First of all, I apologize ahead of time if these questions are worded in a confusing manner. I haven't been feeling the best the past few days (stomach flu bug) and don't feel quite up to par.
I am preparing a return for a special man to me, my grandpa. We lost my dear grandma in September to cancer "of unknown origin". My grandpa is a smart man, but never handled any of the "business aspects" to their life. He never even wrote out a personal check until after she passed. Now, it's all in his hands and I didn't want to see him going to someone to have his taxes done. My grandma always did them herself and asked me 2 weeks before she passed if I'd take care of the taxes for grandpa. It's my 3rd year preparing returns, and I still have a lot to learn. But I want to help him in any way that I can.
That said, here's what I am faced with. I understood all of the other income/deduction information my grandpa got together for me, but there were 2 pieces of information that I am not sure about.
He received a statement from a Flexible Premium Deferred Annuity. It's labeled as: Tax Qualification: Deferred Comp. The details say :
Surrender amount: $208.82
Surrender requested: $208.82
Federal Tax Withheld: -$208.82
Amount disbursed: $0.00
Grandpa said he had the whole amount go to pay federal tax. It also has an asterick at the bottom of the sheet that says "The IRS requires that $208.82 be declared as taxable income. Now where on earth do I put this on his return? He hasn't received any other statements regarding this amount. He's got everything very organized for me, so I know he's not missing it; but maybe has not received a proper form yet; for tax preparation.
Second question:
He received a Form 5498 IRA Contribution Information Form. All of the amounts in the boxes have zero's in them. Grandpa told me that my grandma held an amount of $68,000 from Profit Sharing in an IRA. And that amount is not taxable until he decides to draw on on it. Do I need to fill out a form with the information provided on the 5498 if everything is all zero's?
Thanks!!
I am preparing a return for a special man to me, my grandpa. We lost my dear grandma in September to cancer "of unknown origin". My grandpa is a smart man, but never handled any of the "business aspects" to their life. He never even wrote out a personal check until after she passed. Now, it's all in his hands and I didn't want to see him going to someone to have his taxes done. My grandma always did them herself and asked me 2 weeks before she passed if I'd take care of the taxes for grandpa. It's my 3rd year preparing returns, and I still have a lot to learn. But I want to help him in any way that I can.
That said, here's what I am faced with. I understood all of the other income/deduction information my grandpa got together for me, but there were 2 pieces of information that I am not sure about.
He received a statement from a Flexible Premium Deferred Annuity. It's labeled as: Tax Qualification: Deferred Comp. The details say :
Surrender amount: $208.82
Surrender requested: $208.82
Federal Tax Withheld: -$208.82
Amount disbursed: $0.00
Grandpa said he had the whole amount go to pay federal tax. It also has an asterick at the bottom of the sheet that says "The IRS requires that $208.82 be declared as taxable income. Now where on earth do I put this on his return? He hasn't received any other statements regarding this amount. He's got everything very organized for me, so I know he's not missing it; but maybe has not received a proper form yet; for tax preparation.
Second question:
He received a Form 5498 IRA Contribution Information Form. All of the amounts in the boxes have zero's in them. Grandpa told me that my grandma held an amount of $68,000 from Profit Sharing in an IRA. And that amount is not taxable until he decides to draw on on it. Do I need to fill out a form with the information provided on the 5498 if everything is all zero's?
Thanks!!
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