FTB
bjt...@aol.com
Lee Reams
Barbara,
I think the issue a “Registered Domestic Partnership (RDP)” Chapter 112 in the Big Book that you refer to as Domestic Partnership.
Lack of Notification: You mentioned that your client was never informed about the domestic partnership. So seems his argument that he did not about it won’t hold water since a signed application must be submitted to the state to register as RDPs.
RDP Wages – IRS Pub 555 indicates that only the RDP’s share of the income and deductions should be entered on the appropriate lines of the RDP’s separate tax return, so wages should be split for entry on line 1 of the 1040 (2021 version). However, in doing so the tax software will treat the community property allocated to the other partner as earned income for several issues, such as IRA deductions and the dependent care credit, the refundable portion of the child tax credit, and the earned income tax credit, which is not correct. The IRS website Q&As 18 and 24 clearly states that earned income for these purposes is determined without respect to community property rules.
Health Insurance Adjustment: The $8,000 difference on the W-2 due to domestic partner health insurance is a significant factor, and is community income, thus each would If your client was not aware of the domestic partnership and did not meet the criteria, this adjustment might be unjustified. Perhaps he would be liable for $4,000, assuming the wages of the two were spit correctly in the first place.
Lee
On Jul 18, 2024, at 10:10 AM, bjtaxx via ClientWhysConnect <clientwh...@googlegroups.com> wrote:2020 On his w-2 there was a difference of about $8000 between Ca and IRS. I have later found out this is the "domestic partners" health insurance. FTB adjusted. He owes about $900. I filed petition. The petition was not allowed. But I can petition again...but I must be able to justify my stance. I was never told about the "domestic partnership",Question when I read the rules for Ca domestic partner 1. they must live together 2. they must file a CA joint return, or file a married separate splitting the community income. My client did not live with his girlfriend, he filed "Single" and the girlfriend filed "head of household" and received a large EIC (I did not file her return). They are no long together and in 2022 filed for dissolution of the "Domestic Partnership".Do I have anything to protest? Or should I just leave it alone and have him pay the additional tax.
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