Carry-forward of individual losses, with late-filed past taxes [US]
The 2012 return was due 4/15/2013 (I'm assuming it didn't fall on a weekend). No late filing penalty if there was no tax due, but he has until 4/15/2016 to file for a refund or to document anything that should have carried forward. Is Jim right to be worries? Yes, since the statute of limitations for refunds for 2012 is close and he might lose any tax refunds he might be entitled to for that year. Also, the pattern itself may raise some flags of suspicion and trigger audits, both because of such a variance in income and because of the medical expenses (which are generally considered a red flag). So he might get audited. However, if all the income and expenses are properly documented, audit itself should not be a problem.
Assuming US/IRS: If you filed on time and paid what you believed was the correct amount, they might be kind and let it go. But don't assume they will. If you can't file on time, you are supposed to file estimated taxes before the deadline, and to make that payment large enough to cover what you are likely to owe them. If there is excess, you get it back when you file the actual forms. If there is a shortfall, you may be charged fees, essentially interest on the money you still owe them calculated from the submission due date. If you fail to file anything before the due date, then the fees/interest surcharge is calculated on the entire amount still due; effectively the same as if you had filled an estimated return erroneously claiming you owed nothing. Note that since the penalty scales with the amount still due, large errors do cost you more than small ones. And before anyone asks: no, the IRS doesn't pay interest if you submit the forms early and they owe you money. I've sometimes wondered whether they're missing a bet there, and if it would be worth rewarding people to file earlier in order to spread out the work a bit better, but until someone sells them on that idea... File a 2nd amended return that corrects the mistake I made on the 1st amended return This. Pay the $500 before April 27th and try to get it back later This. I'm not a tax expert, but I think you mean Form 4562, right? If you acquire the laptop in the year for which you're filing taxes, then it is just that simple.  (At least according to my reading of 4562 instructions, and my history of accepted tax returns where I've done this for my own business.) If, however, you acquired the laptop in a previous year and have already depreciated it previously (with the plan to spread over several years), there is more complexity I believe -- you may limited in how you could accelerate the remaining depreciation. Your CPA doesn't need to file anything, so don't worry about him being sidetracked. You are the one doing the filing. Since the amended returns have to be filed on paper, you'll actually go and mail a package to the IRS (each return in a separate envelope). The reason the CPA suggests to file the amended returns after the current one, is to ensure the NOL is registered in the system before the amended returns are processed. The IRS doesn't have to automatically accept the amended returns, and if there's no NOL on the current year they may just bounce the amended returns back to you. Keep in mind that since you haven't filed your return by the due date (including extensions), you're now unable to forego the carry-back. I don't know if you discussed this with your CPA, but you're allowed, if you chose so, to not apply the NOL to prior years, and instead to apply it forward for the next 20 years (or until it runs out). Depending on your income pattern, that might have been something you could have considered, but you can only chose this if you file a statement before the due date (with extensions), which is now passed. I checked this myself and there is no monetary penalty for late filing. However, since I am late I have to do all publication over again which costs me extra $50. Here's an answer received elsewhere. Yes, it looks like you have a pretty good understanding the concept   and the process. Your wife's income will be so low - why? If she is a full-time student in any of those months, you may   attribute $250 x 2 children worth of income for each of those months. Incidentally, even if you do end up paying taxes on the extra $3000,   you won't be paying the employee's share of Social Security and   Medicare (7.65%) or state disability on those funds. So you still end   up saving some tax money. No doubt, there's no need to remind you to be sure that you submit all   the valid receipts to the administrator in time to get reimbursed.  And a must-have disclaimer:   Please be advised that, based on current IRS rules and standards, any advice contained herein is not intended to be used, nor can it be used, for the avoidance of any tax penalty that the IRS may assess related to this matter. Any information contained in this email, whether viewed or subsequently printed, cannot be relied upon as qualified tax and accounting advice. ... Any information contained in this email does not fall under the guidelines of IRS Circular 230. "Yes, it's taxable. If anyone suggests it's a gift, they are mistaken. There's a line on the 1040 for ""other"" and as long as you claim it, you're fine with the IRS. It's 2012 income as you already got it.  Edit - mhoran makes two good points I'm not really able to address. (a) does a late bonus such as this effect one's penalty? (b) since it skipped payroll, will there be an issue by not having FICA withheld?" "There are many people who have deductions far above the standard deduction, but still don't itemize. That's their option even though it comes at a cost. It may be foolish, but it's not illegal.  If @littleadv citation is correct, the 'under penalty of perjury' type issue, what of those filers who file a Schedule A but purposely leave off their donations? I've seen many people discuss charity, and write that they do not want to benefit in any way from their donation, yet, still Schedule A their mortgage and property tax. Their returns are therefore fraudulent.  I am curious to find a situation in which the taxpayer benefits from such a purposeful oversight, or, better still, a cited case where they were charged with doing so. I've offered advice on filings return that wasn't ""truthful"". When you own a stock and cannot find cost basis, there are times that you might realize the basis is so low that just entering zero will cost you less than $100 in extra tax. You are not truthful, of course, but this kind of false statement isn't going to lead to any issue. If it gets noticed within an audit, no agent is going to give it more than a moment of time and perhaps suggest, ""you didn't even know the year it was bought?"" but there would be no consequence.  My answer is for personal returns, I'm sure for business, accuracy to the dollar is actually important." "Your question does not say this explicitly, but I assume that you were once a W-2 employee.  Each paycheck a certain amount was withheld from your check to pay income, social security, and medicare taxes.  Just because you did not receive that amount of money earned does not mean it was immediately sent to the IRS.  While I am not all that savvy on payroll procedures, I recall an article that indicated some companies only send in withheld taxes every quarter, much like you are doing now.  They get a short term interest free loan.  For example taxes withheld by a w-2 employee in the later months of the year may not be provided to the IRS until 15 January of the next year.   You are correct in assuming that if you make 100K as a W-2 you will probably pay less in taxes than someone who is 100K self employed with 5K in expenses.  However there are many factors.  Provided you properly fill out a 1040ES, and pay the correct amount of quarterly payments, you will almost never owe taxes.  In fact my experience has been the forms will probably allow you to receive a refund.  Tax laws can change and one thing the form did not include last year was the .9% Medicare surcharge for high income earners catching some by surprise.    As far as what you pay into is indicative of the games the politicians play.  It all just goes into a big old bucket of money, and more is spent by congress than what is in the bucket.  The notion of a ""social security lockbox"" is pure politics/fantasy as well as the notion of medicare and social security taxes.  The latter were created to make the actual income tax rate more palatable.     I'd recommend getting your taxes done as early as possible come 1 January 2017.  While you may not have all the needed info, you could firm up an estimate by 15 Jan and modify the amount for your last estimated payment.  Complete the taxes when all stuff comes in and even if you owe an amount you have time to save for anything additional.  Keep in mind, between 1 Jan 17 and 15 Apr 17 you will earn and presumably save money to use towards taxes.  You can always ""rob"" from that money to pay any owed tax for 2016 and make it up later. All that is to say you will be golden because you are showing concern and planning.  When you hear horror stories of IRS dealings it is most often that people spent the money that should have been sent to the IRS." 1: Gambling losses not in excess of gambling winnings can be deducted on Schedule A, line 28.  See Pub 17 (p 201).  Line 28 catches lots of deductions, and gambling losses are one of them.  See Schedule A instructions. 2: If the Mississippi state tax withheld was an income tax (which I assume it was), then it goes on Schedule A, line 5a.  In the unlikely event it was not a state or local tax on income, but some sort of excise on gambling, then it may be deductible on line 8 as another deductible tax.  It probably is not a personal property tax, which is generally levied against the value of things like cars and other movable property but not on receipts of cash; line 7 probably is not appropriate.  The most likely result, without researching Mississippi SALT, is that it was an income tax.  See Sched A Instructions for more on the differences between the types of taxes paid. Just to be clear, these statements hold if you are not engaging in poker as a profession.  If you are engaging in poker as a business, which can be difficult to establish in the IRS' eyes, then you would use Schedule C and also report business and travel expenses.  But the IRS is aware that people want to reduce their gambling income by the cost of hotels and flights to casinos, so it's a relatively high hurdle to be considered a professional poker player. The original post's $16 has two errors: Here is the first scenario: .                                                 Tax Liability($) on   Net .                        Cash    # of     Price    Paper     Realized   Value Time:                     ($)    Shares   ($/sh)   Profits    Profits    ($) 1. Start with:            100        -      n/a         -          -      100 2. After buy  10@10$/sh:    -       10       10         -          -      100 3. Before selling:          -       10       12        (5)         -      115 4. After sell 10@12$/sh:  120        -      n/a         -         (5)     115 5. After buy  12@10$/sh:    -       12       10         -         (5)     115 6. Before selling:          -       12       12        (6)        (5)     133 7. After sell 12@12$/sh:  144        -      n/a         -        (11)     133 8. After buy  14@10$/sh:    4       14       10         -        (11)     133 9. Before selling:          4       14       12        (7)       (11)     154 10.After sell 14@12$/sh:  172        -      n/a         -        (18)     154  At this point, assuming that all of the transactions occurred in the same fiscal year, and the realized profits were subject to a 25% short-term capital gains tax, you would owe $18 in taxes.  Yes, this is 25% of $172 - $100. Unfortunately assets placed in a safety deposit box are not covered under the Federal Deposit Insurance Program (FDIC). Unless the bank is found to be negligent in the way it handled or protected your safety deposit box, neither them nor their private insurance company will reimburse you for the loss. Find out if in the duration you had your box with them, they moved, transitioned or merged with another entity. In this specific situation, you may be able to demonstrate negligence on the part of the banks as they have seemingly misplaced your box during their transition phase, and depending upon the value of the items placed in your safety deposit box, you may be entitled to some form of recovery. Some homeowner's insurance policies may also cover the loss, but if you didn't document what you kept in the box, you have difficulty verifying proof of the value. Valuables are often lost but documents can often be reconstructed. You can get stock and bonds by paying a fee for new certificates. For wills and trusts, you can reach out to the lawyer that prepared them for a copy. You should always keep 3 copies of such documents. When you put stuff in the box, always videotape it (photographs can be challenged) but if the video shows it was put in there, although it can still be taken out by you after you turn off the camera, yields more weight in establishing content and potential value. Also know the value of the items and check with your homeowner policy to make sure the default amount covers it, if not then you may need to include a rider to add the difference in value and the video, receipts, appraisals and such will serve you well in the future in such unfortunate circumstances. If the contents of a safety deposit box are lost because you didn't pay the fee, then depending on the state you are in the time frame might vary (3 years on average), but none the less they are sent to the State's unclaimed property/funds department. You can search for these online often times or by contacting the state. It would help for you to find out which scenario you are in, their fault or yours, and proceed accordingly. Good luck. "You have a sequence of questions here, so a sequence of answers: If you stopped at the point where you had multiple wins with a net profit of $72, then you would pay regular income tax on that $72. It's a short term capital gain, which does not get special tax treatment, and the fact that you made it on multiple transactions does not matter. When you enter your next transaction that takes the hypothetical loss the question gets more complicated. In either case, you are paying a percentage on net gains.  If you took a two year view in the second case and you don't have anything to offset your loss in the second year, then I guess you could say that you paid more tax than you won in the total sequence of trades over the two years. Although you picked a sequence of trades where it does not appear to play, if you're going to pursue this type of strategy then you are likely at some point to run into a case where the ""wash sale"" rules apply, so you should be aware of that.  You can find information on this elsewhere on this site and also, for example, here: http://www.marketwatch.com/story/understanding-the-wash-sale-rules-2015-03-02  Basically these rules require you to defer recording a loss under some circumstances where you have rapid wins and losses on ""substantially identical"" securities. EDIT A slight correction, you can take part of your losses in the second year even if you have no off-setting gain.  From the IRS: If your capital losses exceed your capital gains, the amount of the excess loss that you can claim on line 13 of Form 1040 to lower your income is the lesser of $3,000, ($1,500 if you are married filing separately)" "I've consulted with 5-6 accountants and people who've had the issue before. The advice I received boils down to: ""If you do not attach your 83b with your personal tax return it is not effective. However you can still correct the requirement to file it along with your tax return, because you are within the 3 year window of when the return was originally due."" So you can amend your return/file it late within a certain window and things should be OK. The accountants that have confirmed this are Vanessa Kruze, Wray Rives and Augie Rakow - all of them corporate and credible accountants. You also need to keep onto the confirmation the IRS sent you in case of an audit. There is nothing on IRS.gov about attaching your 83b on a filed late or amended return but those accountants are people who say they've seen it happen frequently, have consulted with the IRS for solutions and that's the one they'd advise one to do in such situation. disclaimer: I am not a CPA" Once the business is shut down, you'll need to show that the corporation is in bankruptcy and the amounts are unrecoverable. You can then report it as investment loss. I suggest talking to a tax adviser (EA/CPA licensed in your State), and maybe an attorney, on what the specific technical details are.