TexTaxToo

For 2023, there is a new checkbox on Form 1116, line 10, indicating that you don't need to attach Schedule B.

A recent TAS blog post said: https://www.taxpayeradvocate.irs.gov/news/tax-tips/employer-identification-numbers/2024/02/

The referenced website is for the 25C credit for Windows and Skylights. Eligible windows and skylights must be labeled "Energy Star Most Efficient 2023". However, the requirements for that label changed from Energy Star V6 to Energy Star V7 on October 23, 2023. Anything manufactured after that date must meet the new requirements (detailed here). The website only recently removed the old requirements, and it's not clear whether they still list products that meet the old requirements (though they would still qualify for the credit if manufactured before Oct. 23). But this post is asking about the requirements for the 25D Residential Clean Energy credit. All that is required is: It appears the manufacturer is saying that the skylight generates electricity which is used to open and close the skylight. In any case, I don't think tax preparers are required to be experts in efficiency standards, etc. The instructions for Form 5695 for both credits say that: So if the taxpayer has a written certification from a reputable manufacturer that the purchase qualifies for a particular credit, that would be enough for me. The problem arises when a salesman tells them it could qualify for a credit, but they have no documentation.

People have also tried to keep possession of gold coins in a self-directed IRA. Of course, the IRS frowns on this: https://www.thetaxadviser.com/issues/2022/feb/taking-possession-coins-irs-taxable-distribution.html https://www.journalofaccountancy.com/issues/2022/mar/gold-coins-taxpayer-home-taxable-ira-distributions.html This case may have led other custodians to be more careful about similar arrangements, resulting in distributions such as this 1099-R.

Kiddie tax, if it applies (it would not in this case), would go on the child's return. The parents may elect to include the child's taxable interest and dividends on their return, but not capital gains. On the facts presented, there is no filing requirement, but Tom is right that filing could prevent a letter, especially if basis was not reported to the IRS for the stock sale.

I don't think DD is needed. One way to enter it if all codes are needed is to reduce the Box 1 wages on the first W-2 by $1, and include the $1 on the second W-2.

That is true for the dependency calculation. Not true for the refundable AOC calculation - for that, it doesn't matter who actually paid for the support, just that the earned income was more than half of the support costs.

Are you confusing 1095-A with 1095-C? Form 1095-A is required to be mailed or electronically provided to individuals with a marketplace plan on or before January 31, 2024. You don't need Form 1095-C unless you just want to ensure that the individual did not have employer coverage.

If they are "related", it looks like reg § 1.414(c)-1 would apply:

I don't understand the question either, but the elective employee contributions are limited to $22,500 for 2023 (plus $7,500 catchup if age 50 or over). That doesn't include employer matching contributions, which can be in addition to that. The overall limit per participant was $66,000 for 2023. I believe that applies to related employers but not necessarily unrelated employers. Someone else can clarify. There may be other limits for highly compensated employees or top-heavy plans.

Be careful when saying "WISP" to an IT person. For them, it will generally mean a type of router that connects to a Wireless Internet Service Provider (WISP).

You can still buy the installed "permanent" version of Office rather than Office 365. Just search for Microsoft Office Professional 2021. Open Office and Libre Office are free open-source office suites. Open Office was first, then Libre Office broke off. They can be used with all Office files and most basic things are compatible, but if you use advanced features like pivot tables in Excel, they won't port very well, at least the last time I tried. There is also WPS Office, free from Chinese company Kingsoft, which is even more compatible with Office, if you trust it. According to Wikipedia (which you can search for more info on any of these), it comes pre-installed on Amazon Fire tablets.

I don't think this is correct. In 2022, he was employed and eligible for a subsidized plan from his employer. Under 162(l)(2)(B), he cannot take the deduction for any health insurance ("Paragraph (1) shall not apply") - that would include the wife's medicare and supplemental. LTC is considered separately, so LTC is deductible if there is no eligibility for LTC from his employer. In 2023, he was not employed. A former employer is not an "employer of the taxpayer". Therefore all the unreimbursed health insurance and LTC would be deductible.

See: https://www.fincen.gov/boi-faqs#F_3

This has nothing to do with the requirements for issuing 1099-NEC, nor with the requirement that credit card processors report ALL credit/debit payments to merchants on a 1099-K. This is only for third party payment processors (e.g., Paypal, CashApp, Uber, AirBnB, etc), where a third party accepts a payment on behalf of someone. See the announcement here: https://www.irs.gov/newsroom/irs-announces-delay-in-form-1099-k-reporting-threshold-for-third-party-platform-payments-in-2023-plans-for-a-threshold-of-5000-for-2024-to-phase-in-implementation

SECURE 2.0 did add other exceptions to the penalty. One if you are terminally ill (hope this doesn't apply). Other additions to definition of Public Safety Employee.

COVID related distributions had to be taken in 2020. The CAA21 provision was for other disasters occurring between 1/1/2020 and 1/26/2021. The SECURE 2.0 act (part of CAA22) made permanent a waiver for disasters occurring after 1/26/2021, but only for up to $22,000 in distributions taken within 180 after the disaster. Both of the latter are only for those who lived in a Presidentially declared disaster area and sustained an economic loss due to the disaster.

Yes, sorry, I meant SEHI on Sch 1. Health insurance for employees is a legitimate business expense on Sch F, but I don't know the best way to set it up. Would they need a QSEHRA or some other "plan"?

SEHI on Sch A. is available for premiums paid for health insurance to cover the tp, spouse, dependents, and any child under 27. Note that when Form 8962 is involved, a special calculation is needed because there is a possible circular recursion where the AGI affects the amount of PTC which in turn affects the SEHI deduction and the AGI.

Here are the regs (bolding is mine) from 26 CFR § 301.7502-1: But the above applies if the IRS received the document or payment and the date is in question. This topic has to do with a payment that was not received (or so the IRS claims) - in that case, note that the exception does not apply to payments: The exceptions (c)(3) and (d) have to do with private delivery services (PDS) and electronic filing.

Again, it is only clothing and household items that are NOT in good used condition that must be appraised. I did give a cite: And antiques, artwork, jewelry, collectibles are specifically excluded. Here's all of the relevant paragraph for those who don't follow links.

Interesting case. In the original correspondence audit, the IRS only challenged Schedule C, where the taxpayer reported no income and a large loss. The audit determined a deficiency and penalty of about $7500. When the taxpayer went to court, the IRS responded by challenging the Schedule A charitable deductions as well. Since they were not in the original audit, the IRS had the burden of proof for those, but mostly prevailed, substantially increasing the deficiency (the court ruled they could not increase the penalty). A footnote in the findings (problems adding as well???):

The clothing donated throughout the year totaled more than $5000, was not appraised and the deduction was denied. Other items donated (furniture, toys, etc), when aggregated by like type, did not total more than $5000 each, so those deductions were allowed.

cbslee refers to a very specific exception where over $500 requires an appraisal if an item of clothing/furniture is NOT in "good used condition" or better. See tax code section 170(f)(16)(C). Without an appraisal value over $500, you cannot deduct such clothing/furniture at all. It's hard to imagine one item in poor condition being worth more than $500, but anything's possible, and you can deduct such items with an appraisal.

"Tax home" as used by the IRS is one factor in determining whether someone is a resident or non-resident alien. It doesn't apply to U.S. citizens, and is not really relevant for this topic, which is state residency, but here is the definition (Pub 519):