I am an accountant/CPA and my engineer husband does our taxes. I do however look over every single number before it is sent and I make sure every piece of documentation is there. I am sure my audit is at least as tough as the IRS.
9 Likes
Right? Not sure why itâs a big deal as parents we do their returns or thereâs any need to push them to do their own.
2 Likes
You were the one complaining about your âclientâ, lol
Itâs not a big deal, I just view it in the category of âlife skillsâ, like swimming or driving a car or cooking a basic meal. Everyone should know how to do it, even if eventually they decide to hire other people to do it for them.
I did my kidsâ taxes through college and for a year after they graduated, then I showed them how to do it and now just give advice as needed. At this point they most likely donât want me all up in their business anyway, so to speak, and wouldnât want me doing their taxes, but thatâs just how my family rolls.
6 Likes
Actually I wasnât complaining about my âclientâ my point of the post was about the stimulus and the adjustment they will make for 2020 income and that people should expect that if they are anticipating the full credit if they didnât receive checks and/or expect future credits. My other comment was sarcasm.
Furthermore, if I follow your logic that you prepared your kids returns for a year after college then this is no different since my kid only turned 23 a few months ago and my other kids are all younger. My kids however, donât have a simple 2 page return and Iâm going to make sure they get every penny coming to them including if that benefit is to make sure they contribute to an IRA now or Roth IRA or other investments. Most 18-23 year olds donât have a clue about putting money away for retirement now when theyâre at lower tax brackets or for ways to lower their tax by taking advantage of certain benefits such as making an extra donation last year or this year that is being allowed in addition to taking the standard deduction.
1 Like
Eldest kid has a corporation (he is a digital nomad), so I cannot do his taxes. He is looking for a new accountant as my cousin, a very good accountant, declined to do his taxes any more last year. Another example of business and family not mixing. Lesson learned for eldest kid.
We discussed this very issue with youngest kid this weekend. I had offered to do her taxes, then offered to let her do her own taxes, for the very reason of staying out of her financial business. Her logic is we get 5 tax returns from 1 Turbo Tax, so I should do it. But she moved from one state to another state in the pandemic, so I am worried about not doing it correctly.
1 Like
Thatâs a great idea to get them going on an IRA.
2 Likes
Do you show them how to do the tax returns? Even people who do not do their own tax returns would find it useful to know how various tax situations are treated, rather than treating taxes as a black box that they can know nothing about.
@srparent15 My daughter who should have also gotten the $1200 stimulus payment didnât, but she did get the $600. However her return will have her qualify for the $1200. No clue either why she didnât get the first payment. I wonder how many other young professionals this happened to. When DD was 17, someone stole her identity with IRS (used her SS#) - probably to use for extra child credits as well as dependent credit; since then she has gotten a yearly PIN with IRS. Only one in our nuclear family to have this happen.
2 Likes
@bernesemtnmom I still do DD2âs tax return (I was going to show her and do it together a weekend, but we may not be able to be together when we both find the time to do it). When she moves OOS I will give her the tools and be phone line support.
If he has a C Corp income or losses do not flow through to his personal tax return so it doesnât change how he does those returns. If he has an S Corp then he needs to file K-1s and pick up the flow through income that way.
Only my 18 year old lives in state currently but with my oldest we discuss it back and forth. He has his own corporation so there are more involved issues to discuss.
With my others we discuss during the year because they have Roth IRAs do contribute throughout the year to those and we discuss why and when to do so. One also has a rental condo so there are many issues revolves around that and the Schedule E return that most individuals arenât even familiar with.
We just had a meeting with our financial planner, and he explained the checks last year were just estimates/âadvancesâ. Many people will see more come after doing their taxes. I assume TurboTax will handle this, but we are not far enough along yet to see how.
ââŠThe stimulus checks are technically an advance of a special tax credit for the 2020 tax yearâŠâ - Donât Worry. The $1,200 Stimulus Payment Wonât Cut Into Your Tax Refund Next April
1 Like
We have discussed this before, but since someone just mentioned it - reminder to all that itâs a great idea to get kids started with ROTH retirement savings when they are young and not making much money, even if parents choose to gift them some amount to help. And as far as I know, doing it before tax day is OK to count for last year.
3 Likes
Yes you have until April 15 to put money into a Roth, even if youâve already filed taxes for 2020.
Could someone tell me how much max Kiddos can put into a Roth IRA for 2020 please?
@nan415 - Up to $6,000 - as long as you have at least that much in earned income.
1 Like
My understanding is that Roth contributions can be made until April, but conversions must happen by Dec.
Conversions can occur anytime. You pay the taxes based on the year the conversion occurs. So if you convert today youâll receive the 1099R for 2021 and the taxes are due in April 2022 when you file your taxes.
Ah, yes - thanks for clarification. My comments were related to tax year boundaries.
1 Like
Our financial guy is putting on a âRetirement Planning Todayâ two evening class for just the cost of the materials. We are going to get âfreshâ info and share with our kids. He is a great and engaging speaker too.
Going to the Medicare/SS meeting soon - found out that my insurance will pay primary and Hâs June Medicare will pay 2ndary - so I just sign him up for Medicare A and then before Oct we figure out the total Medicare for both of us as I retire and give up company medical insurance the end of Sept. Medicare has become more complicated with the Advantage plans in the mix.
Really pleased with our 401k returns in 2019 and 2020. This month seems to be doing well too.
5 Likes