Tax time

[MakersTeleMark]

anyone have experience with freetaxusa.com?

I've used it for over a decade. Never had a problem.

[Dantheman]

It's just the tip of the iceberg with these clowns. They paid all their people through Venmo for almost 2 years, because apparently having ADP do all that shit for you is too difficult. Didn't get her 1099 last year until almost March (expecting the same this year).

Got a 1099 in the mail last week. First thought was, "Hey, only two weeks late, progress!" But, then I looked at the amount, which was only about half of what I know she made last year. She texts el jefe asking if there's another 1099 coming and he responds, "I don't think so, why?" Holy amateur hour.

Now that the ranting's done, an actual tax question: She launders the studio's sweaty towels at home a couple times per week. Our washer and dryer are over a decade old. They currently seem to work fine, but multiple big loads of towels per week are probably hard on them. How out of bounds would it be to upgrade to newer/nicer machines and write that off as a "business" expense?

[Marshall Tucker]

I am a cpa/dentist with a fairly complex return, just cause I play a lot of (cpa) games. Truthfully I have ALLWAYS done my individual return in the cheepest taxcut HR block product that runs about $20 ($10 with earlybird discount.) with nbo problems. It will do your Sch C and really anything else you need, just say no the up sale, and you can do the state by hand. Also do a family limited pthsp and a few S corps out of the turbotax business software for $100 works fine, but you only need this when you have a separate entity.

BTW if you have a business generating, i dunno, a decent amount as mentioned above, it makes an awful lot of sense to incorp or LLC, single owner, AND ELECT S CORP STATUS. can save at least a couple grand up to 10k or so if you know what you are doing. Throw some child ownership in there and you are really cooking with gas.

[Marshall Tucker]

Got a 1099 in the mail last week. First thought was, "Hey, only two weeks late, progress!" But, then I looked at the amount, which was only about half of what I know she made last year. She texts el jefe asking if there's another 1099 coming and he responds, "I don't think so, why?" Holy amateur hour.

Now that the ranting's done, an actual tax question: She launders the studio's sweaty towels at home a couple times per week. Our washer and dryer are over a decade old. They currently seem to work fine, but multiple big loads of towels per week are probably hard on them. How out of bounds would it be to upgrade to newer/nicer machines and write that off as a "business" expense?

My $.02 that would work perfectly fine with low (audit) risk. My $.02 I'd set them up as capital asset, one amount for both, with the description "laundry equipment" or better "gym equipment" and you can either bonus depreciate them 100% in year one, or sec. 179. I've come around to the latter since states seem to recognize 179 more often than bonus, but you'll want to check your state. if your state accepts 100% bonus then depreciating inside the entity is better IMO. simpler. on the 1099 dude. Don't look a gift horse in the mouth. I would document that you asked a question and move on.

[skaredshtles]

Got a 1099 in the mail last week. First thought was, "Hey, only two weeks late, progress!" But, then I looked at the amount, which was only about half of what I know she made last year. She texts el jefe asking if there's another 1099 coming and he responds, "I don't think so, why?" Holy amateur hour.

Now that the ranting's done, an actual tax question: She launders the studio's sweaty towels at home a couple times per week. Our washer and dryer are over a decade old. They currently seem to work fine, but multiple big loads of towels per week are probably hard on them. How out of bounds would it be to upgrade to newer/nicer machines and write that off as a "business" expense?

Seems the better question is why you guys are putting up with this sort of horseshit?

[Dantheman]

on the 1099 dude. Don't look a gift horse in the mouth. I would document that you asked a question and move on.

Oh trust me, if they're really only going to report half her income to the IRS I'm stoked. My worry is that I'll file with what I have now, then they'll realize their mistake at some later time, report her full income, and may or may not even tell her about it. Best case I'm wasting time filing amended returns, worst case the IRS thinks I've willfully committed tax fraud.

Seems the better question is why you guys are putting up with this sort of horseshit?

Because besides the owner having no idea how to properly run a business, she likes working there a lot for several reasons. New W/D for the "business" isn't a bad fringe benefit, either.

[neufox47]

Oh trust me, if they're really only going to report half her income to the IRS I'm stoked. My worry is that I'll file with what I have now, then they'll realize their mistake at some later time, report her full income, and may or may not even tell her about it. Best case I'm wasting time filing amended returns, worst case the IRS thinks I've willfully committed tax fraud.



Because besides the owner having no idea how to properly run a business, she likes working there a lot for several reasons. New W/D for the "business" isn't a bad fringe benefit, either.

You have the 1099 issued. For them to restate and not give her a copy would be a big problem on their end. Very very very low chance the IRS pursues this as tax fraud. Like lotto winner odds.

Definitely expense the laundry equipment. Also don’t forget the supplies.

[jono]

...and the miles between the two places she's doing business, yes?

[MakersTeleMark]

And transport of laundry, folding services, storage fees, toxic waste dumpage, etc.

[bigdude2468]

I used a CPA when back when I had depreciation schedules, K-1 LLC income, carried losses, paid CG tax every couple years or so, etc. I currently DIY file a schedule C and pay SE tax, but I do it all on paper (well, actually, PDF fill-in). Takes me less than an hour each year.

The $24K (now $24,400) married couple standard deduction is a boon for older couples with paid-off residences, but threatens some charities and results in some weird sets of incentives. A CPA with whom I share a client tells me that some LDS tithers are giving 20% every other year, itemizing the years they double tithe and taking the standard deduction for non-tithing years.

Charitable deductions are still good as long as you do not take the standard deduction.

[Danno]

Charitable deductions are still good as long as you do not take the standard deduction.

Except lots more people now take the standard.

[skaredshtles]

Except lots more people now take the standard.

Does *anybody* still itemize??

Sent from my SM-G973U using Tapatalk

[jackstraw]

All you have to do is accelerate depreciation on your equipment, give a stock option deal to your employees, and set up shop in the Cayman's. Easy eh


Company- U.S. Income- Federal Tax- Effective Tax Rate
Amazon.com $10,835 –129 –1%
Delta Air Lines $5,073 –187 –4%
Chevron $4,547 –181 –4%
General Motors $4,320 –104 –2%
EOG Resources $4,067 –304 –7%
Occidental Petroleum $3,379 –23 –1%
Honeywell International $2,830 –21 –1%
Deere $2,152 –268 –12%
American Electric Power $1,943 –32 –2%
Principal Financial $1,641 –49 –3%
FirstEnergy $1,495 –16 –1%
Prudential Financial $1,440 –346 –24%
Xcel Energy $1,434 –34 –2%
Devon Energy $1,297 –14 –1%
DTE Energy $1,215 –17 –1%
Halliburton $1,082 –19 –2%
Netflix $856 –22 –3%
Whirlpool $717 –70 –10%
Eli Lilly $598 –54 –9%
IBM $500 –342 –68%
Goodyear Tire & Rubber $440 –15 –3%
Penske Automotive Group $393 –16 –4%
Aramark $315 –48 –15%
AECOM Technology $238 –122 –51%
Tech Data $203 –10 –5%
Performance Food Group $192 –9 –4%
Arrow Electronics $167 –12 –7%

[Dantheman]

You have the 1099 issued. For them to restate and not give her a copy would be a big problem on their end.

This assumes a basic level of competency and fucks given on their end. But, she found out yesterday that they switched their business entity halfway through the year (such a change would have been obvious to me when her DDs came through, except they were still paying her through Venmo at the time). She'll be getting a second 1099 from the previous entity. As to when, "we're working on it."

Also don’t forget the supplies.

I should write up a hospital-esque chargemaster. Detergent - $25/load; dryer sheets - $75/ea; and so on.

...and the miles between the two places she's doing business, yes?

3.6 miles RT.

[AdironRider]

Oh man those morons.

How many contract employees other than your wife do they have? I think the fine is $50 per late 1099.

[Dantheman]

How many contract employees other than your wife do they have? I think the fine is $50 per late 1099.

About a dozen between the two locations they own. Not enough for it to be a financial concern for them.

[Dantheman]

Does *anybody* still itemize??

Rich people with gigantic mortgages. I read recently that over 85% of people are expected to take the SD this year.

[skaredshtles]

Rich people with gigantic mortgages.

I think that there's a limit even on that, isn't there?

[PassTheDutchie]

I've used it for over a decade. Never had a problem.

A little late RE: FreeTax, but same-same for me as Makers.

[Mazderati]

I think that there's a limit even on that, isn't there?

Residential mortgage interest deductions for the first $750k or 1MM are still allowed. No cap for commercial mortgage interest deductions.

[St. Jerry]

Small biz owner

Drumpf gave me a happy ending last year. Expect the same this year.

Unfuckingbelieveable

If you are independently employed and can create the right biz for 2020 you can win bigly too

Accountants lawyers and famous folks can’t do it. But otherwise see what you can do. I didn’t change anything but my 2018 tax bill was schweet

Drumpf gave me a kick in the nuts last year. Lost most of my itemized deductions. Blue stater here with high property taxes and sizable mortgage interest.

[bigdude2468]

Here is what the Tax Foundation says about the number of filers who itemize. I think the important thing to note is pre tax reform 30% of filers itemized. I am not saying it is not a significant drop but 70% of filers never itemized.

We estimate about 13.7 percent of taxpayers will itemize in 2019. This is more than 17 percentage points lower than it would have been in 2019 under pre-TCJA law.

I understand the angst about the limit on state and local tax deductions. States that do not have an income tax (that is not me) have been getting the short end of the stick for years. There was a time that filers could take a sales tax deduction based on your income and the amount of sales tax (%) that your state charged. The states that do not have income tax fund their operations somehow, my guess is through other taxes. States that charge high sales tax deny their residents an opportunity to take a deduction.

[Marshall Tucker]

^ a lot of the states did not increase their standard deduction the way federal did. So there is an arbitrage where Itemized, while lower than standard on fed, saves aggregate tax. But, yeah, on the whole, itemized are a thing of the past. Only exception I'm seeing are the property contribution trusts.

[old goat]

Here is what the Tax Foundation says about the number of filers who itemize. I think the important thing to note is pre tax reform 30% of filers itemized. I am not saying it is not a significant drop but 70% of filers never itemized.

We estimate about 13.7 percent of taxpayers will itemize in 2019. This is more than 17 percentage points lower than it would have been in 2019 under pre-TCJA law.

I understand the angst about the limit on state and local tax deductions. States that do not have an income tax (that is not me) have been getting the short end of the stick for years. There was a time that filers could take a sales tax deduction based on your income and the amount of sales tax (%) that your state charged. The states that do not have income tax fund their operations somehow, my guess is through other taxes. States that charge high sales tax deny their residents an opportunity to take a deduction.

Residents of states without income tax have not been getting the short end of the stick. True--they don't get to deduct the tax from their income, but they don't have to pay the tax in the first place, which saves them a lot more money than the deduction does. This whole thing about the high tax states taking advantage of the low tax states is a bullshit pseudopopulist argument dreamed up by the Republicans to help justify their tax bill and to divert attention from the giveaway to the wealthy.

[GeezerSteve]

Charitable deductions are still good as long as you do not take the standard deduction.

Uh, yeah. duh

Except lots more people now take the standard.

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