Tax Return Griping Thread

[TromboneAl]

Vent your tax return frustrations on this thread.

Here's a minor example. I don't find a 1099 for my local checking account nor for VG Prime Money market. I suspect that it's because the amounts were low, so I do some Googling, and find that yes, if the amount is under $10, then there's no 1099. I note that a lot of other people have had this same question.

I also learn that you still need to report the interest, even if it is under $10, so a little more online research is necessary to find these amounts. I could probably ignore it, but you never know.

I know, it's a minor gripe, but indicative of how something that should take a few seconds to do ends up taking longer.

 

[FinanceDude]

Yet another reason to simplify the tax code...........

 

[ERD50]

Agreed, that one is very minor, but it is the principal. They don't make it clear.

I don't report it, even though I know that technically I should. This is pure rationalization on my part, but I figure that most people don't, so why should I take the extra effort, maybe be rewarded by having to pay more taxes for my effort/honesty, just for being a 'chump'?

Even if you got called on it, it might be $2 tax due. I can't imagine there would be a penalty. Do as you see fit, but don't lose sleep over not reporting it.

They ought to sync the two - if below the $ to be reported, no need to report. One small step for the taxpayer.

-ERD50

 

[easysurfer]

Vent your tax return frustrations on this thread.

Here's a minor example. I don't find a 1099 for my local checking account nor for VG Prime Money market. I suspect that it's because the amounts were low, so I do some Googling, and find that yes, if the amount is under $10, then there's no 1099. I note that a lot of other people have had this same question.

I also learn that you still need to report the interest, even if it is under $10, so a little more online research is necessary to find these amounts. I could probably ignore it, but you never know.

I know, it's a minor gripe, but indicative of how something that should take a few seconds to do ends up taking longer.

+1.

For this reason, the last time I started a new checking account, I made sure that it does not pay interest to avoid this situation.

 

[TromboneAl]

Yet another reason to simplify the tax code...........

Agreed, but I don't think it's going to happen.

With eight hours and a red pencil, I could significantly simplify the returns. For example, I'd first get rid of all the "If you are a blind minister who used to work in the railroad industry, enter..." crap.

 

[TromboneAl]

Anyone notice the unconventional rounding? $3.50 is rounded to $3 instead of $4, $3.51 is rounded to $4.

 

[Alan]

They ought to sync the two - if below the $ to be reported, no need to report. One small step for the taxpayer.

Fully agree.

You can receive something like $550 in gift cards from your employer, and they don't report it because it is not subject to tax. Your bank won't report $5 in interest, but you break the law if you don't declare it.

 

[Alan]

A gripe I had this year is with the new forms for reporting international bank accounts. On one of them there is mandatory field to enter zipcode and it won't accept a non-USA format. I ended up including the zipcode (post code) for my UK bank in the main address field and entering 12345 in the zipcode field.

 

[Alan]

For my Louisiana tax return I print it out, sign it and mail it in. I also fill in the form to have it in deposited to my bank account. I didn't know it but this year they have decided to increase the pressure to file electronically by sending out Chase Bank Visa credit cards with your refund pre-loaded on them - no Direct Deposit and no printed checks.

They sent mine to the wrong address - a typo on their part.

The tactic has worked, next year I will go on-line and enter the details diectly on their site. (My free copy of TT includes one free State return, but not free e-filing for that State).

 

[scrabbler1]

A few gripes.

(1) That new form (8949) which is a spinoff from Schedule D to report individual sales for cap gains. Took a while to figure out if I could combine my friend's (I do his taxes) sales of individual stock along with his sales of some mutual fund shares of a bond fund.

(2) New York State eliminated its short form (IT-150) which was comparable to Federal form 1040A. I prepare tax returns for my aforementioned friend as well as my ladyfriend, and one or both of them had been able to use that easy form compared to the 4-page long form, IT-201.

 

[W2R]

I owed the IRS $350 which they removed from my bank account the day after I e-filed.

But Louisiana owed me $151, and it took them several weeks after I e-filed (on their website), before that appeared in my bank account.

Isn't that just typical!

To be honest, I really have no complaints about my taxes. Turbotax makes doing my federal taxes easy and relatively painless. Doing my Louisiana taxes on the state website is just as easy and quick. Compared with the hassles that my taxes presented thirty years ago, this was great.

 

[jclarksnakes]

+1.

For this reason, the last time I started a new checking account, I made sure that it does not pay interest to avoid this situation.

I was thinking about doing that very same thing the other day. We have taken tax planning to a new low. It must cost the bank a whole lot more to compute and credit those little bitty interest amounts than it does to actually pay them. Maybe they should offer to drop the interest on those checking accounts and instead give us free checks or a toaster.

 

[Alan]

Compared with the hassles that my taxes presented thirty years ago, this was great.

30 years ago we were still living in the UK and the taxes were so simple I never had to do one. (just had to send in the shirt off your back - easy peasy )

 

[pb4uski]

My gripe is after paying for TurboTax also having to pay an additional $20 to have my state returns e-filed.

When I was w*rking I typically had to file in 3-5 states depending on where I worked that year and would get back $10-30 from each state. It seemed to me to make little sense to pay $20 to e-file to get back $10-30, so I print out and mail each state other than my resident state.

Now that said, my only tax preparation costs are TurboTax, e-filing fees and my time so I guess that I don't have a lot to gripe abut in the whole scheme of things.

 

[M Paquette]

(My free copy of TT includes one free State return, but not free e-filing for that State).

Another gripe. New York has free e-filing, and requires it for folks using software. Turbotax can't charge for filing, so they charge ten bucks more for that state.

 

[Animorph]

I'm owed a refund for fed and state, but I'm too chicken to file early in case I get corrected forms. Only thing worse than filling out complex tax forms is correcting them after they've been sent in.

 

[TromboneAl]

+1.

For this reason, the last time I started a new checking account, I made sure that it does not pay interest to avoid this situation.

Good idea. In the past, I have made changes in things to avoid extra tax work. I've even considered rebalancing on Jan 2 and Dec 30 so that I'd only have to deal with the tax consequences every other year.

 

[sheehs1]

I received a 1099 for an early distribution from my nondeductible IRA which I did not initiate. I deposited the $6K in February 2011. Morgan Stanley took it out in June 2001 and routed it to my taxable account (don't review the detail of monthly statements...I just look to see if the total is up or down).
Research determined it was a back office error. Had I not moved my accounts from Morgan, same thing would have happened in December as a back office person coded my account for bi-annual $6K distributions due to educational reasons. Took me 5 weeks to get this straight. Since I had moved my accounts, I had to deposit another $6k into Morgan, wait for the corrected 1099 and then ACAT the money over to the new financial advisor.
Perhaps not a direct IRS tax gripe....but a gripe none the less.

 

[easysurfer]

Good idea. In the past, I have made changes in things to avoid extra tax work. I've even considered rebalancing on Jan 2 and Dec 30 so that I'd only have to deal with the tax consequences every other year.

Yeah. I figured, not getting the less than $10 of interest each year is not gonna bankrupt me. I'd much rather just not have to deal with the tasks of trying to tally up or locate the small interest total.

 

[ChiliPepr]

A gripe I had this year is with the new forms for reporting international bank accounts. On one of them there is mandatory field to enter zipcode and it won't accept a non-USA format. I ended up including the zipcode (post code) for my UK bank in the main address field and entering 12345 in the zipcode field.

Little bit of trivia: the zipcode 12345 = world headquarters of General Electric in Schenectady, New York.

 

[pb4uski]

... I've even considered rebalancing on Jan 2 and Dec 30 so that I'd only have to deal with the tax consequences every other year.

Interesting idea... I'll have to mull that one over. I guess you would still have to fill out a Sch D each year due to CG distributions, but you would only need to enter rebalancing sale transactions every other year. I think I like it.

 

[ziggy29]

One thing that's always concerned me is that if you get less than $10 interest on an account -- let's just say $6 -- and neither you nor the IRS gets the 1099, and if the amount of interest you reported was $6 greater than what the IRS has recorded as your interest income off of the 1099s it *did* receive, does this raise any potential for your return to be scrutinized more closely?

 

[Finance Dave]

My gripe is my own fault I guess. I didn't get a form I was expecting (I think it was an interest paid form on a mortgage?), and when I called the bank they said "We only have to send you one if you paid more than $xx (I think it was like $600?). It's never happened to me before, so they said just report it as you see it on your statement, but you won't have a form for it. News to me.

Other than that, filed the taxes last week, and I have a few followups with our accountant this week. This is our first year filing with the LLC...so it will be a new experience and I'll study the outcome carefully to see what he did. We lost about $6k on the business side in 2011...which was expected since we're ramping up.

 

[Mulligan]

Vent your tax return frustrations on this thread.

Here's a minor example. I don't find a 1099 for my local checking account nor for VG Prime Money market. I suspect that it's because the amounts were low, so I do some Googling, and find that yes, if the amount is under $10, then there's no 1099. I note that a lot of other people have had this same question.

I also learn that you still need to report the interest, even if it is under $10, so a little more online research is necessary to find these amounts. I could probably ignore it, but you never know.

I know, it's a minor gripe, but indicative of how something that should take a few seconds to do ends up taking longer.

I have always known about not receiving 1099s for under $10 as I have had a few of those types of accounts over the years, but I did not know about having to report it. I always thought if they didnt have to report it, I didnt have to claim it. I dont feel guilty though, as they might have been shorted $15 bucks over the years but I have missed a few minor deductions I was to lazy to refile over, so they are still ahead.

 

[scrabbler1]

Interesting idea... I'll have to mull that one over. I guess you would still have to fill out a Sch D each year due to CG distributions, but you would only need to enter rebalancing sale transactions every other year. I think I like it.

Actually, if you get cap gain distributions ONLY then you might not need to complete a Sched D. This happened with my friend in 2010 and with me in 2011. All you do is enter the amount in Form 1040 (or 1040A) and complete the CG/QD worksheet in the instruction booklet.

One more gripe....

That friend whose taxes I just finished the other night is so inept and insecure, he has called me THREE times since Monday night with questions about assembling the already completed returns (federal and state). These returns consist of 3 forms each but because he wanted to make copies of each return before mailing them out, I could not actually finish the work, leaving him with what should be a trivial task. Never mind I showed him and wrote out what he was supposed to do. Never mind he added some of his own notes. Never mind he has the instruction booklets which would answer his questions. It's like dealing with an 8-year-old. I am afraid to answer the phone these days!

In the same vein as TromboneAl's advice, I can bunch most of my estimated state income taxes into a single calendar year by paying one year's taxes in the following January and the following year's in December of the same calendar year. Besides a small tax benefit, I won't have to file Sched A every year, only in alternating years.