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Other Taxes

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. OTHER TAXES. Self-employment taxes Social Security and Medicare on Tip Income Additional taxes on IRAs and Other qualified retirement plans

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Other Taxes

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  1. 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 NJ Training TY2010 v1.0

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

  3. SELF-EMPLOYMENT TAX • Receives net income from self-employment income over $400 • Income as a church employee of $108.28 or more - out of scope • Schedule C or C-EZ triggers Schedule SE • TaxWise automatically calculates and transfers 50% as an adjustment to income NJ Training TY2010 v1.0

  4. TAX ON UNREPORTED TIPS • SS and Medicare tax due on: • Employer allocated tips from W-2 Box 8 • Unreported tips of $20 or more per month • Tips of less than $20 per month: • Not subject to SS or Medicare tax • Do not need to be reported to employer • All unreported tips listed on Form 4137 and transferred to Form 1040 Line 7 NJ Training TY2010 v1.0

  5. TAX ON IRAs • IRAs and other qualified retirement plans • Distributions before age 59½ and not rolled-over • Form 5329, Part I NEW • Early distribution exceptions • Penalty on Minimum Distribution not taken at/after age 70 ½ • Excess contributions and not removed by the due date of the return NJ Training TY2010 v1.0

  6. ADVANCE EARNED INCOME • What are Advance Earned Income Credit Payments? (252) • Reported Box 9 – W2 • Must file a tax return • How does AEIC affect tax • Form 1040—Other Taxes section • Will be added to taxes due NJ Training TY2010 v1.0

  7. REPAYMENT OF 2008 FIRST TIME HOMEBUYER CREDIT • If TP still owns the home, complete Form 5405 Part IV • If TP has sold the home, complete Form 5405 Part III and Part IV • Includes foreclosure NJ Training TY2010 v1.0

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