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About BHoffman

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  1. How much NIIT does he pay, and would an S election allow him to avoid it?
  2. I have a client who is thinking of moving back into their rental property. They have about $50,000 in carry forward PAL. They have about $58,000 in accumulated depreciation. I understand that if they live in the house for 2/5 years and then sell, some or all of the gain can be excluded via Sec 121 (they might have a home office). I believe the entire PAL is used in the year of sale, and the entire depreciation is recaptured. Correct? Thanks!
  3. Thanks! I have been using Mozilla Thunderbird email since you suggested it and like it fine so far.
  4. Ugh. The heavy smoker sent her paperwork in. I have looked through it and put in all in a ziploc. Phew! I noticed that she missed taking a 2016 RMD in the amount of $494 from an Ameriprise IRA account and advised her to take it now and keep a copy of the payment she receives. I'm wondering whether to go the whole form 5329 route or wait and see if IRS sends a notice? If I should send in the form 5329, can you advise on "reasonable cause"? She explained her "reasonable cause" as confusion since she received dividend checks from a separate Ameriprise stock account and thought they were the required min. distributions. I don't know if IRS is going to complicate things unless the "reasonable cause" is something very common and very typical, like her elderly husband's health issues. Are there any other very common and very typical "reasonable cause" explanations for missed RMDs that I could ask her about? Thanks for any advice.
  5. I would terminate the s election. Here's a how-to:
  6. Terry - a few things I've learned over the years concerning clients and Quickbooks include keeping the chart of accounts short and sweet. Lots of clients come to me with pages and pages of accounts on the COA. That makes for lots and lots of opportunities for coding errors, IMHO. But, as long as the QB type is correct (expense, income, asset, liability, equity), the data errors are manageable. I might suggest that you perform your work on a monthly or quarterly basis since this also has worked better. The bookkeeper will probably be able to ask and answer questions as the issues are more recent than looking back annually. Also, I don't think trying to force QB to a strict tax accounting basis is going to work for the reasons you mentioned above. I think you can figure the AAA, etc. from preparing the tax return. Again, I see no benefit to angsting over AAA, OAA, and AEP if the company has always been an SCorp. I have only needed to consider the ordering rules when the shareholder takes distributions in excess of basis, and I keep track of that via the shareholder basis worksheet in Drake. You might be making the bookkeeping in QB a lot more difficult than it needs to be. My own philosophy is that simpler is better. I am a simple woman
  7. I thought CP stands for Civil Penalty. The presenter was a dud but I liked a lot of the info. And, you are sooooo right about the actual "AUR Experience" being less than the rosy picture he painted.
  8. I'm actually loving CPE Academy. The live webinars are usually only an hour, so I can pay full attention instead of dropping off into my own drool after hours and hours. And, they are free! I'm finding them to be interesting and informative. Tomorrow, "Reasonable Compensation for Shareholder Employees of SCorps". It will be fun to see how the presenter determines this.
  9. I have only used the AAA account when the company had AEP from previous years as a C Corp.
  10. Drake has an M-1 reconciliation report, but you have to enter the book balance sheet in Sch L. When I'm confronted with a client bookkeeping disaster, I usually offer to keep the books myself on a tax (almost always cash) basis and let them use their Quickbooks to keep track of their payables and receivables. If they can't keep the books, they are probably just using QB as a word processor to print checks and invoices anyway. I agree with Abby regarding messing around with the equity accounts. I set up my SCorp equity section with the QB retained earnings and then I add an account called "current year distributions" to show the shareholder distributions, which I then close to retained earnings with a journal entry on Jan 1 of the following year. You might teach your client's bookkeeper to code any disbursement made to the shareholder to that distribution account rather than put it on the profit & loss. Pretty easy to run a report and just see what tax payments (estimated or otherwise) were made if the bookkeeper puts an explanation in the "memo" on the payment. Last thing: Has the business ever been a C Corp, or has it from day one been an S Corp?
  11. Things I learned today about IRS AUR (most common: CP2000 notices): 1. Better to fax responses unless a huge stack of paperwork is involved. The response goes directly to an agent for processing instead of sitting in the mail. 2. IRS is "working" on a way to match K-1 forms. I got the impression that, as of today, IRS does not match K-1s. 3. Always best to provide a statement for any amount listed on line 21, showing each payor EIN and each amount separately. If IRS can exactly match an amount to a 1099, it won't issue a CP2000. 4. Better to call Practioner Priority Line and select Option 5 to be connected to AUR section. Those calls are routed to the front of the line, so less wait time. 5. Never send an amended tax return in response to a CP2000. AUR does not process amended tax returns, and it just muddies the waters. I think I've read questions regarding the above, and thought I'd share with you
  12. Guy walks into a bar with a toad stuck to his head. "What happened to you?", asked the bartender. "I dunno", says the toad. "It started out as a wart on my butt!"
  13. Eric....groan.....