Questions about prize earnings and foreign employers were among the calls fielded Wednesday night during the second of three free Tax Call-In programs.
The final call-in will be this morning from 9 a.m. to noon. Call 330-996-3644.
The program, co-sponsored by the Beacon Journal and the Ohio Society of CPAs, also included a live tax chat Tuesday. The full transcript of that chat and all tax stories by the Beacon Journal this week, including the special Tax Section, can be found at www.ohio.com/taxes.
On Wednesday night, eight volunteers from Akron firm BCG & Co. were on hand to answer 61 questions that readers posed.
CPA Lesley Keller took a call from a man who said he has been taking care of his parents since 2000 and hasn’t earned an income in that time. However, he won a $1,000 gift card from a radio station and received a 1099 form for the winnings. He wondered if he had to file a tax return.
Keller explained that as long as there was no other income, the man did not have to file a federal tax return, but he would have to file a return with Akron because the winnings are taxable in the city.
Staff accountant Dave Kinney might have answered a call from the oldest taxpayer contacting the program. The woman said she was 100 years old — about to turn 101, she noted — and still did her own taxes on paper forms.
She said she retired in 1976 from the telephone company and received Social Security income and income from retirement, interest, pensions and dividends. She wondered whether her Social Security income was taxable, and Kinney said that based on the information she provided, it did not sound like that portion was taxable.
The woman also asked if she would qualify for the Earned Income Tax Credit, which could be worth as much as $6,044.
Kinney said no, because she did not earn any income and she was also over the 65 age limit.
The Earned Income Tax Credit is available to qualifying taxpayers who are at least 25 and under age 65, without a qualifying child.
Staff accountant Jennifer Schumacher took a call from a woman who works for a foreign employer, and the company did not issue U.S. tax statements on Form 1099 or W-2.
(These forms are only for U.S. companies to report income).
The caller wondered if that was OK, or if anyone would get in trouble.
Schumacher told her that a foreign company is not required to give her a tax statement for her earnings, but she might still be required to pay both the U.S. self-employment and income taxes.
She would need to report the earnings on her Form 1040 as wages, or on Schedule C if a contractor, but in either case she should use the information from her foreign pay stubs for income reporting.
Tax credits and tax treaties could provide her with relief from double taxation, if applicable.