Tax Question #264

[critical_phil]

i know this has been discussed, but my search feature isn't working...



what am i supposed to do with that $90 check from brad henry?

[Mjcpr]

Which form are you filling out?

[Hamhock]

Line 21...Other income. It is fully taxable for federal income tax purposes.

Then, change the $90 into pennies, and mail them in with your return.

[critical_phil]

Which form are you filling out?

1040

[Mjcpr]

1040

I thought it was Line 10.....Other Income or something like that.

[Mjcpr]

I thought it was Line 10.....Other Income or something like that.

Taxable Refunds, Credits, or Offsets of State and Local Income Taxes

[Hamhock]

negatory...line 21

[IB4OU2]

Which form are you filling out?

Geez, you sure are showing your Patricia side today.........

[1stTimeCaller]

fugg em. If they dent send you a 1099 don't report it.

[Mjcpr]

negatory...line 21

Go with this then....hamhock is an accountant and stuff.

:O

[jeremy885]

http://www.tax.ok.gov/upmin021006.html

Guess it's taxable income. Time to file my amended return. :rolleyes:

[Hamhock]

Line 10 make sense. I gayronetee the IRS will take it no matter which line you use.

I went to a luncheon with the regional IRS chick and she said line 21.

[jeremy885]

How is this rebate different then the 300/600 check the IRS sent out in 2001 as an advance on your 2001 tax year refund?

[critical_phil]

other income aye.

thanks.



also, can i deduct leisure expenses? my microsoft money is telling me i spent 19k for "leisure".


i don't remember having 19k worth of fun last year...............

[Hamhock]

How is this rebate different then the 300/600 check the IRS sent out in 2001 as an advance on your 2001 tax year refund?


IRS vs. OTC

IRS says EVERYTHING is taxable, unless specifically excluded. The IRS rebate was specifically excluded. (That's the easy answer anyway. You probably also used the $90 in the previous year to generate a Sched A deduction).

[critical_phil]

#13? (1099-misc box 3, not from self-employment)


http://img530.imageshack.us/img530/5088/tax4eq.jpg

[Mjcpr]

#13? (1099-misc box 3, not from self-employment)

15 maybe? Put it there and see where it's entered on your forms....you can view them at the end (after ponying up the cash of course).

[Hamhock]

It is clearly Alaska Permanent Fund Dividends.

I think I used #15. Pat is right, use #15 and then see where it slaps it on the return.

[Rhino]

I still can't wrap my head around why tax refunds are taxable.

They keep my money interest-free for a year, give it back to me and then tax me on it?

Screw. off.

[TopDaugIn2000]

I never amended mine. :O

everyone please come visit me in the slammer if you get any spare time.

[Hamhock]

I still can't wrap my head around why tax refunds are taxable.

They keep my money interest-free for a year, give it back to me and then tax me on it?

Screw. off.


Only state tax refunds are taxable. And they are only taxable to the extent that they helped you create a Sched A. itemized deduction in the previous year.

For example: (oversimplified)

Year 1 I have $100k of income, but I send $100k to the State of Oklahoma as an income tax payment. I deduct that $100k on Schedule A of the 1040, thus no federal tax due.

Year 2 I receive my $100k refund back from the State of Oklahoma, 'cause I didn't really owe that much. The IRS wants me to pick up as income, the portion of the $100k that I used to get me out of federal tax the year before.

[Hamhock]

I still can't wrap my head around why tax refunds are taxable.

They keep my money interest-free for a year, give it back to me and then tax me on it?

Screw. off.


And yes...you are loaning your refund to the gubm't interest free. People who brag about big tax refunds are bragging that they let the IRS hold there money for a year, when they could have easily tripled that money placing covered calls.

The goal should be to owe as much of the tax due on April 15 as possible without paying penalties. (Obviously, the goal is not to pay any..but you know what I mean.)