Pacun

My prayers for Rita and her family for such a big loss.

No, the refi has to be used on the house that is being used as collateral.

TCJA changed the refi regulations. It might be useful if you gave us the cost of each house and the dates. If the first house costs a million dollars, then you are limited by the first loan of a million dollars and you cannot take any mortgage interest paid to the second house. if the first house is $750K, then technically you will be limited to that because there will be not room left for the second house. If the first house cost is $400K and the second house cost $700K, then you will use the whole first house (no refi) interest and ONLY half of the interest paid for the second home. Again, I am assuming that the second house was purchased in the last couple of years and the old house was purchased pre-TCJA.

Are you including the date of death? If yes, take it out. If not, add it in. I did one a couple of years ago who died in February before filing. Wife was able to sign and file jointly without any issues.

I just give them their papers back because I know they will eventually do the same with another preparer and they will get billed. When I get new people, I quickly open a sample return matching their situation and I plug in the numbers. I tell them... you owe about XX or you will get a refund of about XX. I also tell them how much I will charge them. if they decide to stay, I start entering their info on my computer. If they don't like it, I give them their papers back and give them directions to H R block. I am pretty sure H R Block employees will not do estimates and they charge a lot.

On Sch A, enter the interest paid on the main loan on the first home and the interest paid on the second home provided it costs less than $750K. No interest from the refi.

You can be 10 years old and qualify for EIC.

Yes, and if they had earned income in 2019, they could also qualify for EIC.

Yes, as long as it is not scholarship and grants, no matter who pay or get the loans... the credit follows the exemption of the student.

This is what I did with my daughter's 1098-T. My daughter lives with her mom only attends school because they live 4 blocks from campus and yet 1098-T reads that her scholarships were 30K and tuition only 24K. I asked her to give me her whole account report and at the end of 2019 the balance was 0. In 2020, my daughter got scholarships from private donners $1,000, state scholarship $2,500, university scholarship $7K, federal grants another $5K and other scholarship for another $1,500 (not accurate numbers but very similar) Then I got US gov-backed loans for $2K, another personal loan for $4K. Another loan for about $1K, refunds were listed too and they totaled about $2K. Story over, now my points. If I were to read the scholarships rules, I will have to read a lot because my daughter got at least 5 different scholarships and each with its own rules. The 1098-T is wrong and it might list loans as scholarships or they are listing less tuition charged. What I did, I got the loans, added them up and substract the refunds and use that amount to get AOC. On ATX I entered the 1098-T as sent and below there is a line to enter the correct amount of payments. I have highlighted the loans amounts and refunds for 2020 and I have saved those records with their taxes. I didn't match the amounts but I noticed that there is no money left. How could scholarships be bigger than tuition and by a lot if she doesn't have room and board expenses. I guess students can get more if they apply and are good students. Also, ATX told me that I have claimed 4 years already but it reads 3 on "how many years have you claimed before". I had to check 2016 to sure. My daughter finished her bachelors in 3.5 years and there is no way for me to claim the AOC for 5 years.

Accounts doesn't have to be under the tax payer's name. I had a new client this year where the ex-preparer had listed his/her account first and took $900 off her refund. Since the account of the tax preparer was listed first, the stimulus were deposited to the tax preparer. A few years ago, my bother kept bothering me because his refund never arrived to his account. When I filed his taxes, he told "I have the same bank account, use the same account as last's year". I did and the account was his ex-girl friend. She had his money but luckily they were friends and he got his money. So IRS doesn't check names, only routing number and account number.

US Citizen living and working in Spain with US child earned 15K euros. I am sure that person doesn't qualify for EIC, and additional child tax credit but I just want to double check in case Spain is special. Has any one read the treaty and give me some advice? Where would you report those 15K ueros? Any additional info or suggestion will be appreciated.

By virtue of the marriage she is the mother of the children but I think the IRS will go with blood relationship in this case. Very interesting question and I hope others provide a better answer.

Almost everybody in my list has 1099G since they got a refund from the state in 2019 and/or they collected unemployment in 2020.

Every month they will get a check from the IRS starting in July till the end of the year. The new name for the IRS is "Weak IRS" because with all the changes the organization will be very weak with the extra work.

Let's say you have a child and you $30K in earned income. and you made another $12K in unemployment. You are out of the EIC credit but if your income is reduced by $10,200, you will qualify. Another example, same person and same child: in this case the person made has 0 earned income for 2020 and collected $42K in earned income. This person doesn't now qualify for EIC even though last year his earned income was $18K. If you reduce his 2020 income by $10,200 then he can use his 2019 earned income and get an nice piece of the pie. I hope this is not the case because the money allocated for this stimulus will be short.

You will have to pay attention when the form gets updated (if it will be) and then you will have to see who gets affected by that update. The problem is that the update might be to form 1040 and you will not have that chance.

I think income will be adjusted but EIC will stay using the exempted unemployment as part of the formula.

Thank you Lion and Lynn. I was able to get the records of payments from the students and I see 14K paid by personal loans so no need for the taxable scholarship but I like the W2 trick. If they questioned the AOC I will show the loans amount and if needed I will amend. Thank you again.

Can I push a scholarship of 2K to the student so that the parents benefit for AOC? If yes, how can I do it properly on the student's return? Thank you in advance for your comments and/or instructions.

No, no step up basis because no one has died. The basis for the partnership is adjusted basis or FMV at the time of the transfer.

I have noticed that each time I fill out form 1099-G with unemployment, Sch A is added. Do we know why? I don't see the relation.

Also, I am under the impression that April 15 is the last day to file taxes. So, I don't want to be postponing any tax returns. I will be happy to amend for my clients. I never charge for the first amendment. So, I will amend as needed. I have not heard HR is turning away people because they collected unemployment, nor are they collecting forms from people and waiting for the laws to change. Oh, but I keep forgetting that the VPs of HR block make MUCH MUCH MUCH more than what I make without touching a 1040 form. I guess the difference is that they are running a business.

In your case, $25K will be taxed and penalized. $100K will be divided in three years, so if no money was returned, 1/3 of $100K will be added to the $25K to be taxed but no penalty.

I agree but most of my clients are from the restaurant industry and most of them collected unemployment. Some of them are using last year EI for EIC and additional child tax credit. Those people need their refund. If I see that someone will owe, maybe I will ask them to wait. In the past our industry has dealt with numbers and facts. Now we need to get a crystal ball and have it next to our calculator.