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FAQs: Tax Facts for 2012 Filings
Taxes...Taxes...Taxes...Taxes...Taxes...Taxes...Taxes...
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Greetings!
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Melissa Stein
President
CFP®, CRPC® |
During this 2012-2013 tax season, I want to make sure the process is as easy as possible for each of you. Below is some information that will be helpful and will clear up any confusion.
For your convenience, under "Quick Links" I have provided links to IRS.Gov and to SteinWealth's web site.
As always, my staff and I are available if you have specific questions or concerns.
Sincerely,
Melissa J. Stein |
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Pershing Pointers
When will my forms from Pershing be ready?
Due to regulatory changes and longer reporting times, Pershing and other similar custodians have later operational deadlines than typically expected. Pershing released final IRS Forms 1099's on or before February 28, 2013. If you have signed up for electronic tax statements, they will be available only online and not mailed. They may also be available earlier online. Otherwise, paper statements will be mailed on February 28, 2013.
Where do I get my forms?
You will get them either online or in the mail...please continue reading below.
Online: If you signed up for paperless documents, you must complete the following process to get your forms:
Enter the Financial Organization Number: 3KZ (case sensitive)
Enter your username and password. (You received these directly in your meeting with Melissa or you received them in an email from Cetera.)
In the mail: If you have NOT, in the past, enrolled for paperless statement delivery, you should have received your tax documents in the mail shortly after February 28, 2013.
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What accounts will generate tax documents?
While there may be some variations, below are the accounts that will generate a 1099:
- Individual & Joint Accounts - If you have an individual or joint investment account you should receive a 1099 EVERY year.
- IRAs/Retirement Accounts - IRAs or retirement accounts that you have received distributions from. This includes any Roth IRA conversions.
- IRA Rollover - If you did a pension or IRA rollover you will NOT receive a 1099 from Pershing, but you will likely receive one from the original institution. Typically Pershing will send a Form 5498 by May of the same tax year. This document should be kept for record keeping purposes only with the corresponding tax year.
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What Fees are Deductible?
Where do I find my annual advisory fees? Are they tax deductible?
Fees can be found on your year-end performance report under the section "Fee Summary & Detail." Please click on the following link to see an example.
Sample Quarterly Performance Report 03_2013 (2).pdf
Typically the IRS permits the following as tax deductible:
(Please consult your tax advisor. Stein Wealth does not provide tax advice.)
Investment Fees and Expenses
You can deduct investment fees, custodial fees, trust administration fees, and other expenses you paid for managing your investments that produce taxable income.
Deductions Subject to the 2% Limit
You can deduct certain expenses as miscellaneous itemized deductions on Schedule A (Form 1040). You can claim the amount of expenses that are more than 2% of your adjusted gross income. You figure your deduction on Schedule A by subtracting 2% of your adjusted gross income from the total amount of these expenses. Your adjusted gross income is the amount on Form 1040, line 38.
Generally, you apply the 2% limit after you apply any other deduction limit. For example, you apply the 50% (or 80%) limit on business-related meals and entertainment before you apply the 2% limit.
Deductions subject to the 2% limit are discussed in the three categories in which you report them on Schedule A (Form 1040).
- Unreimbursed employee expenses (line 21).
- Tax preparation fees (line 22).
- Other expenses (line 23).
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Common Tax Forms:
1099 - Report interest & dividends on taxable accounts
1099R - Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., for each person to whom you have made a designated distribution or are treated as having made a distribution of $10 or more from profit-sharing or retirement plans, any individual retirement arrangements (IRAs), annuities, pensions, insurance contracts, survivor income benefit plans, permanent and total disability payments under life insurance contracts, charitable gift annuities, etc.
5498 - Form 5498 is an annual document issued by a financial institution to report information about individual retirement accounts and other tax-preferred savings accounts. Form 5498 is filed with the Internal Revenue Service and a copy is also sent to the person who owns the account. Essentially, Form 5498 provides independent confirmation to the IRS of the amounts you contributed to IRAs and other tax-preferred savings accounts.
Form 5498, IRA Contribution Information - Reports information about IRA-based accounts such as traditional IRAs, Roth IRAs, SEP IRAs, and SIMPLE IRA plans.
Form 5498-SA - Reports information about Health Savings Accounts (HSA), Archer Medical Savings Accounts (MSA), and Medicare Advantage MSAs.
Form 5498-ESA - Reports information about Coverdell Education Savings Accounts. |
 Stein Wealth Advisors, LLC
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