Impairment-Related Work Expenses

[Gary]

On page 4-23 of TheTaxBook, it states that impairment-related work expenses are miscellaneous itemized deductions not subject to 2% AGI Limitations, but then says that the expenses are first reported on Form 2106 and then entered on line 27, schedule A. Shouldn't this go on line 28 of schedule A. This definitely make a difference if there is AMT.

Thanks,

Gary

[Gene V]

On page 4-23 of TheTaxBook, it states that impairment-related work expenses are miscellaneous itemized deductions not subject to 2% AGI Limitations, but then says that the expenses are first reported on Form 2106 and then entered on line 27, schedule A. Shouldn't this go on line 28 of schedule A. This definitely make a difference if there is AMT.

Thanks,

Gary

Gary, per Schedule A instruction, the amount should go on line 28. TTB probably meant line 28 instead of line 27.

[Gary]

2106

Gene:

Thanks for replying. I still question why it says to enter on 2106. This will automatically take it to line 27 if greater than 2%.

Gary

[erchess]

Override and workaround

There is probably a way for you to prepare the return in your software by overriding what goes to A-27 and making a manual entry on A-28. If there is not or if you cannot during business hours call their support hotline and learn the procedure, then you have the wrong software and should make a change by next year. Even in that event, all is not lost for this return.

In that event you can prepare the return on PDF Forms you can get from the IRS (the hard but free way) or from something like the CFS Forms package or Kleinrock Zillionforms (the easier but more costly way.) Which way is better for you depends on how much time and how much money you have and on how often you find yourself in this situation.

[Gene V]

Gene:

Thanks for replying. I still question why it says to enter on 2106. This will automatically take it to line 27 if greater than 2%.

Gary

On my software (lacerte) for Form 2106 there is a box to check for handicapped, if I check that box--the Form totals goes to line 28.

Gene

[ChEAr$]

Like Lacerte

On my software (lacerte) for Form 2106 there is a box to check for handicapped, if I check that box--the Form totals goes to line 28.

Gene

Taxwise has the same check the box at bottom of the form 2106.

[Gary]

Thanks

Thank you all for your replies.

Gary

[S T]

My software

My software as well, on the form 2106 has a "special rule" "disabled employees" to check which then will carry to Schedule A - line 28.

Sandy

[BOB W]

How does the "check the box" decide what expenses are disabled related expense from other employee expenses? Would you create 2 2106s?

[ChEAr$]

Yes

How does the "check the box" decide what expenses are disabled related expense from other employee expenses? Would you create 2 2106s?

that sounds reasonable to me.

[Davc]

Drake has a box to enter the amount and it then reports each portion on the correct line with a label for the IRE.

[BOB W]

COOL>> I check UT for the same............