tax-aide training for tax year 2015 ca-2 state meeting jay wiedwald, ca-2 trs sep 2015 regional...
TRANSCRIPT
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TAX-AIDE
TAX-AIDE
Sep 2015 Regional Meetings 1
Training for Tax Year 2015
CA-2 State Meeting
Jay Wiedwald, CA-2 TRS
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TAX-AIDESep 2015 Regional Meetings 2
Teachable Qualities of a Counselor?(Responses from audience)
● Develop Listening Skills
● Ask probing questions
● Use Resources
● Learn and use trouble-shooting techniques
● Tax law knowledge
● Learn how to explain tax law in everyday English
● Knowing when to ask for help – and willingness to actually do so
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TAX-AIDESep 2015 Regional Meetings 3
Habits you’d like to Break!(Responses from audience)
● Starting a return “too soon” Complete interview before
touching the keyboard
● Trusting that CF or other reviewed Intake sheet sufficiently
● Ignoring Intake Sheet during QR
● Rushing under pressure of clients waiting
● Not checking Duck Book before asking for help
● Incomplete passing of return info to the QR Complete grey sections on
Intake Sheet
● Relying too much on pro forma
● Not using the Comment section at bottom of Main Info Sheet
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TAX-AIDESep 2015 Regional Meetings 4
THANKS!
● I’ll consider those as I prepare for the Instructor Workshop
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TAX-AIDE
TAX-AIDE
Filing Status
Married, Single, and More
Pub 4012 – Tab BPub 4491 – Part 2Pub 17 – Chapter 2
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TAX-AIDE
[BACKGROUND]
● Objectives: Recognize factors that determine filing status
options See how filing status affects tax issues Focused TWO entry/outcome relationships Cultivate habit of using resources
● Broadly suitable for all experience levels Pace and Depth of presentation will depend
on audience experienceTWO Immersion Training – 2015 6
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TAX-AIDE
TAX-AIDE
Filing Status
Married, Single, and More
Pub 4012 – Tab BPub 4491 – Part 2Pub 17 – Chapter 2
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TAX-AIDE
Filing Status
● Two criteria: Marital status on last day of tax year
Federal definition – “married” ● Legal marriage under laws of any state or
country● Does not include civil unions or registered
domestic partners
Type of dependents, if any
TWO Immersion Training – 2015 8
Pub 17 Ch 2
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TAX-AIDE
Five Choices for Filing Status
● Single
● Married filing jointly (MFJ)
● Married filing separately (MFS)
● Head of household (HH)
● Qualified widow(er) (QW)
TWO Immersion Training – 2015 9
Pub 4012 Tab B
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TAX-AIDE
Form 1040
TWO Immersion Training – 2015 10
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TAX-AIDE
Filing Status Importance
● Many tax items affected by filing status Necessity to file a return (Page A-1) Standard deduction (Page F-1) Tax rate bracket Eligibility for certain credits (Page I-3
Step 3)
TWO Immersion Training – 2015 11
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TAX-AIDE
MFS Disadvantages
● Highest tax rate/lower standard deduction
● Cannot claim most tax credits
● Cannot deduct student loan interest
● Capital loss limit $1,500 (not $3,000)
● … and a few more.
TWO Immersion Training – 2015 12
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TAX-AIDE
Head of Household – Unmarried
● Provided home for qualified child Might not be a dependent
● Provided home for related dependent
● >50% cost of maintaining home for dependent parents living elsewhere
● Pub 4012 page B-1 Left Side
TWO Immersion Training – 2015 13
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TAX-AIDE
Head of Household – Married“Considered Unmarried”
● Lived apart all of last 6 months of year
● Provided home for: Child, stepchild, or eligible foster child for
over six months
● No other relatives qualify
● Pub 4012 page B-1 Right Side
TWO Immersion Training – 2015 14
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TAX-AIDE
Head of Household
● Key advantages Higher standard deduction than Single or
MFS Advantageous tax rate structure
TWO Immersion Training – 2015 15
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TAX-AIDE
Qualifying Widow(er)
● Spouse died in one of two past years Has dependent child or stepchild in home
all year Grandchild not eligible
● Maintained home for child >50% of cost
● Can file QW for two years only
TWO Immersion Training – 2015 16
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TAX-AIDE
Use the Decision Tree
TWO Immersion Training – 2015 17
Turn toPub 4012Page B-1
Don’t miss the footnotes
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TAX-AIDE
TaxWise – Main Information Sheet
TWO Immersion Training – 2015 18
Enter name and SSN only if child
not also dependent
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TAX-AIDE
Quality Review
● QR is more than just making sure the box is checked!
● Must conduct the same probing interview to make sure that it is the correct (and best) Filing Status
● HoH is the biggest source of errors
TWO Immersion Training – 2015 19
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TAX-AIDE
Let’s Explore
TWO Immersion Lesson
on Filing Status
Fred SilvaTWO Immersion Training – 2015 20
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TAX-AIDESep 2015 Regional Meetings 21
● NOW…Fire up your laptops and log into:https://twonline.taxwise.com/training
Client ID: 1144583
User Name: USERxx
Password: USERxx (Unless you’ve already logged
in)
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TAX-AIDE
Immersion Lesson Worksheet
TWO Immersion Training – 2015 22
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TAX-AIDE
Immersion Lesson Worksheet
TWO Immersion Training – 2015 23
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TAX-AIDE
● NTTC Webinar August 7th. Link available on OneSupport (or below): https://
aarptaxaide.webex.com/aarptaxaide/ldr.php?RCID=0895e16d9eb616aa7c7b7ab078f22d4b
(Not compatible with Windows10)
● Starts at 16:42 mark, 17 minutes long
● Followed by “Donald Duck” demo (11 minutes) Great for new counselors, and even those with a little
experience
This Demo available online
TWO Immersion Training – 2015 24
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TAX-AIDESep 2015 Regional Meetings 25
Demo Questions ???
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TAX-AIDE
TAX-AIDE
Sep 2015 Regional Meetings 26
Training for Tax Year 2015
CA-2 State Meeting
Jay Wiedwald, CA-2 TRS
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TAX-AIDESep 2015 Regional Meetings 27
Topics
●Training and Certification
●ACA
●Scope
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TAX-AIDE
TAX-AIDE
Sep 2015 Regional Meetings 28
Training andCertification
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TAX-AIDESep 2015 Regional Meetings 29
AARP Training Materials
● NTTC Workbook for Tax Year 2015 15 practice returns – replaces Pub 4491-W Quizzes and exercises Printed – available through fulfillment
One copy being mailed to each Instructor Each district must determine how to obtain/distribute copies to trainees
● NTTC Training Slides – first release was October 15th
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TAX-AIDESep 2015 Regional Meetings 30
IRS & FTB Training Materials
● Have been ordered for all Counselors Instructors need them early to certify
before the December Workshop Some variation by district regarding:
1040 InstructionsPub. 17540 Instructions
Getting accustomed to electronic documents is wise, but paper still useful
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TAX-AIDESep 2015 Regional Meetings 31
Instructor Workshop
● Two days in December – Instructors DCs SMT members IRS (Patrick Brown) and FTB (Mark Callahan)
● Two “identical” workshops for flexibility and a manageable group size
● Train the trainers – help Instructors improve their knowledge and teaching skills
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TAX-AIDESep 2015 Regional Meetings 32
Training Principles
● Retention is enhanced when multiple parts of the brain are involved Integrate tax law with TW data entry Student “contemplates” issues
● Adults learn differently Not fully engaged unless they see a good reason May need to accommodate diminished senses
● Develop good habits Use of resources Follow a process
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TAX-AIDESep 2015 Regional Meetings 33
New/Expanded Training Tools
● NTTC Workbook Eight updated and seven new practice
returns Targeted ACA, Filing Status and
Exemption exercises Quizzes
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TAX-AIDESep 2015 Regional Meetings 34
New/Expanded Training Tools
● NTTC Lesson Plans Series I – Updated from last year Series II – New this year, targeted at returning
counselor training
● TWO Templates supporting these National and CA-2
● Schedules for new and returning counselors
● NTTC Power-Point Training Slides Select as appropriate to audience
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TAX-AIDESep 2015 Regional Meetings 35
OneSupport/Tax Training/TWO Immersion Training
“Read me first” in Series I package Schedule and direction files in Series II package
Look over a typical lesson See Lesson Notes (Series II)
Resources Read-aheads Templates
Check Them Out!
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TAX-AIDENTTC – Oct 2015 36
Certification Requirements
● All Volunteers – IRS Standards of Conduct test Pub 4961 is only available in electronic format
● Local Coordinators and Counselors Intake/Interview and Quality Review training and test –
10 questions – New Link & Learn or Pub 5101 (on-line only)
● Counselors Advanced test
35 instead of 40 questions Increased emphasis on ACA
Completing four exercises from NTTC Workbook
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TAX-AIDENTTC – Oct 2015 37
Certification Testing
● Recommend (URGE!!!) Link & Learn rather than paper Excellent on-line training reinforces
classroom Easier for the Instructors However, Instructors don’t see test score –
only that the test was passedMagnifies need for Instructor to review
exercises to assess student
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TAX-AIDENTTC – Oct 2015 38
Optional Certification Tests
● Optional Certifications for Counselors HSA Military International Cancellation of mortgage debt (if extended)
Out-of-Scope for California
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TAX-AIDE
Training and Certification
Questions…
NTTC – Oct 2015 39
Comments…
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TAX-AIDE
TAX-AIDE
Sep 2015 Regional Meetings 40
AffordableCare Act
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TAX-AIDESep 2015 Regional Meetings 41
ACA
●ACA in scope for Tax-Aide except for: Shared Policy Allocation
Marketplace coverage for a person who is not on the return
Alternative Calculation for Year of MarriageMarketplace customer got married during
the tax year
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TAX-AIDESep 2015 Regional Meetings 42
ACA
● Several first year exemptions no longer apply
● Shared Responsibility Payment (SRP penalty) greatly increased: $325 per person, up from $95 last year
or if greater: 2% of income, up from 1%
● Taxpayers do not need to provide proof of insurance (unless due diligence raises questions)
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TAX-AIDESep 2015 Regional Meetings 43
Expanded ACA Section of Intake Form
Counselors are expected to record in detail… … and QR’s to confirm!
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TAX-AIDESep 2015 Regional Meetings 44
Great variability in CA-2 Sites
National VITA/TCEAverage
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TAX-AIDESep 2015 Regional Meetings 45
ACA
Questions…
Comments…
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TAX-AIDE
TAX-AIDE
Sep 2015 Regional Meetings 46
Scope
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TAX-AIDESep 2015 Regional Meetings 47
Scope creep is a concern
•Several requests for local/regional scope change • Training, certification, Volunteer Protection Act, etc. all become issues
•We’re trying to help the majority of those taxpayers who need us – not every taxpayer
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TAX-AIDESep 2015 Regional Meetings 48
Scope – Approved Change
● Only one requested change was approved by IRS:
1099-R Code L (with 1, 4 or B) now in scope Loan treated as distribution Early distribution subject to 10% penalty Cannot be rolled over
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TAX-AIDESep 2015 Regional Meetings 49
Scope – Requests Not Approved
● Request for Medicare Advantage Medical Savings Account distributions not approved this year
● Line 29 adjustment for self-employed health care costs not approved
● AARP may make any return with SE income and paid medical insurance OOS due to ACA impact
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TAX-AIDESep 2015 Regional Meetings 50
Other Changes
● Dependents can be issued an Identity Protection (IP) PIN
● Medicaid Waiver Income now mandatorily not taxable
● myRA - New savings account (like a Roth)
● Can claim up to $25,000 in expenses on a Sch C
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TAX-AIDESep 2015 Regional Meetings 51
Additional Boxes on 1099 Forms
● 1099-INTBox 10 Market discount (2014)Box 11 Bond premium (2014)Box 13 bond premium on tax-exempt bond (2015)
● 1099-OIDBox 5 Market discount (2014) Box 6 Acquisition premium (2014)
● 1099-INT, 1099-DIV, 1099-OID, and 1099-MISCFATCA filing requirement check box (2015)
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TAX-AIDESep 2015 Regional Meetings 52
Additional Boxes on 1099 Forms OOS
● 1099-INTBox 10 Market discount (2014)Box 11 Bond premium (2014)Box 13 bond premium on tax-exempt bond (2015)
● 1099-OIDBox 5 Market discount (2014) Box 6 Acquisition premium (2014)
● 1099-INT, 1099-DIV, 1099-OID, and 1099-MISCFATCA filing requirement check box (2015)
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TAX-AIDESep 2015 Regional Meetings 53
Tax-Aide – “We’re Special”
● Some topics not in scope for VITA are for Tax-Aide SEP/Simple IRA distributions 1099-K for self-employment income Land rental received as cash (no expenses) Non-cash donations up to $5,000
…and nine more!
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TAX-AIDESep 2015 Regional Meetings 54
Challenges due to Expanded Scope
● Topics aren’t covered in IRS Training Materials… but should be addressed during training
● Will suggest that these be taught as a unit Make their scope clear and provide
reference resources Focus on site leadership
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TAX-AIDESep 2015 Regional Meetings 55
Identity Theft and $1 AGI Returns
● Have recommended including $1 of income on federal return so it could be e-filed
Detects or prevents ID theft
● IRS counsel has a problem with this –
it’s an “inaccurate” return.
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TAX-AIDESep 2015 Regional Meetings 56
TY2015 Tax-Aide Practice
CONCLUSION:
We will continue Tax-Aide practice of preparing $1 AGI returns and include this in training materials
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TAX-AIDESep 2015 Regional Meetings 57
That’s All, Folks
Questions…
Comments…