tkamba

I have done this with a civil commitment converted to a marriage. It works just combine the 2 tax returns.

I believe the child qualifies for EIC. EIC goes with where the child lives.

He has a contract for short sale set up but has been putting it off trying to figure out what to do, especially if he owes tax on the write off. He is not an existing client, he was recommended to call me by another client, so I do not know how much of his original purchase is left after depreciation. It is on his taxes as a 3 Flat rental property for 8 years per the taxpayer. He just moved in to the building in March 2013 and is claiming the other 2 apartments are vacant or maybe family lives there (per our conversation, which ever will work). That is why he is suggesting getting out of the write off using the main home exemption on Form 982. But sounds like the Qualified Real Property Business Indebtedness may apply if he is not insolvent or at a loss. I will have to look at those requirements. Thank you!

That was my feeling, that Section 121 Principal Residence, time frames would apply but he insists that 12 months residency is required under Mortgage Relief Debt Forgiveness and that there has been an amendment that changed the homestead residency requirement from 12 consecutive months to 1 month. He went to some Real Estate Seminar and you know they know everything.

I had a client call today and state that the rule had changed from 12 month to 1 month residency to qualify for the Main Home Exclusion. Of course I tell him this sounds too good to be true. He has a 3 flat that he purchased 8 yrs ago for $360,000. He never refinanced but because of no payments, interest and RE Taxes for the last couple of years, the current balance is about $420,000. He is trying to short sale it for $270,000. He just recently moved into this property, March 2013, after a short sale of another rental property that he wants to claim this same Main Home Exclusion because he moved in for a short time before the sale. I do not have the info for that sale. I research on IRS website, per Form 982 instructions and Publication 4681, they describe Main Home as follows: 　 "Main home. Your main home is the one in which you live most of the time. You can have only one main home at any one time." Nothing about length of time it needs to be your main home? I would find this too good to be true but I seem to be wrong. I told him to be safe, he may want to just claim insolvency but REALLY? You do not have to live in the home for any length of time to get the exemption?

Rental Income and sale normally go to the state that the property is located. I have had 2 clients come to me with this issue, one in Hawaii and another in CA. In both states, the Revenue Department held an escrow from the sale of the property until past returns were filed and it was proven that they did not owe taxes to those states. IL would give a credit to the taxpayer if they paid taxes but they do not get the write off for the rental losses from another state.

Thank you for your responses, I thought I was pushing the envelope but hoping it would work. I guess I will go back to the drawing board.

It seems that the S Corporation can take the carryover 179 deduction that was limited on the C Corporation taxes but I just want to ask to see if anyone disagrees. Client started a C Corporation to hold rental property in 2011 and never made the S Election, nor did they tell me about this company until recently. So, no extensions were filed so we are late filing both 2011 and 2012 taxes, so I believe too late to file for the S election with the 1st tax return (2011), correct? Now, how did I find out about the corp existence? He sent me mortgage interest info for 2012. So, no mortgage interest in 2011 and only 1/2 of 2012. No RE Tax for 2011 or 2012 because what the seller paid at closing is still more than they have paid so far. The rental property does have some equipment that I can take 179 deduction that is limited to the income - so 2011 and 2012 $0 income. Now, I know that if I lower the 179 and create a carryover NOL because of normal depreciation, the NOL will be stuck in the C Corporation but they want to convert to an S Corporation ASAP. I am thinking that if I create a carryover 179 deduction, that even if we convert to a S Corporation when filing the 2013 taxes that they will still be able to deduct the carryover 179 deduction on their 2013 personal taxes (subject of course to the combined total limited 179 deduction on their personal returns). They of course do not want to have their losses stuck in the C Corporation. If I deduct $33,000 for 179 they have a carryover NOL in 2013 of about $3,000 but if I deduct $35,000 for 179, there is no NOL since the 179 only $0's out income and they have about $3,000 of 179 deduction carrying over from 2012 to their 2013 taxes and the owners can claim this excess 179 deduction on their personal 2013 taxes. Am I looking at this correctly or am I off base? Thanks for any advise!

I emailed them this issue. They responded that they hoped to have an email reply within 4 days. I found a work around also.

I have gotten this error. It seems to be a hiccup. I re-created the IL efile and it went through no problem except it is taking days to get accepted by the state.

I have this problem too. I faxed ATX last night and they actually responded really quick. They stated they are aware of the problem. Not to re-file the return until they fix the problem but did not let me know how I will know when they fixed the issue?? I have 6 IL returns holding. Returns filed prior to this 6 and after the 6 seem to be working fine.

Thank you. Same result but cleaner filing. This was a 1st for me.

New Client came in with a W-2 from a local church for which he is the organist for the services. They issued him a W2 but did not withhold any taxes. I questioned whether this was really a W2, since there is no way to pay just 1/2 of the ss and medicare taxes. He went back to the church and was told they were previously told that they shoudl be issuing W2's not 1099-MISC which I would agree but they did not listen to the rest of the advice and withhold and pay taxes on this income for the technically employee. They have stated that they did not pay any taxes for this tax payer. My client want to make sure that all taxes are paid and is willing to just pay both sides of all taxes. I am leaning toward treating the W2 as a 1099-MISC and attaching a statement that explains the differnce in reporting. Can anyone think of another way or should we just plan on hearing from the IRS?

A client of mine received the letter to repay the loan beginning this year, which was correct, I filed the original return. He received his refund last week but they did not withhold the $500 I told the IRS to hold for the repayment?

I had this same problem last week and ATX did get me an answer via fax. In the preparer manager - 1 - preparers make sure foreign preparer is not checked 2 - firm make sure the country is blanked out 3 - open your return and and use the utility to enter preparer on form again I have not had the issue again.