Filing Requirements Flashcards
Who must file 2014 - Single
Under 65 = Gross Income > $10,150
65+ = Gross Income > $11,700
Who must file 2014 - Head of Household
Under 65 = Gross Income > $13,050
65+ = Gross Income > $14,600
Who must file 2014 - Married Filing Separately
Any age = Gross Income > $3,950
Who must file 2014 - Qualifying widower(er) with dependent child
Under 65 = Gross Income >$16,350
65+ = Gross Income > $17,500
Who Must File 2014 – Married Filing Jointly
Both Under 65 = Gross Income > $20,300
One Spouse 65+ = Gross Income > $21,500
Both 65+ = Gross Income > $22,700
How Is Marital Status Determined?
As Of December 31, Of The Tax Year
When Is An Individual Considered To Be 65?
The Day Before Their 65Th Birthday
Personal Exemption Amount 2014
$3,950 per taxpayer
Additional Standard Deduction for age and blindness for 2014
$1,200 Per Person (Married And Qualified Widower)
$1,550 Per Person (Single And Head Of Household)
Can a dependent claim themselves?
No, a dependent can not claim a Personal Exemption and may have a reduced Standard Deduction.
Dependent Filing Requirement – Single, Under 65, Not Blind
Unearned Income > $1,000
Earned Income > $6,200
Gross Income > $1,000 Or Earned income (Up To $5,850) Plus $300
What is Gross Income
Standard deduction ($3950 in 2014) \+ personal exemption
Dependent Filing Requirement – Single, 65+, Or Blind
“Uei > $2,400 ($3,850 If 65+ And Blind)
Ei > $7,250 ($8,700 If 65+ And Blind)
Gi > $2,400 ($3,850 If 65+ And Blind) Or Ei (Up To $5,500) Plus $1,750 ($3,200 If 65+ And Blind)”
Dependent Filing Requirement – Married, Under 65, Not Blind
“Uei > $950
Ei > $5,800
Gi At Least $5 And Spouse Itemizes
Gi > $950 Or Ei (Up To $5,500) Plus $300”
Dependent Filing Requirement – Married, 65+, Or Blind
“Uei > $2,100 ($3,250 If 65+ And Blind)
Ei > $6,950 ($8,100 If 65+ And Blind)
Gi Was At Least $5 And Spouse Itemizes
Gi > $2,100 ($3,250 If 65+ And Blind) Or Ei (Up To $5,500) Plus $1,450 ($2,600 If 65+ And Blind)”
Four Factors Determining Filing Requirement
Gross Income, Filing Status, Age, Dependency Status
Define Gross Income
All Income Received In The Form Of Money, Goods, Property, And Services, That Is Not Exempt From Tax, Including Sources Outside Of The Us
Is Social Security Included In Gross Income?
Not Unless Individual Is Mfs And Lived With His/Her Spouse During The Year, Or 1/2 Of The Benefits Plus Other Income Exceeds $25,000 ($32,000 If Mfj)
Does Gross Income Include Gain From A Sale Of A Principal Residence Or Foreign Earned Income When Determining Filing Requirements?
Yes And Yes. Even If Gain From Sale Of The Home Is Excluded From Gross Income.
How Is Community Income In A Community Property State Handled?
1/2 Of Any Community Income Is Considered Each Spouse’S Income.
California, Nevada, Washington – Registered Domestic Partners?
Must Report 1/2 Of The Combined Community Income Of The Individual And His/Her Partner
What Constitutes Gross Income For A Self–Employed Individual?
“Service Business – Gross Income = Gross Receipts
Manufacturing, Merchandising, Or Mining – Gross Income = Sales – Cogs”
Individual Filing Requirements
Gross Income Exceeds The Sum Of The Personal Exemption Allowed For Filing Status Plus The Standard Deduction, Increased For Age And/Or Blindness
What Is Dependent Gross Income?
Gross Income = Total Earned Plus Unearned Income
Earned Income
Salaries, Wages, Tips, Professional Fees, Taxable Scholarships, Fellowship Grants
Unearned Income
Investment–Type Income Such As Interest, Dividends, And Capital Gains. Also Includes Unemployment, Taxable Ss Benefits, Pensions, Annuities, And Distributions From A Trust
When Can A Parent Elect To Report The Child’S Interest And Dividends?
“Child Is Under 19 Or A Full Time Student Under 24 At The End Of The Year
Child Is Required To File A Return For 2011, Except For This Election
Child Only Had Income From Interest And Dividends Including Capital Gain Distributions And Alaska Permanent Fund Dividends
The Child Does Not File A Joint Return For 2011
Child’S Gi
How Does A Parent Make The Election To Report Child’S Interest And Dividends?
Completing And Attaching Form 8814 (Parent’S Election To Report Child’S Interest And Dividends) And Attaching It To Their 1040 Or Form 1040Nr
When Reporting Kiddie Tax, How Much Is Reported On Parent’S Return?
Only The Amount Of Interest, Dividends, And Capital Gain Distributions Over $1,900. The First $950 Is Not Taxed, While The Next $950 Is Taxed At 10%. Use Part Ii Of The Form 8814 To Figure The Tax On The $1,900 As If It Was Received By The Parent. The Amount Is Carried To Line 44 Of The 1040 Or Line 42 Of The 1040Nr, And Box A For Form 8814 Is Checked.
Is A Child Born On January 1, 1988 Considered 23 Or 24 For 2011 Tax Purposes?
24
Investment Income Greater Than $1,900 – Kiddie Tax
“Subject To Tax At The Parent’S Tax Rate If All Of The Following Conditions Are Met:
Child Was Under Age 18 At The End Of 2011 Or Was 18 But Did Not Have Ei That Provided More Than Half His Support (Same Rule For Full Time Student Under Age 24)
Child’S Investment Income Was More Than $1,900
Child Did Not File A Joint Return
Child Is Required To File A 2011 Return
At Least One Parent Was Alive At The End Of 2011”
Kiddie Tax – What If Parent Won’T Or Can’T Choose To Include Child’S Income On Their Tax Return?
Form 8615 (Tax For Certain Children Who Have Investment Income Of More Than $1,900) Is Used To Figure The Child’S Tax And Is Attached To The Child’S 1040
Calculating Tax On Child’S Net Investment Income
“Determine Net Investment Income In Part I Of Form 8615. Determine Tentative Tax At The Parent’S Tax Rate In Part Ii. That Is The Difference Between The Tax On The Parent’S Taxable Income With The Child’S Net Investment Income And Without. If More Than One Child With Investment Income, The Tentative Tax Is Based On The Income Of All The Children Then Divided Proportionately.
Figure Child’S Tax In Part Iii. This Is The Larger Of The Child’S Share Of The Tentative Tax Based On The Parent’S Tax Rate Plus The Tax On The Child’S Income In Excess Of Net Investment Income Figured At The Child’S Rate Or The Tax On The Child’S Income Figured At The Child’S Tax Rate”
How Do You Determine The Imposed Tax Rate On Child’S Net Investment Income Based On Parent’S Filing Status?
“Mfs – Return For The Parent With Greater Ti Is Used
Parents Are Married But Do Not Live Together, And The Custodial Parent Is Considered Unmarried, The Return For The Custodial Parent Is Used.
Parents Are Divorced Or Legally Separated, And Custodial Parent Has Not Remarried, Custodial Parent’S Return Is Used. If Custodial Parent Has Remarried, Stepparent Is Considered Other Parent For Following The Preceding Rules.
Never Married But Lived Together All Year, Parent With Higher Ti Is Used. If They Did Not Live Together All Year, Custodial Parent’S Return Is Used.
Mfj – Joint Return Is Used”
Decedent Tax Return Requirements
Same Four Factors Are Used For Deceased Persons As Individual Persons
Who Files For A Decedent?
“Personal Representative Or Spouse – Write Deceased With Name And Date Of Death On Top Of Return
Personal Representative Would Fill In Area For Spouse’S Name – Executor, Administrator, Or Anyone In Charge Of Deceased Property”
What Document Should Be Filed With A Decedent Tax Return For A Refund To Be Received?
A Copy Of The Certificate That Shows Appointment By A Court.
What Is Not Acceptable Evidence Of Appointment As A Personal Representative For A Deceased Person?
Poa Or A Copy Of The Will
How Should A Spouse Sign A Decedent Tax Return?
Write Filing As A Surviving Spouse In Signature Area
What Form Needs To Be Filed With A Decedent Tax Return To Receive A Refund (Except For Spouses)?
Form 1310 (Statement Of Person Claiming Refund Due A Deceased Taxpayer)
Alien Tax Return ? Which Form To File?
Nonresident Aliens File Form 1040?Nr And Report Certain Income
Resident Aliens File Form 1040 As A Us Citizen Would
Dual Status Aliens File Both
What Is A Resident Alien?
Individual That Meets Green Card Test Or Substantial Presence Test.
Green Card Test
Individual Is A Resident Of The Us If He Is A Lawful Permanent Resident At Any Time During 2011
Substantial Presence Test
Taxpayer Is A Resident If Both Conditions Are Met:
Physically Present In The Us For At Least 31 Days In 2011
Physically Present In Us For At Least 183 Days During 2009?2011. Include All Days Of Physical Presence In 2011, 1/3 Of The Days In 2010, And 1/6 Of The Days In 2009
Days Of Presence Exclusions
Days The Person Commutes To Work In The Us From A Residence In Canada Or Mexico If They Do It On A Regular Basis
Days In Us For Less Than 24 Hours When In Transit Between Two Places Outside The Us
Days Present As A Foreign Vessel Crew Member
Days In Us If Medical Condition Arising In Us Keeps Them From Leaving
Days The Individual Is Exempt
Exempt Individual For Days Of Presence Test
Foreign Government Related Person Present With An A Or G Visa
Teacher/Trainee Under A J Or Q Visa Who Substantially Complies With Requirements Of Visa
A Student In Compliance With Requirements Of Their F, J, M, Or Q Visa
Professional Athlete In The Us To Compete In A Charitable Sports Event
Form 8840 (Closer Connection Exception Statement For Aliens)
Used To Claim Closer Connection To A Foreign Country To Avoid Us Resident Status
Nonresident Alien Taxes
Subject To Us Income Tax Only On Us Source Income And Certain Foreign Source Income
Nonresident Alien Filing Requirements
Nr Engaged In Trade Or Business In Us During 2011, Even If They Had No Income From That Business, No Us Income, Or Exempt Income
Nr Not Engaged In A Trade Or Business In The Us With Us Income On Which The Tax Liability Was Not Satisfied By The Withholding Of Tax At The Source
Taxpayer Represents A Deceased Person That Would Have Had To File A 1040Nr
Taxpayer Represents An Estate Or Trust That Has To File Form 1040Nr
Nonresident Alien Filing Requirements ? When Are They Not Required To File?
Nr Only Us Trade Or Business Was Personal Services And Wages
Dual?Status Aliens
Us Resident For Current But Not Preceding Year ? Us Resident Only For The Part Of The Year That Begins On Residency Starting Date. Before That Date, Person Was A Nonresident Alien.
Meets Substantial Presence Test, Starting Date Is First Day Present. Green Card Test, First Day Of Lawful Perm Residency. Meets Both, First Date Is Earlier Of Two.
Person Not Meeting Green Card Or Presence Test In 2010 Or 2011 But Meets Presence Test In 2012
Can Elect To Be Treated As A Resident For Part Of 2011 If They Did Not Choose To Do So For 2010 And Were Present In Us For At Least 31 Days In A Row In 2011 And Present For 75% Of The Days Between The First Day Of The 31 Day Period And The End Of 2011
When Can A Dual Status Alien Choose To Be Treated As A Us Resident For Entire Year?
Nr Alien At Beginning Of Year
Ra Or Citizen At End Of Year
Married To Ra Or Us Citizen At End Of Year
Spouse Joins In Making The Choice
Us Source Interest Income
Interest On Bonds, Notes Or Other Interest?Bearing Obligations Of Us Residents Or Domestic Corps
Interest Paid By A Domestic Or Foreign Partnership Or Foreign Corp Engaged In Us Trade Or Business At Any Time In 2011
Original Issue Discount
Interest From A State, Dc, Or Us Government
Us Source Dividends
Received From Domestic Corps Except:
If Domestic Corp Elects To Take American Samoa Economic Development Credit
Part Of Dividend Received From Foreign Corp Is Us Source Income If 25% Or More Of Its Total Gi For The Three Years Leading Up To End Of The Tax Year Were Connected With Trade Or Business In Us, Then Us Sourced Portion Is Found Using This Calculation:
Foreign Corp Gi Connected With Us For 3 Year Period/Foreign Corp Gi From All Sources For That Period
Us Source Personal Service Income
All Wages And Compensation For Services Performed In Us
Allocate If Services Performed In More Than One Country
Us Source Fringe Benefit Income
Sourced On A Geographical Basis And Includes Housing, Education, Transportation, Tax Reimbursement, Hazard Pay, Moving Expense Reimbursement
Us Source Transportation Income
All Income From Transportation That Begins And Ends In Us
50% If Begins Or Ends In Us
Compensation To A Crew Member Of A Foreign Vessel Is Not Us Income
Us Source Scholarships, Grants, Prizes, And Awards
Residence Of The Payer Unless Designated As International Organizations Immunities Act ? Then It Is Foreign
Us Source Pensions And Annuities
Pension From A Domestic Trust For Services Performed In And Out Of The Us Is Divided Between Both Attributable To Earnings Of The Trust And Employer Contributions Made For Services Performed In Us
Us Source Rents And Royalties
Property In Us Including Use Of Intangible Us Property (Patents, Copyrights, Franchises, Etc)
Us Source Real Property
Property Located In Us
Sold To Foreign Or Bought From Foreign Is Partial Us Income
Us Source Personal Property
Us If Individual Has Us Tax Home
Nr Exclusion From Income
Us Source Interest Income Not Connected With Business Or Trade If It Is From Deposits With Persons In The Banking Business, Deposits With Mutual Banks, Coop Banks, Credit Unions, Etc., And Amounts Held By Insurance Company Under Agreement To Pay Interest On Them
Interest On Obligations Of A State Or Dc Or Us Possession
Portfolio Interest On Obligations Issued After July 18, 1984
Dividend Income Is Exempt From 30% Tax:
Us Source Divs From Fc
Interest?Related Divs From Mutual Fund
Stcg Divs From Mutual Fund Or Investment Co.
Income For Personal Services If All Conditions Are Met:
Performs Svcs As Ee Of Nr Individual, Fc, Not Engaged With Us, Or Works In An Office Maintained Outside The Us
Performs Services Less Than 90 Days
Pay Is Less Than $3000
Other Filing Requirement Situations
Church Employee With Wages > $108.28
Hsa, Msa, Or Medicare Advantage Msa Distributions Received
Self?Employment Earnings > $400
Owes Any Special Taxes:
Form 5329 (Addt. Taxes On Qualified Plans And Other Tax?Favored Accounts), Unless There Is No Other Filing Requirement, Then File Only Form 5329 For The Following:
Additional Tax On Distributions From A Qualified Plan, Ira, Roth Ira, Coverdell Esa, Or Qtp
Addtl. Tax On Excess Contributions To Ira, Roth Ira, Hsa, Archer Msa, And Coverdell Esa
Additional Tax On Excess Accumulations Of Qualified Retirement Plans , Including Iras
Amt
Household Employment Taxes ? If No Other Filing Requirement, File Only Schedule H
First?Time Homebuyer Credit Repayment
Ss And Med On Unreported Tips Or Wages Received From An Employer That Did Not Withhold These Taxes. Attach Form 4137 (Ss/Med On Unreported Tip Income) Or Form 8919 (Uncollected Ss/Med Taxes On Wages) To 1040
Numerous Write In Taxes Including Uncollected Ss/Med Or Rrta Tax On Tips Reported To The Employer Or On Grou
How To Obtain A Tin
File Form W?7, Application For A Us Tin
How To Obtain An Atin For A Pending Adoption
Form W?7A, Application For Tin For Pending Us Adoptions
What Is A Limitation Of A Tin Or An Atin?
They Cannot Be Used To Claim The Earned Income Credit ? Ssns Are Required
Determining Married Status
Married For The Whole Year If One Of The Following Apply:
Married And Living Together As Husband And Wife
Living Together In A Common Law Marriage That Is Recognized In The State Where They Now Live Or Where The Common Law Marriage Began
Married And Living Apart, But Not Legally Separated Under A Decree Of Divorce Or Separate Maintenance
Separated Under An Interlocutory (Not Final) Decree Of Divorce
When A Marriage Annulment Occurs
Any Years In Which Taxpayers Elected Mfj Should Be Amended As Legally, Marriage Never Existed
Married Filing Jointly ? Valid Signatures
Deceased Spouse Must Be Signed By Spouse Or Executor Or Administrator
Injury Or Disease Prevents One Spouse From Signing, The Taxpayer Can Sign For Them With Proper Notation And A Statement Attached To The Return
Spouse Is Serving In A Combat Zone, Filing Spouse Can Sign And Attach A Statement
Any Other Reason And The Spouse Signing Must Include A Poa
Form 8857, Request For Innocent Spouse Relief
Used To Relieve Spouse Of Joint Liability For Items Of The Other Spouse’S That Were Reported Incorrectly
Married Filing Separately ? Can An Individual Claim An Exemption For Their Spouse?
Only If The Spouse Had No Gross Income, Is Not Filing A Return, And Was Not A Dependent Of Someone Else
What Credits Are Individuals Mfs Ineligible To Take?
Child And Dependent Care Expenses And Amount Excludable Under An Employer Dependent Care Plan Is $2,500
Earned Income Credit
Exclusion Or Credit For Adoption Expenses
Education Credits
Deduction For Student Loan Interest
Tuition And Fees Deduction
Exclude Interest Income From Us Savings Bonds Used For Higher Education
If Mfs And Individual Lived With The Spouse At Any Time During 2011 ? What Special Rules Apply?
Credit For Elderly Or Disabled Cannot Be Claimed
Up To 85% Of Ss Benefits Are Included In Income
Special $25,000 Loss Allowance For Rental Activity Is Lost Entirely
These Credits Or Deductions Are Reduced At Income Levels That Are Half Of Those Allowed For A Mfj Return ? Mfs
Child Tax Credit
Retirement Savings Contribution Credit
Exemption Amount For Determining Alternative Minimum Tax
The Following Credits Or Deductions Are Half Those Allowed For Mfj ? Mfs
Capital Loss Is Limited To $1,500
Special Allowance For Rental Activity Losses Is Limited To $12,500 If Lived Apart From Spouse For Entire Year
First Time Homebuyer Credit Is Limited To $4,000 (Or $3,250 For Long?Time Residents)
Can Mfj Amend To Mfs And Vice Versa?
Mfs Can Amend To File Mfj Any Time Within 3 Years From The Due Date Of Separate Returns, Not Including Extensions.
Mfj Cannot Amend To Mfs After The Due Date Of The Return
Head Of Household Requirements
Unmarried Or Considered Unmarried” On 12/31/11
Unmarried Status
Legally Separated Under A Decree Of Divorce Or Of Separate Maintenance
Considered Unmarried””
Files A Separate Return
Pays More Than Half The Cost Of Keeping Up The Home For The Year
Spouse Did Not Live In The Home During The Last 6 Months Of The Year
Home Was The Main Home Of The Child, Stepchild, Or Foster Child For More Than Half The Year
Must Be Able To Claim An Exemption For The Child. Even If Taxpayer Releases The Exemption To The Noncustodial Parent.
Spouse Is A Nr Alien At Any Time During The Year And They Do Not Elect To Be Treated As A Resident For The Entire Year.
Can A Nonresident Alien File As Head Of Household
No
Qualifying Child
Son, Daughter, Grandchild
Qualifying Relative
Father, Mother
Qualifying Relative Other Than Father Or Mother
Grandparent, Brother, Sister
Hoh ? Qualifying Child
Qc And Single
Qc And Married And Taxpayer Can Claim Exemption For Him/Her
Hoh ? Qualifying Relative
Qr And Taxpayer Can Claim Exemption For Him/Her
Hoh ? Qualifying Relative Other Than Father Or Mother
He Or She Is Related, Lived With The Taxpayer For More Than Half The Year, And Taxpayer Can Claim An Exemption For Him/Her
Costs Of Keeping Up A Home
Rent Mortgage Interest Property Taxes Insurance On The Home Repairs Utilities Food Eaten In The Home Other Expenses Related Specifically To The Home
Costs Of Keeping Up A Home That Are Not Included In Hoh Calculation
Clothing Education Medical Care Vacations Life Insurance Transportation Rental Value Of Home Owned Value Of Taxpayer Services
Kidnapped Child
Hoh Or Qualifying Widower With Dependent Child Is Available Even If Child Is Kidnapped, Provided:
Law Enforcement Presume That Kidnapper Is Not A Family Member
In The Year Of Kidnapping, Child Lived With Individual For More Than Half Of The Part Of The Year Before Kidnapping
The Individual Would Have Qualified For This Status If Child Had Not Been Kidnapped
Last Year Of Kidnapped Child Treatment
The Year That A Determination Is Made That Child Is Dead
The Year The Child Would Be 18
Standard Deduction For 2011
Single ? $5,800 Hoh ? $8,500 Mfj ? $11,600 Qw ? $11,600 Mfs ? $5,800
Additional Standard Deduction For 65+ Or Blind
Single, Hoh ? $1,450
Mfj, Qw, Mfs ? $1,150
Partially Blind Status
Must Get A Certified Statement From The Eye Doctor Or Registered Optometrist Stating That The Taxpayer Cannot See Better Than 20/200 In The Better Eye With Glasses Or Contact Lenses, Or The Taxpayer’S Field Of Vision Is Not More Than 20 Degrees
Dependent Standard Deduction
Generally Limited To $950 Or Ei Plus $300 (Not More Than $5,800)
No Standard Deduction
Mfs And Spouse Itemizes (Unless Hoh)
Filing A Tax Return For A Short Year Because Of Change In Annual Accounting Period
Nonresident Alien
Dual?Status Aliens
Personal Exemption
2011 Amount Is $3,700
Who Cannot Claim A Personal Exemption?
If Another Person Can Claim T/P As A Dependent, T/P May Not Take Exemption, Even If Other Person Does Not Claim Them As A Dependent
Is A Nra Entitled To A Personal Exemption?
Yes. Residents Of Mexico, Canada, S. Korea, Us Nationals And Student/Business Apprentices From India Can Also Claim A Personal Exemption For A Spouse If That Spouse Had No Income For Us And Is Not Claimed As A Dependent By Someone Else.
Can Dual?Status Aliens Take A Personal Exemption?
Exemptions For Spouses And Dependents Cannot Be More Than The Taxable Income For Period Of Residence
Test For Dependency Exemption
Cannot Be A Dependent Of Someone Else
Joint Return Test. Cannot Claim A Married Person Unless Married Person And Spouse File Mfj Only To Claim A Refund And No Tax Liability Exists.
Citizen Or Resident Test
Qualifying Child Tests
Relationship Age Residency Support Special Test For Qc Of More Than One Person
Qc Relationship
Son Daughter Stepchild Eligible Foster Child Descendent Of Any Of The Above Brother Sister Half?Brother/Sister Stepbrother/Sister Descendent Of Any Of The Above
Qc Age Test
Under 19 And Younger Than T/P
Full Time Student Under 24 And Younger Than T/P
Permanently And Totally Disabled Regardless Of Age
Qc Residency Test
Must Live With T/P > 1/2 Year
Home Does Not Have To Be Traditional
Non?Permanent Temporary Absence Is Same As Occupancy In The Home
Qc Special Rules Test
Apply To Divorced/Separated/Never Married Parents
Custodial Parent ? Whoever Child Spends Most Nights At
Neither If Emancipated
Counts As A Night If In Parent’S Home Or With Parent
If On A Sleepover, Counts Toward Parent That Would Have Had Them
If Parent Has A Night Job Which Prevents Child From Sleeping Nights But Lives More Days With That Parent, That Parent Is Custodial Parent
If Equal Nights, Parent With Higher Agi Gets Child
Noncustodial Parent
Qc If All Are True:
Parents Are Legally Apart And Lived Apart For Last 6 Mths Of Year
Child Received > 1/2 Support From Parents
Child Is In Custody Of One Or Two Parents For > 1/2 Yr
Effective Date Of Decree Determines What Document Is Needed For Noncustodial Parent
Noncustodial Parent ? Documents Needed
Post 2008 Decree: Form 8332, Release/Revocation Of Release Of Claim To Exemption For Child By Custodial Parent
Post 1984 And Pre 2009 Decree: Pages From Decree May Be Attached To 1040 In Lieu Of Form 8332
Pre 1985: Can State That Noncustodial Parent Can Claim Child
Support Test For Qc
Child Provided
Qualifying Person Of More Than One T/P Test
T/P That Claims Qc Gets All: Exemption Child Tax Credit Hoh Credit For Child/Dependent Care Expenses Exclusion From Income For Dependent Care Benefits Earned Income Tax Credit If Parents Can Claim Qc But Don'T, Someone Else Can If They Have A Higher Agi Than Both Parents
Qc Of Noncustodial Parent Limitations
Noncustodial Parent Cannot Claim: Hoh Credit For Child/Dep Care Exp Exclusion For Dep Care Ben. Eitc
Tie Breaker Rules For Qc
Parent Trumps Anyone Else
Parent That Lived With Child Most
Parent With Highest Agi If They Spent Equal Time
If Neither Are Parents, Highest Agi Wins
Qualifying Relative Tests
Not A Qualifying Child
Member Of Household Or Relationship Test
Gross Income Test
Support Test
Not A Qc Test For Qr
Not Qr If Qc Of Anyone
Qc Can Be Qr If The Parent Is Not Required To File A Return And Either Doesn’T File Or Files Only For A Refund
Member Of Household/Relationship Test For Qr
Lives With T/P All Year Or Related To T/P In These Ways:
Child, Stepchild, Eligible Foster Child, Or Descendant
Sibling, Stepsibling, Half?Sibling
Parent, Grandparent, Or Direct Ancestor (Not Foster)
Stepparent
Niece/Nephew
Aunt/Uncle
Child?In?Law, Parent?In?Law, Sibling?In?Law
Can A Cousin Be A Qr?
Yes Only If They Live In Home Entire Year
Do Dependency Relationships Established By Marriage End At Death Or Divorce?
No
Gross Income Test ? Qr
Must Be Less Than $3,700
Support Test ? Qr
T/P Must Provide > 1/2 Support
Support Includes Tax Exempt Income, Savings And Loans Used For Support
Own Funds Not Used For Support Are Not Support
Foster Care Payments Are Support Provided By Agency
If Two T/P Could Take Exemption Except For Support Test, But Together Provide > 1/2 Support, Multiple Support Agreement Is Used To Allow One Person To Claim Exemption
Due Dates For 1040
April 15 For Calendar Year T/P
15Th Of Fourth Month After Year End For Fiscal Year T/P
Automatic Six Month Extension
Using E?File Program Or Paper Form 4868 By Due Date Of Return
Extension For Individuals Living Abroad
Auto 2 Mth Ext. If:
Us Citizen/Resident
On Due Date Of Return, T/P Is Living Out Of Us And Puerto Rico Or In Military/Naval Service Outside Of Us And P.Rico
Individuals Serving In A Combat Zone
Deadline For Filing Auto Extended
Applies To Members Of Armed Forces, Merchant Marines For Dept. Of Defense, Red Cross, Accredited Correspondents And Civilians Under Direction Of Armed Forces
What Is A Combat Zone?
President Designated Where Us Is Engaged In Combat
2011 Combat Zones
Afghanistan, Effective 9/19/01
Pakistan, Tajikistan, Jordan, Uzbekistan, And Kyrgyzstan As Of 12/14/01
Kosovo Area As Of 3/24/99 ? Includes Federal Republic Of Yugoslavia (Serbia/Montenegro), Albania, The Adriatic Sea, And The Ionian Sea North Of The 39Th Parallel
Persian Gulf Area, As Of ?1/17/91 ? Includes Persian Gulf, Red Sea, Gulf Of Oman, Gulf Of Aden, Total Land Areas Of Iraq, Kuwait, Saudi Arabia, Oman, Bahrain, Qatar, And The United Arab Emirates, And Part Of The Arabian Sea
Combat Zone Extension Time
180 Days After The Later Of The Last Day In A Combat Zone Or The Last Day Of Any Continuous Qualified Hospitalization For Injury From Service In The Combat Zone
Due Date For Form 1040Nr And 1040Nr?Ez
Nr Earned Wages Subject To Us Tax: Same As 1040
Without Wages Subject To Us Tax: Calendar Year June 15 Or 15Th Day Of 6Th Month After Year End For Fiscal Year
Decedent Tax Return Due Date
Same As If Decedent Was Alive
Late File And Late Pay Penalties
Late Filing Is 5% For Each Month/Part Of Month But No More Than 25% ? Based On Unpaid Tax At Due Date
Late Payment Penalty Is .5% Of Unpaid Taxes Per Month/Part Of Month After Due Date
If Both Penalties Are Combined, 5% Failure To File Is Reduced By Failure To Pay Rate
Employee Compensation
Wages Salaries Commissions Fees Tips Fringe Benefits Stock Options
Tips ? Recording
Can Be Recorded On Form 4070A, Employees Daily Record Of Tips
Tip Reporting To Employer
Cash, Check, Credit Card Tips By 10Th Of Each Month
Required For Every Month That Tips > $20
What If Employee’S Check Cannot Cover Fica?
Reported On W?2, Box 12, Codes A And B
Reported On 1040, Line 60, Identified As Ut
What Tips Are Included On 1040, Line 7?
Cash And Noncash Tips Not Reported To The Employer. Tips Reported To Employer Will Be On W?2.
Allocated Tips
The Amount An Employee Is Deemed To Have Received But Not Reported While Employed At A Large Food/Beverage Establishment, Shown On W?2
Taxable Unless Employee Has Proof That They Did Not Receive Them
Form 4137, Ss/Med Tax On Unreported Tip Income
Includes All Tips Reported To The Employer, All Unreported Tips, And All Allocated Tips. Ss/Med Is Calculated On Amounts For Which There Was No Withholding.
Expense Reimbursement
Can Be Excluded From Wages If Provided Under An Accountable Plan Of The Employer.
