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Am I on the right path to decreasing my tax burden on the…

Am I on the right...
Am I on the right path to decreasing my tax burden on the income made in commission for unpaid quarterly taxes?The break down is the following for me and frank :so far
Eric nurse w-2 full-time earning gross 36,332, SIMPLE IRA 1090.00, FED 4767.00, SS 2,252, MED 526, State 1073. SDI 327.00,
FRANK: w-2 full-time45k, FED 7245, MED 650, state 2012. SDI 404, commission non taxed first year earnings 117,000.
Will open a HSA for 3400, 2 401k at 18,000 each, home office deduction educational expenses plus others
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Answered in 7 hours by:
11/19/2017
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 14,228
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

Step 1 - For federal tax purposes, the IRS looks to state or foreign law to determine whether individuals are married. The IRS has a general rule recognizing a marriage of same-sex spouses that was validly entered into in a domestic or foreign jurisdiction whose laws authorize the marriage of two individuals of the same sex even if the married couple resides in a domestic or foreign jurisdiction that does not recognize the validity of same-sex marriages.

...

DO you qualify to file jointly?

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Assumed Married filing jointly, standard deduction, 36000 into 401(k)'s, and NO business deductions

Detailed Data Table

Estimated Tax Analysis

Gross income$198,332

Qualified plan contributions-$39,400

Adjusted gross income=$158,932

Standard/Itemized deductions-$12,700

Personal exemptions-$8,100

Taxable income=$138,132

Tax liability before credits$26,010

Child tax credits-$0

Estimated tax liability=$26,010

Taxes withheld-$12,012

Tax shortfall=$13,998

...

Now, bear with me a moment and I'll show what happens with Home office expense, phone costs, (if separate business line), auto expense, advertising, etc at another 20,000

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Estimated Tax Analysis

Gross income$178,332

Qualified plan contributions-$39,400

Adjusted gross income=$138,932

Standard/Itemized deductions-$12,700

Personal exemptions-$8,100

Taxable income=$118,132

Tax liability before credits$21,010

Child tax credits-$0

Estimated tax liability=$21,010

Taxes withheld-$12,012

Tax shortfall=$8,998

...

Now adding the full 2500 American Education Opportunity Credit

...

8998 - 2500 = 6498

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Another 20,000 of business expense gets you down to 3998

Estimated Tax Analysis

Gross income$158,332

Qualified plan contributions-$39,400

Adjusted gross income=$118,932

Standard/Itemized deductions-$12,700

Personal exemptions-$8,100

Taxable income=$98,132

Tax liability before credits$16,010

Child tax credits-$0

Estimated tax liability=$16,010

Taxes withheld-$12,012

Tax shortfall=$3,998

....

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Customer reply replied 6 months ago
we file jointly. Would a additional retirement account help ? Should we purchase the equipment we have been holding off on to increase the home office deduction? Ie computer ? Does my work preparing for the nurse specialty ie use of home office qualify?
Customer reply replied 6 months ago
How concerned should we be regarding the bone payment of quarterly tax
Customer reply replied 6 months ago
None payment
Customer reply replied 6 months ago
I know this sounds silly but we are so impressed can we just hire you!?

More money contributed would help. With the solo401(k) you can do more than just the 18000 salary deferral piece.

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For example, on the 117000 piece one could contribute Maximum Profit Sharing Contribution $21,746.84 PLUS the Maximum 401(k) Contribution of $18,000.00

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(I can help you set this up if you'd like)

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Purchasing equipment would fall under the section 179 deduction (which, although normally equipment purchase have to be depreciated over the useful life of the equipment, allows you to accelerate the full purchase price of the equipment into the first year placed into service)

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Now, on the home office expense is a very specific deduction - that allows you to take your living expenses in the home; utilities, depreciation or rent, mortgage interest, etc. and then multiply that by the proportionate space used in the home FOR business and deduct it.

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On the estimated payments, the reason you do that is simply to avoid the underpayment penalty (not as bad as you might think) ... because it's only charged for the portion of the year that you've underpaid if you get everything paid by April of the following year.

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Sure, we can talk. What I can do is make what's called a premium services offer for a small amount and then see what's needed from there.

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Customer reply replied 6 months ago
Just let me know what you need . I honestly can’t express how much pressure and stress I have been under . There has to be something beyond your fee I can contribute?

See this on the education expenses - First they can be ANY institution as long as a higher learning (college) institution that takes federal financial aid.

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"You can claim an education credit for qualified education expenses paid by cash, check, credit or debit card or paid with money from a loan.

If you pay the expenses with money from a loan, you take the credit for the year you pay the expenses, not the year you get the loan or the year you repay the loan.

Qualified Education Expenses for Education Credits

Qualified expenses are amounts paid for tuition, fees and other related expense for an eligible student that are required for enrollment or attendance at an eligible educational institution. You must pay the expenses for an academic period* that starts during the tax year or the first three months of the next tax year."

...

Then other expenses can qualify if they are to CONTINUE a current profession (those to prepare you for a NEW career aren't deductible as work related education.

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Let me make the offer and then we can discuss on a phone consult.

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Can talk tomorrow as well (nothing with a time on it until 2:30 eastern)

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Customer reply replied 6 months ago
I’m off Tuesday if that day works i Welcome the consult

That'll work. Just accept what I've offered here, and we'll both get an encrypted private link for sharing contact information.

...

Then after discussing, the consult MAY be enough to get you on your way (You should see something that says "accept offer" or "get more help"

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Did you see the offer?

Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 14,228
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified
Lane and 87 other Tax Specialists are ready to help you
Ask your own question now
Customer reply replied 6 months ago
I don’t see the “offer”
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Lane
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 14,228
14,228 Satisfied Customers
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986

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