Transcript Scenario #2 PPT - Earn It! Keep It! Save It!

EKS Training
Classroom ground rules
Houseke
eping
o Ask when unsure
o Do not be disruptive when instructor is teaching
o No side conversations: if you have a question ASK
o Be respectful to your peers
o Turn Cell Phones to silent
o Wait for instructor prompt to begin computer work
5 Step Plan:
1. As a class we will review Client Notes, and
Class
Structure
2. Intake & Interview Sheet & supporting
documents.
3. Instructor will teach Tax Law – referencing
Pub 4012 and 13614-C
4. Instructor will show you how to enter
information into TaxWise. WATCH!
5. Now Do! Students will enter information on
TaxWise
Scenario #2
What you will learn in this scenario:
Scenario
#2
1. Determining Filing Status
2. Exemptions: Dependency
3. Credits- Refundable vs Nonrefundable
EITC – CTC – Advanced CTC- Dependent Care
1. Determining Itemization
Scenario
#2
Let’s review Olivia’s Information:
 Pull out Interview Notes
 Pull out Intake & Interview sheet 13614-C
Intervie
w Notes
Review
 What’s different in this scenario?
 Any questions you have when reviewing the
notes?
Review 13614-C to ensure responses match
Let’s review 13614-C
Intake
&
Intervie
w
 Everything accurate? If not, what’s
missing/wrong/needs to be changed?
Notice anything different?
Did they have all the required
documents?
Make any corrections needed on 13614-C
Lets look at the Job Aid in Pub 4012, pages 15-16.
Publica
tion
4012
Is client eligible for VITA services?
Refer to Publication 4012 page 8-9
Scope of Services Chart
Tax Law
Topic #1
Dependency Exemption:
 Review personal exemption and dependency
exemption
 What is a “qualifying child” or “qualifying relative”?
Open: Publication 4012 Tab C
Tax Law
Topic #1
What exemptions will Olivia
take?
Does Nicholas qualify as a
“qualifying relative”?
Revie
w
13614
-C
Review 13614-C, Part II,
numbers 1 &2
 Based on decision tree, what
is Olivia’s filing status?
Tax Law
Topic #2
Filing Status:
 What is Olivia’s filing status?
Open: Publication 4012, Tab B
Let’s start:
TaxWi
se
Enter Olivia’s:
 Personal information on Main
Information page
 Income documents:
W2 & 1099- INT
Refer to Publication 4012, Tab D
Tax
Law
Topic
#2
Adjustments to income:
What are adjustments to income?
Does Olivia have an “adjustment to income”?
Let’s Open Publication 4012 Tab E-5
&
Olivia’s 13614-C
Instructor:
TaxWi
se
Enter Olivia’s:
 1098 E
Refer to Publication 4012, Tab E-5
Students: WATCH instructor
TaxWi
se
Students:
Enter Olivia’s 1098 E
Refer to Publication 4012, Tab E-5
Tax
Law
Topic
#3
Deductions:
Common deductible expenses:
 Unreimbursed Medical Expenses
 Charitable Contributions
Let’s Open Publication 4012 Tab F
& Schedule A
Instructor:
TaxWi
se
Let’s enter Olivia’s deductions.
Refer to Interview notes &
Publication 4012, Tab F-3
Students: WATCH instructor
TaxWi
se
Students:
Enter Olivia’s deductions
Refer to Publication 4012, Tab F-3
TaxWi
se
Should Olivia itemize her
deductions?
Refer to Publication 4012, Tab F
Tax
Law
Topic
#4
Tax Credits:
 Two Types: Refundable & Nonrefundable
 Refundable Credits allows taxpayers to
lower their tax liability to zero and
everything over zero they get as
credit/payment.
 Nonrefundable Credits allow taxpayers to
lower their liability to zero.
Tax
Law
Topic
#4
Nonrefundable Credits:
 Child & Dependent Care Expenses (pub 4012, Tab
G-3-5)
Education Credit (pub 4012, Tab J-4)
Child Tax Credit (pub 4012, G-8-9)
Refer to Publication 4012, Tab G
1040, Tax & Credits, Lines 48-54
Tax
Law
Topic
#4
Refundable Credits:
 Advanced Child Tax Credit (pub 4012, Tab G-8)
Earned Income Tax Credit (pub 4012, Tab I)
Refer to Publication 4012,
Tab G & I
1040, Payments, Lines 66-72
Tax
Law
Topic
#4
What credits can Olivia
possibly qualify for?
Child & Dependent Care Credit
Instructor:
TaxWi
se
Enter Olivia’s childcare expenses
Refer to client documents &
Publication 4012, Tab G-3
Students: WATCH instructor
TaxWi
se
Students:
Enter Olivia’s childcare expenses
Refer to Publication 4012, Tab G-5
Education Credit
Instructor:
TaxWi
se
Enter Olivia’s education expenses
Refer to client documents &
Publication 4012, Tab J
Students: WATCH instructor
TaxWi
se
Students:
Enter Olivia’s education expenses
Refer to Publication 4012, Tab J
Let’s Review Auto-populated
credits on TaxWise:
TaxWi
se
Did Olivia qualify for these credits?
Child Tax Credit
Advanced Child Tax Credit
Earned Income Tax Credit
Let’s review 1040 to see!
THINGS YOU NEED TO KNOW ABOUT THE CA STATE RETURN:
Completin
g the
CA return
1.
Get the red out! Most information will automatically populate
from the federal return
2.
If you have entered more than one W-2 on the 1040, you will
have to manually add the additional W-2’s. The first W-2 will
carry over, but the rest won’t.
3.
Make sure to complete the direct deposit or balance due
portion of the return
4.
Complete the CA Renters Credit Wkt when applicable.
Savings
Initiative
Let’s Watch!
WHY
Wrapp
ing up
Return
Let’s Review Olivia’s return
 Does Olivia want to direct deposit her refund?
 If so, is she requesting to split her refund?
Pull out 13614-C, Part VII
HOW
Instructor:
Splitting
the
Refund
Enter Olivia’s bank information
on Form 888
Open Publication 4012, Tab K-2
TaxWi
se
Students:
Fill Out Form 8888
Finishing
the return
Pub 4012,
Tab K
THINGS YOU NEED TO KNOW ABOUT FINISHING A RETURN
1.
All returns will be e-filed (unless otherwise specified)
2.
Bank account information needed for direct deposit- refer to
Part VII of the Intake Sheet
3.
Identity Protection PIN- if client checked the “yes” in box 12 of
the Intake Sheet, refer to Pub. 4012, Tab P-1
Qualit
y
Revie
w
Let’s check our work!
 Do we have matching AGI?
 Let’s review entry of:
- W2
- 1099-INT
- 1099-E
- 1098-T
Can an unmarried person claim “head of household” status?
Yes, if they provide more than half of the cost of keeping their home
and a “qualified person” lived with them for ½ the year.
Knowled
ge
Check!
True or False: The term “dependent” means a “qualifying child” or
“qualifying relative”?
True
A taxpayer must have this to qualify for EITC?
Earned Income
Where in the 4012 can you find examples of earned income?
Pub 4012, Tab I-1
True or False: Laura’s foster son Jack is 12. He is a US citizen, he lives
with Laura and she provides his full financial support. Is Jack a qualifying
child for the child tax credit?
True
Knowled
ge Check
cont...
The tax credit for child and dependent care expenses allows taxpayers
to claim a credit for expenses paid for the care of children under what
age?
13
True or False: The qualifying person must live with the taxpayer for the
entire year?
False, the qualifying person must live with them for more than ½ the
year.
Where can you find information in the 4012 about Deductions? What
tab does it tell you the standard deductions amount.
Tab F
What is the most common big ticket item in which the taxpayer may
benefit most from itemizing?
Mortgage Interest
Where can you find the requirements to qualify for the Child Tax
Credit in the 4012?
Knowledge
Check
cont...
Tab G-8 & 9
Is the Child Tax Credit a refundable or nonrefundable credit?
Nonrefundable, but the client may be eligible for the Additional Child
Tax Credit with is refundable.
What should you do for every tax return to ensure the taxpayer
receives EITC?
Always check the EIC box on the Main Information sheet when
inputting dependent information.