If you think mail is bad, try calling them. I waited one day for 2 hours to talk to a rep. Right at the 2 hour mark, my call disconnected. Infuriating. Budget cuts i guess....but that's ANOTHER story.....

Budget cuts? No way. The IRS budget is projected to increase by $80 billion over the next 10 years.

When you says tax, do you mean my refund? I had $2600 refund on federal. My total income was $79000, most of which was from an inherited IRA. Is the penalty on the state taxes(Ohio) , cause i had a an underpayment on the Ohio tax for underpayment of school district taxes for $29? Maybe i do need a CPA this year to explain this to me? Wait, tax withheld on federal $15000.

My understanding is Trump cut the IRS budget when in office leaving them to cut staff and that is why i couldn't talk to a rep. Actually the cuts started before Trump went into office but continued with his tenure. Don't ask me any questions. That's all i know. :)

As I understand it, the "Inflation Reduction Act" increases the IRS budget by $80 billion over the next 10 years.

I'm trying not to sound completely stupid when i call them.

I believe this is what the budget was cut over the last 10 years. Since dems are in office, they are reversing things. Again, I'm no expert.

Inherited IRA and Property in another State are Complications in your Tax Returns
 

I am not a CPA nor Tax Preparer other than my own via TurboTax. However I have been researching rules for inheritance for our children. I think that you accurately recognize the need for some help in understanding how to handle inherited IRA and property in another state.

Perhaps someone on this site can suggest a good Tax Preparer/CPA who can simplify the rules and give you a plan and good understanding. Inherited IRA's have rules as to how long you have to distribute the assets depending upon whom the IRA was inherited from and when the transfer occurred. This is too complex and private to be discussed on a public forum.
Perhaps Boomer may have some suggestions.

Actually, i'm past the point of needing help with inherited IRA. I cashed it out but i am aware of the 10 yr thing to disperse taxes under the secure act. I don't have property in another state yet.

Not really but for each individual to determine, the only private issue is the amount, and even then, round numbers can be used, or made up numbers. The complexity is dependent upon the quality of the explanation, and this bbs has had many, many discussions on the same topics over and over again, so searching the forum and looking at the links many have provided will provide one with general enough information to ask intelligent questions.

What many are missing here is how all the pieces fall together, as turbo tax doesn't have a good output for that in my opinion. It is a tax return software, not an analytical software to give you strategies, which have to be in place prior to filing.

I have responded to IRS letters about a missing or bad or erroneous or late filing and its not the worst of all letters. . . although depending upon the mistake, certain ones will trigger additional audits in the future, but also pay the fee for the INtuit representation if you are unsure about the output, and they will help represent you.

I had a missing RMD one year, I actually put the missing amount into the tax return, even though it was not distributed, and paid the tax, and put a note into the return about the missing distribution. Never heard back from the IRS and its been almost 5 years. . .

The link to the 2023 excel tax workbook is an excellent place to start getting an idea, as long as you have all the paperwork to find the answers.

Remember, you pay taxes on your Adjusted Gross Income (AGI) - the net amount of taxable income, not all of your income may be taxable. For example, not all of the social security you received is taxable. Next, your AGI is reduced by your standard deduction or your itemized deductions, whichever is higher. For 2023, the Standard Deduction for a single person over age 65 is $15,700 and for a married couple, both over age 65, is $31,400.

You are taxed on any balance after the appropriate deduction above. If $23,000 is your 2023 total income and you are single, you would pay 10% tax on $7,300 or $730. If you file as a married couple, both over age 65, you would pay 10% tax on $1,000 or $100.

Hope this helps.

Gigi,

There you have it.

If I were you, I would get a CPA, at least for this go-round.

But keep in mind that all CPAs are not created equal. Choose carefully.

I have read the website of the fee-only financial planner you found back in Ohio, Havanich Financial. On her site she lists “Tax reduction strategies and tax-planning” as areas she can address for clients. You might want to talk with her again — or see if she will just recommend a CPA — if your need is not so much long range as it is just needing to feel like you have a clear understanding of what you need to do tax-wise, for now.

Btw, that was a pretty big tax refund you mentioned. Maybe that was unusual for you. But when you go for advice, find out the best way to keep that money for yourself during the year instead of letting the government have it.

Also, I don’t know if this applies, but in some Ohio school districts, a tax is put on earned income only. I guess that is done to keep retired voters’ support for school taxes.

You have a lot on your financial mind right now, and you are being smart to be careful and to ask questions. But, like I said at the beginning of the post, if I were you I would find the right CPA. Go in with your list of questions written down. And if you come across one who is dismissive and does not listen or is condescending about questions, find a different one.

We will always have a CPA. We could wrestle our way through Turbo Tax, I guess, but don’t want to. Besides, I want my CPA’s signature on the return. (But that’s just how I am.)

At this point, I do know how to prepare very carefully for the CPA. But it has been a learning curve — and that’s OK.

Boomer

A good CPA MIGHT be able to save you more taxes than his/her fee. I agree that you should get one that will listen to your questions no matter how out of left field they may be. It's much like a doctor - you can't be helped if don't you ask your questions. Your CPA should also be asking you questions to see what you may not be aware can save you money.

How many Schedule C filers would be better off as a S Corp? Are you taking all the deductions that may be available. Are you making contributions that can reduce your taxes that all not deductible because you use the standard deduction? Many CPA's will give to an introductory no charge meeting to see if there's a way to save you money.

I've seen too many filers that missed deductions.

I believe that the services we provide are beneficial to our clients. If the taxpayer can do it him/her self I'll tell them.

My business is a sub chapter S and taxes change from year to year.

My cpa keeps up with this much better than I can and when I ask if I can do something different his job is to keep me out of trouble so I can sleep at night.

He also makes some suggestions to save me money

That is worth some dollars to me.

True and useful, as long as the person brings along or has a workbook of all the income and assets, etc so that the CPA can get a sizing of the T-shirt. .

So to start, have at minimum all your income sources and expected amounts for the year, and the inherited IRA details, and then any other investment accounts such as IRAS,/401Ks for reference. For money market, take the latest dividend amount for the month and multiply it by the remaining months to forecast out the full year. from that number and sources, the CPA can ask some basic deduction questions and get the size of your t-shirt (english expression, breadbasket is the american equivalent)

good luck.