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About jklcpa

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    ATX Supreme Guru
  • Birthday 05/01/1960

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  1. added something to this: depends upon our clients' ability to receive ACCURATE 1095s on a timely basis. How many of us had to wait for clients to get these forms corrected? Some here, I am sure. Luckily I had only one, and the process of getting this corrected form caused a lengthy delay in filing an otherwise very basic return. I was bothered when I found out that the national marketplace sub'ed out that job of investigating and calculating corrected amounts or other reported data, and then that information was transferred back to the marketplace to issue the corrected form. Now with the Equifax debacle and hacking, it all bothers me a lot more.
  2. I agree, John. Much like many of us discussed here when this issue came up during the filing season, the law hadn't changed even though IRS said it wouldn't actively pursue. That was also compounded by the issue of whether the software would allow filing of "silent" returns without rejection, if I recall correctly. I think it's a good thing that IRS has come out with its position before the filing season starts.
  3. re: Drake - I don't have IL loaded to test, but it appears that Drake considers this taxable in Illinois and would not include this payout in the IL exclusions. Comments on Drake's forum said that in March of 2015 Drake made a change so that anything with Code D in box 7 is taxable in Illinois. Prior to that change, Drake included items with code D in the subtractions making it necessary to manually override the subtractions on IL. Another comment by an EA regarding that programming change said he'd confirmed directly with IL DOR and with Drake Support that this nonqualified annuity income has always been taxable to Illinois, and that prior to 2014 Drake's program contained an error that caused this income to show up as nontaxable. I've seen some comments out on the web where it was said that Illinois was going after taxpayers that try to exclude this. Other comments specifically said that Lacerte's default programming excludes payouts with code D and that there is a checkbox to indicate that the amount doesn't qualify for the exclusion. I don't have that program, just what I read.
  4. Scanners

    @SaraEA I believe what you say is correct about not being able to access your file cabinet if your firm did not renew the Creative Solutions products. Drake's document manager has all of that same functionality that you describe AND files are stored directly on the C:drive in a directory that is accessible outside of the program. I am 100% sure that I could retain access to those pdfs even if I left the company. @Abby Normal what pdf program do you use to insert the adding machine tapes into the pdfs? I have Acrobat and don't see that but have not explored the plug-ins.
  5. Scanners

    ^^ Catherine said exactly what I was also trying to convey. I have a Twain scanner that works perfectly within Drake's doc mgr, but I can also scan using the scanner's software and save to Drake's Doc Mgr directory without ever opening the doc mgr or tax programs. I did that last week when someone brought in a state revenue notice that didn't require any attention on my part, but I wanted to save a copy in the client's records. I scanned and named the file using the scanner without having to enter passwords to open any of Drake's programs. Easy and quick. Drake "recommends" using a twain-compliant scanner, but it is only "required" if you want to scan from within the DDM software itself.
  6. 2018 PTIN

    Is the IRS using the early birds to test its systems? Why the rush to renew at the earliest possible moment?
  7. W-2 Verification Code Expands

    1. You probably already know all of this, but for anyone reading this that doesn't - It was implemented in 2016 on a much smaller scale and expanded to the 50 million level we encountered last year and was still considered in the testing phase. IRS reported a success rate of about 94%, and a reduction in refunds issued on returns with fraudulent W-2s. Even if the W-2 contained the code, not entering the code didn't stop a return from being processed. We don't know if the return received extra scrutiny, but I'd say probably not. 2. They won't. IRS and the large payroll processing companies collaborated on this, and the verification code is the generated by applying an algorithm provided by the IRS. The resulting code is unique and is based other data contained on that particular W-2. I suspect that even our tax software that we use to prepare and file W-2s will not be able to generate these codes. Logically, the IRS won't be releasing the details of how the algorithm generates the code because that would defeat the purpose if the fraudsters are able to generate valid codes for a fake W-2. That's in a similar vein to why we practitioners were not told specifically what additional data is being transmitted with returns that we e-file. One was obviously the amount of input time so that IRS could shut down the preparation mills where thieves were generating fraudulent returns in a matter of seconds or a few short minutes.
  8. speaking of 3115.....

    Disclaimer - I don't do farm returns so this reply is meant to generate additional discussion in hopes of getting to the proper reporting and may not be helpful, but I'll take a shot. Thinking out loud - I think these are the main issues regarding the wife's involvement in the farm: First, the wife already has s.e. income from another activity other than the farm. Does she also materially participate in the farming operation in a substantial and significant way for this to really be a partnership for tax reporting purposes? If she doesn't then I'd have trouble calling this a partnership merely because jointly held land and buildings are used in the farm operation and are collateral for the loan. If you think it's a partnership and if she does materially participate, then this can be a qualified joint venture and not be treated as a partnership requiring 1065 reporting, and instead the income and expenses may be split and reported on the appropriate schedules and forms of the 1040. https://www.irs.gov/businesses/small-businesses-self-employed/married-couples-in-business If the wife doesn't materially participate but you still think this is a partnership, then they can't claim QJV and report only on the 1040. In this case the proper reporting would be on a 1065. Additionally, without her participation, I believe that any loss to her would be considered passive and not be available to offset her other s.e. income. If after all of this, you decide that the 3 years' tax reporting is not correct, I don't see this as a 3115 change at all because there is no change in the income or deductions due to an accounting method change, only a split in the reporting and that the wrong forms were used. Sorry that's so lengthy and might not be of much help.
  9. Scanners

    Good point about the Twain issue Randall. I can't answer about the Creative Solutions program that Sam is using because he didn't mention which one, but I use one of their too, and I'd suspect that their files are stored in a proprietary area that may be less flexible than Drake's as he mentioned Drake is the other program. Drake recommends a Twain-compliant scanner so that all of the features that make their document manager fully functional, functions that would include scanning, naming, remembering those common names, and turning duplex on and off from within the doc mgr itself. With that said, Drake's Document Manager will install and still function as a file storage directory because it simply puts the files into a directory on the C: drive, and it is absolutely possible to scan and save by using the scanner's software itself outside of Drake while still naming and saving within that same Drake doc mgr directory. In a similar vein, it's possible to save other files such as Word & Excel to that Doc Mgr directory in their original formats or as pdfs. There is a slight inconvenience to using a non-twain scanner, but the files are still there and accessible, either by launching the doc manager from within Drake's tax program, opening the Doc Mgr program itself separately, or opening files directly from the file directory of the C: drive.
  10. For those of you running your network over wifi...

    I agree with cbslee and that we should continue with our usual abundance of caution. I don't know why the articles I read said that MS had released and emergency patch today, because the updates that I received late this afternoon were for ancillary programs and the usual database updates for my AV software.
  11. Form 3115

    No, I never have either. I can tell you that when one of my corp clients called the state to inquire about a refund that was due for that year that included a 3115 for the 481 adjustments due to the repair regs, and was told that the delay was because the client had filed corrected returns. I don't think the state knew what to do with all of that extra information, and I could just picture the poor person that had to wade through it.
  12. For those of you running your network over wifi...

    Yes, everyone should be on hardwired access. Interestingly, when I googled to find more information about the Windows update that is scheduled for tomorrow, I also found articles about Microsoft issuing an emergency update today that already shut down this KRACK attack on systems running any of their OS that are still supported. I can't see what is coming in yet, but I can tell you that my system is receiving some update now.
  13. Minimal Depreciation

    Not personally. I've heard of audits where the agent questioned the depreciation because of the underlying allocation of the basis between building and land that would affect the deductions.
  14. Minimal Depreciation

    Haha, that's funny because we don't operate like that around here and some members haven't even visited or read the post yet. You'll have to get used to us being overly generous with advice and the fact that we do continue to discuss topics and offer opinions on subjects that interest us even if the original poster has received valid answers. It only ends when the last member who wants to comment has done so. Beside, I made some .
  15. Win 10 Update on Tuesday

    Thanks for the notice.