.

The sale of a home for most people is non taxable. Read this:
https://www.irs.gov/taxtopics/tc701

So there is that.

mac5155
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Tax Season

Postby mac5155 » Mon Jan 04, 2021 10:16 am

FWP: for the first year in my life I won't be able to deduct $2500 in student loan interest this tax year.

dodint
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Tax Season

Postby dodint » Mon Jan 04, 2021 10:18 am

My wife was asking if the unemployment issue could be offset with other deductions. NOPE, thanks Trump! I know that's not entirely true as the standard deduction was also raised so it's still kind of there. But not really.

MrKennethTKangaroo
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Tax Season

Postby MrKennethTKangaroo » Mon Jan 04, 2021 10:21 am

a. are you sure it is a trust and not an estate

b. he should receive a k-1
Yes it was a trust (I guess when I said "estate" what I was really saying was "sold her house/final possession")

What triggers the K1? The attorney who did the closing on the house called him today asking for the EIN of the trust, that's what prompted this question. I wasn't sure why they'd want/need that. The house sold in April.
Estates have to file tax returns in a lot of circumstances. same thing with trusts. Thought trusts are a really tricky, my trust game was never good, and I haven't prepared a tax return in 6 years. But they are asking for the EIN probably because the attorney has to issue a 1099 regarding the sale of the house. I think it is a 1099-S

Beveridge
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Tax Season

Postby Beveridge » Mon Jan 04, 2021 2:58 pm

Follow up to Mac's and KTK's convo...

My grandpa died, so my dad and uncle pay inheritance tax on what was left in the estate including the appraised value in the house and land. They since sold house and land at cost or maybe a little less. Will there be any tax implication for them individually or not?

I'm thinking no because the sell was for appraised value (or less) at death and inheritance tax was paid.

There would only be additional state tax and federal tax had the property sold for more than the basis created upon death, correct?

dodint
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Tax Season

Postby dodint » Sun Jan 10, 2021 7:52 pm

2021 is the first year I plan to have income from my Schedule C sole proprietor LLC. For quarterly anticipated earnings purposes is my safe harbor $0? My plan is to just estimate them quarterly as I go, so anything above nothing should be good enough for safe harbor as far as I can see.

skullman80
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Tax Season

Postby skullman80 » Mon Jan 11, 2021 9:32 am

I'm assuming the answer is no, but is there any way for my wife and I to file taxes jointly without her student loan payments jumping up double?

Right now we file married but separate because of this.

She owes like 220k on her student loans (absurd I know). She (we) pay roughly $1100 a month right now. It's like 850 federal and 150 private I think? Something like that. She is on a Income based repayment plan at the moment. If we add in my income to hers by filing together than the payment is going to jump to probably 2000 or 2100 a month. Because of this we have been filing married but separate. We bought a house and it would just make things way easier to file together with the deductions and such and I also believe get us more back at tax time. I don't however want to get more back for a refund and then have to put out another 1k a month in student loan payments.

Fire0nIce228
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Tax Season

Postby Fire0nIce228 » Mon Jan 11, 2021 10:47 am

I'm assuming the answer is no, but is there any way for my wife and I to file taxes jointly without her student loan payments jumping up double?

Right now we file married but separate because of this.

She owes like 220k on her student loans (absurd I know). She (we) pay roughly $1100 a month right now. It's like 850 federal and 150 private I think? Something like that. She is on a Income based repayment plan at the moment. If we add in my income to hers by filing together than the payment is going to jump to probably 2000 or 2100 a month. Because of this we have been filing married but separate. We bought a house and it would just make things way easier to file together with the deductions and such and I also believe get us more back at tax time. I don't however want to get more back for a refund and then have to put out another 1k a month in student loan payments.


I'm no professional but my wife and i are in a simliar boat and we file married but seperate due to her student loan debt and the IBR payment setup. Shes about halfway through the non profit loan forgiveness thing so for us while it does suck at tax time, the hope is the lower IBR leads to a substantial forgiveness when the 10 years of service in the program passes.

mac5155
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Tax Season

Postby mac5155 » Mon Jan 11, 2021 11:07 am

Don't forget that the amount forgiven is treated as taxable income in the FY that it's forgiven.

dodint
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Tax Season

Postby dodint » Mon Jan 11, 2021 11:10 am

She owes like 220k on her student loans
Is she an astronaut?

mac5155
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Tax Season

Postby mac5155 » Mon Jan 11, 2021 11:11 am

:lol:

skullman80
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Tax Season

Postby skullman80 » Mon Jan 11, 2021 11:15 am

She owes like 220k on her student loans
Is she an astronaut?
Haha. No she is a PA. She had no help going to school for her parents. She had some scholarships, but she went 4 years, plus then 2 more for PA school? I can't remember. In any event she graduated with like 210k debt I think, and even though she has paid on time every month... she is actually more in debt now because of the interest rate. It's insane.

dodint
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Tax Season

Postby dodint » Mon Jan 11, 2021 11:24 am

Yeah, just teasing. That's unfortunate. Maybe Biden will come through and forgive it. ;)

mac5155
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Tax Season

Postby mac5155 » Mon Jan 11, 2021 11:27 am

$10k of it

NTP66
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Tax Season

Postby NTP66 » Mon Jan 11, 2021 11:29 am

I look forward to the 'I had to pay my way, why should they get money off!' nonsense if that happens.

mac5155
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Tax Season

Postby mac5155 » Mon Jan 11, 2021 11:30 am

CAN MY MORTGAGE BE FORGIVEN LOLZ

NTP66
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Tax Season

Postby NTP66 » Mon Jan 11, 2021 11:31 am

CAN MY MORTGAGE BE FORGIVEN LOLZ
Two hail marys and... that's the only one I remember, but you're good.

skullman80
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Tax Season

Postby skullman80 » Mon Jan 11, 2021 11:35 am

Of note I'm going to be paying off my student loans this year after like 15 years... and I'd have no problem with everyone (not just my wife) getting some sort of relief overall even though I just paid mine off. The whole system is broken, but it is what it is.

She also gets hers forgiven I think after 15 years or 20 because of the field that she is in or something like that. With that said she got boned the first few years being a PA cause even though she worked for UPMC, she technically drew a check via the Leukemia department so it didn't accrue towards her years of service even after she appealed it. The role she is in now with UPMC is does accrue towards that, but she basically lost about 5 years worth of "time' towards forgiveness.

willeyeam
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Tax Season

Postby willeyeam » Mon Jan 11, 2021 11:45 am

i'm all for some loan forgiveness, it's maybe the best way to inject some cash into the economy via the middle class imo. that said, there needs to be some reform to college costs or this is just a band aid on a bullet hole

dodint
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Tax Season

Postby dodint » Mon Jan 11, 2021 11:47 am

What I'm pisssed off about is before the CARES Act deferral my payment was in the $200s, and coming out of it somehow my payment is in the mid-$300s. Not a huge deal but my understanding was that it wasn't supposed to change. My servicer actually changed my repayment plan without telling me, and when I went back to fix it the payment was about $100 higher. It went into deferment before I started making payments so the balance never should have changed, nor the payments.

Not a huge deal because my amount financed is low, it only has like two semesters of law school on it. But I bet some other people got f'd.

NTP66
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Tax Season

Postby NTP66 » Mon Jan 11, 2021 11:51 am

Source of the post that said, there needs to be some reform to college costs or this is just a band aid on a bullet hole
Agreed 100%.

robbiestoupe
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Tax Season

Postby robbiestoupe » Mon Jan 11, 2021 1:12 pm

Damn skullman that's some loan. I know PA's are paid peanuts compared to the work they do so I feel for you/your wife. My wife did 4 years undergrad, 2 years post and 1 year doctorate for PT at Chatham. That last year was $50k alone, but she was only about $150k in debt I believe by the time she graduated. That was in 2007.

We decided to put all our extra money into the loans when we got married in 2009 and had it paid off in 2015, except for a $16k interest-free loan her parents gave her which we paid off in 2019. It also helped we had no car loans and waited to buy a house until 2015, but it was no fun going through that period.

In retrospect I had $16k in loans for a 4 year degree when I graduated in 1999. Probably would be $100k if I graduated last year. Completely stupid the cost of a higher education.

skullman80
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Tax Season

Postby skullman80 » Mon Jan 11, 2021 1:20 pm

Damn skullman that's some loan. I know PA's are paid peanuts compared to the work they do so I feel for you/your wife. My wife did 4 years undergrad, 2 years post and 1 year doctorate for PT at Chatham. That last year was $50k alone, but she was only about $150k in debt I believe by the time she graduated. That was in 2007.

We decided to put all our extra money into the loans when we got married in 2009 and had it paid off in 2015, except for a $16k interest-free loan her parents gave her which we paid off in 2019. It also helped we had no car loans and waited to buy a house until 2015, but it was no fun going through that period.

In retrospect I had $16k in loans for a 4 year degree when I graduated in 1999. Probably would be $100k if I graduated last year. Completely stupid the cost of a higher education.
We both make good money so it's not even a woe is us story, but it's still realllly annoying the amount of money she has paid already and she owes more than she did when she finished school. It just boggles my mind.

I know my wife did 4 years at Allegheny college, then went to some place in Marietta college for her PA studies. It's offset with how meager my loans were in general I guess, but I didn't do 6 or 7 years of college either.

I need to really sit down and look at her loans and see if I can even find a way to refinance some of them. I married into this, so I'm not sure of all the details with her interest rates, I just know that if we filed our taxes together with her income and my income her payment would double what it is right now for her IBR plan.

It's again what some people don't realize about how some people get behind even if you do the "right" thing by going to college. Neither my parents nor her parents could afford to give either one of us a single cent to go to college. We both grew up pretty poor. It just seems asinine to me that we basically have kids sign their lives over at 18 for 100's of thousands of dollars in loans that puts them behind the eight ball before they even finish college because that is what "you are supposed to do". That's not even factoring in the people who get degrees who pay peanuts once they graduate. My wife was lucky to make north of 80K right out of PA school.
Last edited by skullman80 on Mon Jan 11, 2021 1:22 pm, edited 1 time in total.

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