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1 NTTC Training 2008 NEW IN-SCOPE - 2008 RENTAL & ROYALTY INCOME ON 1099-MISC FORM 8606 NON-CASH CONTRIBUTIONS
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2 NTTC Training 2008 RENTAL & ROYALTY INCOME PUB 17, CHAPTER 12 Rental and Royalty Income from: Oil leases Other similar “income only” sources Income reported to taxpayer on Form 1099-MISC Use Sched E to report income Cannot accept if expenses must be reported against income
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3 NTTC Training 2008 DATA ENTRY INTO TAXWISE From Line 17, Form 1040, Link to Sched E Complete Line A of Sched E Go to line 3 or 4, Col A, and link to 1099-MISC. Complete 1099-MISC Back out to form 1040. Income should now show on line 17
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4 NTTC Training 2008
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5 SCHED E, PAGE 1
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6 NTTC Training 2008 FORM 8606 PUB 17, CHAPTER 17 IRA NON-DEDUCTIBLE CONTRIBUTIONS IRA DISTRIBUTIONS AFTER NON- DEDUCTIBLE CONTRIBUTIONS ROTH IRA NONQUALIFIED DISTRIBUTIONS
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7 NTTC Training 2008 IRA NON-DEDUCTIBLE CONTRIBUTIONS Non-Deductible Contributions Alternative when Deductible are limited by Income and/or Retirement Plan Can be made up to maximum for year Total of Deductible and Non-Deductible cannot exceed maximum for year. $5,000($6,000 over 50 yrs of age) max for 2008
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8 NTTC Training 2008 REPORT DEDUCTIONS ON FORM 8606 Non-Deductible contributions MUST be reported on Form 8606 Creates Basis in IRA If not reported, no benefit on distribution Form 8606 provides cumulative record Non-Deductible Contributions Distributions
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9 NTTC Training 2008 FORM 8606 Part I – For reporting non-deductible contributions and distributions Distributions reported here only if there were non-deductible contributions Part II – Conversions Out-Of-Scope Part III – Distributions from Roth IRAs
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10 NTTC Training 2008 NON-DEDUCTIBLE CONTRIBUTIONS Enter amount in Line 1, Part I. Taxpayer must provide amount for entry into Line 2 (Basis for earlier year). Found on Form 5498
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11 NTTC Training 2008 FORM 8606 Taxpayer info.
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12 NTTC Training 2008 NON-DEDUCTIBLE CONTRIBUTIONS Distribution? No – Done Yes – Complete Lines 4 – 14 of Form 8606 Taxwise does calculation automatically Purpose of this is to pro-rate non-taxable amount (basis) over life of IRA. Taxpayer must provide value of IRAs
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13 NTTC Training 2008
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14 NTTC Training 2008 IRA DISTRIBUTIONS If there have been non-deductible contributions: KEY: Taxwise - must check box on 1099-R screen, exclusion worksheet
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15 NTTC Training 2008 FORM 1099-R
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16 NTTC Training 2008 NON-CASH CONTRIBUTIONS PUB 17, CHAPTER 24; INSTRUCTIONS, FORM 8283 REPORTING NON-CASH CONTRIBUTIONS $500 - $5,000
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17 NTTC Training 2008 NON-CASH CONTRIBUTIONS Claim non-cash charitable contributions Part of Itemized deductions (sched A) >$500, must complete Form 8283 In-Scope, $500 - $5,000 Form 8283, Section A, Part 1, page 1 Out-of-Scope, >$5,000
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18 NTTC Training 2008 NON-CASH DEDUCTIONS Report items (groups of similar items) of <$5,000 Securities listed on daily exchange Taxpayer must provide his/her cost Taxpayer must provide Fair Mkt Value Preparer completes form
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19 NTTC Training 2008 FORM 8283, SECTION A In Taxwise: Select Form 8283 from Forms List Complete Section A Information carries back to Sched A detail worksheet and to Sched A, Gifts to Charity
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20 NTTC Training 2008 FORM 8283, PAGE 1
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21 NTTC Training 2008 FORM 8283, PAGE 1
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