The Tax Questions Blog

Posts Tagged ‘business’

Bob Austin, PM Magazine - People Who Don't Pay Taxes

PTIN: Preparer Tax Identification Number

Question: How do I figure out the total taxes to be taken out of a given salary?

In Colorado Springs, I am trying to figure out the percent that will be taken out of a given salary, including Fed, state, s.s, Medicare, and FIT (don't know what that is). This does not include benefits or retirement plans.

Answer: Go here for some handy estimators: http://www.paycheckcity.com

FIT - Federal Income Tax

Child Tax Credit Deduction Calculator 2010, 2011

Question: Is a legal settlement for an unreturned security deposit taxable?

We sued our landlord last year for retaliatory eviction after we reported him to LA Bldg/Saftey which turned into a nightmare lawsuit in LASC. We then went thru the required mediation process and agree to settle for $3300.00, the amount of sec dep paid on 2002, plus $100.00. We just rec'd a1099 from the landlord with only the $3300 listed as "other income". No one told us to expect this and research so far seems to say it has to "replace" something (i.e. wages) to make it non-taxable. We paid him this money as security when we initially moved in to the property in '02. Lawsuit included "intentional emotional distress" as one of the claims as my husband is a disabled veteran. If anyone has any clues your help is greatly appreciated. Thank you.

Answer: Did the settlement spell out that this was a return of your security deposit plus $100 for emotional distress? If so, only the $100 was taxable. Report it on the "other income" line of the 1040, and attach a statement to your return explaining why you did not claim the remaining amount. If you have a copy of the judgement and it does spell out the settlement, make a copy and attach it to your return.
It seems that your landlord is still jerking you around, because no 1099 was required. I would assume that he is trying to write off the 3300 as a business expense.
You could always call the IRS and ask them to send a letter to your landlord requesting a corrected 1099 (there is such a letter). Jerk him around a bit.
Also, perhaps he never sent the IRS copy to IRS, he only sent a recepient copy to you, just to freak you.

Depuy ASR Hip Recall Settlement - www.asrhipsettlement.com

Question: How to file taxes without being married?

Me and my fiance had our daughter on July 16, 2010, we are not yet married and won't be by the time we file taxes in January or February. Anyways I worked in 2010 up until I had Sophia, he will have worked all year. My question is can we file together and claim her, or do I need to file separately because we aren't married and who would be the best one to claim her--him since he worked all year?! I'm really confused when it comes to this stuff and obviously would like the option that gets us the most money lol. Please help anyone that knows about this kind of stuff? Thanks in advance!

Answer: As you know by now, you can not file MFJ till you marry before Dec 31st, 2010. Now, if he earned more than you, he need the help by letting him claiming Sophia so he does not pay tax, or reduce his tax or getting some refund based on the earned income credit.
I suggest you and before doing any filing, to do a test by filing sophia with you as head of household and then make another filing as single. See what is the different.
Also, do test filing by putting Sophia with him and file as Head of household then prepare another filing for him as single. Compare what is the different and think about what to do.
You can not file together with him, BUT, you may file as a single and check box 6 of form 1040 If someone can claim you as dependent. All of this depending on the amount of your income. Check it out.
In this case only, the father of your child could claim both Sophia and you (you should check Box 6 when you file your Tax as single), this could push his refund higher. Try to do test of all these scenarios and decide what is good for both. Good luck
As far who is entitled to claim Sophia, either of you could as far both agreed to do so.

How to File Taxes If You Haven't Filed in Years