We've made some updates to the Tax Report, providing additional information for you and your clients. The new version will remain in beta while we finalize the changes. Here's a review of some of those new features!
While Version 2.0 of the Tax Report remains in beta, you can toggle back and forth between Version 1.0 and 2.0 by clicking on the toggle switch seen near the top-right of your Tax Report.
Your firm's admin will first need to enable access to Tax Report 2.0 under their "settings" tab >> "security settings."
Users will then be able to toggle back and forth between 1.0 and 2.0
Key Figures
The Key Figures remain the same in Tax Report 2.0, with a slight modification to "hide" more entries that would otherwise be $0. For example, the Key Figures box shown below from Tax Report 1.0 indicates no tax-exempt interest or carryforward losses. These rows are omitted on the corresponding Key Figures section for Tax Report 2.0.
Tax Report 1.o:
Tax Report 2.0:
Tax Breakdown (NEW)
We've included a chart that shows a breakdown of the total tax bill for your client's tax return. That chart is broken down into the income tax on the two forms of taxable income, ordinary income and qualified income [long-term capital gains (LTCG) and qualified dividends], as well as other taxes like Self-Employment Tax, the Net Investment Income Tax (NIIT) and Additional Medicare Tax. 
Marginal Tax Brackets - Ordinary Income (UPDATED)
In addition to indicating marginal rates and corresponding income brackets for ordinary income, this panel now includes the amount of ordinary income within each bracket and the corresponding tax on that income, with everything totaling at the bottom of the table. 
Additionally, the section includes a bar chart for easier visualization of how each bracket is filled, along with showing how much room the taxpayer has in their current bracket. You can see the tax associated with each bracket by hovering over the amount of income in that bracket. 
Marginal Tax Brackets - Long-Term Capital Gains & Qualified Dividends (UPDATED)
Similarly, the marginal tax brackets on "qualified income" (i.e., long-term capital gains plus qualified dividends) now include the amount of qualified income in each of the 0%/15%/20% brackets, as well as the tax associated with that income/bracket. 
This table is accompanied by a bar chart to visualize how "qualified income" is stacked on top of ordinary income when determining taxable income, which is how the 0%/15%/20% brackets are determined. The chart includes horizontal lines to indicate where those brackets start and end, along with color coding to indicate which of those preferential tax rates applies to different amounts of qualified income. 
Medicare Part B/D Premiums (UPDATED)
The Tax Report's Medicare panel shows the impact of income on a taxpayer's Medicare Part B and D Premiums two years after the year of the tax return, specifically whether the taxpayer will be subject to Income Related Monthly Adjustment Amount (IRMAA) surcharges. Rather than having users toggle back and forth to see either Part B premium adjustments or Part B premium totals (as was the case with Tax Report 1.0), this section now shows the total premium, including base amounts and any surcharges.
Social Security (NEW)
For taxpayers with Social Security benefits, this new panel breaks down how the calculation of how much of those benefits are subject to taxation, including gross benefits, taxable percentage, and taxable amount of benefits. We also show the "Combined Income" (i.e., Provision Income) amount that is used in that calculation.
Schedule A (UPDATED)
If the tax return includes Schedule A , the Tax Report will include a breakdown of the itemized deductions noted on that Schedule. Additionally, we have added a graphical representation of those itemized deductions, including a demarcation where the standard deduction would otherwise occur. This can help advisors show clients how much of their itemized deduction was truly deductible relative to having just claimed the standard deduction.
Schedule B - Income Sources
If Schedule B is included with the uploaded tax return, the Tax Report will show a summary of the interest and ordinary dividend sources and amounts:
Schedule D - Capital Gains/Losses
If included with the uploaded tax return, a summary of short- and long-term capital gains listed on Schedule D will be summarized as before. In addition to being called out in the Key Figures section, if present, any carryforward losses (or $0 if none) are highlighted as well. While not included in the sample below, if Schedule D includes any Section 1250 Deprecation Recapture of 28% Tax, we'll note those items in the Schedule D section, along with notes on how those two subsets of long-term gains are taxed.
Tax Efficiency of Investment Income (NEW)
One of the new additions to the Tax Report is a graphical section dedicated to the tax efficiency of investment income that shows up on the return.
Now, users can see what portion of the clients' Ordinary (total) Dividends are qualified and therefore eligible for taxation at the more favorable long-term capital gain rates. Users can also have a quick look at the amount of taxable vs. tax-exempt interest and how much of the net capital gains are short-term (and taxed at ordinary income rates) and long-term (and taxed at the more favorable long-term capital gains rates).
Schedule C/E - Income Sources
If included with the uploaded tax return, the business name and net profit from Schedule C will be listed as on the prior version of the Tax Report. The entity names (properties, businesses, trusts/estates) reporting income on Schedule E will also be listed. Because of the various classes of income on Schedule E, the net income for those entities is not currently pulled into the Tax Report.
Net Investment Income Tax Summary (NEW)
For taxpayers subject to Net Investment Income Tax (NIIT), the new version of the Tax Report will lay out how that NIIT is assessed.
NIIT is assessed on the lesser of net investment income or the excess income above the where NIIT is triggered ($250,000 for MFJ or QSS/$200,000 for Single or HoH/$125,000 for MFS). The table and chart will indicate both elements, illustrate the lesser of the two, and highlight how much income was subject to the NIIT.
Modified Adjusted Gross Income (MAGI): Planning Considerations (UPDATED)
The MAGI Tiers have been revamped as well. Did you know that the calculation for MAGI varies depending on the financial planning application? In fact, there are six different MAGI calculations - each of which we have organized the MAGI tiers by the six different calculations.
You can click on the (?) icon shown circled in blue below to learn more about each MAGI limit for each respective planning consideration and see the actual dollar amount of the MAGI calculated for each planning situation where outlined in green below.
The six definitions are now included in the same section as those MAGI planning considerations, instead of at the bottom of the Tax Report before. Users can click the eye icon to hide specific MAGI calculations or the teal "Hide All Formulas" button to hide all of them.
Deductions & Credits (NEW)
In addition to the itemized deductions in the Schedule A section noted above, the new Deductions & Credits section includes all deductions, both on Schedule A and on Schedule 1. We also now list out the specific credits included on the return, adding color to the total credits claimed number included in the Key Figures section.
Observations and State Tax Hints
Observations and State Tax Hints have a refreshed font! Users can click the eye icon to hide individual observations, or drag and drop to reorder the observations using the stacked lines icon outlined below.
Remember, the State Tax Hints are available by indicating the state of residence in the client household and are available whether or not you have subscribed to the State Taxes Add-on Feature.
If allowed the wording of observations can be edited using the pencil icon as before, and any insights or workflows associated with the Kitces or FpPathfinder integrations can be accessed by clicking on their respective logos where circled below.
We hope you enjoy these new changes to the Tax Report. As always, feel free to reach out to our Support Team if you have any questions along the way!