Tax Trouble

[Jynohn]

Anyone else having a hard time with taxes due to deployment? I did ours last week with the free military offer from Turbo Tax and it seems as if we owe over $3,000

I'm having a hard time believing this is accurate because DH was deployed for all but 3 weeks in 2005 and was tax exempt. When I do my taxes separately I end up getting back almost $1,000, but adding in his we end up owing. Most of his income shows up properly on his W-2, but it's also reporting $10,000 as taxable income that was never taxed. I have no idea what this could be as his re-enlistment bonus was also tax exempt since he signed in a combat zone. There was no way he made $10,000 in the 3 weeks he was stateside! He already went to command, but they haven't been much help. Anyone else have tax issues or have any advice to give?

Thanks!

Jynohn

 

[poohbear1029]

Are you sure that his bonus is tax free? If so, fine, if any doubt, check with someone on base. I say this only because DH signed a bonus 4 years ago(not in combat zone) and now travels every other month to combat zone (thereby making those months tax free) and we were told that even if he receives his bonus in a tax free month it is not tax free.....I can find out where he learned that if you want....

I am giving out my fair warning on Turbo tax for military taxes this year! The state of MA just audited our 2002 returns because Turbo tax forced us to file wrong....example:

DH is a NH resident, no state income tax....so doesnt need to file state. Military is only income. Turbo tax would not allow us to file MA state separately for me, because we had filed jointly federal. BUT, it did allow us to back out his W-2 wages. Well...MA caught up with that and said we under-reportedand owed them back taxes. Which is not true, but we reported wrong and even once we manually refiled, we had adjusted payment and interest. Needless to say I will be calling Turbo Tax to complain as they are supposed to have a guarantee.

Anyway....we now have to also redo our 2003 and 2004 MA state taxes because we used Turbo Tax. It seems to me that Turbo Tax might not be complete in the all the idiosyncrosies for military taxes.

 

[Longsx3]

Go on base and have your taxes done, every Military Base offers it.

As far as the 10K, some of it depends on rank. This site may help http://www.irs.gov/newsroom/article/0,,id=101262,00.html

 

[Jynohn]

Hello:

Yes, I'm positive the bonus is tax-excluded. DH made double sure when he signed the contract We actually had taxes taken out of it, but then we were reimbursed the following pay period. I still can't for the life of me figure out what that 10K is. It's really strange that it's an even number too. Exactly $10,000.00

Thanks for the warning about TT, and the info about getting taxes done on base. DH made an appt. for next week. Hopefully they'll be able to figure out the situation for us. My only concern is that they won't be able to tell us what that $10K is about. I think it may be a mistake on his W2, not in my computations .

 

[cheeringmom]

Go on base and have your taxes done, every Military Base offers it.

As far as the 10K, some of it depends on rank. This site may help http://www.irs.gov/newsroom/article/0,,id=101262,00.html

i agree. my dh is deployed and I will not attempt to do the taxes w/o him! Good luck

 

[Longsx3]

Hello:

Yes, I'm positive the bonus is tax-excluded. DH made double sure when he signed the contract We actually had taxes taken out of it, but then we were reimbursed the following pay period. I still can't for the life of me figure out what that 10K is. It's really strange that it's an even number too. Exactly $10,000.00

Thanks for the warning about TT, and the info about getting taxes done on base. DH made an appt. for next week. Hopefully they'll be able to figure out the situation for us. My only concern is that they won't be able to tell us what that $10K is about. I think it may be a mistake on his W2, not in my computations .

Your right the Tax office may not be able to help wiht the 10K, I would stop by Finance before the Tax appt. Also look up the LES for the month after you received the bonus and you might be able to figure out if it was classified as tax exempt.

Kelly

 

[DawnCt1]

Can't you file for an extension while your DH is deployed? Do you even have to send in an estimated payment?

 

[PrincessaC]

Are you sure that his bonus is tax free? If so, fine, if any doubt, check with someone on base. I say this only because DH signed a bonus 4 years ago(not in combat zone) and now travels every other month to combat zone (thereby making those months tax free) and we were told that even if he receives his bonus in a tax free month it is not tax free.....I can find out where he learned that if you want....

I am giving out my fair warning on Turbo tax for military taxes this year! The state of MA just audited our 2002 returns because Turbo tax forced us to file wrong....example:

DH is a NH resident, no state income tax....so doesnt need to file state. Military is only income. Turbo tax would not allow us to file MA state separately for me, because we had filed jointly federal. BUT, it did allow us to back out his W-2 wages. Well...MA caught up with that and said we under-reportedand owed them back taxes. Which is not true, but we reported wrong and even once we manually refiled, we had adjusted payment and interest. Needless to say I will be calling Turbo Tax to complain as they are supposed to have a guarantee.

Anyway....we now have to also redo our 2003 and 2004 MA state taxes because we used Turbo Tax. It seems to me that Turbo Tax might not be complete in the all the idiosyncrosies for military taxes.

I agree with you about Turbo Tax. We too filed with TT and got audited! We're still trying to work it out and figure out what went wrong. What a pain!!!

 

[Jynohn]

Well DH just got back from base and the W2 was definitely wrong. When he received his re-enlistment bonus they originally took taxes out, which we received back the following pay period. Looks like they reported that refund as taxable income. He now has to go through finance to get that straightened out. What a PIA...

The good news though....they redid our taxes and instead of owing $3200 we are now getting back almost $2K! I would have been happy with just not owing, but that just made my day.

Moral of the story...don't use Turbo Tax!!!

Thanks again everyone for your help.

Jynohn

 

[DawnCt1]

Well DH just got back from base and the W2 was definitely wrong. When he received his re-enlistment bonus they originally took taxes out, which we received back the following pay period. Looks like they reported that refund as taxable income. He now has to go through finance to get that straightened out. What a PIA...

The good news though....they redid our taxes and instead of owing $3200 we are now getting back almost $2K! I would have been happy with just not owing, but that just made my day.

Moral of the story...don't use Turbo Tax!!!

Thanks again everyone for your help.

Jynohn

Good for you! Glad it worked out!

 

[wide awake]

Turbo Tax worked great for us...and it sounds like it would have worked for the OP if the W-2 would have been correct. I used to do taxes so am pretty confident in what you can and can't do...and the state rules are always tricky. If you aren't comfortable w/ doing taxes on your own I'd pay the extra fee to have the Turbo Tax return checked out...I think it was $35 ? All I can say is that I did ours in less than an hour, and we had our $3950 fed and state refund in the bank w/in 10 days...and no fee. We have a form A, B, and 2160 w/ mileage and depreciation, had I paid to have this done plus the rapid refund I'd have been out around $250.