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Because they make good lighting stands for a standing desk. Of course a good book on Capone is an appropriate topper. Looking forward to a good tax season for everyone.

This is a reminder that we do NOT host political discussions on this forum, and with new leadership in the U.S. House, I expect that some members will be tempted to post about proposed new legislation on here. Already this morning, I've deleted two posts and modified a third to eliminate a political reference in a very minor way that does not affect its content. I'm asking that each of you to please be cognizant of content before posting to keep this a politics-free site. This would be especially true of any legislation floated out that we all know has no chance of becoming law short of h*ll freezing over. Thank you.

From my heart to all of yours, have a wonderful New Year!!!

Happy New Year, everyone!

Happy New Year to everyone! May it be prosperous & healthy.

A blessed, happy, and healthy year in 2023 to everyone here!

See, it's better! No, don't look under that tablecloth; nothing to see there!

Live long and prosper.

So I just finished the self study course. Got 78.57% so I passed. Nothing like doing it at the last minute!

As we have chatted about before, it can be freeing, and many will say necessary, to fire a few clients each year/season. In my case, I don't really have to prepare, I can just issue a refund, and send a "thank you for past usage, make sure to print needed records" type of message. Happened again today. Someone asked a relatively simple question, with the proper answer being no. The now former customer did not like the answer (the item was something it is not proper to do), so the refund was initiated. For me, most fire themselves, such as making the "threat" along the lines of do what I want or I will find other software/post negative reviews, etc. These are becoming sadly routine as attempted blackmail seems to be some sort of way people think they can get what they want. The other usual is someone asking me (interestingly, the person who wrote the software) for help, then claiming my suggestion is wrong, unable to be done, etc. Today's example was a customer who believed their "IT" person (or was just being dishonest about having an "IT" person), sent a nasty reply, then sent another rely that the software was not the issue as proved by installing in a different location (it was a firewall issue on their end, not broken software on my part). As I get ready to try to train my eventual replacement, I have been making notes of things to help them deal with customers. One of them is to never assume the customer is telling the truth. This is a huge change from 30 years ago when I started... It simply is not wise to take all information at face value. I actually often ask for "proof", such as a screen capture, and a fair amount of the time the customer was wrong, mistaken, or just untruthful. So for here, I wonder if you are ready to fire at all times, meaning ready to give working papers or copies on short notice, and send them to the next person/firm? I ask, because I know we chatted here, years ago, about even terrible customers having money to "get" (meaning to get/earn for services), and sometimes, they have more to spend than easy customers. In my case, I have one price, so I cannot charge more for tough customers... Plus, as I get older, and relatively stable financially, I have little need to deal with certain things. (Maybe I am getting to be more Mr. Wilson than Dennis!)

Ain't that the truth! Not so much here, but on other boards I've seen people hold themselves out to be "tax professionals" when they are nothing more than a glorified keypunch operator. Software is a great tool and there are times when it catches my mistakes, but then again, there are other times when it gives an answer that I know if not right. Generally it's because I didn't click on a box or other. If someone doesn't have a good idea of what the result should be, they don't know to look at what has to be checked. I think those of us who "could" do a return with calculator and pencil are going the way of dinasours!

And, that is an age reference that I can identify with.

1099s are for payments made regardless of accounting method of payer or recipient. Tom Longview, TX

I've been using Fujitsu ScanSnap for several years. If it died today I would immediately order another one. It has been one tough scanner.

Two tax breaks I wish had been extended are the charitable contribution deduction for nonitemizers and the increase in expenses eligible for the child care credit. I did not find abuse of the deduction for charities and was in fact surprised that so many clients said they gave zero. The maximum expenses allowed to calculate the child care credit started at $2k back in 1976 (and that didn't cover the cost of care back then) and increased to only $3k along the way.

My first ever accounting related job was updating the pages as corrections came in. My dad would bring those binders home from work (a few at a time) with the new pages, and I'd swap them out. For a pittance, but it was my pittance!

The W9 should answer that question if the vendor filled it out correctly. In box 3 on Form W9, if they check LLC, then they are supposed to tell you how the LLC is taxed in the area to the right by putting in a "C" "S" or "P". My rule of thumb has been if they don't fill it out correctly, they get a 1099. Tom Longview, TX

Happy, Healthy New Year!

Key filing season dates There are several important dates taxpayers should keep in mind for this year's filing season: January 13: IRS Free File opens January 17: Due date for tax year 2022 fourth quarter estimated tax payment. January 23: IRS begins 2023 tax season and starts accepting and processing individual 2022 tax returns. January 27: Earned Income Tax Credit Awareness Day to raise awareness of valuable tax credits available to many people – including the option to use prior-year income to qualify. April 18: National due date to file a 2022 tax return or request an extension and pay tax owed due to the Emancipation Day holiday in Washington, D.C. October 16: Due date to file for those requesting an extension on their 2022 tax returns.

Tax software is no substitute for tax knowledge. You can replace the words "tax" with any profession.

I Agree the 30% Backup withholding applies if recipient refuses to submit a W-9. However, hard to collect the Backup Withholding from a recipient when it was a one-off service and payment was already issued prior to having the mess of providing the 1099NEC etc that is dumped in your lap on January 28th... Just Sayin..

Some days it sucks to be us

Yes, ATX has the place to indicate QCD and the amount of the distribution that was donated. As my church's treasurer we have received several checks from the fiduciary, some stating purpose but not that it was a QCD. The donor indicated via email. I have my church donation sent to me made payable to the church and I deliver it. I have had the others mailed directly to the charities. None of the checks indicated QCD. I have the acknowledgement letters and report the total of the distributions on the 1099R data entry screen. I ask those clients who may have given QCD amounts for copies of the acknowledgements 'to be sure I indicate the correct amount of the distribution that is not taxable.'

I've never felt a need for any paperless software. I just scan and (hopefully) save the scan to the correct folder. I also print many things to PDF files in the client folder, like emails, text files, spreadsheets, photos of docs, etc.

The increased Child Care Credit and the over 65 EIC were two of the favorites that gave back a little bit to those who are working to make ends meet. I would have hoped they could have found something more beneficial to the wealthy to chip away at.

My first ever accounting related job was hand addressing envelopes to the Commissioner of Revenue for Franklin County VA. When I graduated to putting the corrections in the CCH books, it was a relief!

He should just apply for an EIN--it's easy enough to do. Best argument in favor is that he won't have to give his SS number to clients. Operating without an EIN makes me wonder if his business banking is combined with his personal, which is a big No No!

I would wait for the Court Appointment Documents. The Estate represented by the Co-Administrators will be your clients.

I wonder if that is ever going to show up in any Intuit advertising? Tom Longview, TX

I don't think he'll get SS credit for returns overdue by 3 (?) years or some amount of time, so if he expects the missing years to help his SS calculation it would be better to file them sooner rather than later. Why do our clients think we are SS experts?!

While I am not out in the wild, I rarely come across anyone who can handle even one payroll (power outage, computer failure, etc.) with any sort of writing instrument, paper, and cash or checks. I still suggest people have 15T and their state pub in their top drawer, but I doubt if any do. Same for paper checks on hand, and/or access to at least a few hundred dollars per employee to buy a day or two delay. Just an age thing, but I was not allowed a calculator in class until my feeble attempt at conforming in college. Still cannot find the Dr or Cr buttons on a calculator <smile>, or the "any" key. As I embark on trying to pass on what I know, I ever so strongly try to remind/inspire the person to learn the process, not so much the tool, as understanding the process is the gold, anyone can bang on a keyboard to use the tool.

I stopped in the middle of reading this thread to send an email to a client telling them that I would not be able to do their return this year. Thank you for the timely reminder that some people are just not a good fit and the sooner we part ways the better for both of us!

Catherine. I hope I am getting better (more forceful?) at catching issues up front, such as those who expect the software to teach them accounting/payroll processing, rather than use the software as a tool. My self explanation is computers have become appliances to many, expected to do it all "for" the user. Last century, all who used computers/software were already experts, now a growing majority believe the ads stating anyone can Q by using B software. I find myself working on perfecting a stock reply, that software is a tool to help someone do something they can already do without said software. If there is no existing training/experience to rely on, then hiring out is the best bet - maybe a small local person/firm who is willing to patiently answer questions (not for free) if the person wants to learn the process. I also mention all business owners should have at least a modest idea of the process, so they can spot trends/issues, but they should defer to the people they pay for advice (and their E&O coverage!). There are endless options to gain knowledge, free and paid, in person and remote, so lack of desire to gain knowledge is a red flag.

From the IRS' site; guidance for this year.

Yes - and as a result, I have rarely had to fire on the spot. As time goes on I am refusing potential problem clients upon their first inquiry. With existing clients, if I start to see signs of trouble creeping in, I recommend that they seek other help because it seems they need more assistance than I have time properly to provide. The last client I fired I finished his return (and got paid, not nearly what it was worth) and then sent a letter stating I would not be able to help him going forward. Thought for sure with him I was going to have to tell him to leave, but knowing I was ready to say it came through enough in our interactions that we were able to finish that one last year. He got a lot more slack than others, since doing his return was a favor to his late mother. Thanks for the reminder, as well as for confirming the impression that people are not telling the truth as much any more. On the tax end, I don't know if they're just incompetent financially, confused by confusing rules, overwhelmed with general busy-ness, or just lying. But I definitely see it more and more.

It is supposed to, however for years I just printed and mailed black & white laser printed copies with no problems. Now I efile thru a third party.

But the trigger for the 1099 is when payment is made. Correct?

Ain't it the truth!

There are of things which will be reduced as the pandemic related expenditures expire, Medicaid, WIC, SNAP and the Child Tax Credit. In addition none of the usual year end extenders were passed.

We have had clients who called with intricate questions. When we told them they really should consult with their attorney, they pointedly said that attorneys charge too much and they were hoping to get answers from us (on a free phone call)! In this case it's a no brainer. They need an attorney or FA to set this up the right way to achieve whatever goals they have.

The recipe on this page (scroll down a ways) would make a cake big enough for ALL of us to have a couple of pieces! https://randombitsoffascination.com/2023/01/06/closing-out-the-holidays-with-twelfth-night/ For those who don't click links (emphasis added): Take four pounds of flour dried and sifted, seven pounds of currants washed and rubbed, six pounds of the best fresh butter, two pounds of Jordan almonds blanched, and beaten with orange flower water and sack till fine; then take four pounds of eggs, put half the whites away, three pounds of double-refined sugar beaten and sifted, a quarter of an ounce of mace, the same of cloves and cinnamon, three large nutmegs, all beaten fine, a little ginger, half a pint of sack, half a pint of right French brandy, sweet-meats to your liking, they must be orange, lemon, and citron; work your butter to a cream with your hands before any of your ingredients are in; then put in your sugar, and mix all well together; let your eggs be well beat and strained through a sieve, work in your almonds first, then put in your eggs, beat them together till they look white and thick; then put in your sack, brandy and spices, shake your flour in be degrees, and when your oven is ready, put in your currants and sweet-meats as you put it in your hoop: it will take four hours baking in a quick oven: you must keep it beating with your hand all the while you are mixing of it, and when your currants are well washed and cleaned, let them be kept before the fire, so that they may go warm into your cake. This quantity will bake best in two hoops. (whatever those are!) ~Hannah Glasse (1784)

If these were my clients, I would set up each business as a separate business entity with separate payrolls which would give you a lot more long term options especially from a legal point of view.

Disagree. If you make payments to a vendor via CC or Payment App, the CC company is supposed to send the 1099K and you do not send a 1099NEC or 1099MISC. That was made clear earlier this year. The IRS does not want double reporting of payments made by CC. If the church does not want to file 1099s, then pay everything to vendors eligible for 1099s via CC. Tom Longview, TX

Example; You receive a bill for $10,000 with a breakdown of Equipment - $7,000, Installation Supplies - $250, and Installation - $2,750. You send out a 1099 NEC for $10,000. The recipient deducts their cost for the equipment and supplies in COGS .

65.5 cents per mile driven for business use, up 3 cents from the midyear increase setting the rate for the second half of 2022. 22 cents per mile driven for medical or moving purposes for qualified active-duty members of the Armed Forces, consistent with the increased midyear rate set for the second half of 2022. 14 cents per mile driven in service of charitable organizations; the rate is set by statute and remains unchanged from 2022. https://www.irs.gov/newsroom/irs-issues-standard-mileage-rates-for-2023-business-use-increases-3-cents-per-mile

And the wait for parts can be a lot longer too.

It only matters on the year that your license ends. Two days ago, while renewing my PTIN, I saw that I have to renew my license in March 2023, which I completely forgot. I panicked because this year I had only 18 credits. In my head, I said... "I am short if every year I have don't the minimum requirement". Luckily, on that website they have my CPE credits and I had a lot in one year so I had exactly 72 credits. I am happy you noticed it now because 48 hours later, it would be too late. Everybody, please double check if your license expires in March, so you still have time to pass the CPE exams.

Years ago one of China's leaders stated that the US had gotten away from "making things" to pushing paper around. China's leadership, for all it flaws, is noted for its no-nonsense, see-things-as-they-are approach, so it made me think. So much wealth in this country is derived from stock options, swaps, derivatives, stock shorting, straddles, and now NFTs and cryptocurrency. How does any of that improve anyone's life, except for those on the winning end of those trades? Most of us have clients with brokerage statements that are dozens of pages of buys, sells, buys, sell, buy again, margins. All this paper amounts to nothing productive. Maybe China had a point. Note that the country has banned crypto.

CA taxes revenue to the end customer location. So if your friend is providing a service to a customer in CA, that revenue is sourced to CA. There is no de minimis exception that I am aware of. From the FTB website - "We consider you to be “doing business” if you meet any of the following: Engage in any transaction for the purpose of financial gain within California" Then you have to look at what type of entity they are. Corps, S Corps, Partnerships and LLC all have a $800 minimum tax that needs to be paid yearly. In order to pay the tax, you need a state tax ID number. To get a state tax ID number, you need to register with the SOS. The SOS has an annual filing fee of $25 (last time I checked). If your client is a Sole Proprietor, they can just file a 540NR showing the CA profits from their business. Hope this customer of your friend is generating enough revenue to cover the cost of doing business in CA. Tom Longview, TX