2012 Tax Prep Work....what needed (cicrumstances)?

Many parts to your question, I will be brief and if you need more info, ask another question about that part only please.

Q1: ~I am on SS Disability, my husband was (has been since 2010) on workmans comp until March, with a lup court settlement in November (our atty said the lump is non taxable)...is this true, was is weekly checks taxable (2/3 of his salary)?

A1: Workmen's compensation is not taxable, checks or lump sum.

Q2: We received an inheritance in February on a non/family (neighbor family friend) member- each my hub and I receive 18,000; we requested taxes be pulled, and then after the settlement were notified by the county court we owed a 10% inheritance tax, which we paid....it was from her 401K as a college employee thru the state teacher's emplyee pension- I'm sure we would receive some paperwork- what form would it be?

A2: Your inherited 401k money that was distributed to you is taxable as long as the original owner's contributions were not taxed, which is the usual case. You will each receive a Form 1099R from the payer of the 401k. It will show the amount of the distribution, federal and state withholding, and the taxable amount. This information is reported to the IRS and is used on your tax returns.

Q3: ~My husband and I have paid several things on opening our own business (in the process, filing/approving paperwork etc.) but have kept track of expenses accumulated so far- application fee to the state board needed, tax dept registration, 2012 vehicle (paid in full), mileage log separating personal use and business useage, toll facility receipts, etc., state board license fee, continous ed costs (classes)....what if any of this can be used?

A3: If your business has opened for operation, much of this can be used. Take this all to your preparer. Plan on having more than one meeting with your preparer, and take notes as to what additional information you may need to provide.

Q4: I know we'll receive a mortgage statement for our house payment, my husband's pension (from first career) 1099 (?), my disbaility 1099, bank statements

A4: All these forms should be brought to your tax preparer and will figure into your tax return.

Q5: When it comes to medical expenses and mieages- is it worth it or can it be used? on one occasion we had a hotel stay (more than 50 mies from hm), I keep track of prescription copays/out of pocket costs, mileages for the medical trips (most are 40+ miles from our hm).....was an estimated 1200 miles, contact expenses, anything else?

A5: If you itemize and your adjusted gross income is less than 7.5% of your medical expenses that you paid, you may get a tax benefit from including these deductions. Impossible to say for sure, but since a lot of your income was tax-free, I'd guess you will have little to no medical deduction, but you can bring all of this stuff to your tax preparer, please add it all up for him and he can quickly determine if it is going to do any good.

Q6: child support isn't deductible?

A6: no

Q7: My daughter who turned 19 in september is a fulltime college student that lives lil more than half time with us, she does receive pell grant thru us, work study and a few part time jobs outside of school- not sure if we can claim here if it would be more advantageous for her to file herself (i don't think she would be at the any mandatory file- the only w2 we have is for college work study at 5284.)

A7: You can't decide whether or not she claims herself. If all she had was a work study job, she did not provide over half of her own support and cannot claim herself. She should file a 1040EZ and not claim herself if there was any federal income tax taken out of her pay.

Q8: with having a new business process, will there be two sets of income taxes or all one lump for personal and business

A8: One tax return unless you have set up a partnership or corporation, which doesn't seem to be the case.

Too much info.

Watch the mail in January for the 1099 and 1098 forms. If the 1099s and W-2s exceed, $19,500, take everything to a preparer. Each dependent is another $3800 that wouldn't be taxable.

As for the "new business," what business? According to you, you are on disability and can't work and your husband is on worker's comp and can't work. You state it hasn't generated income yet, so even if you have valid expenses you can't claim any yet.

Most of the issues around your 19 year old are how much was the Pell grant vs. how much was tuition. Did she get any loans? If the Pell grant was LESS than tuition and she did not support herself, then you would to claim a possible education credit. If the Pell grant was MORE than tuition, she may have a filing requirement because her W-2 is so close to $5950. If she *did* support herself, everything goes on her return. (This is a factual decision, not a choice. Get the numbers and figure it out.)

Did the 15 year old live with you? If not, you must have the custodial parent sign the 8332 before claiming them.

If your 19 year old did NOT support herself and any tuition was paid out of pocket, then there could be an education credit for a refund.

As for your daughter, her income is hers. The only questions are whether or not she supported herself or not and whether any of her grants were used to pay non-tuition expenses. A W-2 for $5284 is below the $5950 for a dependent, but is so close to $5950, she could go over that.

the SS disability might be partially taxable, that will depend on the rest of your income

the workmen's comp is not taxable, it is due to an injury that prevents him from working

the 401(K) would probably issue you a 1099R, if the 401(K) had been withhdrawn by the executor of the estate and you got the results as inheritance(ie you didn't inherit the 401(K) this would not be taxable to fed, your state apparently had tax on inheritance

what you have quoted as your business activity sounds very well documented, you don't say how you are operating this business--as a sole proprietor with each of you participating you can split the Sch C between each of you and this would be reported with your 1040

if you choose a corp or partnership that will require other forms and separate filing 1120 or 1065

yes his pension will be reportable and taxable

the Sch A includes medical expenses which exceed 7.5 of your AGI,and yes, mileage is deductible for medical trips, taxes, including property, sales, income, some of vehicle license, mortgage interest on your home, charitable donations to non profits, could have some casualty losses and misc which cover a multitude of items

if the 19 yr old lives in your household 6 months even away at school is considered at home, and if she does not provide more than 50% of her own support--and that is not her cell phone, or her car payment, that is rent, food, clothes, medical etc, she is your dependent

she very likely would not get any financial aid if she were not your dependent

The form you should get for the retirement plan money is Form 1099-R. College employees don't have 401(k) plans through state teacher's employee pensions. A 401(k) plan is a plan for employees of a for-profit business. College employees have Section 456 plans or 403(b) plans.

Child support is never deductible. There are no exceptions to this rule, ever, under any circumstances.

Instead of asking us on here, why don't you go speak to a tax specialist or go speak to a tax lawyer since your problem is so complicated.