Novice tax question for all-knowing board

[joeparules]

First time I had a kid with a job outside of PA. My daughter made about $400 working at a henna shop at the Jersey shore last summer. She received a W-2 for the job with the state listed (Box 15) obviously as NJ. Do I have to:

1. Claim this income on her PA state return or fill out one for NJ?
2. Include this income on her local (Berkheimer) return?

Life used to be so much easier without wife and kids and I could use the 1040 EZ form!!

 

[91Joe95]

First time I had a kid with a job outside of PA. My daughter made about $400 working at a henna shop at the Jersey shore last summer. She received a W-2 for the job with the state listed (Box 15) obviously as NJ. Do I have to:

1. Claim this income on her PA state return or fill out one for NJ?
2. Include this income on her local (Berkheimer) return?

Life used to be so much easier without wife and kids and I could use the 1040 EZ form!!

If she's a resident of pa, file in both states. Not hard to do, here's a start.

http://www.state.nj.us/treasury/taxation/njit25.shtml

 

[LionDeNittany]

How old is your daughter?
She's a dependent right?

LdN

 

[joeparules]

How old is your daughter?
She's a dependent right?

LdN

Yeah, she just turned 18 last month.

 

[91Joe95]

Yeah, she just turned 18 last month.

If she files, she has to file in both states. Feds as normal, then just follow each state's rules. They're fairly straightforward and in each state's tax booklet, which is readily available online, at the library, etc. Doubt you're using tax software for state taxes for her, bit they cover it also, and you can ask their help section too.

 

[Lionguy32]

I wouldn't bother filing unless she had taxes withheld that you want refunded.

 

[rohrmd9]

I wouldn't bother filing unless she had taxes withheld that you want refunded.

Yea this is a good point. It depends on her total wages (from all income sources). If her AGI is less than a certain amount she probably doesn't need to file a federal or state return; however, if either state withheld taxes she could file and likely get a refund.

EDIT: So it looks like if she earned more than $33 dollars in PA then she does have to file a PA tax return even if no taxes were withheld. For NJ, since she earned less than 10k in NJ and she's non-resident (assuming her permanent home is with OP in PA) she does not need to file a NJ state return.

 

[dawgduice]

Hence the "stupidity" of different laws and taxes etc. of the "state system". Something that has only added to our economic woes. But others will say that the "founders" wanted it that way. Really ??

 

[LionDeNittany]

Hence the "stupidity" of different laws and taxes etc. of the "state system". Something that has only added to our economic woes. But others will say that the "founders" wanted it that way. Really ??

The Founders had no choice. Neither does the Federal Government.

The "wanted it that way" is just your lack of knowledge speaking.

 

[dawgduice]

The Founders had no choice. Neither does the Federal Government.

The "wanted it that way" is just your lack of knowledge speaking.

Really ??? Amazing, but this is one of the reasons we are who we are. Well, they also wanted slavery, so why do we no longer have that? THINK !!!!!!!

The difference is that I see the dog peeing on my leg and you just wonder why your leg is wet. The sad truth is until the majority of people SEE the "dog" things will remain as they are. I'm guessing it will take science another 50-100 years to genetically fix that "problem". I think the "founding fathers" wanted it that way
I wonder if they knew the average IQ is 98 ?

 

[LionDeNittany]

Really ??? Amazing, but this is one of the reasons we are who we are. Well, they also wanted slavery, so why do we no longer have that? THINK !!!!!!!

The difference is that I see the dog peeing on my leg and you just wonder why your leg is wet. The sad truth is until the majority of people SEE the "dog" things will remain as they are. I'm guessing it will take science another 50-100 years to genetically fix that "problem". I think the "founding fathers" wanted it that way
I wonder if they knew the average IQ is 98 ?

Again, you're using the word "wanted". Not sure why you keep using that word.

The Founders had no choice.
Neither does the Federal Government.

LdN

 

[joeparules]

I'm sure no one cares, but here is what I ended up doing:

• Federal: Lumped both W-2s into a 1040 EZ so she could get back the $73 they withheld from her hostess job in PA.
• State: Filed electronically her PA job ($1 so no action required) and mailing in a NJ Non-Resident form ($1 so no action required). I realize the NJ-NR is not needed, but knowing PA they will come after her for her NJ earnings and I have a copy to show them. She would have owed if I lumped them together in PA.
• Local: Lumped both W-2s together and owe $5 (PA job withheld the 1% while NJ job did not)

Thanks for the (non-confrontational) replies!

 

[dawgduice]

Again, you're using the word "wanted". Not sure why you keep using that word.

The Founders had no choice.
Neither does the Federal Government.

LdN

My point is the "founding fathers" and NO IDEA what the future would hold. They did allow for a system to make change AND we as a "business and political business" country USE the "founders" as an excuse to NOT do the right thing. Sort of the silly argument on the second amendment and guns. Remember 98 IQ.
How can one State have an income tax and another not? Why do business' leave one state for another? We have continued to operate as if each state is it's own country?? All of this continues a failed political and economic system.
I do agree at the time the "founding fathers" had no choice. But we do now. Yet we continue this ridiculous system. I happen to live in a state were there is no income tax? So, I too take advantage of the silly system

 

[dawgduice]

I'm sure no one cares, but here is what I ended up doing:

• Federal: Lumped both W-2s into a 1040 EZ so she could get back the $73 they withheld from her hostess job in PA.
• State: Filed electronically her PA job ($1 so no action required) and mailing in a NJ Non-Resident form ($1 so no action required). I realize the NJ-NR is not needed, but knowing PA they will come after her for her NJ earnings and I have a copy to show them. She would have owed if I lumped them together in PA.
• Local: Lumped both W-2s together and owe $5 (PA job withheld the 1% while NJ job did not)

Thanks for the (non-confrontational) replies!

Not-Confrontational, BUT, it should have been a LOT simpler to do Thank goodness it's not a leap year !!

 

[joeparules]

Not-Confrontational, BUT, it should have been a LOT simpler to do Thank goodness it's not a leap year !!

Completely agree. I know I'm getting old, but I can still remember the day when I could do my federal taxes in ten minutes, state in about two minutes and there were NO local taxes.

 

[dawgduice]

Completely agree. I know I'm getting old, but I can still remember the day when I could do my federal taxes in ten minutes, state in about two minutes and there were NO local taxes.

I am in that same age group and I guess it's why I know it does NOT have to be the way it is now.

 

[LionDeNittany]

My point is the "founding fathers" and NO IDEA what the future would hold. They did allow for a system to make change AND we as a "business and political business" country USE the "founders" as an excuse to NOT do the right thing. Sort of the silly argument on the second amendment and guns. Remember 98 IQ.
How can one State have an income tax and another not? Why do business' leave one state for another? We have continued to operate as if each state is it's own country?? All of this continues a failed political and economic system.
I do agree at the time the "founding fathers" had no choice. But we do now. Yet we continue this ridiculous system. I happen to live in a state were there is no income tax? So, I too take advantage of the silly system

Here's your problem. Because you don't agree with someone else doesn't make what you think the "right thing".

Sort of like the second amendment and guns. I'm not a gun owner. I feel they should be restricted and licensed. That doesn't make me right.

"How can one State have an income tax and another not? Why do business' leave one state for another? We have continued to operate as if each state is it's own country?? All of this continues a failed political and economic system."

This is what makes America great. If it wasn't for individual states, the US would have put a ton of money in keeping Detroit alive and never properly developed Florida and Georgia.

Who are you to say Florida SHOULD have a state income tax when they decide to not? Who is Florida to say Michigan SHOULD NOT have state income tax when they do?

Which of these is the "right thing" in your opinion? If you have an answer which is better than democracy and state and municipal rights to taxation, let me know.

LdN

 

[dawgduice]

Here's your problem. Because you don't agree with someone else doesn't make what you think the "right thing".

Sort of like the second amendment and guns. I'm not a gun owner. I feel they should be restricted and licensed. That doesn't make me right.

"How can one State have an income tax and another not? Why do business' leave one state for another? We have continued to operate as if each state is it's own country?? All of this continues a failed political and economic system."

This is what makes America great. If it wasn't for individual states, the US would have put a ton of money in keeping Detroit alive and never properly developed Florida and Georgia.

Who are you to say Florida SHOULD have a state income tax when they decide to not? Who is Florida to say Michigan SHOULD NOT have state income tax when they do?

Which of these is the "right thing" in your opinion? If you have an answer which is better than democracy and state and municipal rights to taxation, let me know.

LdN

Being right is not my fault. Hence why I no longer vote nor serve on a jury with my "peers" ;-) I would have been one that would have been against slavery, where they right? So the "right thing" is in fact THAT !!!
Most intelligent people will get that, not all, since some get overwhelmed by greed.
Actually, doing the "right" thing is what our purpose is, religion and greed muddle that "purpose".

 

[LionDeNittany]

Being right is not my fault. Hence why I no longer vote nor serve on a jury with my "peers" ;-) I would have been one that would have been against slavery, where they right? So the "right thing" is in fact THAT !!!
Most intelligent people will get that, not all, since some get overwhelmed by greed.
Actually, doing the "right" thing is what our purpose is, religion and greed muddle that "purpose".

So what you're saying is that you believe you're god.

OK. To each their own I guess.

 

[rohrmd9]

Completely agree. I know I'm getting old, but I can still remember the day when I could do my federal taxes in ten minutes, state in about two minutes and there were NO local taxes.

Hey at least you're not someone like, for example, a pro athlete that has to file in every state they play in! Of course, if you were you could easily afford a tax specialist to worry about all those forms for you!

 

[psuro]

Hence the "stupidity" of different laws and taxes etc. of the "state system". Something that has only added to our economic woes. But others will say that the "founders" wanted it that way. Really ??

....and.....here we go.....

 

[zwick99]

I have a long term capital gain question too.

I have a stock with a spinoff. Can I uses a cost basis of 0 for the spinoff.

At some point in the future if I sell the original stock I would then use 100% of my original cost as the cost basis. The IRS comes out ahead and gets their money from the spinoff early. They still get their money in full.


Do you see any problems with my method?

 

[dawgduice]

So what you're saying is that you believe you're god.

OK. To each their own I guess.

NO, not "THE" God but maybe "a" God

 

[Peetz Pool Boy]

I have a long term capital gain question too.

I have a stock with a spinoff. Can I uses a cost basis of 0 for the spinoff.

At some point in the future if I sell the original stock I would then use 100% of my original cost as the cost basis. The IRS comes out ahead and gets their money from the spinoff early. They still get their money in full.


Do you see any problems with my method?

Can't tell if your question is TIC or genuine.

Most spin-offs these days are "non-taxable" in that you dont owe taxes because of the transaction, but you do have to allocate basis in your pre-existing basis of "parent " to (a) surviving parent and (b) new "child". You then need to track basis for both.

The parent company should have sent you a document explaining how they suggest allocating basis between "parent " and "child". If not, post the name of the parent and child companies and we'll help you out.

 

[Pitt5593]

Being right is not my fault. Hence why I no longer vote nor serve on a jury with my "peers" ;-) I would have been one that would have been against slavery, where they right? So the "right thing" is in fact THAT !!!
Most intelligent people will get that, not all, since some get overwhelmed by greed.
Actually, doing the "right" thing is what our purpose is, religion and greed muddle that "purpose".

An intelligent person would know the difference between where and we're.

 

[dawgduice]

An intelligent person would know the difference between where and we're.

Good catch Are you a PITT guy? My son-in-law is a PITT grad, fun times this year and next.

 

[zwick99]

Can't tell if your question is TIC or genuine.

Most spin-offs these days are "non-taxable" in that you dont owe taxes because of the transaction, but you do have to allocate basis in your pre-existing basis of "parent " to (a) surviving parent and (b) new "child". You then need to track basis for both.

The parent company should have sent you a document explaining how they suggest allocating basis between "parent " and "child". If not, post the name of the parent and child companies and we'll help you out.

1. The spinoff is being sold.
2. There are usually fractional shares with spinoffs and they are sold for cash which is taxable.
3. The allocations are not that simple. Sometimes the spinoffs have spinoffs combined with mergers and other spinoffs.

One example would be the Merck spinoff Medco which then merged with ESRX.

 

[psu1969a]

First time I had a kid with a job outside of PA. My daughter made about $400 working at a henna shop at the Jersey shore last summer. She received a W-2 for the job with the state listed (Box 15) obviously as NJ. Do I have to:

1. Claim this income on her PA state return or fill out one for NJ?
2. Include this income on her local (Berkheimer) return?

Life used to be so much easier without wife and kids and I could use the 1040 EZ form!!

Best advice find a CPA in your area; pay the fee to have your daughter's tax returns prepared. Cost depending upon area should be the 75 - 100.

 

[artsandletters]

....and.....here we go.....

The girl made 400 bucks and now we need a Senate committee.

 

[artsandletters]

1. The spinoff is being sold.
2. There are usually fractional shares with spinoffs and they are sold for cash which is taxable.
3. The allocations are not that simple. Sometimes the spinoffs have spinoffs combined with mergers and other spinoffs.

One example would be the Merck spinoff Medco which then merged with ESRX.

Why would you use a Merck example? Tip of your tongue?