Tax credit question

[jeff_h]

Im military if that helps I know there is alot that offer free tax prep for military maybe you guys know one I havent found

 

Yes, I have processed a few hundred military returns during my previous life, the software that was used at that time was TaxWise, though that was several years ago and I don't know if that was the software used throughout DoD.

 

I normally run my taxes through a triple check to make sure things are kosher, though most people are probably not OCD enough to go through such lengths, they just want it to be over with.

 

a - Input all my stuff into TurboTax online in order to check the numbers/results.

 

b - Input all my stuff into TaxSlayer online in order to check the numbers/results, and I normally file this way for 10 bucks.

 

a - Input all my stuff into my own Excel spreadsheet where I have a tab titled '1040' and another one titled 'MyW2', 'HerW2', 'SchedA', etc etc for any forms needed, and input the proper values into the corresponding rows on the proper tab, and when it asks for a value from another form (such as the 1040 asking for itemized deductions from SchedA), I have a link on the 1040 tab over to the proper row on the SchedA tab, so things update each other automatically.  It's really not difficult at all and works very well for the typical taxpayer who only files 4-6 different forms. This way I can double-check the calculations for each form and when there is a disparity it is easy to trace back to where it is, etc.

[svogt302]

Does anyone know of this Tax Credit be continues thru 2014?   All the IRS documentation say the vehicle has to be purchased prior to 01/01/2014 but I wonder if this gets extended year by year?  The link below shows  the forms updated every year since 2009.

http://apps.irs.gov/app/picklist/list/priorFormPublication.html?resultsPerPage=200&sortColumn=sortOrder&indexOfFirstRow=0&criteria=formNumber&value=8936&isDescending=false

 

I really want to purchase a new '14 Fusion Energi but I am worried the $4007 tax credit may not be available & it would be a show-stopper.

It does appear that Ford will give a $5007 rebate on a lease, leading me to believe the credit will be there as Ford will assume it.

 

http://www.fueleconomy.gov/feg/taxphevb.shtml

http://www.irs.gov/Businesses/30D.-New-Qualified-Plug-in-Electric-Drive-Motor-Vehicles-%E2%80%93-Ford-Motor-Company

 

Thanks for a response...................

Edited February 17, 2014 at 12:48 AM by svogt302

[jeff_h]

Does anyone know of this Tax Credit be continues thru 2014?   All the IRS documentation say the vehicle has to be purchased prior to 01/01/2014 but I wonder if this gets extended year by year?  The link below shows  the forms updated every year since 2009.

http://apps.irs.gov/app/picklist/list/priorFormPublication.html?resultsPerPage=200&sortColumn=sortOrder&indexOfFirstRow=0&criteria=formNumber&value=8936&isDescending=false

 

I really want to purchase a new '14 Fusion Energi but I am worried the $4007 tax credit may not be available & it would be a show-stopper.

It does appear that Ford will give a $5007 rebate on a lease, leading me to believe the credit will be there as Ford will assume it.

 

http://www.fueleconomy.gov/feg/taxphevb.shtml

http://www.irs.gov/Businesses/30D.-New-Qualified-Plug-in-Electric-Drive-Motor-Vehicles-%E2%80%93-Ford-Motor-Company

 

Thanks for a response...................

 

The item that did not get renewed (yet) after 2013 was the credit for alternative fuel charging equipment, meaning that if you bought and installed a 240V charger in your garage to go with your new Energi, you wouldn't be able to claim 30% of the costs unless the law gets revised during this year - which may or may not happen, depending on the horse-trading that goes on.

 

As for the purchase of the Energi itself, you should be good to go until Ford sells 200,000 units that are eligible for the credit, and thus far they are around 20,000 so you would be good to go for purchasing one and getting the tax credit for $4,007 unless that amount changes - it changed slightly during the 2013 calendar year, but changed for the better as I think it was $3,751 before being raised to $4,007, IIRC.

 

Here is the IRS notice (dated Feb 13, 2014 as of the time of this posting) that notes the credit to be available starting in 2009 and starting to phase out once the 200k sales mark is passed:

 

http://www.irs.gov/Businesses/Plug-In-Electric-Vehicle-Credit-%28IRC-30-and-IRC-30D%29

 

...and there is the page which shows the latest totals of about 20k (dated Nov 7, 2013 as of the time of this posting):

 

http://www.irs.gov/Businesses/IRC-30D-%E2%80%93-Plug-In-Electric-Drive-Motor-Vehicle-Credit-Quarterly-Sales

 

The above page is the IRS page showing the numbers that they use for their own reference, but below is a bookmark I check now and then for monthly sales figures across the EV models as I'm curious -

 

http://insideevs.com/monthly-plug-in-sales-scorecard/

Edited February 17, 2014 at 01:04 AM by jeff_h

[svogt302]

Thanks Jeff!!!!!!

[Russael]

Well, I had my taxes done 2 weeks ago and just now got my refund... only to find that it's 821 short for federal.  Oddly enough, the amount that it's short is the exact amount that I paid for my charging station.

 

Has anybody had any issues with claiming the charging station credit?  The CPA had problems while putting that in to the system and it actually took away credit instead of giving more.  He issued an override on the form to make it apply credit (about 246 dollars).  I did get the 4007 credit, however, normally I get back about 800 from federal anyway, so it should've been 4800... and with the charging station credit, >5000.  My refund that I got back was about 4200.  I went through his forms and I'm not sure what happened.  My fed tax bill was over 5k as well... in reality, the difference between my refund and the amount paid to the Feds was about 50 bucks in the Feds favor.

 

I'm reaching back out to him but he hasn't responded via email yet (he's crazy busy this time of year... if I don't hear from him by Monday, I'll call him).  Just wondering if anybody else had tax credit issues.

 

Are there any tax software programs out there that you can use for free (and then pay just to submit it) so I can fill out my own taxes as a comparison?

[jeff_h]

I'm reaching back out to him but he hasn't responded via email yet (he's crazy busy this time of year... if I don't hear from him by Monday, I'll call him).  Just wondering if anybody else had tax credit issues.

 

I sent mine out 3 weeks ago via paper, credit for 30% of the purchase/installation of the charging station should be $492 for me - waiting to see what happens.

 

 

Added 1 day after above, finally had status updated on IRS site that they received the paper return:

 

"We have received your tax return and it is being processed.

You should get your refund within 21 days from the date we received your tax return.

Please check here or use our free mobile app, IRS2Go, to check on your refund status."

.

Edited March 2, 2014 at 04:24 PM by jeff_h

[Russael]

I tried Turbo Tax, and that lets you do the whole kit and kaboodle for free (you only pay to file), and it actually came up with a dollar amount slightly higher than the CPA's refund.  Still... something went wrong at the Federal level, so now I get to deal with this rubbish. :(

[JATR4]

Well, I had my taxes done 2 weeks ago and just now got my refund... only to find that it's 821 short for federal.  Oddly enough, the amount that it's short is the exact amount that I paid for my charging station.

 

Has anybody had any issues with claiming the charging station credit?  The CPA had problems while putting that in to the system and it actually took away credit instead of giving more.  He issued an override on the form to make it apply credit (about 246 dollars).  I did get the 4007 credit, however, normally I get back about 800 from federal anyway, so it should've been 4800... and with the charging station credit, >5000.  My refund that I got back was about 4200.  I went through his forms and I'm not sure what happened.  My fed tax bill was over 5k as well... in reality, the difference between my refund and the amount paid to the Feds was about 50 bucks in the Feds favor.

 

I'm reaching back out to him but he hasn't responded via email yet (he's crazy busy this time of year... if I don't hear from him by Monday, I'll call him).  Just wondering if anybody else had tax credit issues.

 

Are there any tax software programs out there that you can use for free (and then pay just to submit it) so I can fill out my own taxes as a comparison?

It doesn't matter what your tax bill is.  What matters is what you paid in federal taxes--withholding and estimated.  Was that amount more than $4,200?

[jeff_h]

It doesn't matter what your tax bill is.  What matters is what you paid in federal taxes--withholding and estimated.  Was that amount more than $4,200?

 

Actually it looks like it does matter if it would bring your tax liability under what the tentative minimum tax is.  This is why I filled out the 6251 anyway when TurboTax said it wasn't needed for me, going from the instructions for line 17 of the Form 8911, copied/pasted below:

 

Line 17 - Although you may not owe alternative minimum tax (AMT), you must still figure the tentative minimum tax (TMT) to figure your credit. Complete and attach the applicable AMT form or schedule and enter the TMT on line 17.

[Russael]

Trying to find what my TMT might be or how it's calculated.

 

My Fed income tax withheld was 5099, but my 'Regular Tax' is 4313  My refund was supposed to be 5039.  Now if this TMT or AMT is getting me, that'd explain why my refund was reduced, but none of that was described to me by the CPA.  TurboTax even calculated my return to be around 5055 and didn't indicate anything about TMT or AMT.  So is it actually impossible to get back ALL of the federal that was withheld?

 

I told ya that my income was probably the lowest on the forum here. :)  I put down a huge down payment on this car.  Maybe I should've leased it for 2 years and then bought it out.  I would've had to do that with the Focus Electric if I went that route.  I put away as much as humanly possible in to my 401k as well.

 

I took a peek at form 6251... that's a pretty complex form.

[larryh]

Experimenting with Turbo Tax, if you attempt to claim both the PHEV credit and the EVSE credit, there is a very narrow range of income (less than $10,000) in which you can get the full EVSE credit.  If you don't have enough income tax, you can't get the credit.  If you have $10,000 more than the minimum income to get full EVSE credit, then AMT applies and reduces the amount of credit.  The credit is $0 after about $50,000 more than the income for which you can claim full credit.  If you have $1,000,000 of income, then you can claim the credit again.  I think AMT is a political ploy used to tax the lower and middle class rather than the rich as claimed by the politicians.  It certainly hasn't been well thought out.  The entire tax system is a mess. 

Edited March 1, 2014 at 11:36 PM by larryh

[meyersnole]

Did not realize that the gap was that small, just saw that AMT took away yet another deduction. :(

[JATR4]

Trying to find what my TMT might be or how it's calculated.

 

My Fed income tax withheld was 5099, but my 'Regular Tax' is 4313  My refund was supposed to be 5039.  Now if this TMT or AMT is getting me, that'd explain why my refund was reduced, but none of that was described to me by the CPA.  TurboTax even calculated my return to be around 5055 and didn't indicate anything about TMT or AMT.  So is it actually impossible to get back ALL of the federal that was withheld?

 

I told ya that my income was probably the lowest on the forum here. :)  I put down a huge down payment on this car.  Maybe I should've leased it for 2 years and then bought it out.  I would've had to do that with the Focus Electric if I went that route.  I put away as much as humanly possible in to my 401k as well.

 

I took a peek at form 6251... that's a pretty complex form.

Don't you have a copy of your tax return?  You should.  If you do then the answers may be on your return.  The AMT is line 45 of form 1040.  The TMT is line 33 of form 6251.

[Russael]

Yeah, my 1040 doesn't have anything for line 45.  I don't recall him actually filling out the 6251.

 

I finally heard back from the CPA and he said the IRS rejected the return based on his override of the 8911 form.  But if that were the case, my return should've been 246 short (the amount of the credit), not 819... unless they socked me with some kind of fee.

[JATR4]

Yeah, my 1040 doesn't have anything for line 45.  I don't recall him actually filling out the 6251.

 

I finally heard back from the CPA and he said the IRS rejected the return based on his override of the 8911 form.  But if that were the case, my return should've been 246 short (the amount of the credit), not 819... unless they socked me with some kind of fee.

If the return is filled out correctly, there shouldn't be a reason to override a line.  Again, do you have a copy of your return?  And I mean a copy of every page of the return.  I have prepared taxes in the past and I always gave my clients a copy of their returns--every page.

[larryh]

The IRS has attempted to charge me more income tax (including fines and fees) on four occasions.  Each time, they miscalculated my return (and it is not all that complex).  I computed it correctly.  The tax rules are so convoluted, that even the IRS can't figure them out.  They need to fix the tax system. 

Edited March 2, 2014 at 12:34 PM by larryh

[Russael]

If the return is filled out correctly, there shouldn't be a reason to override a line.  Again, do you have a copy of your return?  And I mean a copy of every page of the return.  I have prepared taxes in the past and I always gave my clients a copy of their returns--every page.

 

Yes, I have a copy of all of the forms for my return, including a summary page he prints out for us.

 

This is the first time I've had a problem with my return where they reduced what I was supposed to receive.  As I mentioned before, I usually got back about 800 from Federal, always.  If you add in the car credit, I should've received 4800, give or take.  And if you add in the charging station credit, that'd take it to right around 5050.  Larryh, what did you do if they goofed up?  Do you call the IRS themselves and make them do a review on your return?

 

I'm trying to get him to give me another appointment or see if he'll go over the stuff again and possibly submit corrections (which I don't see any that are needed).  Even if he has to take the charging station credit out, that should give me an additional 600 out of the Feds.

[JATR4]

Yes, I have a copy of all of the forms for my return, including a summary page he prints out for us.

 

This is the first time I've had a problem with my return where they reduced what I was supposed to receive.  As I mentioned before, I usually got back about 800 from Federal, always.  If you add in the car credit, I should've received 4800, give or take.  And if you add in the charging station credit, that'd take it to right around 5050.  Larryh, what did you do if they goofed up?  Do you call the IRS themselves and make them do a review on your return?

 

I'm trying to get him to give me another appointment or see if he'll go over the stuff again and possibly submit corrections (which I don't see any that are needed).  Even if he has to take the charging station credit out, that should give me an additional 600 out of the Feds.

I am assuming your return was e-filed.  If so, the IRS calculated your refund based on the info provided.  If your preparer had to override the amount calculated on the 8911 then the IRS program probably threw out the claim. 

 

If you have a printer that will scan your return so that you can attach it to an email, I will input your information into my tax program and see if I can find a problem.  I will do this for free.  I have no need for names, addresses or social security numbers.  PM me if you have any interest. 

 

I read somewhere that these tax credit forms are getting extra scuitiny from the IRS.

[larryh]

The IRS sent me a letter and bill for the the additional tax, penalty, and interest that they claimed I owed each time.  The letter included a phone number to call.  I called them, but that was useless, they won't fix their error over the phone.  I had to send a letter to them with all the details of my computations I had made for my tax return, including all worksheets, for their review.  That will take several months.  During that period, I did not have to pay the additional taxes, penalty, or interest until the dispute was resolved.  However, if it was not resolved in my favor, I would have to pay even more interest.  I would expect that they will send you a letter informing you of the changes that they made to your return. 

Edited March 2, 2014 at 03:37 PM by larryh

[JATR4]

Here is what my tax program says when you check for errors on a return that has an override:

 

"Using an override can prevent the cross-checking that's important to an accurate tax return."

[larryh]

According to Turbo Tax, to claim the $4007 EV credit and a $500 EVSE credit, a single person with the standard deduction will need at least $44,000 of income to have enough federal tax to cover the two credits, i.e. the federal tax with be $4507 dollars minus the $4,507 credit, or $0.  If you have more than the standard deduction, you will need more income to have enough federal tax to cover the credits.  The more deductions you have, the harder it will be to get the full EVSE credit. 

Edited March 3, 2014 at 11:37 AM by larryh

[Russael]

I am able to claim the 4007 EV credit... wasn't aware of a 500 EVSE credit.  I have earned a little north of the 44,000, so I should've gotten it along with the charging station credit.  I'm going to have JATR4 take a peek at everything.

 

If the IRS is going to send me a letter, then I'll have to probably resubmit all the paperwork to them for review... or maybe the CPA will do that...I don't know.

[larryh]

I am assuming the cost of a charging station with installation is typically around $1500, so the EVSE credit is approximately $500. 

Edited March 3, 2014 at 01:12 PM by larryh

[Russael]

Mine was 819 (did the install myself), so my 30% credit was 246.  The CPA told me the 8911 form was rejected due to an override he had to do in order for it to give credit and not take it away.  TurboTax applied the credit appropriately.

[jeff_h]

Sweet - just checked my status on the IRS web page and will be getting refund this week.  I had figured refund of $7,144 (would have owed money but claimed $4,007 x2 and $492 for EVSE credit), refund will be $7,145 so I guess they rounded up somewhere when I had rounded down -- but the good news is that the return was processed and approved as I sent it.