TT Full service (Tax Information Notes)

Question 1

If box 12 of W-2 has an amount in it, how will it potentially affect a customer’s tax return?

Answer 1

The retirement contributions in Box 12 may reduce3 your taxable income, potentially lowering your tax liability.

Question 2

T/F a gift to a non-profit charity registered under section 501(c)(3) of the IRC is an itemized deduction.

Answer 2

True,
a gift to a non-profit charity registered under section 501(c)(3) of the IRC is an itemized deduction.

Question 3

Are political contributions considered itemized deductions?

Answer 3

No,
Political contributions are not considered itemized deductions.

Question 4

Per the IRS, you can only deduct what portion of your medical expenses on Schedule A?

Answer 4

Per the IRS, you can only deduct medical and dental expenses that is more than 7.5% of your AGI.

Question 5

What publication refers to medical and dental expenses?

Answer 5

Publication 502, Medical and Dental Expenses

Question 6

How are car registration fees treated?

Answer 6

The amount that is considered deductible registration fees varies from state to state.

Question 7

What is a key difference between a Flexible Spending Account (FSA) and a Health Savings Account (HSA) in 2024?

Answer 7

The maximum contribution limit for an FSA in 2024 is $3,200, while for an HSA it is $4,150 for individuals and $8,300 for families, with additional contributions allowed for those aged 55 and older.

Question 8

What is box 12 code W on a form W-2?

Answer 8

Box 12 Code W is company contributions to an HSA Account.

Question 9

What is box 12 code DD on a form W-2?

Answer 9

Box 12 Code DD is the cost of employer sponsored health coverage.

Question 10

What is distribution code 1 on 1099-SA (Distributions from an HSA, Archer MSA, or Medicare Advantage MSA)??

Answer 10

Distribution code one on form 1099-SA (Distributions from an HSA, Archer MSA, or Medicare Advantage MSA) means its a normal distribution.

Question 11

Where are medical and dental expenses entered on Schedule A?

Answer 11

Medical and Dental Expenses are entered on Schedule A, lines 1-4.

Question 12

Where is the amount of deductions for taxes paid on Schedule A?

Answer 12

Deductions for taxes paid are entered on Schedule A, lines 5-7.

Question 13

Where are mortgage interest deductions entered on Schedule A?

Answer 13

Mortgage interest deductions are entered on Schedule A, lines 8-10.

Question 14

Where are gifts to charity entered on Schedule A?

Answer 14

Gifts to charity deduction is entered on Schedule A, lines 11-13.

Question 15

Where are total itemized deductions calculated?

Answer 15

Total Itemized deductions are calculated on Schedule A, lines 17 and 18.

Question 16

For home loans taken out after December 15,2017 you can generally deduct home mortgage interest on how much indebtedness?

Answer 16

You can generally deduct home mortgage interest on the first $750,000 ($375,000 if married filing separately) of indebtedness.

Question 17

What is the limit for (SALT) State and local tax deductions?

Answer 17

The limit is $10,000 ($5,000 if married filing separately).

Question 18

What publication defines a Health Savings Account?

Answer 18

Publication 969 Health Savings Account.