Tax Time

[riverwed070707]

Really crazy tax year for me. I quit my FT job in 2021. Last year I worked part time as a w2 contractor through a staffing agency. I also completed a full renovation on a rental property. Since I am now spending more than 50% of my time on real estate, I made the leap to a real estate professional which allows me to deduct full losses. I also established a property management business (managing my own rentals) so I can put my 14 year old on payroll. She's going to help with bookkeeping this year to make a little spending money and I'll match her earnings in a Roth IRA.

Summary... my taxable income came out to only $11k this year due to renovation expenses. My federal tax due was $1,103 resulting in a refund of $4,157 and my state tax owed was $282 resulting in a $2,037 refund.

Pros: Nice refund, feel better about not getting back to FT work and see a bit of a path forward to transitioning away from W2 income all together, finally figured out how to bring DD into the business
Cons: No financial institution is going to lend me money for my next property with an $11k income I'm sitting on a good chunk of funds waiting for the right opportunity but its not enough to buy in cash and renovate so I guess I'm going to need to get creative there

[Jluke]

State took the money out of my checking. Waiting for federal to deposit what they owe me, which isnt much. That will probably take some time.

I tracked in the IRS 2 go app but you can track on website too.

they said about three weeks from receipt which I found they received it to be 3 weeks after I mailed it. You did electronically.

I found out through a pending transaction for my credit union account when to expect the refund.

which is 33 days from when I snail mailed it

[rennigade]

Federal return pending in account. That was quick.

[Fishindude77]

Been dragging my feet on this, but just finished the majority of the work this morning and have things packaged up ready to go to our CPA.
Just need a couple questions answered by one income source and it goes in the mail.

I'm sure we'll be paying some taxes.
Typically pre-pay the year in a lump sum, then settle up any under/over payment at next filing.

[bjl584]

I just got everything gathered up last night.
I'll be dropping it off to my CPA tomorrow.

[riverwed070707]

Federal refund deposited today - exactly 2 weeks from filing!

[QuarterMillionMan]

I'll preface this with I know that I'll need to ask my tax expert but I have a question on stock gains & losses. First, short term & long term, having both do I file 1 for short term and 1 for long term? Second, proceeds reported to IRS and proceeds not reported to IRS. Being that I have both of these as well do I now have 4 separate forms to file, 1 for short term proceeds reported to IRS, 1 for short term proceeds not reported to IRS, 1 for long term proceeds reported to IRS, and 1 for long term proceeds not reported to IRS? I hope someone can provide clarification.

[QuarterMillionMan]

Another tax question (I know that I'll need to consult my tax professional but thought I'll ask here) on cryptos specifically Cash App which they provided a 1099-B which shows proceeds of $6184 but does not show cost basis. When i go through all my activity of 2022, I purchased $4435 (cost basis). I'm guessing I'll use the $4435 as my cost basis.

[kork13]

Another tax question (I know that I'll need to consult my tax professional but thought I'll ask here) on cryptos specifically Cash App which they provided a 1099-B which shows proceeds of $6184 but does not show cost basis. When i go through all my activity of 2022, I purchased $4435 (cost basis). I'm guessing I'll use the $4435 as my cost basis.

Easy one first: Yes.

[kork13]

I'll preface this with I know that I'll need to ask my tax expert but I have a question on stock gains & losses. First, short term & long term, having both do I file 1 for short term and 1 for long term? Second, proceeds reported to IRS and proceeds not reported to IRS. Being that I have both of these as well do I now have 4 separate forms to file, 1 for short term proceeds reported to IRS, 1 for short term proceeds not reported to IRS, 1 for long term proceeds reported to IRS, and 1 for long term proceeds not reported to IRS? I hope someone can provide clarification.

This is simpler than you think. Bottom line, it all ends up on a single form: Schedule D. Regardless of short/long, reported/not reported. The calculations will vary based on short/long, but reported/not reported matters zip -- when you include it on your tax return, YOU are reporting the unreported stuff.

[QuarterMillionMan]

Thanks kork. In previous year I'd put it all on 1 form. This time for some reason I thought I was doing it wrong in past years and had created 4 separate forms but seemed like overkill and overcomplicated. I was overthinking it.

[QuarterMillionMan]

This is simpler than you think. Bottom line, it all ends up on a single form: Schedule D. Regardless of short/long, reported/not reported. The calculations will vary based on short/long, but reported/not reported matters zip -- when you include it on your tax return, YOU are reporting the unreported stuff.

Kork at least 2 (if not 4).

[QuarterMillionMan]

Also, in my case possibly 5 because I have an "undetermined."

[QuarterMillionMan]

The 5 was consolidated into 1 schedule D. Kork you were right.

[QuarterMillionMan]

FYI the penalty for not having health insurance is about $900.