Monday, June 28, 2010

Procrastination 2009

I am just now sitting down to do our 2009 Income Tax Returns.  What I do in years like this is send Revenue Canada, 'scuse me, "The CRA" two whopping cheques. They get to play with our money*  for a few months, and then I claim all or most of it back -- and they owe me!  Bwaahhaaahahhhhaaaaaa!

The important thing if late is to get your payment in on time -- to avoid penalties and nasty threats of dark possibilities if you are late filing in subsequent tax years.

My goal is to get the returns done by Friday without screaming.  If you open your laptop some morning this week and it emits either a sharp, shrill cry, or a plaintive moan followed by indistinct gurgles, that will be me.

* Like paying Canada Post employees to mis-re-direct our re-mis-directed mail and G20 police to arrest innocents while watching the perps, you know, trash their police cars and vandalize and loot...

47 comments:

Frances said...

But income tax is such fun!!

maryT said...

I agree, Income tax is really fun. Hope you are using a computerized program, much simpler.

RkBall said...

I use QuickTax.

I've already had my first moan&groan moment.

Frances said...

To err is human, but to really mess up requires a computer. Also, garbage in equals garbage out; doubly so with a tax program. Be warned!!

RkBall said...

OK -- I'm trying to enter a T5. The slip I've got has only one box with data in it -- Box 13. QuickTax skips this box -- it goes from 12 to 14. Arrrggghhhh!

Wait a minute. QuickTax lists the boxes as follows --
24, 25, 26, 13, 18, 19, 10, 11, 12, 14, 15, 16, 20.

Sill me -- I thought 13 would come after 12 and before 14.

maryT said...

You will find that little problem of box numbers not in order in a lot of places. Seems whenever they make a change, they just omit a number and put in another.
And remember, we are paying someone big bucks to make all those changes.
My advice, on every line, click on it and see where it takes you, then click on the boxes that show up. And my rules is, when calling Rev Canada, I do it several times with the same question and take the best 3 our of 5 answer. It helps if the person at the other end has no foreign accent.
And remember you can phone them for help, without giving your name, or personal info if you don't want to.

RkBall said...

Now, I've got a question for QuickTax, and it is saying, "Enable Cookies". Cookies are enabled on Safari -- arrgggghhhh!

What do I do now?!

RkBall said...

"And my rules is, when calling Rev Canada, I do it several times with the same question and take the best 3 our of 5 answer."

That is so funny. Funny thing is, I do the same thing -- although I go with 2 out of 3.

Had a question about how to claim US stock income/capital gains. I was bounced to "International". The CRA lady, after listening to my question two or three times and still not understanding it, told me I needed to contact the US authorities -- and this for information ON HOW TO FILL IN A CANADIAN TAX FORM!!!

RkBall said...

Ask Tina said:
Hi! I'm Tina, your QuickTax Interactive Agent. You can access this service and ask me questions 24/7. Ask me a question like the one below and I'll guide you to an answer.

I can help answer questions about QuickTax products and services. I am a computer, not a person, so please keep your question short and ask one question at a time.

You said:
I tried to access Tina using Mac OS Safari. I kept getting an error message telling me to enable Cookies Cookies are enabled. Does quicktaxweb work using Safari?

Ask Tina said:
I am designed to answer questions one sentence at a time, could you please try rephrasing your question?

You said:
Does Quicktaxweb work using Safari?

Ask Tina said:
QuickTax does not offer a CD or download for MAC users.

However, If you own a Macintosh PC, you can use the QuickTax online product to file your taxes. QuickTax online supports Macintosh and Windows operating systems, as well as multiple browsers, including Firefox, Safari, and Internet Explorer.

Was this answer useful to you?

You said:
No

Ask Tina said:
I'm sorry that I wasn't able to help you. Could you tell me why this information didn't help you? Was it because:

You said:
The solution I provided did not resolve your problem

Ask Tina said:
Thank you for your feedback; we will use this to improve my knowledge. What else can I help you with?

You said:
So far you have helped me with nothing.

Ask Tina said:
I'm sorry. I did not understand that. Could you please ask your question again using different terms?

You said:
You have not helped me.

Ask Tina said:
My apologies. I don't quite understand your question. Can you try rephrasing it in a different way?

RkBall said...

I have switched from Safari to Firefox. My screen name is Arrrggh. I suppose I shouldn't be giving this out. I'll change a letter. My screen name is Arrggh. There.

Frances said...

Let's have a quick look at foreign source income of the investment type. I presume you didn't get a T3 or a T5 because those would have had the relevant box numbers for you to enter.

Foreign source dividends and interest are treated the same. Foreign source dividends are NOT entered as dividends (section I) on Schedule 4 but in a special area called 'Income from foreign sources' at the bottom of section II of that schedule. It lands with Canadian source interest income on line 121 of the T1.

Capital gains/losses do retain their character whether foreign or domestic. You enter them on Schedule 3. I suspect you will be using section 3 on that schedule. Just remember, everything on the return has to be in Canadian dollars. So you need to know not only what you paid for your foreign investment in its currency, but also what the exchange rate was at that time. Similarly, you will need the exchange rate at the time you sold to get the correct conversion. Don't make the common mistake of just looking at the gain or loss in the foreign currency and translating that to CAD; with the rise in the CAD, what looks like a gain may actually be a loss.

Hope this helps.

Cheers!!

RkBall said...

Thanks -- it's like I've got a support team happening here!

It's taken me all morning to enter about 6 T3/T5 slips -- mainly because Quicktaxweb does not fully support Safari, even though it says it does.

I switched to Firefox and I'm back in the saddle again.

Thanks, Frances.

maryT said...

Is you question dealing with a tax question or program question. When I called them a long time ago, the person said, we don't handle tax question.

RkBall said...

Program question.

maryT said...

check your e-mail.

RkBall said...

I'm on to my little music business now. If you're interested, check out

www.firesong.ca.

I have all the receipts here somewhere...

Frances said...

So you're doing a T2125. Have fun!! Don't forget to ensure continuity from prior years for any capital assets you might have.

maryT said...

I must relate a problem with Rev Can expert from a few years ago.
Farmer had a fire, lost machinery, bldgs etc.
Called and said I wanted to talk to a farm expert, and lady said I can help you.
I knew, by her accent she couldn't so I had some fun. First question, how do you take the value of a Quonset, lost in a fire, out of CCA. Then I asked other questions, using names like, John Deere, New Holland, etc.
After about 30 minutes she said, could I ask you a question, go ahead, What is a quonset. I told her, if you don't know that you are not a farm expert, and was transferred to a supervisor, who transferred me to another dept. Eventually I was transferred to Problem Resolution head honcho, in Vancouver. I related my problem and he said, do you know who I am, and I thought he was being smart but held my tongue. (difficult) and he said, my dept handles problems of major corporations, not individual problems. Ok, he asked my problem and he helped me and said, go back to the beginning and tell the gal, xx of Problem resolution, ext xxx says xxxxxx. Use my name whenever you have any problem. Funny how using that name got me immediate help.
Solution was simple, use the UCC of any item lost and go from there, no recapture involved.
I had thought that was the answer but wanted to make sure.

RkBall said...

"After about 30 minutes she said..."

30 minutes?!

The mind boggles, Jeeves, the mind boggles.

maryT said...

During that 30 minutes I was asking a lot of questions re farming that I knew she had no clue about. It was a fun couple of hours.

Frances said...

Checked your website - looks interesting. Any more queries - put out a new post and hope it's picked up. I'll keep an eye out for it.

Trust your website small business in NOT incorporated. If it is, then it's a T2 issue which is a whole other form. Otherwise, if you are a sole proprietorship, it goes on the T1.

By the way, you're not that late. As a sole prop, you're allowed until June 15th to file your taxes. Just have to have any tax owing by 30th April.

Frances said...

Checked your website - looks interesting. Any more queries - repost. I'll keep an eye out for it.

Trust your website small business in NOT incorporated. If it is, then it's a T2 issue which is a whole other form. Otherwise, if you are a sole proprietorship, it goes on the T1.

By the way, you're not that late. As a sole prop, you're allowed until June 15th to file your taxes. Just have to have any tax owing by 30th April.

maryT said...

Totally agree, do not incorporate.
You could then be lumped in with all those nasty corporations the thugs are protesting against.
I will be joining you in getting frustrated, client just dropped off 27 file folders filled with receipts to put in order to do his taxes.

RkBall said...

I have the worst of both worlds. I have an incorporated company, Richard Ball & Associates Inc., which specializes in software engineering training, plus my little music business.

I spend about two weeks of my life getting the corporate books in a position to do an (expensive) hand-off to the accountant.

I spend about one week (off-and-on) getting our personal income tax done.

RkBall said...

Procrastination update -- took the car in for an oil change this morning; went to "Norman's Store" for some stuff. Blogging. Now, back to the income tax. Am printing off the monthly RBC account where I keep track of music business income/expenses, and blogging in between.

I am a great procrastinator!

But, I get by with a little help from my friends!

RkBall said...

MaryT and Frances: For sticking with me this week, I would like to offer you each a complimentary copy of my debut CD, Love Lifted Me. If you would like one, go to firesong.ca, and send me an email with your mailing instructions.

RkBall said...

Arrggh. I had to enter some music business data in QuickTax THREE times, because, I would go look up some info, key it in -- and the software had "timed out" without bothering to let me know. It let me dutifully to enter a screen of info, I press enter, and "Timed OUt!".

Got the music business in. Next, looking up my safety deposit box fee.

maryT said...

Got to your site via the link provided. Great stuff.
Do you use an accounting program, if not, sounds like you should.
Just print off the stmts for tax time, enter the totals in Quick tax, enter your slips and your are done.
You could even just have one company with various income and expense categories alloted to corporate and non corporate entities.

RkBall said...

Moved to Ontario this year. Doing the Ontario Tax Credits. Need to find the "Roll Number" for our property. Do I have this info here -- PEI -- or is it back in Toronto??

maryT said...

When did you move to Ont, and from where did you move. Where did you live Dec 31, 2009. That is the provincial return you must do.
And if you moved you might be able to claim moving expenses, and if you don't need them all for 2009, the unused can be claimed in 2010.
Check out the moving expense form, there are lots of allowable expenses there, and a lot of people don't even know about them.
But they can only be claimed against income earned in new location.

RkBall said...

Hi Mary,

Good comments. We moved in Nov 2009 from our house in PEI to our townhouse in Toronto, so we were residents of Ontario Dec 31 2009.

What this means is we will have to pay double property taxes on our home in PEI -- that is the way the PEI government "thanks" the rest of Canada for all the transfer funds it receives!

There were no moving expenses per se beyond the drive from PEI to Ontario. I'll charge this as a business expense as there was a contract with RBC in Toronto that I was going to fulfill.

Interestingly, my business is incorporated in PEI, but we are (currently) residents of Ontario. I'm not sure how that will work out.

I'll post a picture of our PEI property for you to take a look at -- the "backyard"!

RkBall said...

MaryT: "I agree, Income tax is really fun."

Did you really mean this, or were you being at least a teenie bit tongue-in-cheek?!

maryT said...

As a tax preparer, yes, Income tax is fun as it is my bread and butter, but also tongue in cheek.
You had to have moving expenses, if it is only car expenses and meals and hotels. Like meals for two weeks in new location or old locations and hotels.
When my clients are moving, and going to get the car fixed I tell them, wait till you are on the road, then costs will be deductible.
Check out the moving expense form as there might be some costs re your home in PEI that can be deducted. Every little bit helps.
It is Friday today, will you getter done today.

RkBall said...

Will I get 'er done?

Well, the pressure's off because I've basically got everything entered, and (wipe brow) I don't owe the CRA more than I already sent them -- I always worry about this when I file late. It's 1:15 and I haven't headed upstairs to the home office yet. Gotta have a burger on the BBQ first!

RkBall said...

2:30. Alternative Minimum Tax. I almost got hit with it last year (2008). The good news is there's a carry-over.

"If you must pay AMT in a year, the excess of that AMT over your regular tax amount can be carried forward as part of your “minimum tax carryover”. This can be carried forward seven years to offset your regular income tax in any one year to the extent it exceeds the AMT for that year."

Spent an hour getting clarification on this baby.

RkBall said...

T3 Box 42. Cost base adjustment. I bought some shares of Plazacorp 2,3,4 years ago. Box 42 represents return of capital, or something close to it. Here's what this baby means (as I understand it):

You buy a stock for $5. 10 years later, you sell it for $5.

BUT, during the past ten years, you have been paid .25 a year return of capital, or whatever this is. That means that your capital cost is reduced by $2.50 to $2.50/share. Meaning a capital gain becomes payable.

*Worse, it means that you have to keep track of these year by year -- which I have not been doing!*

Know what I'm gonna do -- sell it and buy it back 30 days later in RSP.

Right now, I'm going back through previous years tax returns to figure out what the amount was in Box 42 each year.

I want a tax system where you enter your slips and deductions data and you're done!

RkBall said...

Turns out, I was mixing up two investments. Upon closer inspection, my 2008 slip was for Lakeview Hotel Real Estate, not PlazaCorp.

PlazaCorp is a Split Corps entity, and shows a T5 Box 18 "Capital Gain Dividend", whereas Lakeview (which I sold last year b/c of this issue) shows a T3 Box 42 "Return of Capital".

Capital Gain Dividend vs. Return of Capital -- I got the two mixed up.

Another hour of my life "well-wasted"!

RkBall said...

It's 5:34pm Friday and yes, MaryT, I am PRINTING out the tax returns!!!

Got interrupted this afternoon by Fr. David Harris who dropped by -- I had to let him sample our fabulous new Keurig coffee-maker from COSTCO USA, and also our SIX-year old Cheddar from COSTCO Moncton.

Life is good!

RkBall said...

Oh, boy... looking over the printed returns. Looks like I showed my music business as Professional Income this year, and Business Income in past years -- and QuickTax has printed out TWO sets of form T2125. With, of course, different amounts on them. Now I have to go into QuickTax and try to repair the damage.

Arrrggh!

RkBall said...

Must have something to do with QuickTax's new look and format this year.

RkBall said...

Sure enough -- last year, they had a category, Business Income" -- and that's what I used for my, er, business income. This year, they have a bunch of categories like Professional, Farming, etc., and then one at the end -- Other Income". Sure enough, that's where they had buried the carry-over data from last year -- CCA -- without even notifying me it was there! I wondered why I had to re-enter all the CCA info from scratch this year.

Arrrggh!

RkBall said...

I'm trying to re-enter the data over in the Business screens, and wipe the data from the Professional screens -- Quicktax is not letting me do this -- Arrrggh!

RkBall said...

I wiped as much as I could, went back, and was able to Delete the Professional Income bit.

Back on track!

maryT said...

Just go into the profession stmt and change all the figures to zero. Program will still print them, but will have no effect and don't have to be mailed.
I just updated my accounting program to 2010 as have new clients. But, I started working on some 2009 books and when going for a report, put in last fiscal year. zeros all over the place. After an hour of trying everything, and hoping it was not lost, it fianaly dawned on me. With a 2010 program, last fiscal year is to Dec 31, 2009. Changed the dates to 01-01-08 to 12-31-08 and magically all info is there.
Every file I have now has to be updated to 2010 before I can work in them. The larger the file the longer it takes. 30 minutes has been the shortest time. Must get out the latest Grisham novel that I bought for .50 at a garage sale.

RkBall said...

I'm done. The big problem for me this year was --
QuickTax is changing to TurboTax next year. They changed their look-and-feel, this year, I think perhaps to ease the transition.

You had to basically know everything in the initial interview before you begin. Do you have investment expenses? I don't know at this point. Other Income? Don't think so. That sort of thing.

And, as I just said, I didn't see something called Business Income, or Income from a business, so I keyed in all the info into Professional Income -- after all, if you are running a small business, it should be something more than just "Other Income". Worse, QuickTax did not warn me I was doing this, because I had not checked the Other Income box during the initial interview, it did not take me to the data it was bringing in from the 2008 year -- CCA etc., and so I didn't get to "see" it until I had printed out and was doing the final attachments, signatures, etc. Then, I had to go back and do the re-do!

RkBall said...

My final advice on using QuickTax. -- See fresh post.

RkBall said...

Turns out it was "Other Type of Business". I guess if I had read this carefully I would have caught it.

My bad.

8:30 pm Friday.

Now it's on to DVDs.

Liked your Grisham comment.

"... nothing intellectually compelling or challenging.. bald assertions coupled to superstition... woefully pathetic"