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  2. Another headscratcher will be timing differences. If payroll expenses are paid in 2020 and your loan is forgiven in 2021, how do you handle the situation. I predict a lot of business returns being put on extension to avoid amending the 2020 tax return.
  3. Unless Congress acts, the PPP expenses are not deductible. Profit is larger. Taxes are higher.
  4. Just a random thought, but what happens to the profit for the months PPP covered the whole payroll and will not have to be repaid back? Let’s say a business had zero interruptions from the pandemic and chugged along as before and used up the PPP loan appropriately and the profit per month is as follows: Average sales $100,000, payroll cost $50,000, operating expenses $25,000 (per month) Jan $25,00 Feb $25,000 Mar $25,000 + $50,000 (PPP loan forgiven) Apr same as March May same as March The rest of the months, the profit is $25,000, so if the PPP loan is not forgiven it would be a liability, but how are business going to account for the freebie? Are business not subject to income tax if the PPP covered 100% of the payroll cost? This is a topic I have heard no one discussed and just want to see it’s really beneficial to a business.
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  6. I think IRS supports only 2019 amended individual returns beginning Aug. 17 but not business returns. https://www.irs.gov/e-file-providers/modernized-e-file-mef-status
  7. grandmabee, can you tell whether a different 8879 is needed? Are the returns being held until Aug. 17 (per IRS opening day)?
  8. Drake will exile 17 August, but you can transmit to Drake to hold until then.
  9. People who died in 2019 are not entitled to the stimulus payment but those who died or will die in 2020, should be entitled to it. There is no "final" checkbox on 1040's, but the IRS learns quickly that you are dead from the Social Security Administration. When I see an obit for one of my clients, and I have a POA for them, I quickly download the latest transcripts because if I wait 30 days, I can no longer download transcripts.
  10. I don't look good in jumpsuits, and I worked too hard to get my EA certification. Some clients just are not a good fit. Better to figure it out sooner rather than later.
  11. I know Drake is now letting them e-file the returns per a post on another blog.
  12. Perhaps he signed and mailed his client copies instead of the original red forms. One can hope. It has happened. Let us know the outcome of the employee's check. One would think that there would be something from IRS if there was reported wages and nothing to match with since they match pretty much everything.
  13. I'm waiting until after August 17 to even try. Lynn Jacobs kindly pointed out the date: https://www.irs.gov/e-file-providers/modernized-e-file-mef-status What is not clear is whether ATX can manage this and whether a different Form 8879 is required or if there are other issues to be addressed.
  14. Has anyone had any success in E-Filing an amended return for 2019?
  15. Yes. The employees all received their W-2 and the 941s were filed for both Federal and state. Our office did the payroll for him. He was given the W-3 to sign and mail. I'm hopimg that this is somehow a duplicate that got lost in the pile of paper.
  16. I like to say, "If you drive at 60 mph, and work seven days a week, you're driving 2 hours and 45 minutes a day for your work. Imagine how much money you'd make if you found a job where you didn't have this excessive travel burden." If they don't recheck their log, I'm with Terry, it's a catch and release.
  17. It will be interesting to see the results of the employee's check. Is it possible that the client printed out all copies to provide needed copies to employees and maybe state and local agencies but actually filed through BSA or other online service to SSA? Was this client yours for 2015? If so, did you assist with 941's and year end reconciliations?
  18. Abby this will be interesting. I partially agree with your position. However, if a deceased person's tax return was checked as final, there won't be a filing requirement for 2020. Or if the return was not checked as final, the decedent would not have income (maybe some would as an estate winds down) and thus no need for a personal 1040. Not sure if this would be handled on the estate tax return if there was one. A lot of unknowns. I have a check for my deceased mother and plan on holding onto it until further guidance is given. I'm definitely not cashing it. The IRS mail is a nightmare and no guarantees the check won't get lost.
  19. I always question them and advise them as Catherine has said. I tell them I don't want any surprises in an audit. Also, if it is a new client, they get questioned a bit harder and if I think I smell a rat, then I set them free. Agree, document. I use Drake and keep notes in the client file. I add the date and time along with the details. I show it to the client for their approval.
  20. Sorry everyone, I typed the OP in a hurry and was not very clear. So, here goes, this client purchased this home approximately 5 years ago. After living there for three years, they converted the property to rental and it has been rented for the last two years. I understand the two years doesn't have to be consecutive and I also understand that any depreciation taken has to be recaptured when the property is sold. Because it is still rental property and they are looking into selling it, I don't think the 121 exclusion applies. I understand it would if they convert the property from rental to personal use. If the 121 is allowed due to the five year rule, the depreciation would have to be recaptured which would result in a capital gains tax. I am advising my client against this because they maybe selling their primary residence as well and can only take the 121 exclusion once every two years.
  21. We have a client who was going over old records and came across a red copy of his 2015 W-3 and W-2s. The envelope for mailing was clipped to the forms. He has received no correspondence about this. Should he mail this in to the SSA or let sleeping dogs lie? One of his employees is going to check his Social Security statement to see if the wages are listed. The 941s were all filed for that year and the employment taxes paid. I'm hoping that this is a duplicate copy.
  22. The latest guidance from SBA, a FAQ sheet released on Monday Aug 3, helps clear up some (but not all), of the key questions which have been loitering in our minds these past few weeks. Here's a link, just in case you haven't seen it from another source and don't mind clicking on links. https://www.sba.gov/document/support-frequently-asked-questions-ppp-loan-forgiveness?utm_medium=email&utm_source=govdelivery
  23. Absolutely I question them. I don't question what looks in-line with prior years. I do question when something is suddenly out of whack, or a new client, and every one of them are told that while I don't need to see the logbook or the receipts, if they are audited they will be required to provide them to the IRS, and these amounts are high enough to be a red flag. Now that you know this, client, is this still the correct figure? And I document that I have asked them (usually by email, and I print the email and response to pdf in the folder for the correct year).
  24. Home ACQUISITION debt is deductible when use to purchase or improve a home. It doesn't matter whether the bank calls it a mortgage or a HELOC. This means we have to track the original mortgage balance through refi's because the interest on refi costs that are part of the new loan are not home acquisition debt.
  25. TAXMAN

    NT - mom

    Went thru this a year ago. Still sometimes hard. I rest on memories(good or bad). I know she has no more pain. As for other GOD will take care of. Prayers be with you.
  26. Some IRS mailing addresses were recently discontinued, but doesn't list the one for Cincinnati for 1040-ES. Here are the ones that were affected: https://www.irs.gov/filing/closing-of-business-po-box-addresses-could-affect-your-clients Here is the page to check mailing address for where the taxpayer lives or by form: https://www.irs.gov/filing/where-to-file-paper-tax-returns-with-or-without-a-payment
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