Margaret CPA in OH

The Aussie schools have some sort of code (I saw the list online) that does qualify for student aid, I found out from the parents, so kids would be eligible for ed credits. What they don't have is an EIN and they don't produce Form 1098-T, a US form. So I have asked for a breakdown of expenditures to see what qualifies and paper file amended returns with explanation. This situation does not easily fit into the allowed boxes and forms. But I think they are 'credit worthy.'

There isn't an exemption, only a standard deduction. On the Main page just above Signature there is a check box to check if someone CANNOT claim you as a dependent. Seems odd but if that box is checked, the standard deduction goes to $12,000 instead of a much lower amount. Bunny hop from line 8 for the worksheet. I think that should explain it.

A TIN is a Taxpayer Identification Number which can be an SSN or ITIN (easy Google search ) So the qualifying student must have one of these.

Yes, Judy and Catherine, I was less than explicit. I meant the earnings was subject to the penalty unless an exception applied. I just did one of these last month. I did say to use 5329 for clarity even when I am not.

If an exception doesn't apply (over 59 1/2, disabled, first time homebuyer, etc.) penalty applies even if 5 years has passed since first deposit otherwise not a qualified distribution. See Form 5329. I think.

Australian clients have 2 kids in college now and are using 529 funds from plans set up years ago when living in Ohio. The Aussie schools don't qualify for ed credits but it seems the tax should only be on the earnings. When contributions were made, they were deductible in Ohio but not federal. When looking to enter in Other Income, it seems to want the total of distributions and earnings probably expecting offset from education credits. But that doesn't seem right to include the initial contributions as taxable income. The instructions state that "(d)istributions from these accounts may be taxable if (a) in the case of distributions from a QTP, they are more than the qualified higher education expenses... my emphasis. So all this nondeductible money from the past is now taxable? What am I missing?

Thanks again, Lion. 62 year old is not taking SS, was fully on Medicaid in 2017. They have to repay some tax credit. So be it!

The lapse is Jan-April so more than 2 months but not over 2 years. Of course the SSA-1099 shows medicare premiums deducted but I've never seen that it indicates full year coverage. Would it if only for part year, receiving benefits for less than a year? Medicare partner is fully covered for the year. Non-medicare partner has marketplace coverage for 8 months. Guess I leave fully covered box unchecked and see what happens. Thanks again!

Thanks, Lion. I thought there was something about being without for 3 or 4 months that didn't count against you but could misremember. Also, the one on Medicare did not receive a 1095 but she is on Medicare. Or maybe she didn't provide. I will ask.

Married couple with one over 65 and on Medicare the other 62 and uninsured for 4 months, 8 months on marketplace. Combined income is 327%, monthly contribution amount is $424. From 1095-A, I entered the figures for the 8 months in columns a,b and f lines 12-23. However column e seems to want data entered and there are no calculations for c and d. I expected to see $424 in column c as it references 'amount from line 8b' but it is 0 and data entry is not allowed. I did manual calculations and input the difference in column e. Is this appropriate? It saves the taxpayer $200. Also, how to answer the single question about MEC for one taxpayer that did have coverage for full year and one who didn't?

Thank you so much!!! I just tried it and am so happy! I could not find this in the KB but really should understand the REAL KB is right here on this board.

I thought it was possible to drag and drop or something in the past to move forms into a different order for printing. Just now I had client with 2 forms se (sequence order 17) the appeared on the print list and printed before the 1040, nowhere near sequence 17. I ended up printing them separately then inserting in the 'right ' order. I couldn't find anything spot on to me in the kb. Is it possible to move things before printing? I certainly could not drag and drop.

It may not apply here but another option is to do this: Trustee makes a regular practice of distributing capital gains: pursuant to Reg. 1.643(a)(b), trustee is making a regular practice of distributing capital gains to the beneficiary as the trust instrument permits. The drafter of several trusts for which I've recently been trustee included this language which allowed the benes to have the cash to pay the tax on the distributed net income. I thought for these trusts and these benes, it was a good idea. And that 65 day rule proved very helpful as determining the distribution correctly was a challenge to manage by Dec. 31.

Just curious here - does the student receive all the money from the scholarships that are in excess of the tuition, etc. for which they are meant to cover? I thought many/most scholarships were paid directly to the school, not to the student, so am wondering about the excess. I haven't had any of these, just average smart students, I suppose

Ringers, THANKS! These are, in my opinion, things of beauty. I so appreciate your willingness to share even as I have only 4-5 that need something like this. It still irks me that I can't just say that, for example for one family, that I've known them since the kids were babies, one parent and one child even worked for me, we live a block apart, I vouch for them.

Thanks, HAHN104, I did not know that and did not see in the instructions. I have only one client with this and it is completed. So Christian, there you go!

Are you preparing the man's return? If so, you send Form 8332, signed by both parents with SSN's, within 3 days after the e-filed return has been accepted. Include in your software Form 8453 (there is a checkbox for 8332), print that out and mail with the 8332 to Internal Revenue Service, Attn: Shipping and Receiving 0254, Receipt and Control Branch, Austin TX 73344-0254 Make sure you retain a copy of the 8332 for your files. If not, the woman completes the Form 8332 by filling in the boxes, pretty self-explanatory, and gives to man. He or tax preparer manages the mailing of 8332 to IRS, not you.

So far I've only had foreign tax on a 1041 but it worked fine. Are you sure you chose Passive Income at the top of the form to show?

Hahn1040, I have asked about other expenses and am awaiting the answer. I did the pencil calculations to better understand what was happening. It's easier for me to use real numbers than just look at the words. Just in case there is taxable money, though, I wanted to know where and how to put it. It's interesting that it would be taxable to the designated beneficiary because I don't see anyone's name on the 1099-Q except "Beneficiary's/Recipient's Name and Address" which is the mother. Her SSN is also on the form. Is this a problem? Sorry for all the questions and confusion. As mentioned, this is my first in over 20 years of practice (even though these things haven't been around that long - I have).

Jasdim, I cannot find a worksheet in Pub. 970. I did see an example on page 53 which I followed and substituted client numbers. It appears as though $1167 of the earnings is taxable which makes some sense using $4000 of the expenses for the AOC credit. However, I cannot understand why, in ATX, of Form 8863 Part III it says No for the student receiving the 1098-T. How could the software figure the credit without the data entered on the 1098-T worksheet? Also, if $1167 of the earnings are taxable, where is that entered? Hahn1040, I haven't asked yet about additional expenses but will. Just in case there aren't any, how and where is the taxable amount entered?

Okay, I am in this group, too. In comparing last year's personal return for married partners, checking basis, I noticed that I correctly entered the "-" for the loss on one K-1 entry but not on the second. So, my error, amendment free. The only good thing is that they will be getting a substantial refund as the number was a good size so now doubled in their favor. Unfortunately they had to fork over bucks last year. Nope, not perfect either, so you have much company, Possi!

Thanks, Possi. That's pretty much what I have found, just wondering if there is any way to input the Q data to offset the T data. If I put in the full 1098T amount but it was paid with $9k from 529 plan, his ed credit is overstated so do I reduce and put in the amount $1754 instead of $10754? If so, the 1098T won't match.

Client has first year college student and 529 plan. Withdrew $9000, 1098T shows qualified payments of $10,754. I understood that if using 529 withdrawals, the full amount paid to the university would not be considered for the ed credit. If so, how does one indicate the offset? Or am I incorrect (wouldn't be the first time!) and full credit is permitted. It's clear that the withdrawal is less than the amount paid so no income to report.

Thanks, Possi and Rita. 'Marked for life with terror' is what I don't want but guess I'm already there hence my original post. And I have been apologizing even though it isn't my fault. I just feel it's rude to my clients and resent that IRS trusts me so little. I used to answer the questions honestly on the form but not to excess and didn't really keep documents. Then we had to submit the 8867 instead of just having it in our files. So, documents. I just am so uncertain as to what are 'adequate' questions to ask. As most of my clients are never seen, I was hoping to attach a questionnaire for them to answer and would keep that in my files. That's why I asked if anyone had something like that already. I will do something soon although I think there are only 2-3 more folks with children. Most clients are older than that by now.

I found a simple one at silvercreekteam.com. I like that the client has to sign and date it although I rarely see most of my clients. I suppose selecting one or two of the suggested documents for the file would then suffice. It just feels weird to me.