Gail in Virginia

If this is in an IRA account, and has a loss, do you even need to enter it?

I have suggested waiting to a couple of people since they qualified based on 2019 income but not 2020. However, does anyone know if the EIP3 is going to work like EIP1 and EIP2, and they will not have to pay it back if income exceeds limits next year?

If the W2 is incorrect, the employer should correct it. If the W2 is correct, then the employer withheld IL tax in error, but may not be able to correct that internally. In which case, you would have to paper file the tax return to get the withholding back from IL. At least that is what it seems to me.

I am so sorry to hear of Rita's loss. Tax season is stressful enough without the added stress of losing a loved one. Please convey my deepest sympathy to Rita.

My short answer would be yes, because I am assuming Dad is custodial and releasing exemption to Step-mom, and children lived with both dad and step-mom over half of the year. Not as short as I thought. If the child lived with bio-mom over half of the year, then mom can release the exemption to step-mom, but not the EITC, etc. Interesting. I would want to think more.

Since her income was earned before the marriage, and they were only married a few months last year, i went ahead and took my chances. However, I suggested they get someone from TX who is more familiar with common law rules for next year, or else file jointly.

Thanks, Lynn, I will check about the pre-nup. If I understood correctly, her income was from before they got married but his was through out the year. So if he reports all of his income this year, even though technically some of it would be hers under community property rules, will that be a problem? And then next year address this issue by either reporting correctly or filing jointly?

I think what Slippery Pencil was asking about was Sara's comment that her firm would prepare just the Schedule C for clients and charge for that work. You don't have to prepare the entire return to be required to sign as preparer, so I too am curious about preparing such a substantial portion of a return and having not control over signing the return. That would make me very uncomfortable, and I would not do it.

Young man whose taxes I have been doing for a long time got married this year. He has been living, and still lives, in TX with his wife. She has already filed MFS for 2020, with a very small amount of income. He has the larger income, although the loss on his horse ranch offsets a good bit of it. How can she file without knowing his income? Can I file without know hers? There is no state return to worry about, but is allocating the income optional even though it is a community property state? It is my understanding they are filing separate just to keep things separate, but is that even possible in a community property state? Am i over my head and need to refer him to a TX preparer? Can I have a zoom wine party with Possi tonight?

VA accepts stand alone e-files. I usually file them together but don't have to.

Virginia starts at FAGI, but if they choose not to conform, like they did with Special Depreciation allowance, then we should be making an addition or subtraction for the VA return to be correct. I have not worried a whole lot about the $300 charitable deduction (although maybe I should) but I do wonder about the tax treatment of PPP loans that are forgiven. And I am sure there are other issues that I haven't given much thought yet.

Is the person that is not your client local? If so, and you can find their number, you might call and see if you can get in touch with their preparer/representative and contact them to tell them you have this correspondence IF you want to go the extra mile. Otherwise, I think I would revoke the power of attorney and let them start over but at least get your name off the record so you are not receiving correspondence that you don't want and can't help with.

Why be sorry? Congratulations to your son!

As far as I know, Virginia conforms to 2019, but has not passed any legislation to conform to federal as of 2020. If they have, I have not seen anything about it and would like to.

Please keep up posted if you actually perform this experience. Inquiring minds, you know.

Bonnie, I am so sorry for your loss. I know this is going to be a tough and stressful tax season for you. If you need someone to listen, we are here for you.

I think what Jim is getting at is if you take the amount in box 3 (social security wages) and the amount in box 7 (social security tips) and add them together, then multiply by 6.2%, do you get the amount in box 4 for social security withheld? If you do, then you have no problem and that is usually the way that this works.

Election worker's in my area are considered contract labor and get a 1099 (if anything - this year was unusual in how much some of the election workers were paid because they worked much longer hours due to early voting.) That said, I have also had "interns" that worked for local government get W2's with no withholding of any kind. Box 3 and 5 usually have no amounts in that case. But I haven't seen that in several years, and don't remember how I handled it. I just remember that the local HR department insisted that they could do that and it was correct.

There is a bill in committee that would make the first $10,200 of unemployment for 2020 not taxable. It is not law. IMO, it should have been passed last year or fuhgeddaboutit. But that doesn't seem to be the way some congress-vermin roll.

If it is in joint name, I would think that each of them should get half of the income when you split the return. I doubt it would ever be caught, unless audited. I don't think the IRS matches to that extent. But is it right and ethical? I don't know.

My check was mailed Feb. 5, and that information did show on the Get My Payment information. Who knows?

Hard to say from information. Are you using the modified AGI when you tell us how much the client made? Or just wages? Did they have any non-taxable income? If they have earned income, would a small IRA contribution before April 15 get them below 400% of poverty and save them paying this back?

My question is: Is it ethical to not claim a child as a dependent so that they can get the stimulus in 2020, even though they were a full time student some part of five months of the year and under the age of 24? Perhaps a high school student, supported by parents, made $15,000 this past year because with virtual learning they could work more hours. The parents got the stimulus payment in 2019 for the child, but if he files and claims himself he would get the rebate recovery credit. Seems unethical to me because the parents could claim him and did provide over half of this support. Curious what others think. I have seen different opinions on another board.

Their customer service number is 855-700-6000 according to Google. I don't know why they sent you that letter.

Did you look at how they have your name listed? I have not received that message, although one of my customers did for their account and I assumed that Square had received a mis-match letter for the name/TIN based on the 1099K they sent out from the IRS.