Page 17 - Supplement to Income Tax 2019

Additions & Corrections to the Text of Your Income Tax 2019

Additions & Corrections to the Text of Your Income Tax 2019

Note to our readers: If you have the Professional Edition of J.K. Archer MSA contributions (page 59). The next-to-last
Lasser’s Your Income Tax 2019, some of the corrections to the text sentence on page 59 should state that the deduction for
and the updates provided in the following pages may already be MSA contributions is claimed on Line 36 of Schedule 1 of
included in your edition. We regret any errors.
Form 1040.
The page references in the boldface headings below are to Part II of sample Form 8949 (page 123). In Part II of the
the text of J.K. Lasser’s Your Income Tax 2019. Page references sample Form 8949 (page 123), text may be missing next
within the items themselves (after the headings) are to the to checkboxes D, E, and F. See the Form 8949 on pages
pages of this Supplement unless otherwise noted. 45–46 of this Supplement for the text, which identifies
As explained at the beginning of this Supplement, Congress which box should be checked.
has not (as of the time this Supplement was prepared)
extended to 2018 any of the provisions that expired at the Sample Forms 8824 (pages 159-160). In the second
end of 2017, including the deduction for tuition/fees, the paragraph of the Jones and Smith example, the reference
deduction for mortgage insurance premiums, the exclusion to the sample Forms 8824 should be to the forms on the
for discharge of qualified principal residence indebtedness, “following” page (i.e., on page 160).
the credit for nonbusiness home energy improvements, and Lottery and sweepstake winnings (page 311). The first
several business credits. sentence of 11.2 should state that sweepstakes, lottery, and
For future updates, visit jklasser.com.
raffle winnings are reported as “other income” on Schedule
What’s New for 2018 (page xxvii). In the section for 1 of Form 1040. The Filing Tip should state that gambling
“Individual health care mandate and premium tax credit,” losses up to winnings are deductible in 2018 as an “other”
the last sentence of the first paragraph should read as itemized deduction on Schedule A (Form 1040).
follows: “The penalty does not apply after 2018.” In the
second paragraph, the last sentence should read: “The credit Gambling winnings and losses (page 311). The first
continues to be available even though there is no individual sentence of 11.3 should state that gambling winnings are
mandate penalty after 2018.” reported as “other income” on Schedule 1 of Form 1040.
Key tax numbers for 2018 (page xxxi). Under “IRA Refund claim rules for wrongful incarceration damages
contributions,” the deduction phaseout range for single or (page 320). The exclusion for damages received for having
head of household should be $63,000-$73,000. been wrongfully incarcerated can be claimed for a prior year
on an amended return filed within the regular amended
Reimbursed moving expenses taxable (page 40). As noted return time limit (47.2). The IRS has a set of questions
in the text and in the Law Alert, reimbursed moving and answers on eligibility for the exclusion and refund
expenses are taxable starting in 2018, unless received by claim procedures at www.irs.gov/individuals/wrongful-
qualifying members of the U.S. Armed Forces. However, incarceration-faqs.
the IRS announced that a reimbursement received by any
employee in 2018 for qualifying 2017 work-related moving Partnership tax audits (page 327). In the first paragraph
expenses is excludable from 2018 income, provided the of 11.13, the first sentence should read as follows: “For
employee did not claim a 2017 deduction for the expenses audits of partnership returns for tax years beginning after
(Notice 2018-75, 2018-41 IRB 556). December 31, 2017, the Bipartisan Budget Act of 2015
(BBA) provides a “centralized audit system” that allows the
Section 83(i) election to defer income on qualified IRS to audit partnerships at the partnership level.” The
equity grants (Law Alert, page 54). The IRS has issued last sentence in that paragraph should read as follows:
guidance on the new Section 83(i) election, including the “Partnerships with up to 100 eligible partners may elect
definition of eligible corporations and qualifying equity out of the BBA rules (T.D. 9829, 2018-4 IRB 307).”
grants, and the rules for making the election, including
tax withholding requirements and the requirement that Deductions from gross income (page 336). The last
an electing employee must agree that all deferral stock will sentence on page 336 should state that the adjustments
be held in an escrow account that satisfies specified tests to income (above-the-line deductions) are available on
(Notice 2018-97, 2018-52 IRB 1062). Schedule 1 of Form 1040.

Supplement to J.K. Lasser’s Your Income Tax 2019 | 13