Shopsmith Forums

Ed in Tampa wrote:1099 for social security came today.

There is still hope then.

Are you guys all expecting refunds? Personally, I'm generally not all that eager to send Uncle even more hard-earned money.

BuckeyeDennis wrote:Are you guys all expecting refunds? Personally, I'm generally not all that eager to send Uncle even more hard-earned money.

Well, we normally get a federal refund because of the four houses we own. There are two rentals in California that we can normally take a small loss on. We can also deduct about half of the cost of the trips to CA to visit my wife's family because of the rentals. Then there are two in Utah. All the interest paid really helps. However we sold one house in UT this year so that tax deduction disappears next year. The house we live in will be paid off this year so that tax deduction disappears next year.

Ut does not require with holding on my military retirement pay but it is taxed so I owe state tax every year. Our federal refund has covered the state owed so it has been a wash.

Going forward I suspect the federal refund will mostly disappear so I will owe. I do not care. I would rather have the money earning interest all year and then pay the taxes at the end.

I owe the IRS this year, but I sent them the check and they already have it. Now I don't have to deal with income taxes for another year. I can concentrate on making sawdust with the Shopsmith.

BuckeyeDennis wrote:Are you guys all expecting refunds? Personally, I'm generally not all that eager to send Uncle even more hard-earned money.

My goal is to owe or get refund zero. I usually come very close.

However it may get exciting my FIL gave his house to his three children in 2002. He just died and we sold the house. I thought we would be taxed on the difference between what it was valued in 2002 and the selling price. Not so if gifted the base goes back to original purchase price which was 40 years ago. That bit of "good" news really impacted the capital gains picture. Oh my aching back.

I have tax experts working to find the exact law but that is what I was told by an "expert" so far.

Ed in Tampa wrote:

BuckeyeDennis wrote:Are you guys all expecting refunds? Personally, I'm generally not all that eager to send Uncle even more hard-earned money.

My goal is to owe or get refund zero. I usually come very close.

However it may get exciting my FIL gave his house to his three children in 2002. He just died and we sold the house. I thought we would be taxed on the difference between what it was valued in 2002 and the selling price. Not so if gifted the base goes back to original purchase price which was 40 years ago. That bit of "good" news really impacted the capital gains picture. Oh my aching back.

I have tax experts working to find the exact law but that is what I was told by an "expert" so far.

I certainly agree with the owe or zero refund. If I get a refund that means that money has spent a year not making interest.

I am not sure about that particular provision of the law but if taxes were not taken out before you received the money from the sale I think you are safe. Uncle sugar always gets his first. Same thing with the house we just sold. It was in my wife's name and had never been rented so it was considered a primary residence. That was the first house she has sold so no taxes on the profit.

I am now told that since my FIL gave his kids the house in 2002 but with the provision he would still live In it until his death which was in 2016. Tax liability would be from assessed value at death versus selling price.

So three answers this far.
One the above
Two assessed value at time of gift versus selling price
Three actual cost of house to FIL plus any improvements versus selling price.

I wonder how many other options I will get.
Love tax code absolutely no one really knows it.

The last two forms I needed to do my taxes arrived today. I had guessed at the values and was within the rounding on one and missed the other by $47.... well no big deal and either tonight or tomorrow I'll finish filling in the amounts and then start looking for typo and checking amounts to be sure I've got it all right. Might have it ready by 2/1/17.

BTW I'm getting about $60 back this year. Had a distribution come in this year that I had to adjust the withholding on and I was happy to see the $60 refund rather then having to pay. I don't mind the refunds, given how low interest rates are, according to money the average savings was .06% last year.... so do the math, for me that is about 4 cents of interest lost.

Ed

That's good news. In a couple of days, you have it gone and out of your mind for another year.

For added protection this year they ask for a lot more information about you. If filing jointly they also want that other persons information as well.

The interesting part is where I fill in my wife's information like her state ID. They want that card number and the issue date and the expiration date....... IL issues "lifetime" ID's after you are I think 65. So my wife's card expires 99/99/9999 and guess what the software will not except that.

I tried to find some information this but I'm thinking it is a pretty new error so only limited people have found it so far. I don't think leaving it blank is an issue but I'll find out once I attempt to submit it.

Ed