TAX DAY!!!

Finally taxes are done!  We know it’s almost last minute, but we had a good excuse. Well, at least we did this year, but we also procrastinated, which is probably a topic for another day (or not).

Our primary challenge this year is that I was on disability last year. We did not know how to handle the proceeds from that period. Although I used TurboTax, I usually just let things import from last year, enter my W2 and other income information (like interest and dividents) and let TurboTax do its thing. We have a relatively simple return, since we did not have enough medical expenses (Thank you Medicare and additional insurance) or deductions to itemize. Also, we did not get a tax-related statement from EDD. Not sure what to do. 

I googled what is usually done and ran into a Form 1099-G for disability payments. We did not get one, so we (more I) were on the verge of panicking. We need to file in three weeks, and we cannot wait for the form. Fortunately, the calm one in our household (Hubby) said that if needed, we can simply file for an extension. I’m glad he helped me think through this.

We called EDD and listened to the long message (twice!) The first time the telephone query system said that there is no 1099-G in record for me. Now, we are confused.

We called my HR department and they said I should have a claim. The lady was helpful and gave me my claim number, both for our company and EDD. 

We called EDD again (and listened to the long message one more time) and finally talked to a live person. He told us that the proceeds during my disability is not taxable, since these are insurance payments. My husband and I were elated. No forms to wait for – at least for California!

Because work has been somewhat hectic, I decided to wait for last weekend to finish our taxes. Should not be too bad, right? We’re almost done; all we need to do is print.

However, upon detailed review – I saw that the state return is off – way off. OMG! What could be wrong? I felt like an accountant going through the forms in detail (which is okay since I am OCD that way). After a thorough review, I realized that TurboTax defaulted to my taking the whole year off.

I did both the Federal and State interview and found where I could plug in the amount. Fortunately, we saved all of the statements from EDD and I calculated the total amount. We checked the form for errors, printed, and DONE! Hubby mailed it off the next day.

Thank God I caught the discrepancy.  Lessons learned in this exercise: disability disbursements are not taxable in the state of CA (since these are deemed as insurance payments) and when there is something new in your taxes/life, do the TurboTax interview – it will save you considerable stress. I am hoping that someday somewhere (in CA), someone can benefit from my stress.

And of course, don’t procrastinate… but that is a subject for another post.