any accountants out there that i can ask a question?

[Yehuda25]

irrelevant.  makes no difference.

but what do people usually do?

[Yehuda25]

Whoever makes more money. If they make the same amount, whoever can beat up the other. If they are even, whoever is more stubborn. It's very important.

   so safe to assume the husband usually wins?

[Ergel]

   so safe to assume the husband usually wins?

Only if he's not so bright

[churnbabychurn]

but what do people usually do?

The husband comes first.
In a traditional marriage, the husband works harder to earn the money, manages the finances and is the authoritative figure.

What's your question?

[dealvr]

Interestingly we have a client that is female, makes more money than her husband, and her company pays for her return preparation, yet we still list him first.

[churnbabychurn]

Interestingly we have a client that is female, makes more money than her husband, and her company pays for her return preparation, yet we still list him first.

Of course, who sits at the head of the dinner table?

[lunatic]

Whoever makes more money. If they make the same amount, whoever can beat up the other. If they are even, whoever is more stubborn. It's very important.

So should we assume that Hench is NOT listed first on her return?

[Dawie]

https://www.irs.gov/pub/irs-drop/n-15-76.pdf

REQUEST FOR COMMENTS REGARDING THE EXCISE TAX ON AMOUNTS PAID FOR THE RIGHT
TO PROVIDE MILEAGE AWARDS
Specifically, the Treasury Department and the IRS request comments
addressing the following:
• Whether the methodology in Section 3 of this notice, if adopted, is workable for taxpayers,
airlines, and other potential stakeholders.
• Whether the methodology in Section 3 of this notice, if adopted, should be adopted as a rule of
general applicability instead of as a safe harbor provision.
• Whether the methodology in Section 3 of this notice should be modified to take into account a
longer or shorter period of historical data.
• Whether airlines (or airline mileage awards programs) are willing to share historical data with
taxpayers so that taxpayers can verify the tax base upon which the § 4261(a) tax is applied when
a taxpayer purchases frequent flyer miles
• Whether in lieu of the methodology in Section 3 of this notice, the Treasury Department and the
IRS should provide an allocation percentage that can be applied on an airline industry-wide basis,
which the Treasury Department and the IRS would calculate using industry-provided data.
• How often an industry-wide allocation percentage, if adopted, should be updated to reflect current
industry data and what is the best method for the Treasury Department and the IRS to collect the
necessary data.
• Whether the Treasury Department and the IRS should adopt a methodology that is not described
in this notice and recommendations for alternative methodologies.
• Whether the Treasury Department and the IRS should provide a mechanism for collectors to
make adjustments to the Exclusion Ratio to correct computational and typographical errors after
the collector reports the Exclusion Ratio to the IRS, and how such a mechanism should work.
• Whether the procedures in Sections 4 and 5 of this notice would be workable from the collector
and the taxpayer’s perspectives.
• How to address overpayments and underpayments of tax resulting from errors in the Exclusion
Ratio, including whether the collector should be responsible for such underpayments

[yr]

Anyone know what the tax implications would be for moving from NYC to anywhere in NJ if my job is in NJ?

[Yehuda25]

Anyone know what the tax implications would be for moving from NYC to anywhere in NJ if my job is in NJ?

depends on your "tax home" no?

[yomo]

Currently I get paid with a 1099. Is there any legitimate way to save some $ on social security tax if I change from a schedule C to incorporating myself (LLC or S Corp) and then paying myself a salary with the remainder being a distribution?

[googwallet]

Currently I get paid with a 1099. Is there any legitimate way to save some $ on social security tax if I change from a schedule C to incorporating myself (LLC or S Corp) and then paying myself a salary with the remainder being a distribution?

I'm no accountant here, but I do this. My accountant told me that if your making over about 30k the IRS wants to see some salary, but not all of the income has to come as salary. Not sure on the exact ratio of salary to capital gains, but this is something that is done. You probably will need to give yourself some salary, but not all the income has to be salary, thus saving ss tax on part of it.

[yomo]

I'm no accountant here, but I do this. My accountant told me that if your making over about 30k the IRS wants to see some salary, but not all of the income has to come as salary. Not sure on the exact ratio of salary to capital gains, but this is something that is done. You probably will need to give yourself some salary, but not all the income has to be salary, thus saving ss tax on part of it.

That's exactly what I was thinking about doing and what I heard many people do. But when I asked my accountant about it he said that technically all my earnings are subject to social security because by definition 1099 is earned income/wages and even if I incorporate myself and pay myself only part in salary, the IRS can come later and make me pay SS on the rest and potentially a fine or penalty also. Any accountants want to chime in?

[good sam]

New question: The HR guy at work tells me it's no longer possible to have my insurance paid pretax unless I'm getting insurance through my employer. Because my insurance is through the exchange, I'm ineligible.

Can anyone confirm or deny?

[churnbabychurn]

That's exactly what I was thinking about doing and what I heard many people do. But when I asked my accountant about it he said that technically all my earnings are subject to social security because by definition 1099 is earned income/wages and even if I incorporate myself and pay myself only part in salary, the IRS can come later and make me pay SS on the rest and potentially a fine or penalty also. Any accountants want to chime in?

IMHO if you're an S corp technically you could take a distribution fica free.

But you can't be an active employee of the corp and take your salary as a distribution. Unless you think the IRS was born yesterday...
You could take a partial salary and partial distribution.


See here https://turbotax.intuit.com/tax-tools/tax-tips/Small-Business-Taxes/How-an-S-Corp-Can-Reduce-Your-Self-Employment-Taxes/INF22938.html

Disclaimer:
I don't do taxes..
All opinions my own.

[Dawie]

That's exactly what I was thinking about doing and what I heard many people do. But when I asked my accountant about it he said that technically all my earnings are subject to social security because by definition 1099 is earned income/wages and even if I incorporate myself and pay myself only part in salary, the IRS can come later and make me pay SS on the rest and potentially a fine or penalty also. Any accountants want to chime in?

if the money is paid to the s-corp there would be no 1099
your spouse can own the s-corp and pay you any salary
Plus then you could use the s-corp to pay health insurance (if that was an issue)

[avrumy]

Currently I get paid with a 1099. Is there any legitimate way to save some $ on social security tax if I change from a schedule C to incorporating myself (LLC or S Corp) and then paying myself a salary with the remainder being a distribution?

I see many people do this. Its a grey area. I say do it with the understanding you one day may have to pat the SS tax. Your no worse off then you are now.

[Dawie]

I see many people do this. Its a grey area. I say do it with the understanding you one day may have to pat the SS tax. Your no worse off then you are now.

penalties and interest add up very quickly

[avrumy]

penalties and interest add up very quickly

Its not the type which would incur penalties and interest as i mentioned its a grey area.

[Dawie]

Its not the type which would incur penalties and interest as i mentioned its a grey area.

if they reclass anything you will pay interest, penalties you MAY be able to fight