Monday, May 4, 2015

Tax Preparation Software Sucks - An Open Letter to H&R Block

1.  This paragraph has some disclosures, feel free to skip to the second paragraph if you want to know why this is directed to H&R Block, the third paragraph if you want to know why tax software sucks, and the fourth paragraph if you insist on using tax software and want to know how to do it right.  That said, I work for H&R Block during the tax season, and I love working for them.  They allow me to work 4 months out of the year, and they take care of my clients the rest of the year.  They have a lot of great people who do a great job with taxes.  I wouldn't hesitate to recommend them to anyone looking for great tax preparation (obviously you want to do some due diligence to make sure the specific preparer you get is qualified for your situation, as well as experienced.)  Also, to be clear, this article represents my personal opinion, and in no way represents the views of H&R Block and is a reflection of my experiences and may be completely skewed by them, so take it with a grain of salt (though I'm damn sure I'm right that tax software sucks).

2.  So why single out H&R Block?  Simply stated, many years ago H&R Block took the "if you can't beat 'em, join 'em" approach to tax preparation software, and produced their own.  I use most of the major software and online products every year as part of writing this blog, and H&R Block is among the best, but, as you'll see in paragraph 3 - they all suck.  The reason I single H&R Block out is because they are the only major player in the tax software business that MUST know that the software is woefully inadequate for the job of doing taxes.  Hell, their Second Look product and get your billions back marketing programs are pretty much targeted at tax software users (and crappy preparers).  H&R Block has the experience, research and knowledge to know that tax software isn't adequate to the task of getting people with limited tax knowledge to produce an accurate tax return.  It's time for them to stand up and admit this, and get out of the software business.  It hurts their credibility to claim that tax professionals are worth hundreds of dollars, but that tax software is effective.

3.  Why does tax software suck?  Simple: it has to be both user friendly, easy to use, and accurate.  If it's not user friendly and easy to use, no one's going to pay for it.  Hell, that's why it's so popular!  It is simply not possible to cover all the complexities of tax law and still be easy to use.  So they make it easy to use: "How much did you pay for uniforms?"  Sure, there's an info button you can click that will go into all the nitty gritty of this question, but if you read them every time they come up, it's not simple and easy anymore.  "How many miles did you drive for business last year?"  Again, many popups will be available to help you navigate the dizzying rules that are involved in this simple question, but you're not likely to read them, and, if you do, they're only going to make you more confused.  Don't even get me started on depreciation, business use of home, or investing income!  And that's just the Federal return!  Many states have nearly incomprehensible tax laws, and dozens of deductions and credits that you pretty much need to know exist in order to take advantage of them.  Most software just drags things from the Federal to the State, with barely a peep about what deductions you might miss.  I cannot even begin to describe the messes I've seen from tax software.  Just this year, a client with one W-2, no wife, no kids, no house, and an amazingly simple Federal 1040EZ missed out on over $10,000 in state tax money over the last dozen years because either the software didn't ask, or he neglected to answer enough questions to establish that his military income was exempt from California taxes.  Most of that money is gone forever.  Tax preparation software SUCKS!  You will have a better chance at an accurate return using pen and paper with the Federal and State instructions than you will using software!

4.  So you still want to use software?  Follow the steps below to make sure you have a better chance of not losing money...

Step 1: Download the Federal and State instruction books from the IRS and State websites and read them before you even start.  Get them early and read them in your spare time.  Don't worry, they're fairly short, and you can skip sections that obviously don't apply to you.
Step 2: Get a good tax reference book every couple of years and read the chapters applicable to you.  The best value for your money is my book (of course I think my book's the best - I did title my blog The Super Tax Genius  - I have no shortage of ego.)  Seriously though, it's cheap, it's written in English, it's short, and the chapters are sorted by life events, not the IRS code, so you don't have to read too much.  Here's a link: Everyday Taxes.
Step 3: Read all the popups and gobbledygook while using the software, and keep your tax reference handy.
Step 4: Pay for and print the return BEFORE e-filing.  That way you can check it line by line using the instructions, or...
Step 5: Have a professional check it before filing.  Many tax pros will look it over for free, hoping to find an error and charge you to get more money.  H&R Block will do the entire return from scratch, for FREE and compare the results to yours, hoping to find an error and give you the option to pay to have it fixed (and find out you should have used a pro all along.)  H&R Block calls this the Second Look.  Even paying a nominal fee for the checkup is worth it.
Step 6: If you aren't going to do Step 5, save your tax returns and all supporting documents, and have a pro check them at least once every 4 years.  This way, if there's a mistake, it's not too late to fix it and get you your money.
Step 7: For God's sake print a fricken' copy of your return!  If you don't, it won't be there when you need it (and you will need it, eventually)

Thursday, March 26, 2015

Last Chance for 2011 Refunds

Now is the time to file your 2011 tax return, or, if you already filed, to have it checked.

After 4/15/2015, the IRS won't give you any money for 2011.  So get to an expert and have them look over that return and find you some more money!

Monday, February 9, 2015

The IRS did NOT Call You!

Unless you are currently involved in communications with the IRS that were initiated by you in person or by the IRS via a letter, that person calling claiming to be the "IRS" is full of you know what.

The IRS does NOT initiate communications via phone calls.  Scammers trying to steal your money or identity do.  I have already had six people (including a tax pro I work with) receive these kind of calls.

If you want a little more reassurance, try googling the number the call came from (if the number is hidden it's DEFINETELY a scam).  Chances are the google results will be full of people asking about the number, and MANY people identifying it as a scam.

If you want more reassurance, call the IRS (though this is pretty much a waste of time.)

I'm expecting the scammers to get more sophisticated and start sending letters, but that's for another post.

And BTW, that email from the IRS about a problem with your refund - that's a scam too.

UPDATE: Seven calls - including my sister!  Now they are saying there are serious criminal charges.  Still a total scam.

LAST UPDATE on call numbers: We are up to over three dozen people contacted in this way.  We have also seen a couple of fake IRS letters.  If you receive a letter from the IRS you should be careful to ensure that it is from the IRS.  Most letters should be easy to verify based on information from your return being included on them, but if you have doubts, call the IRS at 1 (800) 829-1040 to verify.  Don't use the number on the letter if you think it's a scam!  You could also have a tax professional check it out.  Also don't click on email links purporting to be from the IRS - these are also scams.

Monday, January 19, 2015

How Much does it Cost to File Taxes?

The National Society of Accountants posted this infographic on their website.  The one thing it doesn't cover is kids.  Kids tend to cost a lot more due to due diligence requirements and conflicts caused by how valuable they are:

Source: www.nsacct.org

Tax Prep Fees National Averages

Thursday, January 8, 2015

2014 Military State Tax Guide

State Guidelines for Military (2014 values)

States with changes for 2014: AR, IA, MO, NE. 

Consolidated list of military posts is HERE

Military Spouses Residency Relief Act (MSRRA)
Most states have begun to treat this in a similar manner to each other. In general, the spouse of a service member has two choices for state of residency: the state they are stationed in, or the military member's state of residency. In order to claim the military members state, they must have established a domicile in that state at some time before moving to the current state. For those qualified to make the election to claim the military members state, it is important to weigh the benefits properly, for example, a spouse who works in SC married to a military resident of MI might assume that since MI does not tax the military member that they should choose this state. This would be wrong because MI will tax the non-military income of the spouse. SC is far more generous to the spouse of a service member stationed in SC. Expert assistance may be required making this determination. It can also be difficult to get the current state to stop withholding from the spouses wages. Each state Dept of Revenue has different procedures for handling this.
 
Residency
A military member normally retains residency in the state they resided in when they joined the military unless action is taken to change this. The W-2 can generally be relied upon as to the state of residence of the military member. The states in which a service member are stationed will not tax the members military income unless they are residents. They will tax any income earned from other employment or business activities conducted in the state by the member and their spouses (subject to the MSRRA discussed above.) The discussions below talk about the taxation of military income for residents of the respective state.
 
Filing Requirements:
Not having to file discussed below assumes there is no withholding from the given state. A member may file even if not required and should do so if they have withholding from the given state so they can get the money back. If a member would not be required to file except for the existence of withholding, they should adjust their state withholding through MyPay so no taxes are withheld from that state. They may also consider stopping withholding even if they are required to file, for states that do not tax their income (MI for example.) Many people do not file required tax returns when there is no refund or balance due. This could result in a letter from the state requesting a return but rarely any penalties – but there can be!
 
Death Benefits:
Many states exclude death benefits and military pay for service members killed in a combat zone or while on active duty. The specifics are not discussed here. Survivors of service members killed on active duty can obtain assistance for this from CACO personnel.

States with Blue names either require a tax return or other document to be filed by military residents, or a tax return should be prepared to determine if any refundable benefits are available from that state. 
 
Alabama:
Alabama treats military residents the same as all other residents.  Alabama does not tax military retirement.
 
Alaska:
Alaska does not have an income tax. Alaska Permanent Funds Dividends are taxable on the Federal Return.
 
Arizona:
Arizona does not tax active duty military pay, and does not require filing if the only AZ source income is active duty pay.
 
Arkansas:
Beginning in 2014, Arkansas no longer taxes active duty military pay.  A tax return is still required.
 
California:
California does not tax military pay of CA residents stationed outside of the state of CA. They do tax military income of their residents when stationed in CA. They also treat military spouses generously, similar to SC. Form 540NR is used to account for this. You write “MPA” to the left of column A for non-resident military income and enter the military income in column B but exclude it from column E.
 
Colorado:
Colorado taxes military residents the same as other residents unless the member is stationed outside the US for >305 days in the year.
 
Connecticut:
Connecticut allows resident military personnel stationed outside of CT to be treated as non-residents for tax purposes. This can be confusing but the point is that they are still a resident, just not treated that way for tax purposes. In order to be treated as a non-resident they must meet all three of the following requirements: 1) Not maintain a permanent place of abode in CT for the entire year (a parents house is not a permanent place of abode.) 2) Maintain a permanent place of abode outside of CT for the entire year. 3) Spend no more than 30 days in CT for any reason during the year. If they meet these requirements they can file as a non-resident and exclude any military wages from gross income and need not file unless they have other CT source income.
 
Delaware:
DE taxes military residents the same as all other residents.
 
Washington DC:
DC taxes resident military personnel the same as all other residents.
 
Florida:
Florida does not have an income tax, however they do have an intangibles tax. Most military members will not have any filing requirement.
 
Georgia:
GA taxes military residents the same as all other residents however Reserves or National Guard called to active duty for more than 90 days may be able to take a credit against their individual income tax based on their income from the National Guard or Reserves.
 
Hawaii:
Hawaii taxes military residents the same as all other residents except that they do not tax the first $6076 of reserve pay or HI national guard pay.
 
Idaho:
ID residents stationed in ID pay taxes on all military income; however, if the member was on active duty >120 days and stationed outside of Idaho they can exclude any military income earned while stationed outside of ID. If they are stationed outside of Idaho the entire year they do not need to file an ID tax return, however Idaho has a Grocery Credit that a military member is eligible for that is refundable so it is possible to get a refund from Idaho even though their was no tax withheld.  This makes Idaho one of the States that a military member should file even when not required to. 
 
Illinois:
IL does not tax military pay; however, the member must file a tax return if they file a Federal return. Military members with children who get Federal Earned Income Credit may get up to 10% of the Federal amount even if they have no taxes due to IL.
 
Indiana:
Indiana taxes military income but allows a deduction of the first $5000 of military income for the taxpayer and/or the spouse ($10000 for military couple.) If a military member changes state of residency to another state they must submit the DD Form 2058 with the tax return for the year they changed state of residency.
 
Iowa:
IA does not tax military income and military income is not used in determining filing requirements (if the only significant sources of income are military income, a tax return is not required.) Starting in 2014, Iowa no longer taxes military retirement.
 
Kansas:
Kansas taxes military income but allows a deduction for recruitment, sign-up and retention bonuses paid that are included in Federal taxable income (if the bonus was tax free to federal do not deduct it from KS. Kansas starts with Federal AGI so it is already excluded.)  The subtraction is made on Adjustments line A21.
 
Kentucky:
Beginning with 2010, KY does not tax military income and does not require a tax return if the only KY source income is military pay.
 
Louisiana:
Louisiana requires a tax return from military personnel the same as any other resident; however, LA gives an exclusion of up to $30000 of military pay if the person has been on active duty outside of Louisiana for at least 120 days during the tax year. The subtraction is taken as a Schedule E subtraction, Code 10E, by entering military pay up to $30000 on the schedule.
 
Maine:
Maine allows resident military personnel stationed outside of ME to be treated as non-residents for tax purposes. This can be confusing but the point is that they are still a resident, just not treated that way for tax purposes. In order to be treated as a non-resident they must meet all three of the following requirements: 1) Not maintain a permanent place of abode in ME for the entire year (a parents house is not a permanent place of abode.) 2) Maintain a permanent place of abode outside of ME for the entire year. 3) Spend no more than 30 days in ME for any reason during the year. If they meet these requirements they can file as a non-resident and exclude any military wages from gross income and need not file unless they have other ME source income. Maine calls this the General Safe Harbor Rule. 
Maryland:
Maryland taxes military residents just like other residents; however, they allow a subtraction for up to $15000 of military pay earned outside of the U.S. (Military Overseas Income.) The deduction phases out dollar for dollar as ALL military income goes above $15000 and there is no exclusion if the total military income exceeds $30000. The subtraction is taken on Form 502SU and the Military Overseas Income Worksheet is used to calculate the deduction.
 
Massachusetts:
There are no special tax benefits for military, however, the Massachusetts Dept of Veterans Affairs will give a one time payment of $500 to any resident after they served at least 6 months active duty in the military. They also have a $1000 benefit for personnel who serve in Iraq or Afghanistan.
 
Michigan:
Michigan requires military members to file a tax return; however, they subtract active duty pay from income (Schedule 1, Line 11). Military members with children who receive Earned Income Credit on their Federal return may collect 6% of the federal amount, even if they pay no taxes to MI. (This was 20% for 2011 and prior years.)
 
Minnesota:
Minnesota subtracts Active Duty Military pay from income of MN residents. If Gross Income on Federal return other than military is less than $10000, no MN return is required.
Minnesota pays $120 per month a military resident spends in a combat zone. This is paid separately from the tax return and is claimed on Minnesota form M99
 
Mississippi:
Mississippi taxes military residents the same as other residents except that they do not tax National Guard and Reserve pay up to $15000.
 
Missouri:
MO allows resident military personnel stationed outside of MO to be treated as non-residents for tax purposes. This can be confusing but the point is that they are still a resident, just not treated that way for tax purposes. In order to be treated as a non-resident they must meet all three of the following requirements: 1) Not maintain a permanent place of abode in MO for the entire year (a parent's house is not a permanent place of abode.) 2) Maintain a permanent place of abode outside of MO for the entire year. 3) Spend no more than 30 days in MO for any reason during the year. If they meet these requirements they can file as a non-resident and exclude any military wages from gross income and need not file unless they have other MO source income. If your spouse works but claims MO as your state of residency through the MSRRA their income is taxable to MO and must file a tax return if they earn more than $1200. As of 2014, Missouri exempts 75% of military retirement income from tax and starting in 2016 all military retirement income will be tax exempt.
 
Montana
Montana requires military residents to file a tax return but exempts active military pay from taxation on Schedule 2, Line 8. Verification of active duty status must be attached to the return.
 
Nebraska:
Nebraska taxes military residents just like other residents.Nebraska has implemented an incredibly complicated option to exclude certain amounts of military retirement income for some years.  It's too stupid to attempt to explain, but if you are retiring or retired from the military in Nebraska you should read this immediately:
http://www.revenue.nebraska.gov/info/military_benefits.html 
 
Nevada:
Nevada does not have an income tax.
 
New Hampshire:
NH does not have an income tax but they do tax interest and dividends. Generally these would need to exceed $2400 for an individual and $4800 for a couple.
 
New Jersey:
NJ allows resident military personnel stationed outside of NJ to be treated as non-residents for tax purposes. This can be confusing but the point is that they are still a resident, just not treated that way for tax purposes. In order to be treated as a non-resident they must meet all three of the following requirements: 1) Not maintain a permanent place of abode in NJ for the entire year (a parent's house is not a permanent place of abode.) 2) Maintain a permanent place of abode outside of NJ for the entire year. 3) Spend no more than 30 days in NJ for any reason during the year. If they meet these requirements they can file as a non-resident and exclude any military wages from gross income and need not file unless they have other NJ source income.(NJ does not consider barracks maintaining a permanent place of abode outside NJ)
 
New Mexico:
New Mexico does not tax active duty military pay however; NM residents are required to file a NM return if they were required to file a Federal return.
 
New York:
NY allows resident military personnel stationed outside of NY to be treated as non-residents for tax purposes. This can be confusing but the point is that they are still a resident, just not treated that way for tax purposes. In order to be treated as a non-resident they must meet all three of the following requirements: 1) Not maintain a permanent place of abode in NY for the entire year (a parents house is not a permanent place of abode.) 2) Maintain a permanent place of abode outside of NY for the entire year. 3) Spend no more than 30 days in NY for any reason during the year. If they meet these requirements they can file as a non-resident and exclude any military wages from gross income and need not file unless they have other NY source income. NY specifically excludes barracks as an abode outside of NY for the purpose of this rule. Also, if a NY return is required to be filed to get back state taxes withheld and this exemption results in zero income (as it usually does) the return may have to be mailed in vice electronically filed.
 
North Carolina:
NC taxes military residents the same as other residents.
 
North Dakota:
ND taxes military residents the same as other residents, however, National Guard and reserve members called to active duty can exclude their active duty pay form ND income.
 
Ohio:
Ohio does not tax military pay of OH residents stationed outside of the state of OH. They do tax military income of their residents when stationed in OH. Ohio does not tax military retirement pay.
 
Oklahoma:
Oklahoma allows military members to exclude active duty pay. This exclusion is accomplished using Schedule 511-C. Military members are required to file an OK tax return if they were required to file a federal return.
Oregon:
Oregon allows a subtraction of all military pay earned while stationed outside of OR and up to $6000 earned while stationed in Oregon (Subtraction Code 319). OR also allows military residents to be treated as non residence if they spent less than 31 days in OR, did not have an abode in OR and had a permanent abode outside OR the entire year.
 
Pennsylvania:
Pennsylvania does not tax Active Duty Military Income of residents stationed outside of PA and does not require a tax return; however, they do require the service member to mail or fax a copy of their orders stationing them outside of PA and their W-2. If filing a tax return a copy of the orders must be included when mailing the return, or sent separately to the address below.
PA DEPT OF REVENUE
NO PAYMENT OR NO REFUND
2 REVENUE PLACE
HARRISBURG PA 17129-0002
May also be faxed to : (717) 772-4193
 
Rhode Island:
Rhode Island taxes military residents the same as other residents.
 
South Carolina:
SC taxes military residents just like regular residents except that it does not tax reservist drill pay. SC is very generous to the spouses of military (residents of another state) in that they allow you to exclude the active duty income of the non-resident military member from the calculation of what percentage of deductions to allocate to the spouse. This generally results in 100% of the deductions against only the spouses SC income. It is very difficult to get tax software to handle this correctly. Line 1 of the SCNR should have no active duty military income in the Federal column.
 
South Dakota:
SD does not have an income tax.
 
Tennessee:
TN does not have an income tax but they do tax interest and dividends. Generally these would need to exceed $1250 for an individual and $2500 for a couple.
 
Texas:
Texas does not have an income tax.
 
Utah:
Utah taxes resident service members the same as other residents.
 
Vermont:
Vermont does not tax military pay of VT residents stationed outside of the state of VT. They do tax military income of their residents when stationed in VT. Military pay is subtracted on line 32. A tax return is not required if the only income is military pay while stationed outside VT. 
Virginia:
Virginia taxes military residents just like other residents except that they give a subtraction of basic military pay of up to $15000. The subtraction phases out dollar for dollar as income goes from $15000 to $30000 and is completely gone at $30000 of income. (If a military member made less than $15000, it would all be subtracted. If they made $20000, they get to subtract $10000.) The subtraction code is 38.
 
Washington:
Washington does not have an income tax.
 
West Virginia:
West Virginia taxes military residents unless they spent less than 30 days in WV. In this case they file as a non-resident. WV does not tax military income of reserves or national guard called to active duty by Executive Order of the President.
 
Wisconsin:
Wisconsin taxes military residents the same as other residents except that they do not tax military pay of reserves or national guard called to active duty. Rent paid by the military member in a state other than WI is allowed to be used for the School Property Tax Credit (not military housing.) If a military member is stationed outside the United States, they may take a credit of up to $300 for pay received while stationed outside the U.S.  Wisconsin does not tax military retirement.
 
Wyoming:
WY does not have an income tax.
 
Feel free to send questions to Kirk at taxadvisor@email.com
I am available to prepare taxes via mail, e-mail, fax and online approval. No fees are charged until the return is complete and you are 100% satisfied. If the fees are too high, refund too low, or we determine that a cheaper filing method is appropriate, I will return all materials and charge no fees.
I will check any individual tax return from 2011, 2012, 2013 or 2014 for free. If I find an error, I will offer to fix it for a fee if desired
 
I have made every effort to ensure the above information is 100% accurate, but I am human and the various governments love to change the rules. If you think something is wrong please inform me via e-mail at taxadvisor@email.com

If you like the blog, buy my book: Everyday Taxes only $5.99 for Kindle!  $11.99 or less for paper copy.

Monday, December 1, 2014

2014 Boomer Deduction Instructions for Turbo Tax Online

If you like the blog, buy my book: Everyday Taxes only $5.99 for Kindle! Paperback $11.99 or less!

These are specific instructions for entering information from the Boomer Deduction Worksheet into Turbo Tax using their online tax preparation at www.turbotax.com.  I used the Miltary version which it said would be $24.99, though I can't vouch for that. 

DISCLAIMER:

This is NOT an endorsement of Turbo Tax!  I also make no promises about the accuracy or reliability of the information presented, it is for assistance and education ONLY.  You MUST do your own due diligence to ensure your taxes are right.  I feel that the assistance of a trained professional is critical in preparing taxes for military members.  Feel free to contact me for questions at taxadvisor@email.com.  Realize still that even if I answer your questions, I make no promises and bear no liability for the accuracy of the answers.  The only way I take ANY liability is if you see me to prepare your taxes in my professional capacity under my employer for whom I work as a tax professional.  Making a donation to this site or buying my book (which I encourage and appreciate if you make extra money from the massive amount of work and expense this takes) does not constitute paying me for my advice.

Glad that's over!

General Instructions:
  • Make sure you fill out the 2014 Boomer Deduction Worksheet, found HERE, first.
  • The information and answers to various questions apply to the Boomer Deduction only.  It is possible that some yes's or no's may be different for you if you have complementing or overlapping situations.
  • I don't write everything from each page, but I generally start at the top of the page.  Sometimes the page title will use information, such as your name or your car make, so mine won't match.  If the page title is long, I may discontinue with a ... but you should be able to tell where I am.
  • If I skip pages, I'll write "more pages" so just keep clicking continue and answering questions until you get to the next page I talk about.
  • I'll indicate new pages on their site by separating information with three asterisks - ***
  • I'll indicate that you should be entering something or clicking a button by using the # sign
Page Instructions:

After logging in and creating an account, you will enter personal information (use "2 Crew FBM Submariner" for occupation), as well as information from your W-2's and other documents, advancing using the continue or Yes/No buttons.  Eventually you will get to the Deductions and Credits portion where you can select "Walk me Through Everything" and then shortly you will get to the pages that matter, or you can select "I'll Choose what to Work On" and click "Start" next to "Job Related Expenses" which will jump you to the third section below:

***
Did Either of You Use Your Own Money to Pay for Job Expenses in 2013?
# Yes
***
More Pages
***
Employment Expenses Related to W-2?
# Yes
***
More Pages
***
Tell Us About the Occupation You Have Expenses For.
# 2 Crew FBM Submariner
***
Do Any of These Uncommon Situations Apply?
# None of the Above
***
Home Office Expenses?
# No
***
Any Vehicle Expenses or Sales?
# Yes
***
Tell Us About Your Vehicle
# Enter asked for information (should be auto or truck <6000# unless really BIG)
***
***
Do You Own...
# Yes or No
***
When Did You Acquire...
# Enter date
***
When Did You Start Using ...
# If on Boomer when car acquired use choice one, otherwise use choice two.
***
Are You Still Using...
# Yes
***
Is Your ... an Electric Vehicle
# Click Yes or No
***
Did You Purchase New?
# Yes or No
***
Did You Trade In Another Vehicle to Purchase...
# Yes or No
If you click Yes it will ask for the purchase price excluding the trade in
# Enter what you paid in cash or with a loan for the car
***
Personal Use of Your...
Was your ... available during non-working hours?
# Yes
Do you have another vehicle available for personal use?
# Answer Yes if the household has 2 or more vehicles
***
Mileage Records for Your...
Did you keep track of your mileage when you used this vehicle for business?
# Yes (The command letter and Boomer Deduction Worksheet should be sufficient)
Did you document your business miles for this vehicle?
# Yes
***
How Do You Want to Enter Your Mileage?
# I'll enter the total miles I drove for the year
Total miles driven for year
# Enter in the box ALL the miles driven by the vehicle for ANY reason (12/31 minus 1/1 odometer)
Miles driven for JOB
# Enter in box the number from Line (N) on the Boomer Deduction Worksheet
Commuting miles
# Enter in box the total miles driven to and from work when NOT on off-crew or Refit Assist
Round trip average daily commute
# Enter in box how far to and from the pier
***
Was Your ... Used for Hire?
# No
***
How Many Vehicles Did You Use for Business in 2013?
# Click the 0-4 box
***
Rural Mail Carrier
# No
Comment: Take a look at the refund amount, you should start seeing this number change soon, and you can see how much this Boomer Deduction is helping - keep an eye on it.  You can thank me later :)
***
Did You Use the Standard Mileage Rate?
(You'll only get this section if you used the car for work in a prior year)
# Yes
***
You've Got a Standard Mileage Deduction of...
Do you want to see if your actual vehicle expenses give you a bigger deduction?
# No
***
Vehicle Summary
# If you used more than one vehicle you will need to click Add Vehicle and go through the process again.  You will need to make sure to divide the Business Mileage from the Boomer Deduction Worksheet between the vehicles as needed.
# Click Done
***
Did You Buy or Own Any Items for Use on Your Job?
# This is generally NO for military.  You can't take haircuts or cell phones as a general rule, and uniforms are generally reimbursed or non-deductible if they can be worn off base.
***
Do You Have any Leftover Deductions from 2012?
# No
***
Any Other Expenses?
# Enter Line (K) amount from the Boomer Deduction Worksheet on the Travel Expenses Line
# Enter Line (M) amount from the Boomer Deduction Worksheet on the Meal and Entertainment Expenses Line
# Enter any other lines as appropriate (though for military it is generally only professional publications)
***
Job Related Expenses
# In the Description Line put "Laundry and Cleaning"
# In the Amount Line put Line (L) amount from the Boomer Deduction Worksheet
***
Reimbursements for Your Expenses
# No
***
Any Special Situations?
# No
***
Job Related Expense Summary
#Done

That's it!  Hopefully this worked for you.  Feel free to ask any questions at taxadvisor@email.com.  I will try to answer quickly but I do get busy during tax time, so don't feel slighted if it takes a while.  Feel free to ask questions in the comments, that way we can help everyone.  Please share with your fellow Boomer Sailors!  If you want me to do your taxes, I can do them via mail or email with no payment until you are satisfied and with secure online review and approval.  I will also check tax returns for free, and, if I find errors, I will tell you the difference and offer to fix for a price (if I check and find no errors I back it up with my companies standard guarantee.)  I encourage you to take advantage of that, I have seen some bad things on Military Tax Returns (I am a retired submarine Master Chief BTW.)

These posts have more info on the Boomer Deduction, with links to references.  If you do your taxes yourself, make sure to do your due diligence.

http://supertaxgenius.blogspot.com/2012/10/boomer-deduction-history-and-references.html
http://supertaxgenius.blogspot.com/2012/03/more-boomer-deduction-information.html

Please DONATE - this was a pain!  And I still have to do Tax Slayer, HR Block at Home and a bunch of others!

2014 Boomer Deduction Instructions for H&R Block at Home (store bought or downloaded)

If you like the blog, buy my book: Everyday Taxes only $5.99 for Kindle!  Paperback $11.99 or less!

These are specific instructions for entering information from the Boomer Deduction Worksheet into H&R Block's at home tax preparation that you would purchase in a store and install on your computer.  I used the Deluxe version linked below.



DISCLAIMER:

This is NOT an endorsement of H&R Block!  I also make no promises about the accuracy or reliability of the information presented, it is for assistance and education ONLY.  You MUST do your own due diligence to ensure your taxes are right.  I feel that the assistance of a trained professional is critical in preparing taxes for military members.  Feel free to contact me for questions at taxadvisor@email.com.  Realize still that even if I answer your questions, I make no promises and bear no liability for the accuracy of the answers.  The only way I take ANY liability is if you see me to prepare your taxes in my professional capacity under my employer for whom I work as a tax professional.  Making a donation to this site (which I encourage and appreciate if you make extra money from the massive amount of work and expense this takes) does not constitute paying me for my advice.

Glad that's over!

General Instructions:

  • Make sure you fill out the 2014 Boomer Deduction Worksheet, found HERE, first.
  • The information and answers to various questions apply to the Boomer Deduction only.  It is possible that some yes's or no's may be different for you if you have complementing or overlapping situations.
  • I don't write everything from each page, but I generally start at the top of the page.  Sometimes the page title will use information, such as your name or your car make, so mine won't match.  If the page title is long, I may discontinue with a ... but you should be able to tell where I am.
  • Generally, when finished entering information on a page you click the "Next" button.  I won't always tell you to do that.
  • I'll indicate new pages on their site by separating information with three asterisks - ***
  • I'll indicate that you should be entering something or clicking a button by using the # sign
Page Instructions:

After logging in and creating an account, you will enter personal information (use "2 Crew FBM Submariner" for occupation), as well as information from your W-2's and other documents, advancing using the continue buttons.  Eventually you will get to the Deductions Section.

***
Deductions
# Check "Job related expenses" box
***
Job Related Expenses
# Click the plus sign next to "Add Job"
***
Job Related Expenses
# In the "Occupation" box, enter "Two Crew FBM Submariner
***
Do Any Special Situations Apply
# Click "None of the Above"
***
Job Expense Assistant
# Click the "Quick Entry" button
***
Enter Your Job Related Expenses
# In the "Overnight Travel" box, enter the total of Lines K and L from the Boomer Deduction Worksheet
# In the "Meals and Entertainment" box, enter the amount from Line M from the Boomer Deduction Worksheet
***
Were You Reimbursed
# Click No
***
Department of Transportation Limits
# Click No
***
Job Related Expense Summary
# Click Next
***
Work Related Home Office
# Click Finished
***
 Vehicles Used in Employment
# Click the plus sign next to "Add Vehicle"
***
Tell Us About This Vehicle
# Enter your vehicles Make and Model
# Enter the Date you first used the vehicle for business
# Enter the number of months you were on off-crew or refit assist in 2013 (round up)
***
Owned, Leased or Provided
# Check Own or Lease as applicable
***
Check Any that Apply
# Check any that apply
***
Your Vehicle Mileage
# Enter total mileage driven during the year for ANY purpose (12/31 odometer - 1/1 odometer)
# In "Miles Driven for Business" box, enter value from Line (N) of your Boomer Deduction Worksheet
# Enter commuting miles from days not in Off Crew or Refit Assist
(Commuting plus business miles should be less than total miles)
# Enter daily round trip commute mileage
***
Reporting Your Expenses
# Click "Next"
***
Standard Mileage in First Year
# Check Yes
(you will only get this page if your vehicle was put in service in 2012 or before.  This page and the next have a similar title so don't be surprised if it confuses you.  Just be sure to check the Standard Mileage Rate box on any pages that ask for it.)
***
Choose Your Vehicle Reporting Method
# Check the Standard Mileage box
***
Tell Us Your Out of Pocket Vehicle Expenses
# Click "Next"
***
Your Vehicle Additional Information
# Check the 2nd box if your household has more than one vehicle
# Check the other three boxes
***
Your Standard Mileage Deduction
# Click "Next"
Watch your refund change and see how much I have helped you!  You can thank me later :)
***
If you drove more than one vehicle for this deduction you would now add another vehicle and repeat the process.  Make sure to divide the business miles between the vehicles if this is the case.

That's it!  Hopefully this worked for you.  Feel free to ask any questions at taxadvisor@email.com.  I will try to answer quickly but I do get busy during tax time, so don't feel slighted if it takes a while.  Feel free to ask questions in the comments, that way we can help everyone.  Please share with your fellow Boomer Sailors!  If you want me to do your taxes, I can do them via mail or email with no payment until you are satisfied and with secure online review and approval.  I will also check tax returns for free, and, if I find errors, I will tell you the difference and offer to fix for a price (if I check and find no errors I back it up with my companies standard guarantee.)  I encourage you to take advantage of that, I have seen some bad things on Military Tax Returns (I am a retired submarine Master Chief BTW.)

These posts have more info on the Boomer Deduction, with links to references.  If you do your taxes yourself, make sure to do your due diligence.

http://supertaxgenius.blogspot.com/2012/10/boomer-deduction-history-and-references.html
http://supertaxgenius.blogspot.com/2012/03/more-boomer-deduction-information.html

Please DONATE - this was a pain!  And I still have to buy and test the Turbo Tax home software!