Read the transcript from Tuesday's online tax chat

Betty Lin-Fisher: 

Hello. This is Betty Lin-Fisher. We are getting ourselves situated and will start our Online Tax Chat at noon momentarily. Have your questions ready!

Betty Lin-Fisher: 

Hello and thanks for joining us for our live online tax chat. I'm Betty Lin-Fisher, consumer reporter and columnist with the Akron Beacon Journal and I will serve as your moderator. With me are four CPAS with a local firm volunteering through the Ohio Society of CPAs. We will try to get to as many of the questions posed as possible. There may be some questions that may be more complicated and not best answered in this online format. We will also have two more call-in sessions – one tomorrow night (Wednesday) from 6-8 p.m. and one on Saturday morning from 9 a.m. to noon, where you can call in, and I will include the information for that at the end of this session.

Betty Lin-Fisher: 

Before we start, we need to get some legal stuff out of the way:
IRS Circular 230 Disclosure
Pursuant to U.S. Treasury Department Regulations, we are now required to advise you that any federal tax advice contained in this communication is not intended by the Akron Beacon Journal or the Ohio Society of CPAs or the CPAs involved or their firms to constitute a covered opinion pursuant to regulation section 10.35 or to be used for the purpose of (i) avoiding tax-related penalties under Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any tax-related matters addressed herein.

Betty Lin-Fisher: 

If you have a question, please feel free to post it and we will do our best to answer it.

Betty Lin-Fisher: 

Here's our first question.

Comment From Guest 

I did some private consulting work for a legal firm (I'm not an attorney) and I received a 1099. Obviously this is for self employment taxes. Are there any offsets for the self employment portion that I can take?

Betty Lin-Fisher: 

they are discussing

Betty Lin-Fisher: 

A CPA is typing the answer. Bear with us as we get used to the system

Betty Lin-Fisher: 

in the meantime, here's another question that another CPA will begin working on

Comment From Guest 

Is an early withdrawl from an ira exempt from city tax? paid state and federal already and 10% penalty will be paid as well.

CPA1: 

You are correct. The consulting income is subject to self-employment taxes. You can offset the income with any expenses incurred and report on Schedule C. You are also permitted a deduction for 1/2 of the self employment taxes paid on Line 27 of the 1040.

Betty Lin-Fisher: 

They are working on the answer to the early withdrawal question

Betty Lin-Fisher: 

Here's another question that another CPA will work on.

Comment From Isabel 

Where do I put a 401K rollover to an IRA on tax form 1040? Do I include it with the taxable 1099 R forms?

Comment From Guest 

thank you

Betty Lin-Fisher: 

Here's another question to throw into the mix. CPAs are typing out answers to the rollover and early withdrawal question.

Comment From Marilyn 

My 94 year old mother passed away last year. My 99 year old father received $25,000 in life insurance policy payments. Does he have to pay tax on this money? THANKS!

CPA3: 

For the early withdrawal of an IRA being taxable to the city: It may depend on which city you live in. For example, in Columbus pre-retirement distributions from retirement plans are taxable to the city of Columbus.

CPA3: 

Life insurance proceeds are not taxable.

Comment From Guest 

Thanks

CPA1: 

Regarding the 401k rollover, the amount is reported on line 16a of the 1040. None will be taxable on Line 16b.

Betty Lin-Fisher: 

While we are waiting for some more questions, I will also be sprinkling in some questions, which were sent ahead of time via e-mail and social media and our CPA's answers.

Betty Lin-Fisher: 

Tim asked: I lived in Akron my whole life; I use to get my taxes done by H&R block and the tax preparer told me that me and my wife did not have to file and send in a paper copy of my taxes to the city of Akron. Is this true? Akron City does take out all my taxes.

Betty Lin-Fisher: 

Here's the answer to Tim: A city of Akron return should be filed even though all the income of the taxpayer has already had Akron withholding. Residents of a city are required to file a return in that city unless the city has exemptions that the taxpayer meets. Such exemptions for Akron include if you are under the age of 18 or retired and only receive income not subject to city tax. From the email it sounds like they still do get wage income and Akron withholds so an income tax return should be filed in Akron.

Betty Lin-Fisher: 

David A. asked: I had assumed that if I owned rental property in another city or state that my city of residence was not eligible for income tax revenue from it. Am I wrong on a basic taxable item?

Cities do not tax investment income. A rental is certainly an investment. A rental requires constant investment, and if located in another city, my residence city does absolutely zero to provide any service of any kind to my properties.

Betty Lin-Fisher: 

Here's the answer to David's question: A return should be filed in the city where the rental property is located. The rental is also reported on the resident city return. The taxes paid to the city where the property is located will likely result in a credit on the resident city return. Different cities have different credit rules so depending on where the taxpayer lives the credit they would receive on their resident city return would be affected. Cities also have different tax rates so that plays a role in the tax that may be due to the taxpayer’s resident city as well.



Rental income is not considered investment income for purposes of the Ohio city tax. Some cities do have thresholds on the amount of monthly rent that must be collect before a return needs to be filed to report it. The thresholds are generally pretty low at a couple hundred dollars.

Betty Lin-Fisher: 

Here's another live question

Comment From Guest 

Is there any way to claim our 17 and 18 yo kids? They are both still in high school and dependent. The 18 y.o. Has a job but makes only about 70.00 every other week. We made about

Comment From Guest 

from glove I got 2 w2 from employer. One they did for 3 months and a company for rest. I had no fed.taxes taken out for 1st3 omnths,but did for rest of year. Should they have taken fed taxes out? also fed id number is differen

Betty Lin-Fisher: 

I think there's some typos in this question, can you please retype or rephrase for the CPAS?

Betty Lin-Fisher: 

Are those two separate questions? if you posted those two questions, please retype for us. There are no identifications with the questions

Betty Lin-Fisher: 

I don't see the questions reposed. The CPAs will do their best to answer the questions as they understand them

CPA1: 

If the 17/18 year old children lived with you for more than half the year and you provided more than half of their support, they would likely qualify as dependents.

Betty Lin-Fisher: 

The CPA is answering the other question posed. In the meantime, here's another question that was posed ahead of time

Betty Lin-Fisher: 

Ronald asked: My question is about inheritance.
We received money from an estate. Do we need to claim this as income on our federal, state and local income tax filings?
Thanks for your help.

CPA3: 

From my understanding of the question about receiving 2 W-2s; I am not sure why there was not federal taxes withheld on the first form, but both W-2s need to be reported on your tax return. If your income taxes have been underwithheld because of the first 3 months of work, you will need to pay the taxes with your tax return.

Betty Lin-Fisher: 

Regarding Ronald's inheritance question, here's the answer: Generally, speaking inheritance will not be taxable. However, there are situation in which a beneficiary of an estate can receive taxable income from the estate. From below it sounds like they just received cash which would not create taxable income.

Comment From Stacey 

My husband owes back child support, if we file jointly will we lose both our refund or just his portion?

Betty Lin-Fisher: 

Thanks Stacey. They are discussing

Betty Lin-Fisher: 

In the meantime, here's another question that was submitted ahead of time. Fran asks: Many of us in the Akron area had major damage from the Storm on July 10th of 2013. Most of us had no flood insurance that covered our losses. We are senior citizens and need help to figure out what we need to do and what forms we need to report the losses from this storm? We had over $15,000.00 in expense losses from this storm, having to replace a 30 foot foundation wall, electric, gas and water lines which were on the collapsed wall and not to mention the 5 ft of water from sewer backup that filled up our basement and destroyed our washer, dryer, freezer(full of food), water heater, air conditioner and dehumidifier and damaged our boiler furnace that required almost $900.00 in repairs. Can you offer any advise how we should report this, The only insurance reimbursement was for $500.00 of our freezer food loss. We have not gotten any help from the Federal Government, City or State. Thank you in advance for any assistance you may offer.

Betty Lin-Fisher: 

Here's the answer to Fran's question: Casualty losses are calculated on Form 4684. The amount calculated on that form then carries to 1040 Schedule A as an itemized deduction. Depending on the specific taxpayer they may or may not get a deduction for this as you have to itemize you deductions in order to get the deduction (i.e. not take the standard deduction).
 

Betty Lin-Fisher: 

Here's another live question

Comment From Sally 

If I itemize my deductions, can I claim the amount taken out of my social security check for Medicare as a medical expense?

Betty Lin-Fisher: 

The CPAS are working on answering both of the outstanding questions. Stand by

Betty Lin-Fisher: 

They are still discussing and typing

Betty Lin-Fisher: 

In the meantime, here's another question from someone submitted earlier. Mike asks: My wife Lynne died last month - Jan. 10. I know that in filing my 1040 for 2013 that I can check Married Filing Jointly.

But how about in 2015 when I'll be filing for 2014. Do those 10 days that Lynne lived in 2014 mean that I again can check Married Filing Jointly?

Thanks much.

Betty Lin-Fisher: 

Here's the answer to Mike's question about filing for his deceased wife: He can file a married filing joint return for 2014 as well as for 2013. IRS Publication 501 provides that “If your spouse died during the year, you are considered married for the whole year for filing status purposes.”

Betty Lin-Fisher: 

By the way, a full transcript of this chat with our questions and answers will be available with this story online at www.ohio.com

CPA1: 

Sally - the supplemental part of Medicare Part B insurance and the premiums you pay for Medicare Part D insurance are allowable itemized deductions on Schedule A. Note, medical expenses are subject to an Adjusted Gross Income (AGI - Line 37) threshhold test. Only medical expenses in excess of either 7.5% or 10% of AGI are deductible.

Betty Lin-Fisher: 

We're about halfway through our chat. Feel free to ask some more questions, even if you've already asked one

Betty Lin-Fisher: 

Here's a question from Debbie:

Comment From Debbie 

Are military retirement pensions taxable income?

CPA3: 

Stacey; you will need to file an Injured Spouse Allocation form after your joint tax return is filed. This will allow for you to allocate the amount of tax refund that will be subject to the back child support. See this link for more information http://www.irs.gov/uac/Injured-or-Innocent-Spouse-Tax-Relief

cpa2: 

Debbie: The military retirement income is taxable

Betty Lin-Fisher: 

Here's another question that was submitted ahead of time from Bill. He asks: My 25 year old son is living at home, but is not my dependent, tax-wise. He is working part time and attending Akron U. full time. I am paying 100% of his tuition and fees. Which of us can get a tax credit for those educational expenses? Such a credit would benefit me more than him, because of my higher tax rate.
Answer: The 25 year old son would be the one who gets this credit because he is not claimed as a dependent. Parents can take the credit if they claim the student as a dependent. The son would not meet the requirements because of his age. However, depending on his income for the year there is a chance he could meet the qualifying relative test.

Betty Lin-Fisher: 

Here's a bit more of that answer. So here's the full post of the answer to Bill: The 25 year old son would be the one who gets this credit because he is not claimed as a dependent. Parents can take the credit if they claim the student as a dependent. The son would not meet the requirements because of his age. However, depending on his income for the year there is a chance he could meet the qualifying relative test.

http://www.eitc.irs.gov/Other-Refundable-Credits/educompchart See “Whom can you claim the benefit for?”

http://www.irs.gov/pub/irs-pdf/p501.pdf See “Exemptions for Dependents” which discusses the requirements for the qualifying child and qualifying relative.

Comment From Debbie 

Thank you for the information. Should I receive a 1099 from the government?

Betty Lin-Fisher: 

Debbie - they are typing your answer.

Betty Lin-Fisher: 

here's a question from Peggy

Comment From Peggy 

My husband is receiving retirement income from a pension; but I am still working and contribute to a 401. Our joint income is less than $58,000 and my and income alone is over $20,000. Can we both contribute to an IRA for the 6500 (both over 50).?

CPA1: 

Debbie - yes, you should receive a statement from the government detailing your taxable benefit.

Comment From Debbie 

thanks again!

Betty Lin-Fisher: 

Peggy - they are working on your answer

Betty Lin-Fisher: 

Here's some more questions

Comment From Carol Auker 

Starting in May of 2013 our condo starting drawing rental income. On the 4562 form for depreciation line 19h do I divide the original cost of the condo by 27.5 or do I use the factor from Table C form 4562 and multiply by the original cost.

Comment From John P 

Can you file for an 'extention' with Ohio taxes? Is there a special form number?

Comment From Peggy 

okay thank you.

Betty Lin-Fisher: 

Thanks, Carol and John. The CPAs are working on your question. I see a question posted from Mike that I will post shortly. We'll let the CPAs finish Carol and John's answers first so it doesn't get too confusing

CPA3: 

Peggy- your maximum contribution for the year into a IRA is $6,500 each if you are 50 or older. This is limited to your taxable compensation; so if your husband only has retirement income he will not be considered to have any taxable compensation. In that case, only you can contribute $6,500 into an IRA.

CPA1: 

John - you do not have to file an extension to Ohio if you don't have tax due. Ohio honors the federal extension. However, if you have tax due, you must make an Ohio payment before the original due date (April 15th) with Ohio Form IT 40P.

Betty Lin-Fisher: 

OK, here comes Mike's question

Comment From Mike D 

Are nondividend distributions, on my consolidated form 1099, taxable. they are on item 3

Betty Lin-Fisher: 

Here's a followup comment from Peggy

Comment From Peggy 

That's what I thought, but The tax software that we are using is allowing us both to take the deduction.

Comment From Peggy 

and giving us a larger refund?

Comment From John P 

Thank you. John

Betty Lin-Fisher: 

OK, CPAs are working on answers for Carol and Mike D. Mike P, I see your question and will post that next

Betty Lin-Fisher: 

While we wait for some other answers to be posted, I will sprinkle in a few Frequently Asked Questions from the IRS.gov website.
How can I prevent problems during the processing of my return?

File electronically and use direct deposit.

If you file a paper return, make sure you do the following before you put it in the mail:
• print your information legibly
• check your math
• list Social Security numbers on a joint return in the same order as the names
• include the correct Social Security numbers of all dependents
• sign the return (you and your spouse, if applicable)
• attach the W 2s or 1099Rs to the front of the return
• include accurate bank and account information for the direct deposit of your refund, if applicable
• if you owe tax, do not send cash. Complete Form 1040-V, Payment Voucher following the instructions on that form and enclose it in the envelope with your check or money order made payable to “United States Treasury.”
• use sufficient postage (the post office will return mail with insufficient postage)
• mail it so it is postmarked on or before April 15, 2014
 

CPA3: 

Carol- use the factor on Table C from the 4562 Instructions based upon the 5th month.

Betty Lin-Fisher: 

Here's Mike P's question

Comment From Mike P 

having no income for 2012 I did not file fed taxes. But in order to receive a pin for filing 2013 taxes you have to have filed 2012 taxes. haow do i file 2012 taxes so that I can receive a pin # for 2013 tax filing?

CPA1: 

Mike D - the amount reported as nondividend distributions is nontaxable. It is not reported on the 1040.

CPA3: 

Peggy- I'm not sure what software you are using but you may need to code it differently or contact product support.

Betty Lin-Fisher: 

Mike P - they are working on your question

Comment From Peggy 

okay thank you.

Betty Lin-Fisher: 

Here's another question -- from Eric

Comment From Eric A Kauffman 

I was wondering if i file taxes for 2013 im retired and all i get is pension and social security

Betty Lin-Fisher: 

Here's another question from Mike D:

Comment From Mike D 

Question #2 Can I itemize room and board costs for an assisted living facility if I have a doctors letter stating that the person had Alzheimers dementia and needed assistance for bathing, dressing, and feeding.

CPA3: 

Eric: Yes you should be filing tax returns assuming you exceed the income limits. Refer to IRS Publication 501 for the income limits.

Betty Lin-Fisher: 

We have about 8 minutes left in our online chat. We are caught up on questions posed, so feel free to ask another question, if you have one. We'll get to as many as we can before we end at 1 p.m.

CPA1: 

Mike P - without knowing which software you are using, you may not be able to electronically file having not filed a 2012 return.

Comment From Mike P 

How can I file a return for 2012?

CPA3: 

Mike D- if the person with Alzheimers is either your spouse or a dependent on your tax return then you will be able to deduct the costs are medical expenses on Schedule A.

Betty Lin-Fisher: 

Here's a followup from Peggy

Comment From Peggy 

One last comment, we are having taxes withheld from my husband's retirement - does that change anything?

Comment From Mike P 

not using any software at this point. Tryed to get a pin on IRS sight

CPA3: 

Peggy- No this does not change the fact that he cannot contribute to an IRA. Make sure to report that withholding on your return though.

CPA1: 

Mike P - if you did not have income in 2012, there is no need to file a return. You can paper file your 2013 tax return and be able to efile in the future.

Comment From Mike P 

thank you

Betty Lin-Fisher: 

We'll hang on just in case there are any last-minute questions, but are two more opportunities to ask questions of CPAs. We will be sponsoring a call-in tomorrow night (Wednesday) from 6- 8 p.m. and our last call-in program on Saturday morning from 9 a.m. to noon. Call 330-996-3644 at that time. Also, you can see all of the tax stories, including the Beacon's Tax Section from this past weekend at
www.ohio.com/business/taxes

Betty Lin-Fisher: 

Thanks. I think there are no more outstanding questions. Thanks for joining us today. Thank you to our CPAs

Comment From Peggy 

okay thanks

Betty Lin-Fisher: 

The full transcript for this chat will be online at www.ohio.com. thanks!

Betty Lin-Fisher: 

Hello. This is Betty Lin-Fisher. We are getting ourselves situated and will start our Online Tax Chat at noon momentarily. Have your questions ready!

Betty Lin-Fisher: 

Hello and thanks for joining us for our live online tax chat. I'm Betty Lin-Fisher, consumer reporter and columnist with the Akron Beacon Journal and I will serve as your moderator. With me are four CPAS with a local firm volunteering through the Ohio Society of CPAs. We will try to get to as many of the questions posed as possible. There may be some questions that may be more complicated and not best answered in this online format. We will also have two more call-in sessions – one tomorrow night (Wednesday) from 6-8 p.m. and one on Saturday morning from 9 a.m. to noon, where you can call in, and I will include the information for that at the end of this session.

Betty Lin-Fisher: 

Before we start, we need to get some legal stuff out of the way:
IRS Circular 230 Disclosure
Pursuant to U.S. Treasury Department Regulations, we are now required to advise you that any federal tax advice contained in this communication is not intended by the Akron Beacon Journal or the Ohio Society of CPAs or the CPAs involved or their firms to constitute a covered opinion pursuant to regulation section 10.35 or to be used for the purpose of (i) avoiding tax-related penalties under Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any tax-related matters addressed herein.

Betty Lin-Fisher: 

If you have a question, please feel free to post it and we will do our best to answer it.

Betty Lin-Fisher: 

Here's our first question.

Comment From Guest 

I did some private consulting work for a legal firm (I'm not an attorney) and I received a 1099. Obviously this is for self employment taxes. Are there any offsets for the self employment portion that I can take?

Betty Lin-Fisher: 

they are discussing

Betty Lin-Fisher: 

A CPA is typing the answer. Bear with us as we get used to the system

Betty Lin-Fisher: 

in the meantime, here's another question that another CPA will begin working on

Comment From Guest 

Is an early withdrawl from an ira exempt from city tax? paid state and federal already and 10% penalty will be paid as well.

CPA1: 

You are correct. The consulting income is subject to self-employment taxes. You can offset the income with any expenses incurred and report on Schedule C. You are also permitted a deduction for 1/2 of the self employment taxes paid on Line 27 of the 1040.

Betty Lin-Fisher: 

They are working on the answer to the early withdrawal question

Betty Lin-Fisher: 

Here's another question that another CPA will work on.

Comment From Isabel 

Where do I put a 401K rollover to an IRA on tax form 1040? Do I include it with the taxable 1099 R forms?

Comment From Guest 

thank you

Betty Lin-Fisher: 

Here's another question to throw into the mix. CPAs are typing out answers to the rollover and early withdrawal question.

Comment From Marilyn 

My 94 year old mother passed away last year. My 99 year old father received $25,000 in life insurance policy payments. Does he have to pay tax on this money? THANKS!

CPA3: 

For the early withdrawal of an IRA being taxable to the city: It may depend on which city you live in. For example, in Columbus pre-retirement distributions from retirement plans are taxable to the city of Columbus.

CPA3: 

Life insurance proceeds are not taxable.

Comment From Guest 

Thanks

CPA1: 

Regarding the 401k rollover, the amount is reported on line 16a of the 1040. None will be taxable on Line 16b.

Betty Lin-Fisher: 

While we are waiting for some more questions, I will also be sprinkling in some questions, which were sent ahead of time via e-mail and social media and our CPA's answers.

Betty Lin-Fisher: 

Tim asked: I lived in Akron my whole life; I use to get my taxes done by H&R block and the tax preparer told me that me and my wife did not have to file and send in a paper copy of my taxes to the city of Akron. Is this true? Akron City does take out all my taxes.

Betty Lin-Fisher: 

Here's the answer to Tim: A city of Akron return should be filed even though all the income of the taxpayer has already had Akron withholding. Residents of a city are required to file a return in that city unless the city has exemptions that the taxpayer meets. Such exemptions for Akron include if you are under the age of 18 or retired and only receive income not subject to city tax. From the email it sounds like they still do get wage income and Akron withholds so an income tax return should be filed in Akron.

Betty Lin-Fisher: 

David A. asked: I had assumed that if I owned rental property in another city or state that my city of residence was not eligible for income tax revenue from it. Am I wrong on a basic taxable item?

Cities do not tax investment income. A rental is certainly an investment. A rental requires constant investment, and if located in another city, my residence city does absolutely zero to provide any service of any kind to my properties.

Betty Lin-Fisher: 

Here's the answer to David's question: A return should be filed in the city where the rental property is located. The rental is also reported on the resident city return. The taxes paid to the city where the property is located will likely result in a credit on the resident city return. Different cities have different credit rules so depending on where the taxpayer lives the credit they would receive on their resident city return would be affected. Cities also have different tax rates so that plays a role in the tax that may be due to the taxpayer’s resident city as well.



Rental income is not considered investment income for purposes of the Ohio city tax. Some cities do have thresholds on the amount of monthly rent that must be collect before a return needs to be filed to report it. The thresholds are generally pretty low at a couple hundred dollars.

Betty Lin-Fisher: 

Here's another live question

Comment From Guest 

Is there any way to claim our 17 and 18 yo kids? They are both still in high school and dependent. The 18 y.o. Has a job but makes only about 70.00 every other week. We made about

Comment From Guest 

from glove I got 2 w2 from employer. One they did for 3 months and a company for rest. I had no fed.taxes taken out for 1st3 omnths,but did for rest of year. Should they have taken fed taxes out? also fed id number is differen

Betty Lin-Fisher: 

I think there's some typos in this question, can you please retype or rephrase for the CPAS?

Betty Lin-Fisher: 

Are those two separate questions? if you posted those two questions, please retype for us. There are no identifications with the questions

Betty Lin-Fisher: 

I don't see the questions reposed. The CPAs will do their best to answer the questions as they understand them

CPA1: 

If the 17/18 year old children lived with you for more than half the year and you provided more than half of their support, they would likely qualify as dependents.

Betty Lin-Fisher: 

The CPA is answering the other question posed. In the meantime, here's another question that was posed ahead of time

Betty Lin-Fisher: 

Ronald asked: My question is about inheritance.
We received money from an estate. Do we need to claim this as income on our federal, state and local income tax filings?
Thanks for your help.

CPA3: 

From my understanding of the question about receiving 2 W-2s; I am not sure why there was not federal taxes withheld on the first form, but both W-2s need to be reported on your tax return. If your income taxes have been underwithheld because of the first 3 months of work, you will need to pay the taxes with your tax return.

Betty Lin-Fisher: 

Regarding Ronald's inheritance question, here's the answer: Generally, speaking inheritance will not be taxable. However, there are situation in which a beneficiary of an estate can receive taxable income from the estate. From below it sounds like they just received cash which would not create taxable income.

Comment From Stacey 

My husband owes back child support, if we file jointly will we lose both our refund or just his portion?

Betty Lin-Fisher: 

Thanks Stacey. They are discussing

Betty Lin-Fisher: 

In the meantime, here's another question that was submitted ahead of time. Fran asks: Many of us in the Akron area had major damage from the Storm on July 10th of 2013. Most of us had no flood insurance that covered our losses. We are senior citizens and need help to figure out what we need to do and what forms we need to report the losses from this storm? We had over $15,000.00 in expense losses from this storm, having to replace a 30 foot foundation wall, electric, gas and water lines which were on the collapsed wall and not to mention the 5 ft of water from sewer backup that filled up our basement and destroyed our washer, dryer, freezer(full of food), water heater, air conditioner and dehumidifier and damaged our boiler furnace that required almost $900.00 in repairs. Can you offer any advise how we should report this, The only insurance reimbursement was for $500.00 of our freezer food loss. We have not gotten any help from the Federal Government, City or State. Thank you in advance for any assistance you may offer.

Betty Lin-Fisher: 

Here's the answer to Fran's question: Casualty losses are calculated on Form 4684. The amount calculated on that form then carries to 1040 Schedule A as an itemized deduction. Depending on the specific taxpayer they may or may not get a deduction for this as you have to itemize you deductions in order to get the deduction (i.e. not take the standard deduction).
 

Betty Lin-Fisher: 

Here's another live question

Comment From Sally 

If I itemize my deductions, can I claim the amount taken out of my social security check for Medicare as a medical expense?

Betty Lin-Fisher: 

The CPAS are working on answering both of the outstanding questions. Stand by

Betty Lin-Fisher: 

They are still discussing and typing

Betty Lin-Fisher: 

In the meantime, here's another question from someone submitted earlier. Mike asks: My wife Lynne died last month - Jan. 10. I know that in filing my 1040 for 2013 that I can check Married Filing Jointly.

But how about in 2015 when I'll be filing for 2014. Do those 10 days that Lynne lived in 2014 mean that I again can check Married Filing Jointly?

Thanks much.

Betty Lin-Fisher: 

Here's the answer to Mike's question about filing for his deceased wife: He can file a married filing joint return for 2014 as well as for 2013. IRS Publication 501 provides that “If your spouse died during the year, you are considered married for the whole year for filing status purposes.”

Betty Lin-Fisher: 

By the way, a full transcript of this chat with our questions and answers will be available with this story online at www.ohio.com

CPA1: 

Sally - the supplemental part of Medicare Part B insurance and the premiums you pay for Medicare Part D insurance are allowable itemized deductions on Schedule A. Note, medical expenses are subject to an Adjusted Gross Income (AGI - Line 37) threshhold test. Only medical expenses in excess of either 7.5% or 10% of AGI are deductible.

Betty Lin-Fisher: 

We're about halfway through our chat. Feel free to ask some more questions, even if you've already asked one

Betty Lin-Fisher: 

Here's a question from Debbie:

Comment From Debbie 

Are military retirement pensions taxable income?

CPA3: 

Stacey; you will need to file an Injured Spouse Allocation form after your joint tax return is filed. This will allow for you to allocate the amount of tax refund that will be subject to the back child support. See this link for more information http://www.irs.gov/uac/Injured-or-Innocent-Spouse-Tax-Relief

cpa2: 

Debbie: The military retirement income is taxable

Betty Lin-Fisher: 

Here's another question that was submitted ahead of time from Bill. He asks: My 25 year old son is living at home, but is not my dependent, tax-wise. He is working part time and attending Akron U. full time. I am paying 100% of his tuition and fees. Which of us can get a tax credit for those educational expenses? Such a credit would benefit me more than him, because of my higher tax rate.
Answer: The 25 year old son would be the one who gets this credit because he is not claimed as a dependent. Parents can take the credit if they claim the student as a dependent. The son would not meet the requirements because of his age. However, depending on his income for the year there is a chance he could meet the qualifying relative test.

Betty Lin-Fisher: 

Here's a bit more of that answer. So here's the full post of the answer to Bill: The 25 year old son would be the one who gets this credit because he is not claimed as a dependent. Parents can take the credit if they claim the student as a dependent. The son would not meet the requirements because of his age. However, depending on his income for the year there is a chance he could meet the qualifying relative test.

http://www.eitc.irs.gov/Other-Refundable-Credits/educompchart See “Whom can you claim the benefit for?”

http://www.irs.gov/pub/irs-pdf/p501.pdf See “Exemptions for Dependents” which discusses the requirements for the qualifying child and qualifying relative.

Comment From Debbie 

Thank you for the information. Should I receive a 1099 from the government?

Betty Lin-Fisher: 

Debbie - they are typing your answer.

Betty Lin-Fisher: 

here's a question from Peggy

Comment From Peggy 

My husband is receiving retirement income from a pension; but I am still working and contribute to a 401. Our joint income is less than $58,000 and my and income alone is over $20,000. Can we both contribute to an IRA for the 6500 (both over 50).?

CPA1: 

Debbie - yes, you should receive a statement from the government detailing your taxable benefit.

Comment From Debbie 

thanks again!

Betty Lin-Fisher: 

Peggy - they are working on your answer

Betty Lin-Fisher: 

Here's some more questions

Comment From Carol Auker 

Starting in May of 2013 our condo starting drawing rental income. On the 4562 form for depreciation line 19h do I divide the original cost of the condo by 27.5 or do I use the factor from Table C form 4562 and multiply by the original cost.

Comment From John P 

Can you file for an 'extention' with Ohio taxes? Is there a special form number?

Comment From Peggy 

okay thank you.

Betty Lin-Fisher: 

Thanks, Carol and John. The CPAs are working on your question. I see a question posted from Mike that I will post shortly. We'll let the CPAs finish Carol and John's answers first so it doesn't get too confusing

CPA3: 

Peggy- your maximum contribution for the year into a IRA is $6,500 each if you are 50 or older. This is limited to your taxable compensation; so if your husband only has retirement income he will not be considered to have any taxable compensation. In that case, only you can contribute $6,500 into an IRA.

CPA1: 

John - you do not have to file an extension to Ohio if you don't have tax due. Ohio honors the federal extension. However, if you have tax due, you must make an Ohio payment before the original due date (April 15th) with Ohio Form IT 40P.

Betty Lin-Fisher: 

OK, here comes Mike's question

Comment From Mike D 

Are nondividend distributions, on my consolidated form 1099, taxable. they are on item 3

Betty Lin-Fisher: 

Here's a followup comment from Peggy

Comment From Peggy 

That's what I thought, but The tax software that we are using is allowing us both to take the deduction.

Comment From Peggy 

and giving us a larger refund?

Comment From John P 

Thank you. John

Betty Lin-Fisher: 

OK, CPAs are working on answers for Carol and Mike D. Mike P, I see your question and will post that next

Betty Lin-Fisher: 

While we wait for some other answers to be posted, I will sprinkle in a few Frequently Asked Questions from the IRS.gov website.
How can I prevent problems during the processing of my return?

File electronically and use direct deposit.

If you file a paper return, make sure you do the following before you put it in the mail:
• print your information legibly
• check your math
• list Social Security numbers on a joint return in the same order as the names
• include the correct Social Security numbers of all dependents
• sign the return (you and your spouse, if applicable)
• attach the W 2s or 1099Rs to the front of the return
• include accurate bank and account information for the direct deposit of your refund, if applicable
• if you owe tax, do not send cash. Complete Form 1040-V, Payment Voucher following the instructions on that form and enclose it in the envelope with your check or money order made payable to “United States Treasury.”
• use sufficient postage (the post office will return mail with insufficient postage)
• mail it so it is postmarked on or before April 15, 2014
 

CPA3: 

Carol- use the factor on Table C from the 4562 Instructions based upon the 5th month.

Betty Lin-Fisher: 

Here's Mike P's question

Comment From Mike P 

having no income for 2012 I did not file fed taxes. But in order to receive a pin for filing 2013 taxes you have to have filed 2012 taxes. haow do i file 2012 taxes so that I can receive a pin # for 2013 tax filing?

CPA1: 

Mike D - the amount reported as nondividend distributions is nontaxable. It is not reported on the 1040.

CPA3: 

Peggy- I'm not sure what software you are using but you may need to code it differently or contact product support.

Betty Lin-Fisher: 

Mike P - they are working on your question

Comment From Peggy 

okay thank you.

Betty Lin-Fisher: 

Here's another question -- from Eric

Comment From Eric A Kauffman 

I was wondering if i file taxes for 2013 im retired and all i get is pension and social security

Betty Lin-Fisher: 

Here's another question from Mike D:

Comment From Mike D 

Question #2 Can I itemize room and board costs for an assisted living facility if I have a doctors letter stating that the person had Alzheimers dementia and needed assistance for bathing, dressing, and feeding.

CPA3: 

Eric: Yes you should be filing tax returns assuming you exceed the income limits. Refer to IRS Publication 501 for the income limits.

Betty Lin-Fisher: 

We have about 8 minutes left in our online chat. We are caught up on questions posed, so feel free to ask another question, if you have one. We'll get to as many as we can before we end at 1 p.m.

CPA1: 

Mike P - without knowing which software you are using, you may not be able to electronically file having not filed a 2012 return.

Comment From Mike P 

How can I file a return for 2012?

CPA3: 

Mike D- if the person with Alzheimers is either your spouse or a dependent on your tax return then you will be able to deduct the costs are medical expenses on Schedule A.

Betty Lin-Fisher: 

Here's a followup from Peggy

Comment From Peggy 

One last comment, we are having taxes withheld from my husband's retirement - does that change anything?

Comment From Mike P 

not using any software at this point. Tryed to get a pin on IRS sight

CPA3: 

Peggy- No this does not change the fact that he cannot contribute to an IRA. Make sure to report that withholding on your return though.

CPA1: 

Mike P - if you did not have income in 2012, there is no need to file a return. You can paper file your 2013 tax return and be able to efile in the future.

Comment From Mike P 

thank you

Betty Lin-Fisher: 

We'll hang on just in case there are any last-minute questions, but are two more opportunities to ask questions of CPAs. We will be sponsoring a call-in tomorrow night (Wednesday) from 6- 8 p.m. and our last call-in program on Saturday morning from 9 a.m. to noon. Call 330-996-3644 at that time. Also, you can see all of the tax stories, including the Beacon's Tax Section from this past weekend at
www.ohio.com/business/taxes

Betty Lin-Fisher: 

Thanks. I think there are no more outstanding questions. Thanks for joining us today. Thank you to our CPAs

Comment From Peggy 

okay thanks

Betty Lin-Fisher: 

The full transcript for this chat will be online at www.ohio.com. thanks!