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James Lange

James Lange’s Answers

11 total


  • Can I receive a tax return

    I have been separated for almost 3 years, I receive Social security Disability. I also receive spousal support. Can I file a tax return and receive money back I have a 13 year old daughter that I have custody of.

    James’s Answer

    The previous answers mentioned the Earned Income Credit (refundable) and the Child Tax Credit (generally nonrefundable, but with a refundable portion in some circumstances). Here, “refundable” means that you can get back as a refund more than any tax you owed, so if you owed none, you are getting a payment from the government. “Nonrefundable” means that the credit can only reduce tax that you owed. I'm not an expert in these credits but it appears that the refundable part of the Child Tax Credit uses the same definition of earned income as the Earned Income Credit. My impression from the question is that the writer isn’t generally filing tax returns but is considering filing to get a refundable credit. If so, it doesn’t look like either credit will help. If returns are being filed and there is a tax liability, I would ask what filing status is being used. If “married filing separately” is being used, consider “head of household”. Based on the information provided, it appears that the writer might qualify to be considered unmarried and eligible for the head of household rates, which are more favorable.

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  • My husband did his taxes 2 months ago, I told him not to claim me, but he did anyway. Hes on a H1V, does that mean anything?

    Im a US citizen, my husband is on a H1V. When he did his taxes 2 months ago he claimed me when I told him not to. How could he do that without my personal information and my signature? Can anything happen to him, if so what? And would I need a imm...

    James’s Answer

    From a tax compliance standpoint, your husband’s visa type is only significant in that it shows that he is allowed to work in the US. Whether he would be required to file as a nonresident alien, resident alien or dual status alien would depend on details you haven’t provided. If he filed as a nonresident alien or dual status alien, he would have to file as “married, filing separately”. He would still have to report your name and social security number, but your signature wouldn’t be needed. If he filed as a resident alien, he could file as “married, filing jointly”; if he did, all of your information should have been included and your authorization should have been obtained. It isn’t clear what you mean by “he claimed me when I told him not to”. If he filed a joint return electronically, he could easily do so without your authorization. You ask if anything can happen to him. If he did everything else right (maybe even if he didn’t), probably nothing will happen to him as far as the IRS is concerned. Do you want it to? If so, consider a tax lawyer. It is possible that a tax problem could lead to an immigration problem, although that seems unlikely for a problem of this magnitude. Again, do you want it to? If so, maybe an immigration lawyer is the way to go.

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  • SEP IRA Contributions Allocation

    We own a small business with me and my spouse as owners. We made contributiuons to a SEP IRA, wrote a single check and asked the investment company contact for specific instructions on allocating funds. The company allocated all the funds into one...

    James’s Answer

    Your question has several facets. I too think that you need professional assistance to help you sort this out. I would suggest a CPA or tax attorney because this is an Internal Revenue Code dominated area. You need to clarify the nature of your business and how you are reporting for it for income tax purposes. You say that both spouses are owners. Consider whether you are reporting for the business correctly. It may be reportable as a partnership or as a qualified joint venture. It is not reportable on one business schedule of a joint income tax return if two people are involved. You also need to clarify what you have set up for the SEP. A SEP is a written arrangement that has to be provided to the participants. What does that writing provide? If there is separate paperwork with the Investment Company with which you set up the arrangement, what does it provide? Is the SEP, as it is currently structured, consistent with the nature of your business (is each of you considered an “employer” for purposes of a SEP? If one of you is an “employee” for purposes of a SEP, nondiscrimination rules may apply). Deciding whether/how to fix an allocation of contributions for one year depends on first clarifying what is wrong.

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  • Wrong 1099 misc refusal to reissue

    ex employer sent 1099 misc to person that worked for me last year (no longer working as of 2012) and I gave him all the new incorporated info and he refuses to reissue. The person that received the 1099 didn't even work for him and he sent one to...

    James’s Answer

    As long as you provided all of the necessary information to the employer, and you report all of your income on your income tax returns, you don't have a problem. The recipient of the erroneous 1099 misc has the problem. Because the IRS matches information submitted to them by employers with information reported on tax returns, if the recipient doesn't report the income, eventually he or she will get a notice. That person should contact the employer to request the issuance of a corrected 1099 misc (and keep documentation of the request to present to the IRS when needed).

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  • I just learned that my wife and I owe approx $7000 federal income tax. Someone told me that there might even be a penalty. Is th

    I retired in July, 2011, so half the year was income and half was soc. sec. I received a refund that year, as we always have. I did not realize that soc. sec. was taxed and that you could have deductions withheld from the checks. So, for the 2012 ...

    James’s Answer

    There are several penalties that could be imposed: the first to come to mind are a late payment penalty, a penalty for underpayment of estimated tax, and an accuracy related penalty for substantial understatement of tax. You can expect interest to also be charged for late payment. There could also be a penalty on the IRA distribution if it was "early", without an exception. Some penalties can be negotiated down/away. Others can't. I agree with the other attorney who responded that you should have assistance from a tax attorney, which will enable you to minimize the damage.

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  • My husband and I have been separated for about 6 mo . And getting divorced . Does he have to give me half of our tax return ?

    He is in the Marines and lives on base in a dorm, and I live off base in base housing with our Daughter. He has been giving me money every 2 weeks to live on, as I do not work. Be cause he did not want me to work, and he has be deployed many ti...

    James’s Answer

    I think what you may mean is, you are expecting that when your 2012 tax return is filed, there will be a refund, and you are asking if half of it is yours. Even if it is, I think you will have difficulty getting control of it. As you describe your situation, he has all of the power. If he files the return electronically and has the refund deposited directly into a bank account of his choosing, there won't even be a refund check to be endorsed. I think the best approach is to follow the advice of the other attorneys for a broader solution, rather than focusing on one potential asset.

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  • Is a loss in a taxable year deductible from inheritance taxes received the same year?

    I receive an inheritance of $10,000 in one year. Same year I show a negative income (loss) of $5,000 on Form 1040. Are these $5,000 deductible from inheritance taxes in Pa? Is there any amount deductible from inheritance taxes in Pa?

    James’s Answer

    I agree with the other attorneys who have responded, and would add that you are confusing unrelated taxes as well as unrelated taxpayers. You seem to be asking if a loss on your individual income tax return can be deducted on the inheritance tax return of a decedent from whom you received an inheritance, in order to reduce the inheritance tax due. If so, the answer is no.

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  • Inherited IRA? Who owns the proceeds from IRA, owner assets, the Estate, or the Beneficiary? A question of timing.

    Harry owns an IRA and he named Lisa as the sole beneficiary. On 12/17 Harry faxes a form to IRA Firm, with notary seal, requesting that the IRA be closed and all proceeds be sent to him. On 12/22 Harry dies. On 12/25, three days after Harry die...

    James’s Answer

    • Selected as best answer

    As already mentioned, an initial step is to consider the terms of the agreement under which the IRA was established, both for the method utilized to make the change (fax) and the point at which the change became effective. If, under the terms of the agreement, the change was effective before death, the proceeds are an asset of the estate, in the form of a receivable on the date of death and in the form of cash when they were later paid. Both the decedent and the estate are cash basis tax payers. The 1099 should reflect the date of payment (12/25); the payee should be the estate.

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  • My brother died and left his insurance policy to his daughter who is a minor. Never married her mother. Difficult breakup.

    We (brothers/sisters) want to have a funeral but have limited funds. My brother has a policy that will cover the cost and still leave money to the beneficiary. The beneficiary is his daughter (16 years old) but the mother and my brother never marr...

    James’s Answer

    Because the named beneficiary is a minor, the terms of the life insurance policy should be reviewed to determine to whom distribution will be made. For instance, the policy may require distribution to be made to a custodian under a state Uniform Transfers (or Gifts) to Minors Act. The holder of the insurance proceeds is unlikely to have the discretion to use them as you would like.

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  • Is there such a thing as an estate account, under an individuals name,on behalf of the estate?

    my estate lawyer is tring to say that an IRA account that was left to me in my name, is an estate account and doesnt belong to me. however, i am listed as the bene on the IRA paperwork when i withdrew the money from the bank. i was taxed for this ...

    James’s Answer

    An IRA on which you were named as the beneficiary on the beneficiary designation form completed by the IRA owner is not a probate asset; that is, it doesn’t pass through the IRA owner’s estate, it passes directly to you (although its value is subject to PA Inheritance Tax). You, as the beneficiary, then had certain options, one of which was to withdraw the money in the account (and pay the income tax on it, if it was a traditional IRA, as it presumably was, since you mention having been taxed on the money). Because you mention that the attorney is a divorce attorney, I wonder if the comment “an estate account and doesn’t belong to [you]” came up in the divorce context when you were discussing assets to be divided up. An inherited asset such as this, if it isn’t commingled with other property, isn’t subject to equitable distribution in divorce in many states, so perhaps it is in that sense that she meant it doesn’t belong to you.

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