1. CA-2 State Meeting Jay Wiedwald, CA-2 TRS
Training for Tax Year 2015
CA-2 State Meeting
Jay Wiedwald, CA-2 TRS
Sep 2015 Regional Meetings

2. Teachable Qualities of a Counselor? (Responses from audience)
Develop Listening Skills
Ask probing questions
Use Resources
Learn and use trouble- shooting techniques
Tax law knowledge
Learn how to explain tax law in everyday English
Knowing when to ask for help – and willingness to actually do so
Sep 2015 Regional Meetings

3. Habits you’d like to Break! (Responses from audience)
Starting a return “too soon”
Complete interview before touching the keyboard
Trusting that CF or other reviewed Intake sheet sufficiently
Ignoring Intake Sheet during QR
Rushing under pressure of clients waiting
Not checking Duck Book before asking for help
Incomplete passing of return info to the QR
Complete grey sections on Intake Sheet
Relying too much on pro forma
Not using the Comment section at bottom of Main Info Sheet
Sep 2015 Regional Meetings

4. THANKS! I’ll consider those as I prepare for the Instructor Workshop
Sep 2015 Regional Meetings

5. Married, Single, and More
Filing Status
Married, Single, and More
Pace and Depth will depend on the experience of the audience, but broadly suitable for all levels.
Objective is to recognize factors that
Pub 4012 – Tab B
Pub 4491 – Part 2
Pub 17 – Chapter 2

6. TWO Immersion Training – 2015
[BACKGROUND]
Objectives:
Recognize factors that determine filing status options
See how filing status affects tax issues
Focused TWO entry/outcome relationships
Cultivate habit of using resources
Broadly suitable for all experience levels
Pace and Depth of presentation will depend on audience experience
TWO Immersion Training – 2015 6

7. Married, Single, and More
Filing Status
Married, Single, and More
16:42 mark, xx minutes long
Followed by Donald Duck demo for new counselors
Pub 4012 – Tab B
Pub 4491 – Part 2
Pub 17 – Chapter 2

8. TWO Immersion Training – 2015
Filing Status
Pub 17 Ch 2
Two criteria:
Marital status on last day of tax year
Federal definition – “married”
Legal marriage under laws of any state or country
Does not include civil unions or registered domestic partners
Type of dependents, if any
U.S. state includes the district of Columbia and U.S. territories
Dependent: An individual who may be claimed as a dependent on another person’s tax return; that is, someone who meets all applicable dependency tests.
Will discuss dependents in a later lesson
There is no requirement for taxpayers to substantiate their marriage – their statement that they are married is enough
TWO Immersion Training – 2015 8

9. Five Choices for Filing Status
Pub 4012 Tab B
Single
Married filing jointly (MFJ)
Married filing separately (MFS)
Head of household (HH)
Qualified widow(er) (QW)
Dependent: An individual who may be claimed as a dependent on another person’s tax return; that is, someone who meets all applicable dependency tests.
Head of Household Filing Status: This filing status is generally for unmarried taxpayers who paid more than half the cost of keeping up a home for a qualified dependent relative during the tax year.
Married Filing Jointly: Filing status for taxpayers who are married to each other or live together in a common law marriage and combine their income and deductions on the same tax return. The status also applies to taxpayers who are separated but not divorced and to taxpayers whose spouse died during the tax year and has not remarried, as long as one tax return is used for both individuals.
Married Filing Separately: Filing status for taxpayers who are married to each other or live together in a common law marriage and report their own incomes and deductions on separate returns.
Qualifying Widow(er) with Dependent Child: Filing status is for widow or widower with one or more dependent children.
Single Filing Status: Filing status that applies to a taxpayer who (1) has never married, or (2) is legally separated or divorced.
TWO Immersion Training – 2015

10. TWO Immersion Training – 2015
Form 1040
TWO Immersion Training – 2015

11. Filing Status Importance
Many tax items affected by filing status
Necessity to file a return (Page A-1)
Standard deduction (Page F-1)
Tax rate bracket
Eligibility for certain credits (Page I-3 Step 3)
TWO Immersion Training – 2015 11

12. TWO Immersion Training – 2015
MFS Disadvantages
Highest tax rate/lower standard deduction
Cannot claim most tax credits
Cannot deduct student loan interest
Capital loss limit $1,500 (not $3,000)‏
… and a few more.
MFS – Lived With Spouse Anytime During The Year
Cannot claim credit for the elderly or the disabled, cannot claim education credits, EIC
Must include social security benefits as income (up to 85% can be taxable)‏
Cannot roll over from traditional IRA to Roth IRA
TWO Immersion Training – 2015

13. Head of Household – Unmarried
Provided home for qualified child
Might not be a dependent
Provided home for related dependent
>50% cost of maintaining home for dependent parents living elsewhere
Pub 4012 page B-1 Left Side
TWO Immersion Training – 2015

14. Head of Household – Married “Considered Unmarried”
Lived apart all of last 6 months of year
Provided home for:
Child, stepchild, or eligible foster child for over six months
No other relatives qualify
Pub 4012 page B-1 Right Side
TWO Immersion Training – 2015

15. TWO Immersion Training – 2015
Head of Household
Key advantages
Higher standard deduction than Single or MFS
Advantageous tax rate structure
TWO Immersion Training – 2015

16. TWO Immersion Training – 2015
Qualifying Widow(er)
Spouse died in one of two past years
Has dependent child or stepchild in home all year
Grandchild not eligible
Maintained home for child
>50% of cost
Can file QW for two years only
TWO Immersion Training – 2015

17. TWO Immersion Training – 2015
Use the Decision Tree
Turn to
Pub 4012
Page B-1
Don’t miss
the
footnotes
Pub 4012 Page B-1
Don’t miss the footnotes
TWO Immersion Training – 2015

18. TaxWise – Main Information Sheet
Enter name and SSN only if child not also dependent
TWO Immersion Training – 2015

19. TWO Immersion Training – 2015
Quality Review
QR is more than just making sure the box is checked!
Must conduct the same probing interview to make sure that it is the correct (and best) Filing Status
HoH is the biggest source of errors
TWO Immersion Training – 2015

20. TWO Immersion Training – 2015
Let’s Explore
TWO Immersion Lesson
on Filing Status
Fred Silva
TWO Immersion Training – 2015

21. NOW…Fire up your laptops and log into:
Client ID:
User Name: USERxx
Password: USERxx
(Unless you’ve already logged in)
Sep 2015 Regional Meetings

22. Immersion Lesson Worksheet
TWO Immersion Training – 2015

23. Immersion Lesson Worksheet
TWO Immersion Training – 2015

24. This Demo available online
NTTC Webinar August 7th. Link available on OneSupport (or below):
?RCID=0895e16d9eb616aa7c7b7ab078f22d4b
(Not compatible with Windows10)
Starts at 16:42 mark, 17 minutes long
Followed by “Donald Duck” demo (11 minutes)
Great for new counselors, and even those with a little experience
TWO Immersion Training – 2015

25. Demo Questions ???
Sep 2015 Regional Meetings

26. CA-2 State Meeting Jay Wiedwald, CA-2 TRS
Training for Tax Year 2015
CA-2 State Meeting
Jay Wiedwald, CA-2 TRS
Sep 2015 Regional Meetings

27. Topics Training and Certification ACA Scope
Brief update on ACA, discussion about Scope and next step on one issue, our training emphasis for this year, two programs and a wrap with an update on committee activities.
Sep 2015 Regional Meetings

28. Training and Certification
Sep 2015 Regional Meetings

29. AARP Training Materials
NTTC Workbook for Tax Year 2015
15 practice returns – replaces Pub 4491-W
Quizzes and exercises
Printed – available through fulfillment
One copy being mailed to each Instructor
Each district must determine how to obtain/distribute copies to trainees
NTTC Training Slides – first release was October 15th
Workbook based on previous years’ Pub 4491W problems updated for 2015
Slides – continue to incorporate feedback – more emphasis on using resources (Pubs 4012 and 17)
Sep 2015 Regional Meetings

30. IRS & FTB Training Materials
Have been ordered for all Counselors
Instructors need them early to certify before the December Workshop
Some variation by district regarding:
1040 Instructions
Pub. 17
540 Instructions
Getting accustomed to electronic documents is wise, but paper still useful
Sep 2015 Regional Meetings

31. Instructor Workshop Two days in December –
Instructors
DCs
SMT members
IRS (Patrick Brown) and FTB (Mark Callahan)
Two “identical” workshops for flexibility and a manageable group size
Train the trainers – help Instructors improve their knowledge and teaching skills
Key venue to help Instructors improve their knowledge and skills
Two full days – not half days
All Instructors – by policy, SC must approve non-attendance
All DCs – Instructors work for them – they need to know how training will occur (many are also Instructors)
Most/all SMT members – they manage state activities [some SCs consider DCs as part of SMT]
SPEC and State – to provide updates and show presence
Sep 2015 Regional Meetings

32. Training Principles
Retention is enhanced when multiple parts of the brain are involved
Integrate tax law with TW data entry
Student “contemplates” issues
Adults learn differently
Not fully engaged unless they see a good reason
May need to accommodate diminished senses
Develop good habits
Use of resources
Follow a process
Sep 2015 Regional Meetings

33. New/Expanded Training Tools
NTTC Workbook
Eight updated and seven new practice returns
Targeted ACA, Filing Status and Exemption exercises
Quizzes
Objective: help/enable Instructors to better do their job
Note: does not include administrative topics such as remuneration options for volunteers, how to order site software or laptop inventory procedures or review of answers to tests
Sep 2015 Regional Meetings

34. New/Expanded Training Tools
NTTC Lesson Plans
Series I – Updated from last year
Series II – New this year, targeted at returning counselor training
TWO Templates supporting these
National and CA-2
Schedules for new and returning counselors
NTTC Power-Point Training Slides
Select as appropriate to audience
Sep 2015 Regional Meetings

35. OneSupport/Tax Training/TWO Immersion Training
“Read me first” in Series I package
Schedule and direction files in Series II package
Look over a typical lesson
See Lesson Notes (Series II)
Resources
Read-aheads
Templates
Check Them Out!
Sep 2015 Regional Meetings

36. Certification Requirements
All Volunteers – IRS Standards of Conduct test
Pub 4961 is only available in electronic format
Local Coordinators and Counselors
Intake/Interview and Quality Review training and test –10 questions – New
Link & Learn or Pub 5101 (on-line only)
Counselors
Advanced test
35 instead of 40 questions
Increased emphasis on ACA
Completing four exercises from NTTC Workbook
Training materials in Pub 4961 are good to use. The revision of Form 6744 on 10/19/15 will probably result in a difference between the electronic version of Form 6744 and the hardcopy version since the hardcopy version has already gone to press.
NTTC – Oct 2015

37. Certification Testing
Recommend (URGE!!!) Link & Learn rather than paper
Excellent on-line training reinforces classroom
Easier for the Instructors
However, Instructors don’t see test score – only that the test was passed
Magnifies need for Instructor to review exercises to assess student
NTTC – Oct 2015

38. Optional Certification Tests
Optional Certifications for Counselors
HSA
Military
International
Cancellation of mortgage debt (if extended)
Out-of-Scope for California
NTTC – Oct 2015

39. Training and Certification
Questions…
Comments…
NTTC – Oct 2015

40. Affordable Care Act
Sep 2015 Regional Meetings

41. ACA ACA in scope for Tax-Aide except for: Shared Policy Allocation
Marketplace coverage for a person who is not on the return
Alternative Calculation for Year of Marriage
Marketplace customer got married during the tax year
Shared Policy – couple that divorced during year but one spouse is on other’s policy; someone who was expected to be a dependent but isn’t. There is a question on draft Intake Sheet that will help counselors quickly identify this situation
Alternative Calculation – both had policies. Could be better to file MFS, could be not a big impact, could mean alternate calculation should be used. Will be working on options for these situations.
Sep 2015 Regional Meetings

42. ACA Several first year exemptions no longer apply
Shared Responsibility Payment (SRP penalty) greatly increased:
$325 per person, up from $95 last year
or if greater: 2% of income, up from 1%
Taxpayers do not need to provide proof of insurance (unless due diligence raises questions)
SRP went from $95 to $325 per person; limit from $285 to $975
Sep 2015 Regional Meetings

43. Expanded ACA Section of Intake Form
Counselors are expected to record in detail…
… and QR’s to confirm!
Sep 2015 Regional Meetings

44. Great variability in CA-2 Sites
National
VITA/TCE
Average
There is a wide range of clients and/or counselor behavior at the 98 CA-2 sites.
But virtually all have fewer ACA situations than the National volunteer program average.
Sep 2015 Regional Meetings

45. ACA
Questions…
Comments…
Sep 2015 Regional Meetings

46. Scope
Sep 2015 Regional Meetings

47. Scope creep is a concern
Several requests for local/regional scope change
Training, certification, Volunteer Protection Act, etc. all become issues
We’re trying to help the majority of those taxpayers who need us – not every taxpayer
Sep 2015 Regional Meetings

48. Scope – Approved Change
Only one requested change was approved by IRS:
1099-R Code L (with 1, 4 or B) now in scope
Loan treated as distribution
Early distribution subject to 10% penalty
Cannot be rolled over
Sep 2015 Regional Meetings

49. Scope – Requests Not Approved
Request for Medicare Advantage Medical Savings Account distributions not approved this year
Line 29 adjustment for self-employed health care costs not approved
AARP may make any return with SE income and paid medical insurance OOS due to ACA impact
Sep 2015 Regional Meetings

50. Other Changes Dependents can be issued an Identity Protection (IP) PIN
Medicaid Waiver Income now mandatorily not taxable
myRA - New savings account (like a Roth)
Can claim up to $25,000 in expenses on a Sch C
Sep 2015 Regional Meetings

51. Additional Boxes on 1099 Forms
1099-INT Box 10 Market discount (2014) Box 11 Bond premium (2014) Box 13 bond premium on tax-exempt bond (2015)
1099-OID Box 5 Market discount (2014)    Box 6 Acquisition premium (2014)
1099-INT, 1099-DIV, 1099-OID, and 1099-MISC FATCA filing requirement check box (2015)
Sep 2015 Regional Meetings

52. Additional Boxes on 1099 Forms OOS
1099-INT Box 10 Market discount (2014) Box 11 Bond premium (2014) Box 13 bond premium on tax-exempt bond (2015)
1099-OID Box 5 Market discount (2014)    Box 6 Acquisition premium (2014)
1099-INT, 1099-DIV, 1099-OID, and 1099-MISC FATCA filing requirement check box (2015)
Sep 2015 Regional Meetings

53. Tax-Aide – “We’re Special”
Some topics not in scope for VITA are for Tax-Aide
SEP/Simple IRA distributions
1099-K for self-employment income
Land rental received as cash (no expenses)
Non-cash donations up to $5,000
…and nine more!
Sep 2015 Regional Meetings

54. Challenges due to Expanded Scope
Topics aren’t covered in IRS Training Materials
… but should be addressed during training
Will suggest that these be taught as a unit
Make their scope clear and provide reference resources
Focus on site leadership
Sep 2015 Regional Meetings

55. Identity Theft and $1 AGI Returns
Have recommended including $1 of income on federal return so it could be e-filed
Detects or prevents ID theft
IRS counsel has a problem with this –
it’s an “inaccurate” return.
Sep 2015 Regional Meetings

56. TY2015 Tax-Aide Practice CONCLUSION:
We will continue Tax-Aide practice of preparing $1 AGI returns and include this in training materials
Sep 2015 Regional Meetings

57. That’s All, Folks
Questions…
Comments…
Sep 2015 Regional Meetings