4491-28 Other Taxes v1.0 VO.ppt - AARP Tax-Aide New Jersey

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4491-28 Other Taxes v1.0 VO.ppt - AARP Tax-Aide New Jersey Powered By Docstoc
					                                                  4491-28 Other Taxes v1.0 VO.ppt




                Other Taxes

             Form 1040 Lines 56-59
               Pub 4012 Tabs 2, 6
             Pub 17 Chapters 30, 36

                                            LEVEL 2 TOPIC
11/30/2010        NJ Training TY2010 v1.0                                     1
OTHER TAXES
n Self-employment taxes
n Social Security and Medicare on Tip Income
n Additional taxes on IRAs and Other
  qualified retirement plans
n Advance Earned Income Credit Payments
n Repayment of 2008 First Time Homebuyer
  Credit (Form 5405)


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SELF-EMPLOYMENT TAX
n Receives net income from self-employment
  income over $400
n Income as a church employee of $108.28 or
  more - out of scope
n Schedule C or C-EZ triggers Schedule SE
n TaxWise automatically calculates and
  transfers 50% as an adjustment to income


11/30/2010        NJ Training TY2010 v1.0    3
 TAX ON UNREPORTED TIPS
n SS and Medicare tax due on:
   n Employer allocated tips from W-2 Box 8
   n Unreported tips of $20 or more per month

n Tips of less than $20 per month:
   n Not subject to SS or Medicare tax
   n Do not need to be reported to employer

n All unreported tips listed on Form 4137 and
     transferred to Form 1040 Line 7

11/30/2010           NJ Training TY2010 v1.0    4
TAX ON IRAs
n IRAs and other qualified retirement plans
   n Distributions before age 59½ and not rolled-
     over
             n   Form 5329, Part I NEW
             n   Early distribution exceptions
n Penalty on Minimum Distribution not taken
  at/after age 70 ½
n Excess contributions and not removed by
  the due date of the return
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ADVANCE EARNED INCOME
n What are Advance Earned Income Credit
     Payments? (252)
       n Reported Box 9 – W2
       n Must file a tax return



n How does AEIC affect tax
  n Form 1040—Other Taxes section
  n Will be added to taxes due


11/30/2010                NJ Training TY2010 v1.0   6
REPAYMENT OF 2008 FIRST TIME
HOMEBUYER CREDIT
n If TP still owns the home, complete Form
     5405 Part IV

n If TP has sold the home, complete Form
     5405 Part III and Part IV
       n     Includes foreclosure




11/30/2010                   NJ Training TY2010 v1.0   7

				
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