[Help completing the TN state tax return]

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StraightEdge
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[Help completing the TN state tax return]

Post by StraightEdge »

[Multiple threads related to the OP's question on TN state tax returns have been combined into here. Please ask all questions in this thread.

Title was: Can you go back and forth in the future between filing taxes as married jointly or separately? --admin LadyGeek]


Just in general with the IRS and also on the TurboTax system?

Not that I would, I'm just curious if you are allowed to change it up from how you filed it the previous year if you ever feel you need to. Whether it's switch it every year or switch it once every three years, etc. Is that allowed?
Chip
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Re: Can you go back and forth in the future between filing taxes as married jointly or separately?

Post by Chip »

Yes, change as often as you like.
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FiveK
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Re: Can you go back and forth in the future between filing taxes as married jointly or separately?

Post by FiveK »

See 2017 Publication 17 - p17.pdf:
If you and your spouse each have in-
come, you may want to figure your tax
both on a joint return and on separate
returns (using the filing status of married filing
separately). You can choose the method that
gives the two of you the lower combined tax.
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dodecahedron
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Re: Can you go back and forth in the future between filing taxes as married jointly or separately?

Post by dodecahedron »

Yes, you can change from year to year as you wish.

However, if you wish to *amend* a previously filed return, you are limited in directionality. You can amend a previously filed return from MFS to MFJ during the entire three year period after you filed the original return. However, once the filing deadline has passed, you may not amend from MFJ to MFS.
Topic Author
StraightEdge
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Why is TurboTax saying I need to file multiple state tax returns?

Post by StraightEdge »

My wife and I got married in 2017 so I'm filing married jointly for the first time. She lived in California as a student from July 2013-May 2017 but she has never filed California state tax return because she wasn't making an income? I lived in California and worked from December 2014-May 2017. So I filed California state taxes for 2015 and 2016.

We both lived in California from January 2017-May 2017. Only I worked though during that time. Then in June 2017, we moved to Tennessee (where there is no state income tax) and my wife worked in Tennessee from May 2017-December 2017 and I was unemployed from May 2017-December 2017.

So why is it saying we have to file multiple state tax returns? The screen is telling me we have to do it for California as part year resident and Tennessee as part year resident? But Tennessee doesn't have state income taxes? I mean my wife has stocks and she had those when she was a student living in California and before we were married in her name but I'm so confused.
TravelGeek
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by TravelGeek »

I have never lived in Tennessee, but according to Bankrate and other sites via Google:

https://www.bankrate.com/finance/taxes/ ... essee.aspx

"The Tennessee income tax does not apply to salaries and wages, but most income from stocks, bonds and notes receivable is taxable at a flat rate of 6%."
magicrat
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by magicrat »

If you perform work in a state you typically have to file a tax return for that state.
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JoeRetire
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by JoeRetire »

Tennessee only taxes investment income from stocks and bonds (at a flat rate of 5%). If you have investment income from stocks and bonds, you may have to file a Tennessee tax return for that income.

If not, call the TurboTax help line.
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StraightEdge
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by StraightEdge »

Ok so I understand why she would have to pay Tennessee state income tax now on her stocks but it's trying to pull her as a resident of California. Maybe technically she wasn't a resident of California because she was only doing school there from 2013-2017 and never filed a CA state tax return during any of those years? She never held a job during her time in CA. So maybe I made a mistake saying she was a resident of CA and I should only put that I was?
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JoeRetire
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by JoeRetire »

StraightEdge wrote: Wed Apr 11, 2018 12:29 pm So maybe I made a mistake saying she was a resident of CA and I should only put that I was?
But you are married filing jointly, right?
It's the end of the world as we know it. | It's the end of the world as we know it. | It's the end of the world as we know it. | And I feel fine.
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StraightEdge
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by StraightEdge »

JoeRetire wrote: Wed Apr 11, 2018 12:32 pm
StraightEdge wrote: Wed Apr 11, 2018 12:29 pm So maybe I made a mistake saying she was a resident of CA and I should only put that I was?
But you are married filing jointly, right?
Well I'm trying different rough drafts of both married filing jointly and married filing separate to see what works better for our situation. But yes, in this instance I am filling out the form as married filing jointly. But as I go through the state tax return part for California, it's asking all these questions about her stocks and such which doesn't make sense. The stocks are only in her name and I changed it to say that she wasn't a resident of California? It still would ask me about when she was a resident in California and about her stocks, etc? It's still asking me about stock information for the state of California.

So confused.
SlowMovingInvestor
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by SlowMovingInvestor »

I'm not very familar with CA's return, but I think as a general rule, if you are filing MFJ for a state, then you can't file a MFJ return claiming one spouse is a resident and one is not. Both of you have to be either residents or non residents (or part year residents, I suppose). Even if the state allows some form of pro-rating, TT doesn't handle it, so you have to fill in everything manually using 'forms mode' in TT using whatever pro-rating is allowed by CA.

So if your wife is on your MFJ CA return, then her stock income will be taxed in CA for the time she was a resident there. Unless her passive income is substantial, it's probably not going to cost that much extra to file MFJ for CA, and the extra deductions for MFJ etc. might make up for that.

Or you can file MFJ Fed, file MFS (Part Year) for CA (just you).
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StraightEdge
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by StraightEdge »

I'm so confused...I thought you couldn't file married jointly for fed and then married filing separate for state taxes? I thought your filing status for state had to match exactly your federal too?

I wouldn't even know how to file married separate for CA for just me on TurboTax? After filing married jointly federal it just jumps into your state tax return on TurboTax? Ugh this is so confusing.
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Pajamas
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by Pajamas »

StraightEdge wrote: Wed Apr 11, 2018 12:56 pm I'm so confused...I thought you couldn't file married jointly for fed and then married filing separate for state taxes? I thought your filing status for state had to match exactly your federal too?
Depends on the state.

California:
https://www.ftb.ca.gov/individuals/Fili ... tion.shtml

Seems like you might be able to do that.
I wouldn't even know how to file married separate for CA for just me on TurboTax? After filing married jointly federal it just jumps into your state tax return on TurboTax? Ugh this is so confusing.
You would probably have to do a joint federal return and file it and then do a married filing separate federal return and not file it to generate a married filing separate California return to file.
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StraightEdge
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by StraightEdge »

Pajamas wrote: Wed Apr 11, 2018 1:14 pm
StraightEdge wrote: Wed Apr 11, 2018 12:56 pm I'm so confused...I thought you couldn't file married jointly for fed and then married filing separate for state taxes? I thought your filing status for state had to match exactly your federal too?
Depends on the state.

California:
https://www.ftb.ca.gov/individuals/Fili ... tion.shtml

Seems like you might be able to do that.
I wouldn't even know how to file married separate for CA for just me on TurboTax? After filing married jointly federal it just jumps into your state tax return on TurboTax? Ugh this is so confusing.
You would probably have to do a joint federal return and file it and then do a married filing separate federal return and not file it to generate a married filing separate California return to file.
This is so confusing. How on earth do I do that using TurboTax online? Because it like forces me to jump right into state tax after I do federal when I'm doing married jointly? Are you saying just to submit the federal jointly using TurboTax online and then somehow skip the state part and just do it on paper and mail it in? How would I do that?

Or is it better just to file married separate on both federal and state for both of us?

Also, I looked back on my wife's tax return for 2016 and the CPA didn't do a TN state tax return even though my wife had stocks and was a resident of the state? Why not?
retiredjg
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by retiredjg »

I think it may be because you have to split the tax due between CA and the "other state".

It seems likely there will be no tax (or little tax) in the "other state", but there has to be an "other state" for CA to accept that you don't owe CA tax for the whole year.

In a case like this, I think TT may know what it is doing - I'd probably just follow their instructions myself.
SlowMovingInvestor
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by SlowMovingInvestor »

StraightEdge wrote: Wed Apr 11, 2018 1:21 pm
Pajamas wrote: Wed Apr 11, 2018 1:14 pm
StraightEdge wrote: Wed Apr 11, 2018 12:56 pm I'm so confused...I thought you couldn't file married jointly for fed and then married filing separate for state taxes? I thought your filing status for state had to match exactly your federal too?
Depends on the state.

California:
https://www.ftb.ca.gov/individuals/Fili ... tion.shtml

Seems like you might be able to do that.
I wouldn't even know how to file married separate for CA for just me on TurboTax? After filing married jointly federal it just jumps into your state tax return on TurboTax? Ugh this is so confusing.
You would probably have to do a joint federal return and file it and then do a married filing separate federal return and not file it to generate a married filing separate California return to file.
This is so confusing. How on earth do I do that using TurboTax online? Because it like forces me to jump right into state tax after I do federal when I'm doing married jointly? Are you saying just to submit the federal jointly using TurboTax online and then somehow skip the state part and just do it on paper and mail it in? How would I do that?

You can't do it with TT online (AFAIK, I don't use TT online). You can only do it with TT download/CD (by opening a new file).
SlowMovingInvestor
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by SlowMovingInvestor »

retiredjg wrote: Wed Apr 11, 2018 1:43 pm In a case like this, I think TT may know what it is doing - I'd probably just follow their instructions myself.
I disagree. I don't think TT handles these kinds of multi-state returns well when spouses are earning in different states. I think it'll give you a return that is 'correct', but you may end up paying more in taxes than you need to.

And really, I don't blame TT -- there are too many scenarios and too many state combinations for it to handle automatically.

TT basically suggests using TT download/CD and creating 'mock' MFS returns for doing different states for such situations.
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Pajamas
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by Pajamas »

StraightEdge wrote: Wed Apr 11, 2018 1:21 pm
Pajamas wrote: Wed Apr 11, 2018 1:14 pm
StraightEdge wrote: Wed Apr 11, 2018 12:56 pm I'm so confused...I thought you couldn't file married jointly for fed and then married filing separate for state taxes? I thought your filing status for state had to match exactly your federal too?
Depends on the state.

California:
https://www.ftb.ca.gov/individuals/Fili ... tion.shtml

Seems like you might be able to do that.
I wouldn't even know how to file married separate for CA for just me on TurboTax? After filing married jointly federal it just jumps into your state tax return on TurboTax? Ugh this is so confusing.
You would probably have to do a joint federal return and file it and then do a married filing separate federal return and not file it to generate a married filing separate California return to file.
This is so confusing. How on earth do I do that using TurboTax online? Because it like forces me to jump right into state tax after I do federal when I'm doing married jointly? Are you saying just to submit the federal jointly using TurboTax online and then somehow skip the state part and just do it on paper and mail it in? How would I do that?

Or is it better just to file married separate on both federal and state for both of us?

Also, I looked back on my wife's tax return for 2016 and the CPA didn't do a TN state tax return even though my wife had stocks and was a resident of the state? Why not?
You might want to file for extensions and then get the CPA to take care of it.
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StraightEdge
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by StraightEdge »

So as I'm going through it jointly, it's asking me which of the total stock numbers that I put in earlier for federal came during the time in California to be taxed by their state...how do I do this?
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Duckie
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by Duckie »

StraightEdge wrote:So as I'm going through it jointly, it's asking me which of the total stock numbers that I put in earlier for federal came during the time in California to be taxed by their state...how do I do this?
You pick the exact date she left California and you look at the brokerage and bank statements, monthly or quarterly, and separate all transactions (dividends or interest paid, stocks or bonds sold) while in California from all transactions while in Tennessee.
muddgirl
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by muddgirl »

When I have done partial year resident returns in the past, I look at it from a cash basis perspective (don't know if I'm using that term right). I make a spreadsheet showing the date of receipt of income, interest, dividends, capital gains, etc. Then I can divide it between the dates I was in one state vs the dates I was in the other state.

If you both lived in CA and then you both lived in TN, and you moved at the same time, I don't know why you would bother to do a MFS for either state. You need a partial year return for both your incomes in California, and a partial year return for both of your incomes in TN, for whatever part of your income is taxable in each state.

The first time I tried to do this in Turbotax, back in 2006, they totally messed it up. Now I do partial year returns myself when I have to. 99% of the work is making the spreadsheet which IIRC TurboTax does not help with.
quantAndHold
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by quantAndHold »

When did you get married? Was it before or after she left California? What state was she a resident of when she was in school in California?

You will definitely need to file two part year state returns if you owe tax in both states. That’s normal when people move from state to state. Most states that have income tax charge tax on the money you made while you were a resident, but set the rate according to your income for the full year. For example, when I moved from WA to CA, I only made a few hundred dollars in CA, but made six figures in WA. My CA tax bill was 9% of the few hundred dollars I made when I was in CA. Have you tried to run the part year return for the states to see where you stand?

If you want to file MFS in California, the previous poster was correct. You can file a MFJ federal return, then generate a “pro forma” federal return as MFS (all you have to do is go back the beginning and click the married filing separately button), then run the state taxes from that. MFS lowers limits on things, so you might not be happy with the result, but it’s worth a try.
Yes, I’m really that pedantic.
quantAndHold
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by quantAndHold »

muddgirl wrote: Wed Apr 11, 2018 4:54 pm When I have done partial year resident returns in the past, I look at it from a cash basis perspective (don't know if I'm using that term right). I make a spreadsheet showing the date of receipt of income, interest, dividends, capital gains, etc. Then I can divide it between the dates I was in one state vs the dates I was in the other state.

If you both lived in CA and then you both lived in TN, and you moved at the same time, I don't know why you would bother to do a MFS for either state. You need a partial year return for both your incomes in California, and a partial year return for both of your incomes in TN, for whatever part of your income is taxable in each state.

The first time I tried to do this in Turbotax, back in 2006, they totally messed it up. Now I do partial year returns myself when I have to. 99% of the work is making the spreadsheet which IIRC TurboTax does not help with.
I used TT to do he California part year return for a very complicated 2017 (fed return was 80 pages). It handled everything correctly.
Yes, I’m really that pedantic.
seawolf21
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by seawolf21 »

TravelGeek wrote: Wed Apr 11, 2018 12:17 pm I have never lived in Tennessee, but according to Bankrate and other sites via Google:

https://www.bankrate.com/finance/taxes/ ... essee.aspx

"The Tennessee income tax does not apply to salaries and wages, but most income from stocks, bonds and notes receivable is taxable at a flat rate of 6%."
That should be gone in 2022.
https://www.forbes.com/sites/ashleaebel ... e958807ca9
seawolf21
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by seawolf21 »

TT download would likely be handle these situations in FORMS mode but you may also need to have state instructions handy to confirm what is allowed or not.

I've used TT for a number of years to file NY/NJ/CT taxes due to family living in NYC and one spouse working in NJ while the other in CT.

NJ non-resident forms allows a Federal MFJ to file NJ MFS for spouse working in NJ and it DIDN'T involve having to create a Fed MFS return. There are worksheets in TT that allow excluding the CT spouse's W2 income from NJ calculation but you can only access it in FORMS mode.

While I understand OP return involves CA and TN, the point is, in terms of complex situations, TT online is useless. TT download INTERVIEW mode offers more functionality than online but TT FORMS mode provides the most capabilities.
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archbish99
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by archbish99 »

My parents used to file annually in three states (we lived in one, Dad worked in another, and Mom had passive income from a third), and I've done this repeatedly both from my own moves and since I've assumed control of their finances. None of those states was one of the ones you mention, so Your Tax Code May Vary.

Based on my experience, part-year resident and non-resident state tax returns often look like this:
  • Calculate your taxes on all your income, as if you'd lived in this state the whole time: $X
  • Calculate the percentage of your income that is legitimately taxable by us (earned while you lived here, or earned by working here as a non-resident): Y%
  • Pay us Y% of $X.
In your primary (resident at end-of-year) state, you'll be taxed on all income you have for the year, no matter where you lived, then claim a credit for taxes paid to other states. Oddly, this credit might not be the same amount as the taxes you actually paid.

I've also found that state returns tend to be straightforward enough, and poorly-enough supported by the software, that it's generally as easy to do the return yourself on paper. Then you can either file that or coerce the software into producing the same output. You can explore trying to file MFS for one of the states, but I'd be surprised if it works to your advantage.
I'm not a financial advisor, I just play one on the Internet.
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StraightEdge
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by StraightEdge »

We got married in April 2017. My wife lived in CA from July 2013-May 2017 but she was just a student and not earning income and not considered a resident of CA. I lived in CA from December 2014-May 2017 and worked there and paid CA state taxes in 2015 and 2016. Then we both moved back to Tennessee in June 2017 and have lived here since.

So when I do joint and the federal portion of the stocks, it's great because it pulls in all the 1099-DIV, 1099-INT and 1099-B from the 1099 forms our financial advisor sent us at the end of the year.

So here is my question...when I then finish the federal portion and switch over to the state income tax it asks me to allocate the interest, dividends and stock sales based off time from California compared to the rest of the year. It has all the year data that I entered previously and TurboTax Premier then says that it can allocate it based off days from my time in California from January 1-May 31, 2017 compared to the rest of the year so that way California gets the proper tax.

So on this part for each section (1099-DIV, 1099-INT, 1099-B), can I not just have it allocate based off the number of days I was in California (so in this case like 151 days?). That seems the easiest way no? Or do I have to literally see for each section when the date was sold or interest or dividend was paid to make it more accurate and calculate the number of days from that standpoint to when I left CA? If I do that, I would then have to like pull out monthly statements and that seems confusing on which number to then pull? Sometimes it does show the exact date on the year 1099 forms of like when the stock was sold so that would be easy to calculate if I have to do it specific by that but in some case like the 1099-DIV section the payment dates just say "Multiple" and I wouldn't know where to go on the monthly statements to pull the right date from?

Does that make sense? It seems a lot easier to just calculate in total the number of days I was in California based off the yearly total even if it's not right and I'm overpaying the state of California, I don't care if I'm not doing anything wrong? It just seems like a lot more work to have to find the exact date based off my time in CA for each little stock sold or interest earned time period and again if it just says Multiple on the 1099-forms I wouldn't know where to pull that information from on the monthly statements we receive?
Last edited by StraightEdge on Wed Apr 11, 2018 6:02 pm, edited 1 time in total.
SlowMovingInvestor
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by SlowMovingInvestor »

seawolf21 wrote: Wed Apr 11, 2018 5:44 pm
NJ non-resident forms allows a Federal MFJ to file NJ MFS for spouse working in NJ and it DIDN'T involve having to create a Fed MFS return. There are worksheets in TT that allow excluding the CT spouse's W2 income from NJ calculation but you can only access it in FORMS mode.
Not to hijack this thread, but I presume in that case, you also had to use Forms Mode to manually change the filing status, deductions exemptions etc. in the NJ return to switch it to MFS mode (and put in MFS limits for deductions and exemptions, which are lower than MFJ limits) ?

EDITED: Actually, now that I reread seawolf21's post, I see that situation is different from OPs. In seawolf21's case, you have only one state of residency with non resident returns in other states. But OP actually has part year residency in 2 states.

seawolf21, you might actually have been better off filing a nonresident MFJ return for NJ (rather than as a non resident MFS), since then you could have used the higher deductions and exemptions that most states have as a result of MFJ status.
Last edited by SlowMovingInvestor on Wed Apr 11, 2018 6:13 pm, edited 1 time in total.
SlowMovingInvestor
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by SlowMovingInvestor »

StraightEdge wrote: Wed Apr 11, 2018 5:53 pm
So here is my question...when I then finish the federal portion and switch over to the state income tax it asks me to allocate the interest, dividends and stock sales based off time from California compared to the rest of the year. It has all the year data that I entered previously and TurboTax Premier then says that it can allocate it based off days from my time in California from January 1-May 31, 2017 compared to the rest of the year so that way California gets the proper tax.

So on this part for each section (1099-DIV, 1099-INT, 1099-B), can I not just have it allocate based off the number of days I was in California (so in this case like 151 days?). That seems the easiest way no? Or do I have to literally see for each section when the date was sold or interest or dividend was paid to make it more accurate and calculate the number of days from that standpoint to when I left CA? If I do that, I would then have to like pull out monthly statements and that seems confusing on which number to then pull? Sometimes it does show the exact date on the year 1099 forms of like when the stock was sold so that would be easy to calculate if I have to do it specific by that but in some case like the 1099-DIV section the payment dates just say "Multiple" and I wouldn't know where to go on the monthly statements to pull the right date from?
Interest you can probably do just by number of days (unless you have a CD in one part of the year, and not in the other).

MFs generally distribute a lot of their dividends and capital gains in the 4th quarter, so you'd end up overpaying CA, and underpaying TN if just allocate based on number of days.

Some brokerages do show a quarterly breakdown of interest, dividends etc. on their web sites. They sometimes also have supplemental printouts with the 1099s which show all dividends paid during the year and when they were paid.
seawolf21
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by seawolf21 »

StraightEdge wrote: Wed Apr 11, 2018 5:53 pm We got married in April 2017. My wife lived in CA from July 2013-May 2017 but she was just a student and not earning income and not considered a resident of CA. I lived in CA from December 2014-May 2017 and worked there and paid CA state taxes in 2015 and 2016. Then we both moved back to Tennessee in June 2017 and have lived here since.

So when I do joint and the federal portion of the stocks, it's great because it pulls in all the 1099-DIV, 1099-INT and 1099-B from the 1099 forms our financial advisor sent us at the end of the year.

So here is my question...when I then finish the federal portion and switch over to the state income tax it asks me to allocate the interest, dividends and stock sales based off time from California compared to the rest of the year. It has all the year data that I entered previously and TurboTax Premier then says that it can allocate it based off days from my time in California from January 1-May 31, 2017 compared to the rest of the year so that way California gets the proper tax.

So on this part for each section (1099-DIV, 1099-INT, 1099-B), can I not just have it allocate based off the number of days I was in California (so in this case like 151 days?). That seems the easiest way no? Or do I have to literally see for each section when the date was sold or interest or dividend was paid to make it more accurate and calculate the number of days from that standpoint to when I left CA? If I do that, I would then have to like pull out monthly statements and that seems confusing on which number to then pull? Sometimes it does show the exact date on the year 1099 forms of like when the stock was sold so that would be easy to calculate if I have to do it specific by that but in some case like the 1099-DIV section the payment dates just say "Multiple" and I wouldn't know where to go on the monthly statements to pull the right date from?

Does that make sense? It seems a lot easier to just calculate in total the number of days I was in California based off the yearly total even if it's not right and I'm overpaying the state of California, I don't care if I'm not doing anything wrong? It just seems like a lot more work to have to find the exact date based off my time in CA for each little stock sold or interest earned time period and again if it just says Multiple on the 1099-forms I wouldn't know where to pull that information from on the monthly statements we receive?
Can’t technically do that as you are making up your own method of allocation but chances of getting caught/fined are probably close to nil. You need to look at all your statements and go online and look at transaction history.

CA does allow FED MFJ to file CA MFS if one spouse is non-resident with no CA income but I would question why you want to do that if she is in CA.

Generally speaking, it probably works out better for you to file CA MFJ instead of filing CA MFS for you and no CA return for her.

TN Hall tax is a simple form. There is no part-time resident form because they merely want you to figure out dividends/interest/capital gains distributions received by either of you after your move to TN (May 2017 onward). If all tax returns are so simple, TT would be out of business.
SlowMovingInvestor wrote: Wed Apr 11, 2018 6:01 pm
seawolf21 wrote: Wed Apr 11, 2018 5:44 pm
NJ non-resident forms allows a Federal MFJ to file NJ MFS for spouse working in NJ and it DIDN'T involve having to create a Fed MFS return. There are worksheets in TT that allow excluding the CT spouse's W2 income from NJ calculation but you can only access it in FORMS mode.
Not to hijack this thread, but I presume in that case, you also had to use Forms Mode to manually change the filing status, deductions exemptions etc. in the NJ return to switch it to MFS mode (and put in MFS limits for deductions and exemptions, which are lower than MFJ limits) ?

EDITED: Actually, now that I reread seawolf21's post, I see that situation is different from OPs. In seawolf21's case, you have only one state of residency with non resident returns in other states. But OP actually has part year residency in 2 states.

seawolf21, you might actually have been better off filing a nonresident MFJ return for NJ (rather than as a non resident MFS), since then you could have used the higher deductions and exemptions that most states have as a result of MFJ status.
Checked both NJ MFS and MFJ in TT it involved under 5 mouse clicks in forms mode to compare. From my perspective, it doesn’t really matter because a dollar paid to NJ is just a dollar-for-dollar credit in NYS vice versa. The grand total of NJ/CT/NY tax paid is the same regardless of NJ filing status as NY has the highest tax. NJ MFS/MFJ only really translate to whether NJ or NY get more of that identical grand total. NJ MFS was better off for NYS.

My point from the post really is TT forms mode should be able to handle fairly complex multi state scenarios.
Last edited by seawolf21 on Thu Apr 12, 2018 7:34 am, edited 2 times in total.
Katietsu
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by Katietsu »

You said your wife was not a resident of CA in Jan - May 2017. Why not? She lived there. She was married to you and you were working there and considering yourself a resident. What state do you think was her Tax Home during those months? Is there a third state to consider? Note that a resident for purposes of in state tuition totally has its own rules.
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StraightEdge
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Married filing joint and separate refund coming out roughly the same for each?

Post by StraightEdge »

[Thread merged into here, see below. --admin LadyGeek]

Some of you may know my situation that I've explained in previous posts. My wife has stocks and is under a student loan forgiveness plan, PAYE, that will take 10% of your income and make your student loan payments each month that amount. So if you file married separate it will only take her income from last year's tax return and if you filed jointly it will take 10% a month of both of our incomes.

With that said, I went through TurboTax and made a rough draft of each and married jointly only comes out about $200 more for a refund...so almost exactly the same as it is for married separate. So my question is...is there anything else I'm missing as to why you wouldn't want to file separate if I lean that way? Because if we file separate yes it will be lower payments each month and not throwing as much at the loan but you can always pay more every month as if it is taking 10% of jointly. And every year we can change our filing status and go back to married jointly if we want but is there anything I'm missing as to why I really still should not do married separate if the amounts come out roughly the same in terms of a refund?

Aren't you allowed to switch back and forth every year from married filing joint and separate if you want? Not that we would...I just want to make sure. Is there anything set in stone for the future or in the IRS eyes on how you file your first year married as a couple? And I got worried because I read this on an online article that was published in 2011...."If you file a joint return, you cannot file separate returns for the tax year immediately following the first year in which you filed the joint return. For the subsequent tax year, you can switch to separate returns. For example, if you first filed a joint return for 2010, you cannot file separate returns in 2011 and you have to wait until 2012 to file separate returns." Is that still true? No one told me that?
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StraightEdge
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by StraightEdge »

My wife and I got married in April 2017 and she lived in CA from July 2013-May 2017. She was only a student there, had no income, and didn't own a home, just rented. Even the CPA that did her taxes for 2016 didn't file a CA state tax return for her and he knew the whole situation. Her address was always showing back home in TN for tax returns, etc. during 2013-2017.

But going back to my last post, I'm still confused on how to allocate the exact breakdowns of interest income, stocks sold, etc. or whatever else I need to allocate to the state of California? Because SlowMovingInvestor said you could just allocate it based off days in CA while seawolf21 said you have to be more precise and allocate it based off time of sale so two conflicting answers? It pulls all the data that I submitted to federal but I don't know how to look at the 1099 form and break it down to doing days of when it happened in California only between January-May 2017? Do I just look at the date and calculate it until 5/31/17? Again though, sometimes it doesn't even show the date of transaction on the 1099 forms and I don't know how to calculate it from the monthly statements she receives because the breakdown doesn't look the same?

And I figured out that Tennessee doesn't have state income tax but they do still have tax on stocks, interest, etc. but only if it's over $1250 for single and $2500 for married joint. What about married filing separate though, what's the number? So I know for our situation this year it definitely isn't over any of those numbers but going forward, how do I know which numbers from the 1099 forms to add together to see if it's over that limit for the state of Tennessee? Would it only be the Total Ordinary Dividends from 1099-DIV box if applicable and Interest Income from 1099-INT box if applicable added together for a sum? Or would it also be Total Capital Gain Distributions from 1099-DIV box as well added to those other two so all 3 spots? And when I got to the end of TurboTax it automatically came up and said it looks like you don't need to file a TN state return unless your interest, stock sales, etc. are over $1250...so does that mean TurboTax doesn't just calculate it on it's own if you need to or not and it's up to your judgement to find out if you did go over that $1250 limit? Why does it not figure it for you? The wording implies that you have to calculate the numbers yourself to see if you need to file for TN state due to that?

Ah please help!
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StraightEdge
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Re: Can you go back and forth in the future between filing taxes as married jointly or separately?

Post by StraightEdge »

Some of you may know my situation that I've explained in previous posts. My wife has stocks and is under a student loan forgiveness plan, PAYE, that will take 10% of your income and make your student loan payments each month that amount. So if you file married separate it will only take her income from last year's tax return and if you filed jointly it will take 10% a month of both of our incomes.

With that said, I went through TurboTax and made a rough draft of each and married jointly only comes out about $200 more for a refund...so almost exactly the same as it is for married separate. So my question is...is there anything else I'm missing as to why you wouldn't want to file separate if I lean that way? Because if we file separate yes it will be lower payments each month and not throwing as much at the loan but you can always pay more every month as if it is taking 10% of jointly. And every year we can change our filing status and go back to married jointly if we want but is there anything I'm missing as to why I really still should not do married separate if the amounts come out roughly the same in terms of a refund?

Aren't you allowed to switch back and forth every year from married filing joint and separate if you want? Not that we would...I just want to make sure. Is there anything set in stone for the future or in the IRS eyes on how you file your first year married as a couple? And I got worried because I read this on an online article that was published in 2011...."If you file a joint return, you cannot file separate returns for the tax year immediately following the first year in which you filed the joint return. For the subsequent tax year, you can switch to separate returns. For example, if you first filed a joint return for 2010, you cannot file separate returns in 2011 and you have to wait until 2012 to file separate returns." Is that still true? No one told me that?
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Re: Can you go back and forth in the future between filing taxes as married jointly or separately?

Post by clemrick »

StraightEdge wrote: Thu Apr 12, 2018 9:29 am And I got worried because I read this on an online article that was published in 2011...."If you file a joint return, you cannot file separate returns for the tax year immediately following the first year in which you filed the joint return. For the subsequent tax year, you can switch to separate returns. For example, if you first filed a joint return for 2010, you cannot file separate returns in 2011 and you have to wait until 2012 to file separate returns." Is that still true? No one told me that?
What site were you reading? I can't say whether that was true or false in 2011, but it is not true now. The reasons against filing MFS is you lose several tax credits and have a lower standard deduction. If those factors don't affect your situation, then you can decide each year how you want to file.
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StraightEdge
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Re: Can you go back and forth in the future between filing taxes as married jointly or separately?

Post by StraightEdge »

https://www.sapling.com/12041057/can-sw ... y-separate

This was the site that said it, last paragraph. Again, I did rough drafts of both joint and separate on TurboTax and only joint comes out better by about $200 so almost roughly the same.
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by seawolf21 »

You need to read the instructions on the TN tax form

https://www.tn.gov/content/dam/tn/reven ... 0_2017.pdf

Your answer to MFS exemption amount is on line 2.

The form also indicates what is taxable or what is not.

As for allocating, allocating by taking total divided by days makes the assumption interest/capital gains distribution/dividends are equally distributed throughout the year. That is usually not true. Even simple interest from a savings account is not evenly distributed due to compounding. But like I said before, the chances CA/TN will question you on it is probably minimal as they only see how much you received for the year from 1040; they don’t know how much was distributed while you were in CA or not. I’m assuming IRS even shares 1040 with states to begin with.
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by SlowMovingInvestor »

StraightEdge wrote: Thu Apr 12, 2018 8:43 am M

But going back to my last post, I'm still confused on how to allocate the exact breakdowns of interest income, stocks sold, etc. or whatever else I need to allocate to the state of California? Because SlowMovingInvestor said you could just allocate it based off days in CA while seawolf21 said you have to be more precise and allocate it based off time of sale so two conflicting answers? It pulls all the data that I submitted to federal but I don't know how to look at the 1099 form and break it down to doing days of when it happened in California only between January-May 2017? Do I just look at the date and calculate it until 5/31/17? Again though, sometimes it doesn't even show the date of transaction on the 1099 forms and I don't know how to calculate it from the monthly statements she receives because the breakdown doesn't look the same?
You are supposed to allocate 'passive' (non wage) income based on your residency in the state. So my answer doesn't really conflict with seawolf21's answer.

However, for interest, it probably makes very little difference if you allocate it based on number of days (or months) for savings/interest accounts. For CDs, if you had some CDs that were paying only in one part of the year, it could make a little difference.

I did not say that you should allocate brokerage gains based on number of days. For brokerage gains, dividends etc., you should really allocate based on your residency. And it would likely benefit you if you did that because many MFs pay out larger distributions in the last month of the year. And if you were resident in TN in that time, you would likely pay less given TN's lower tax rates compared to CA. But depending on the sums involved, it may not make a material difference.

If you really want to find out what dividends were paid when, you would need to look at your brokerage statements. Some brokerages have quarterly statements, others will even provide you with nice downloadable statements showing all transactions in a CSV format. You can then import into a spreasheet and figure out what was paid when. It is kinda painful to do.
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Re: Can you go back and forth in the future between filing taxes as married jointly or separately?

Post by Chip »

The web site is wrong. You can switch back & forth from MFJ to MFS yearly if you like as long as you qualify as married.

One thing you can't do is AMEND a jointly filed return to a separately filed return. Perhaps that's what the blogger meant to say and completely botched it.
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StraightEdge
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Re: Why is TurboTax saying I need to file multiple state tax returns?

Post by StraightEdge »

Sorry I'm still confused.

Just disregard Tennessee. I'm wanting to make sure in the future that if we ever live in a state only part of the year, I am doing the state taxes right if it asks about her stocks and how to tax them properly for the time period we were in each state. This is referring to the 1099 statement I get in the mail. On TurboTax, the state taxes will pull up the yearly 1099-INT, 1099-B or 1099-DIV amounts that I typed in earlier for the federal portion. It then asks me to allocate it and I get all confused thinking I can just do it based off days we lived in that state because TurboTax says it can do it for me that way? So I always assumed that was ok to do? But now are you saying I can't do it that way for all of those boxes that show numbers in the 1099 statements? I have to literally go through on when the numbers/sales happened for the 1099-INT on the actual date and count the number of days from that point to when we left the state, etc.? Because again it's hard to pinpoint on just the 1099 statement if it says "multiple" and the monthly statements look completely different?
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StraightEdge
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Re: Married filing joint and separate refund coming out roughly the same for each?

Post by StraightEdge »

Bump thanks.
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Re: Married filing joint and separate refund coming out roughly the same for each?

Post by trueblueky »

IRS Pub 17, section 2 Filing Status, says that you can change your status from MFS to MFJ after the filing date by submitting a 1040X amended form. You may not change from MFJ to MFS after the filing due date.

This is an every year rule. Example, you could decide today to file a 1040X for tax year 2015 and change from married filing separate to married filing jointly. You could not do the reverse.

I can't find anywhere that says your filing status in 2017 determines your filing status in 2018.

One disadvantage of MFS (there are many) is that you cannot take the student loan interest page one adjustment.
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StraightEdge
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Re: Married filing joint and separate refund coming out roughly the same for each?

Post by StraightEdge »

Thanks but I didn't mean going back and ever changing your previous tax return filing statuses. I'll never do that.

I just meant going forward in the future. And yeah I noticed I couldn't use my student loan interest deduction on marrying filing separate like I could married jointly but again the number still came back almost exactly the same on both rough drafts. Just like $200 off? Seems crazy.
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StraightEdge
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How do I know which amounts from my 1099 form make me decide on if I have to pay a state tax return to Tennessee?

Post by StraightEdge »

[Thread merged into here, see below. --admin LadyGeek]

I know in Tennessee you only pay state taxes on interest and dividends that exceed $1250 for single filing and $2500 for Married Filing Joint....but can someone break this down further so I know for the future which numbers from the 1099 form this is that you add together to find that? Like what is considered interest and dividends on the 1099 form? I see on my yearly 1099 forms I have boxes that say 1099-INT, 1099-DIV and 1099-B and then there is letters with descriptions and dollar amounts. Sorry to make you dumb it down but I just need to know which ones these are specifically that you add together. And what about the amount for Married Filing Separate?

Also, on TurboTax, when you go to do state taxes why does it not just tell you whether you have to file Tennessee or not based off the numbers and whether it exceeds it? It almost leaves it up to you when it says "It looks like you don't have to file TN state taxes unless the interest income, etc. exceeds $1250." So why does it seem every year you have to calculate the numbers on your own rather than TurboTax telling you for sure and it can calculate it itself? Is it because it doesn't know for sure how long you lived in the state for? Because you plug in the numbers from the 1099 form on the federal return in the beginning.
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Re: How do I know which amounts from my 1099 form make me decide on if I have to pay a state tax return to Tennessee?

Post by samsoes »

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Re: How do I know which amounts from my 1099 form make me decide on if I have to pay a state tax return to Tennessee?

Post by quantAndHold »

Given your situation and your level of confusion, you might consider paying someone to do your taxes this year. Then take what they did and do them yourself next year. It’s much easier when you have a template to work from.
Yes, I’m really that pedantic.
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Re: Married filing joint and separate refund coming out roughly the same for each?

Post by LadyGeek »

StraightEdge wrote: Thu Apr 12, 2018 8:28 am Some of you may know my situation that I've explained in previous posts....
StraightEdge - In order to give appropriate advice, it's best to keep all the information in one spot. Searching for older posts will lose a lot of continuity in the discussion. I merged two earlier threads into here.

If you have any questions on your filing status, ask them here.
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StraightEdge
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Re: Can you go back and forth in the future between filing taxes as married jointly or separately?

Post by StraightEdge »

See I'm still confused about how to properly do the allocation. I asked over at TurboTax and a worker replied this way:

- For dividends, refer to the dividends box on the 1099-DIV, and divided that amount by the months lived in each state.
- For interest, refer to box 1, and divide my months lived in each state.
- For the 1099 boxes, divide "total ordinary dividends, "qualified dividends, etc.", the same way i.e. by the months lived in each state.


That doesn't sound right though? Because that sounds like what I was trying to do in the first place and you guys said that's not the correct way to do it and it needs to be based off transaction date to be more accurate for which state it went to?
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StraightEdge
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Re: How do I know which amounts from my 1099 form make me decide on if I have to pay a state tax return to Tennessee?

Post by StraightEdge »

Thanks for the website but that doesn't help me. And to the second poster, I have the tax return from my wife when she was single done by a CPA last year.

I just want to understand all this stuff. And is my original question not pretty simple? I just need to know exactly which spots to add together on the 1099 "Summary of Reportable Tax Information" page that we receive once a year.
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