Basically, any expenses incurred to secure the loan (not the property) are amortized and deducted over the life of the loan. This would be expenses paid for your credit check pull, appraisal fees *if* required by the bank in order to secure the loan (and it was), as well as what the bank calls "origination fees" which may or may not include "points" (which is nothing more than pre-paid interest on the loan.)
Whereas expenses incurred in acquistion of the property are capitalized and depreciated 27.5 years (for rental property). These would be expenses such as title transfer fees, title insurance and things like documentary stamps if your county still does that.
- Amortized expenses are "deducted" over the life of the loan.
- Capitalized expenses are "depreciated" over 27.5 years (as per the MACRS schedule for residential rental property.)
To help you out, if this is your first year reporting rental income/expenses on a tax return, the below information will clarify things for you, that (in my opinion) the program does not.
Rental Property Dates & Numbers That Matter.
Date of Conversion - If this was your primary residence before, then this date is the day AFTER you moved out. In Service Date - This is the date a renter "could" have moved in. Usually, this date is the day you put the FOR RENT sign in the front yard. Number of days Rented - the day count for this starts from the first day a renter "could" have moved in. That should be your "in service" date if you were asked for that. Vacant periods between renters count also PROVIDED you did not live in the house for one single day during said period of vacancy. Days of Personal Use - This number will be a big fat ZERO. Read the screen. It's asking for the number of days you lived in the property AFTER you converted it to a rental. I seriously doubt (though it is possible) that you lived in the house (or space, if renting a part of your home) as your primary residence or 2nd home, after you converted it to a rental. Business Use Percentage. 100%. I'll put that in words so there's no doubt I didn't make a typo here. One Hundred Percent. After you converted this property or space to rental use, it was one hundred percent business use. What you used it for prior to the date of conversion doesn't count.
RENTAL POPERTY ASSETS, MAINTENANCE/CLEANING/REPAIRS DEFINED
Property improvements are expenses you incur that add value to the property. Expenses for this are entered in the Assets/Depreciation section and depreciated over time. Property improvements can be done at any time after your initial purchase of the property. It does not matter if it was your residence or a rental at the time of the improvement. It still adds value to the property.
To be classified as a property improvement, two criteria must be met:
1) The improvement must become "a material part of" the property. For example, remodeling the bathroom, new cabinets or appliances in the kitchen. New carpet. Replacing that old Central Air unit.
2) The improvement must add "real" value to the property. In other words, when the property is appraised by a qualified, certified, licensed property appraiser, he will appraise it at a higher value, than he would have without the improvements.
Cleaning & Maintenance
Those expenses incurred to maintain the rental property and it's assets in the useable condition the property and/or asset was designed and intended for. Routine cleaning and maintenance expenses are only deductible if they are incurred while the property is classified as a rental. Cleaning and maintenance expenses incurred in the process of preparing the property for rent are not deductible.
Those expenses incurred to return the property or it's assets to the same useable condition they were in, prior to the event that caused the property or asset to be unusable. Repair expenses incurred are only deductible if incurred while the property is classified as a rental. Repair costs incurred in the process of preparing the property for rent are not deductible.
Additional clarifications: Painting a room does not qualify as a property improvement. While the paint does become “a material part of” the property, from the perspective of a property appraiser, it doesn’t add “real value” to the property.
However, when you do something like convert the garage into a 3 rd bedroom for example, making a 2 bedroom house into a 3 bedroom house adds “real value”. Of course, when you convert the garage to a bedroom, you’re going to paint it. But you will include the cost of painting as a part of the property improvement – not an expense separate from it.
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Wages are transferred based on your entries of the W-2. For some states, the wages are transferred directly from Box 16 of your W-2 and, in other cases, the numbers transfer from your 1040 and match your Federal wages. Whether you entered the numbers by hand or imported the W-2, correct numbers depend on your entries, so this error is not covered by our guarantee. In all situations, the guarantee covers only penalties and interest; it does not ever cover the additional tax you may owe. guarantee.
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When the excess contribution is the result of the combined contributions of the spouses but neither contribution, without regard to the other spouse's contribution, is in and of itself an excess contribution, the excess contribution is a shared excess contribution. It is not explicitly attributable to one spouse or the other until an action is taken by the spouses to attribute the excess to one spouse, the other spouse, or in some combination between the two spouses. Because only excess contributions are permitted to be distributed form an HSA as a return of excess contribution, obtaining a return of excess contribution from a particular spouse's HSA explicitly attributes that amount of the excess as being in that spouse's HSA.
With regard to the irrelevance of the investment performance in your wife's HSA, I'm referring only to the legally required calculation (https://www.law.cornell.edu/cfr/text/26/1.408-11), substitute "HSA" for "IRA" since the law requires the same calculation for HSAs as is required for IRAs) of the earnings that must be distributed from your HSA to accompany the return of excess contribution from your HSA. Obviously it would have been better to have less earnings required to be distributed by basing the earnings calculation on the investment performance in your wife's HSA, but that would have required that the excess contribution be distributed from your wife's HSA.
Regarding intermediate distributions, no, I am definitely not saying that a nontaxable distribution used to pay medical expenses is considered to be a distribution of earnings. I'm saying that any regular distributions during the calculation period must be added back to the closing account balance in the calculation of attributable earnings. to determine attributable earnings. See the definition of Adjusted Closing Balance in CFR section 1.408-11(b)(2) referenced above.
It appears that it was PayFlex's mistake not to calculate and distribute the earnings as they said they would on the form. By distributing exactly the amount that you indicated was the amount of the excess contribution, PayFlex is effectively saying that there was exactly $0 gain or loss during the calculation period, which you say is not true. You'll need to contact PayFlex to inform them of their error and have them make the correction. Since there were gains, they probably need to treat the first return of excess contribution as return of only roughly 91% of the excess, with about 9% of the excess still remaining. For example, if the excess contribution was $1,668, there was a 10% gain in your HSA and the gross distribution of a return of excess contribution was $1,668, that would mean that $1,516 of excess was returned accompanied by $152 of earnings, with $152 of excess contribution still remaining to be resolved.
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As @HACKITOFF mentioned, the allocations could be in the partnership agreement and the circumstances surrounding such partnerships are, indeed, weird.
TurboTax Business (which can be used to prepare a Form 1065 for the partnership) can handle special allocations but I would absolutely not recommend trying to do so without professional guidance, at a bare minimum.
You would be well-advised to consult with a tax/legal professional who is experienced in partnership taxation and related matters.
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no one can tell you what your actual taxes would be, ignoring the penalty because that will depend on your taxable income. you can use TT taxcaster to get an estimate of the taxes, but i don't think the penalty would be included if it applies.
another way if you have an idea of what your taxable income would be is to look at the tax rate schedule for 2019
again this doesn't include the penalty
if your state has individual income taxes, it might be taxed or it might be exempt.
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YES you can still file a joint return even if you are living apart--for whatever reason. You are not required to live together to file a joint return. And if you own two homes you can enter the mortgage interest and property taxes and loan origination fees paid for both--you are allowed to enter those things for a "second home" as well as a primary home.
If you are legally married at the end of 2019 your filing choices are married filing jointly or married filing separately.
Married Filing Jointly is usually better, even if one spouse had little or no income. When you file a joint return, you and your spouse will get the married filing jointly standard deduction of $24,400 (+$1300 for each spouse 65 or older) You are eligible for more credits including education credits, earned income credit, child and dependent care credit, and a larger income limit to receive the child tax credit.
If you choose to file married filing separately, both spouses have to file the same way—either you both itemize or you both use standard deduction. Your tax rate will be higher than on a joint return. Some of the special rules for filing separately include: you cannot get earned income credit, education credits, adoption credits, or deductions for student loan interest. A higher percent of your Social Security benefits may be taxable. Your limit for SALT (state and local taxes and sales tax) will be only $5000 per spouse. In many cases you will not be able to take the child and dependent care credit. The amount you can contribute to a retirement account will be affected. If you live in a community property state, you will be required to provide additional information regarding your spouse’s income. ( Community property states: AZ, CA, ID, LA, NV, NM, TX, WA, WI)
If you are using online TurboTax to prepare your returns, you will need to prepare two separate returns and pay twice.
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TurboTax has no knowledge whatsoever of your delinquent child support, nor does TT have any control over what happens with your tax refund after you file your tax return. As already stated, the IRS controls that. All TurboTax does is provide you with do-it-yourself software to prepare your tax return. The IRS controls what happens after you file it.
NOTE: You can contact the IRS Treasury Offset Program Call Center at 1-800-304-3107 to ask if they have an offset for you on file. TurboTax would not have that information.
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Depends ... if you don't rent the property then the RE taxes can be deduction on the Sch A. If you DO rent it out then all the income and expenses are entered on a Sch E. Read up on rentals in the IRS pub 527 ... and if you also use it as well as rent it then read up on the vacation home rules.
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