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Posted by hgadagkar on April 9, 2007, 3:10 am
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At the end of 2006, I sent $4K (which was after tax money)
to IRS since I believed that I may owe taxes. After I
prepared my tax return, I now have a net refund of little
over $5K.
When I get my 1099-G next year, how do I account for the
fact that $4K of the refund was paid with after tax money so
that I don't pay taxes on it again on my 2007 return?
Thanks in advance.
Rishi.
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Posted by Phil Marti on April 10, 2007, 10:06 am
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> At the end of 2006, I sent $4K (which was after tax money)
> to IRS since I believed that I may owe taxes. After I
> prepared my tax return, I now have a net refund of little
> over $5K.
>
> When I get my 1099-G next year, how do I account for the
> fact that $4K of the refund was paid with after tax money so
> that I don't pay taxes on it again on my 2007 return?
You won't get a 1099-G. Federal tax payments aren't
deductible on the Federal return, nor are refunds taxable.
--
Phil Marti
Clarksburg, MD
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by Bill on April 10, 2007, 10:06 am
Please log in for more thread options hgadagkar@gmail.com asked:
> At the end of 2006, I sent $4K (which was
> after tax money) to IRS since I believed that I
> may owe taxes. After I prepared my tax return,
> I now have a net refund of little over $5K.
> When I get my 1099-G next year, how do I
> account for the fact that $4K of the refund was
> paid with after tax money so that I don't pay
> taxes on it again on my 2007 return?
Not to worry. As far as the IRS is concerned, your refund
is not income. The only possible issue would arise if you
had itemized a _state_ income tax return, and deducted your
_federal_ taxes paid.
BTW, I've never heard of the IRS issuing 1099-G's for
refunds of tax overpayment.
Bill
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by John D. Goulden on April 10, 2007, 10:06 am
Please log in for more thread options > At the end of 2006, I sent $4K (which was after tax money)
> to IRS since I believed that I may owe taxes. After I
> prepared my tax return, I now have a net refund of little
> over $5K.
>
> When I get my 1099-G next year, how do I account for the
> fact that $4K of the refund was paid with after tax money so
> that I don't pay taxes on it again on my 2007 return?
If you deducted taxes paid in 2006 on your 2006 Schedule A,
that $4K was (or at least should have been) included in that
amount. In other words, you didn't count that $4K as income
in 2006 because you used it to make a tax payment. Since
you're getting it back, you didn't actually pay taxes with
it after all and must include it as income in 2007 since you
did not do so in 2006. In other other words, you DIDN'T pay
taxes on that 4K in 2006, so you must do so in 2007.
If you didn't itemize in 2006, you probably won't even get a
1099G. If you do, you can ignore it. Well, don't actually
ignore it -file it away with the rest of your 2007 paperwork
- but don't include that amount as income on the tax form.
--
John D. Goulden
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by Taxmanhog on April 12, 2007, 12:25 am
Please log in for more thread options hgadagkar wrote...
> At the end of 2006, I sent $4K (which was after tax money)
> to IRS since I believed that I may owe taxes. After I
> prepared my tax return, I now have a net refund of little
> over $5K.
>
> When I get my 1099-G next year.
You will not get a 1099-G for a FEDERAL REFUND
> How do I account for the
> fact that $4K of the refund was paid with after tax money so
> that I don't pay taxes on it again on my 2007 return?
You do not have to, it's not taxable income.
You are confusing this with STATE tax refunds, if your STATE
ES DEPOSITS were deducted as contributed, and you deducted
it on your Federal Schedule A, recovery of the deduction as
income in the following year as a "Taxable STATE income tax
refund"
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ------------------------------------------------------- >>
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