1NY3 Instructor Training 2010

Review

Topics Suggested by Instructors

2NY3 Instructor Training 2010

SS vs SSDI vs SSI

• Social Security• Retirement payments• Reduced benefits at 62• Full benefits at 65, 66, 67, ???• Financed through payroll tax• Up to 85% MAY be taxable – it depends

3NY3 Instructor Training 2010

SS vs SSDI vs SSI

• Social Security Disability Insurance• Payments to workers that become

disabled• Financed through payroll taxes• Can collect until minimum retirement

age• Entered on line 7 as earned income

• After min retirement age – becomes retirement income• Entered line 16

4NY3 Instructor Training 2010

SS vs SSDI vs SSI

• SSI• Supplemental Security Income• For disabled with little or no income• Administered by Social Security Admin• NOT TAXABLE• Financed through “general revenues”• Clients frequently ask about children’s

SSI

5NY3 Instructor Training 2010

NYS Retirement Exemption• NYS Subtractions – Line 26

• NYS, local, or federal pension• Includes State and City Universities• State pension from outside NYS not eligible• NYS or Federal pension received via ex-spouse

• How do you know??• Ask client• If not obvious and client doesn’t know

• Give client opportunity to find out• Assume not a full subtraction but eligible for 20K

subtraction – line 29• Explain to client

6NY3 Instructor Training 2010

NYS $20K Income Exclusion

• Private Pension• Non NYS, local or Fed pensions• Is non gov’t pension received via

ex-spouse eligible?

• No – not from employer – employee relationship

7NY3 Instructor Training 2010

1099-R – Taxable?

8NY3 Instructor Training 2010

1099-R – Taxable?

• Payer should provide taxable amount unless reasonably unable to

• If unable to – box 2a left blank

9NY3 Instructor Training 2010

1099-R – Taxable?

• For Pension -If box 2b “Taxable amount not determined” is checked – 2a is blank

• For Traditional, SEP, or SIMPLE IRA• Payer not required to determine taxable

amount• Box 2a will be same as box 1

10NY3 Instructor Training 2010

1099-R – Taxable?

• If 2a is blank – Interview client• Contributions• Date of retirement• Date started collecting• Was it spouse’s pension• Connection to NYS subtraction

11NY3 Instructor Training 2010

1099-R – Taxable?

• If client cannot provide adequate answers:• Give client option to go away and come

back with answers• Assume all taxable

• Explain assumption to client• Worst thing to happen – additional refund or

owe less

12NY3 Instructor Training 2010

414HSUB

• This year TW will accept 414H• Eligible for Retirement Savings Credit

form 8880?

13NY3 Instructor Training 2010

414HSUB

• NOT eligible for 8880• Not a voluntary contribution

14NY3 Instructor Training 2010

Energy Credits

• Non-business energy property credit• Improvements made for main home• Covers energy efficient

• Windows• Doors• Insulation• Some metal and asphalt roofs• Cannot include prep and/or installation

15NY3 Instructor Training 2010

Energy Credit

• Non-business energy property credit• Can include

• Heat pumps• Air conditioners• Water heaters• Stoves that burn bio-mass• Prep and installation

16NY3 Instructor Training 2010

Energy Credit

• Credit is 30% of eligible costs up to $1500

• $1500 is total of 2009 & 2010 credit• If took $1000 credit in 2009 – can only

take up to $500 in 2010

• Claimed on form 5695 Part I

17NY3 Instructor Training 2010

Energy Credit

• Residential Energy Efficient Property Credit

• Covers• Solar• Wind• Geothermal

• Form 5695 Part II• OUT OF SCOPE

18NY3 Instructor Training 2010

Form 5695

19NY3 Instructor Training 2010

Out ofScope