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For amounts this large, they should invest in "It's Deductible" or another of the charitable contributions calculators. It will help them follow some discipline in valuing their donated items. For the most part, a $100 shirt and an $25 shirt will have roughly the same price on them when they get sold at Goodwill. People don't like to hear this, but it's true.

I have this client who dropped off some info 2/28, and he has emailed or text messaged me several times since then to supplement the information. Well, yesterday, I responded to one of his emails: "Next year you have to give me everything at one time. I will have to kill you if you don’t. It’s office policy. Can't be helped." Soooo, he CAME IN today to see what else I needed. Yep. I showed that guy.

I prefer my clients know a lot about their taxes so they have at least a feel for whether something is wrong with or missing from their return. It is their return after all. But too many questions, or being accusatory that I did something wrong gets old quick.

You were at my office in CT all day and could not have killed anyone in TN.

I'm sure he deserves whatever you do to him - I will testify at your trial if necessary.

Bingo Rita. And I find that the opposite is often true. People who give generously will frequently understate the value of their non-cash contributions. I'm thinking there's an element of perspective there that a stingy giver lacks. I'd like to see the deduction for non- cash contributions somehow capped based on a percentage of cash contributions.

Yeah, I think FMV is what a willing buyer would pay. I think if a willing buyer existed I'd sell my stuff for $6,500. This will sound strange, but did they make any cash contributions? I find that the people who most often overstate non-cash contributions are the ones who don't give cash.

I like both. Some returns I can coast along and others it's POP Quiz time. The other day, I had a client looking disinterested in his business return as we were going over it. I stopped and asked if he was OK. He was young and owed money and was unhappy with the results. So, I had him lean in and walked him through his return line by line. I told him I did my best to get him these results and wanted him to see what goes in to preparing his return. He didn't realize he needed to charge sales tax on his services for the past three years, because his other TWO accountants didn't tell him. He hadn't issued 1099's before either. Our cost was much higher too, but I didn't really care. He had no loyalty and has been drifting from accountant to accountant. After the pep talk, I said that was enough for today and he will need to reschedule to setup time to go over his sales tax issues. Like a good boy, he went out front and made his next appointment. That will be today. I wonder if he will show up.

Hey, three hots and a cot. I'm not sure whether I should make you two accessories or not... lemme get back to you.

What if you told them to take the amount they would PAY for it at a garage sale. Think the number would change? :)

Another accountant always says, "Zip up your jacket, your heart is falling out." LOL. Ah, that's a good one. I've totally noticed that my rich clients donate nothing except old underwear and my poor clients give all but the shirt off their backs.

it won't go to D but it will show on page two of the 8949 for long term sale with codes so loss or gain won't transfer to D. gain or loss column is zero

I always show it with the exclusion -- prevents nastygram letters demanding money later. 1099-S's sometimes get sent to the *sold* address, after the USPS forwarding time expires. Just because your client says they didn't get one, doesn't mean one wasn't sent. Remember, most people have a minor heart attack when one of those IRS envelopes shows up.

Not intending to be picky, but the saying should be "Pigs get fed. Hogs get slaughtered." Pigs being small/young hogs.

NAHHHH its easy, the right number is written on our ceilings.

I like both of these ok. It's the "average Joe" who THINKS he's bright that drives me nuts. You can explain till the cows come home, and you will just get to explain it again next year. And the next.

If they paid over $9000, the Goodwill value would most likely not be $6553. What did they base that value on? We use a book called "MONEY For Your Used Clothing" with guaranteed values for non-cash charitable donations. Check out mfyuc.com!

This one is also pretty apropos to all of us (although some might think adult beverage instead of food). http://imgur.com/u3S72a2 For those who don't click on links: Kummerspeck German Definition: Excess weight gained from emotional overeating. Literal: Grief bacon. (Picture in link has the above text placed strategically between slices of crisp bacon.)

Jack: A suggested reply for you: Client: Please have the broker send over his proposed loan package for you. I would like to propose some "adjustments" to THOSE documents before you agree to anything. Signed. Jack. Have him send THAT one to a broker. Also an invoice for the tax prep, and the "adjustments" that the broker can pay. Rich

PhantoGramerica. Recently, I caught up with a friend who works in health insurance. Let's call him John. Last October, he explained, as the Affordable Care Act's exchanges opened, John spent a lot of time speaking with those seeking insurance. What he related was shocking. It wasn't his opinion of the law. Its adoption rates. Nor the details. What hit me like a cold breeze were the perceptions of those signing up. The dazzling lack of awareness. Not of the law. Most remain ignorant in that regard. It was the lack of basic knowledge. And common sense. The point, he explained, was that he had to spend so much time not on the program's intrinsics, but on basic terms and principles. For instance, words like subsidies. Deductibles. Premiums. As if John was speaking a foreign language. Realizing that most people are not wordsmiths, I can't help but believe that these are terms with which the average adult in the 1960s would have been familiar. Go ahead. Chastise my insensitivity. Yet, what I found unsettling was the larger idea. That so many Americans are ignorant in regards to basic principles, ideas, concepts and themes. In other words, if an idea is not within the vernacular of our popular entertainment outlets, with which we spend so much of our time, then we're often ignorant to their existences, let alone their definitions. Consider the anecdotal evidence: -A recent Pew Survey found that 41 percent of Americans could not name the vice president. -55 percent of Americans believe that Christianity was written into the constitution. -30 percent of Americans could not recall the year of the 9/11 attacks. -49 percent of young Americans could not find New York on a map. -25 percent of Americans could not name the country from which we won our independence. -30 percent did not know what the Holocaust was. -And 20 percent believe that the sun revolves around the earth. This nation, so intent on making all aspects of life easily and equally attainable, has eradicated much of the value we place on thoughtfulness, learning and critical thought. America, contrary to every intent of the Founding Fathers, continues devolving into a nation of infantile, gratification-seeking spectators. More seriously, these tendencies have led us to increasingly place our faith behind politicians and policies of which we know little. Like children willing to walk anywhere, as long as our hands are being held. At this rate, we'll end up a Petri dish of simpletons, enabling the white-coated lab techs to do anything they please. So long as we're comfortable. That which we do prioritize? Phantograms of our own design. Simple, unimportant items to which we've artificially assigned great importance. A "phantogram" is a type of optical illusion that makes a simple, two-dimensional object appear three dimensional. By distorting the perspective of the viewer, it causes him to see the object as having more depth and substance than really exists. A flat image, for instance, mimics the perspective of a multi-dimensional object when viewed from the intended vantage point. Accordingly, our hyper-commercialized, consumer-oriented, media-driven, celebrity obsessed society casts a phantogramic perspective on facets of culture that, until recently, were not held in such esteem. The victim of these national delusions of grandeur? Critical thinking and analysis at the individual level. Because, as a country, we no longer place a premium on critical thinking. Much of that which we once had to think through is served up on a platter by the Federal government. Like a herd of cow led to pasture. We don't question, analyze or protest. We just graze. Consuming is so much easier than questioning. The "ready for consumption mentality" provides the recipient with tacit permission to forgo the heavy lifting. Be that physical, emotional or intellectual. In 2008, Rick Shenkman published a book entitled, Just How Stupid Are We? Facing the Truth about the American Voter. Shenkman lays out four primary themes, among others. First, he demonstrates how ignorant Americans are concerning international events. Second, he shows how little we know about the functioning of our own government. Third, we are usually willing to blindly accept government positions and policies even when a modicum of critical thinking would suggest that they're bad for the nation. And finally, we are easily convinced of most anything by stereotyping, overly simplistic solutions, irrational fears and public relations babble. Sounds like the average election cycle, right? When life's responsibilities are laid out before us like a Denny's breakfast buffet, do we dull the ability to consider important aspects of our lives? Further, do we indemnify people against poor decision making, and the risks therein, by relieving them of the need to make such decisions? What about our schools? Don't they teach critical thinking? Well, according to Dennis Bartels's article in Scientific American, America's schools are too busy preparing kids for standardized tests to teach such mundane skills as critical thought and analysis (article here). Sadly, those poor teaching habits extend to the university level. A recent NYU study underscored the idea that today's university students do not receive the training necessary to develop critical thinking skills. Over 2,200 students were part of the study. 45% made no improvement in their critical thinking skills during their first two years of college. After four years, 36 percent of students had made no improvements in their critical thinking abilities whatsoever. More here. I might argue, however, that developing these skills in college is too late. Shouldn't young Americans be taught how to think critically at the elementary, middle and high school levels? Unfortunately, this is not a cultural priority. In fact, it seems that the American education system is predicated on the very idea of not challenging the system. Not speaking out. Not rocking the boat. As opposed to training young Americans to digest differing arguments, diagnose the root issues, and make a decision, we train them on how to best prepare for standardized tests. Following those tests, instead of having developed a love of learning, deep thought and critical analysis, students immediately return to their brain candy addictions. Texting. Twitter. Facebook. Instagram. YouTube. Video games. ESPN. Nickelodeon. Netflix. Movies on demand. Sitcoms on DVR. On that rare occasion when a student is confronted with two minutes down time, what usually escapes their mouths? "Iiii'm booored." But, they are bored. Because they exist in a world where our media-oriented culture provides entertainment like candy from a Pez dispenser. Readily available for immediate gratification. All day. Every day. Year round. So, that occasional moment's nothingness? It actually feels like hell. Imagine a grossly overweight adult. He eats constantly. Then suddenly, he stops. Eats nothing. Two, three hours later? Serious withdraw. Ditto the drug addict. Long-time smoker. Alcoholic. Our kids are constantly consuming a steady diet of low-brow entertainment. When the well runs dry? Withdrawal hurts. Regrettably, it's not just our children. Adults increasingly default to a myriad means of immediate gratification, as well. In 2012, Americans spent less time at work, volunteering and cooking. Yet, time spent on leisure activities (mostly TV) jumped to nearly five and a half hours a day. Politicians seem especially intent on suppressing real critical analysis. On playing to the lowest common denominators. Elections are won and lost on themes grounded in fear and emotion. Rarely do the major issues, disagreements and debates focus on hard data. Instead, it's divisiveness. Fear mongering. Catering to our basest emotions. Sadly, it works. Slick advertising and communications efforts often carry charismatic candidates with little by way of substance, experience and vision into some of the nation's highest offices. Increasingly, it appears that we are obsessed with the pointless. With phantograms. In turn, we pay scant attention to the day's most pressing issues. So, when we are signing up for healthcare insurance, we may require some assistance. A explanation of some of the words. Or, we're buying a home. The mortgage broker asks if we want that adjustable rate mortgage. With money back at closing. Umm, sure, why not? Perhaps we're considering that timeshare. Cheap vacations? Sounds great. Where do I sign? Or Best Buy will sell you that huge flat screen. If you'll sign up for their credit card. No money down the first year? Too good to be true! Many of the routine decisions that our parents and grandparents methodically made? Today, we jump in with little forethought. Then look back upon them as if we were dealing in quantum physics when they don't end well. But sports? Ah hell, dude, all day long! Would BW3's stock have risen 80 percent over the last year if Americans didn't love to spend their time sitting around, drinking beer, eating wings, watching sports, and answering trivia questions on TV like, how many spots did the 1001 Dalmatians have ? Today, we watch sports on weekends, as well as weekday evenings. We watch the pregame. The game. The post-game. Sports Center highlights. Check stats on ESPN.com. Follow the chatter on TheBigLead.com. Listen to the sports radio personality in the car. Listen to his podcast later that night. Read his book before bed. Our kids see this. And so, at an age where we just wanted to be Pete Rose, our children wake up to Sports Center. Spend their weeks practicing the three to five sports they play, year round. Spend their weekends traveling far and wide for game after game after game. In between watching sports, we fill the empty space with celebrity gossip. Reality television. Video games. HBO. Showtime. ESPN. Fox Sports One. Bravo. The Cooking Network. The Hunting Network. The Fishing Network. CSPAN. GEAR TV. Spike. Cartoon Network. Netflix. Play Station. Gameboy. Style Network. Entertainment Tonight. The Real Housewives of Atlanta, New York, Orange County, Beverly Hills, and New Jersey. We spend more time watching TV personalities perform our hobbies than we do engaging in them ourselves. And I haven't even mentioned sex. Don't have time to. I've got to finish this piece at some point this week! Need further evidence of our inability to think critically? Our lack of focus on the issues that matter? Our government's inability to contend with much of anything of importance? Allow these uniquely American statistics to gestate within the mind for a bit: -The average American watches 1,800 hours of television each year. That's five hours a day, 52 weeks per year. -Nearly 30 percent of Americans have not read a book during the last year. Fifty percent have read one book. One book. -116 million Americans watched the Super Bowl. That twice the viewership of the presidential debates. -4 million viewers will catch tonight's episode of The Real Housewives. -2.1 million Americans married in 2013, yet at least half that number will divorce this year as well, saddling the U.S. with the highest divorce rate in the world by a wide margin. -The U.S. has the highest rate of diagnoses for mental health disorders. Or, is it that we just have the largest appetite for the prescription drugs that accompany those disorders? Or, have we just gotten into the happen of calling every one of life's challenges, a disorder? -The debt carried by this year's 167,000 college graduates will amount to over $200,000, more than they will make, in aggregate, over the next decade. That college debt just surpassed $1 trillion. Care to guess our economy's next bubble? -46 million of the 313 million people living in the United States are on food stamps, including one of every four children. -The rate of teenage pregnancies in the U.S. is above 22 percent, 8 percentage points above New Zealand which has the second most. -66 percent of Americans are considered overweight, yet the average American will still drink more than 600 sodas this year. -The United States has a higher debt per capita than Greece, Portugal, Italy, Ireland and Spain combined. -48 percent of Americans are considered low income or living in poverty. -More than 25 million adult Americans live with their parents. -One of every seven Americans has at least 10 credit cards. -The United States puts a higher percentage of its population in prison than does any other nation. -There are more unemployed workers in the United States than there are people living in the entire nation of Greece? -Less than 65 percent of American men have jobs today, compared to over 80 percent in 1950. Not a a pretty picture. Not if pride is one of the traits you admire. If I told you there was a family in your neighborhood that fit a profile befitting most of the aforementioned statistics, how would you imagine that family? Would you envision them as a sharp, critically thinking bunch? Possessing proper priorities? Solid moral fiber? Would you let them watch your kids? You absolutely would not. At some point, perhaps we'll recognize our phantograms for what they are - simple uni-dimensional distractions with which to bide a bit of free time. Maybe we will return to placing a premium on personal knowledge, learning, growth and accountability. Enjoying the pleasure of succeeding independently. Of deferring immediate gratification in pursuit of a long-term goal. Of personally creating something original and unique. One day, we may place a societal premium on personally experiencing the beauty, danger, tastes, sounds, feelings, highs and lows of this world, as opposed to watching an actor do it for us. The philosopher Alan Watts said that the reason people want to go on and on is become we live in an impoverished present. Someday, perhaps we'll exchange our phantograms for all of the wealth, beauty and joy the world can offer. So long as the boredom does not kill you first.

It took me almost 45 minutes to assemble and scan a tax return, imagine if I had a client waiting

Good question. I know I couldn't do it. For me it would be too easy to make a mistake.

I see the old TD F 90-22.1 form has been replaced by FinCen 114. ATX says this form must be filed online only and is not available in ATX. They did provide a link for instructions. That took me to a website called BSA E-Filing System. Has anyone done this? Should we as tax preparers enroll as filers on this system or just direct our clients to this site to do it themselves? Form 8938 is still required to be filed with 1040 but has a higher threshold requirement than the FinCen 114.

Riding an elephant is easy. It's the getting on and off that's so difficult. But still a whole lot easier than getting the right numbers for an 8283 from some clients.

This is why you can ride elephants.

I tell people to use the amount the item would sell for in a garage sale. Most people will take the high amount on the information out there for valuation. I stick to my "garage sale" value. It is the closest to reality.

Another accountant always says, "Zip up your jacket, your heart is falling out." LOL.

Read carefully NY's definitions of resident and domicile and everything about PY residents.

It'll show on the 8949. I've had clients tell me they didn't get a 1099-S, but it was with dozens of pages of their closing papers. They saw too much at their closing to remember it, but it was sent to the IRS.

You can also elect to treat some of the capital gain from the sale of the land as investment income to allow you to deduct the investment interest that's suspended on the 4952.

I don't think any of us follow the Interest Ordering Rules completely, either because we don't fully understand them or because it's too much work. http://www.irs.gov/publications/p535/ch04.html#en_US_2013_publink1000243081 Also, once you elect to treat part of your home equity interest as not secured by the home, you need IRS permission to revoke that election: http://www.thefreelibrary.com/Election+not+to+treat+debt+as+secured+by+a+qualified+residence.-a0110741604 You would have been better off taking it all as acquisition and home equity interest instead of allocating it to investment interest.

I just give my clients the link and tell them it has to be filed directly by them this year.

This may be true, but I have seen not reporting it come back to bite the taxpayer. Actually it was the state that questioned it because of RE transfers. I always report it right away to save confusion later. How do you charge a client to settle something with the government when you were the one who did not enter it on the tax return?

Any single item or group of similar items over $5,000 need to have an appraisal. Your client had multiple receipts from multiple days? I don't try to manipulate my clients information or curtail their deductions if they are legitimate. However, I would ask them to review their donation slips and to make a more serious effort to reconstruct exactly what was included in each donation visit and give them thrift shop price guidelines to help them dial in to a more accurate (and honest) list of their donations. Perhaps they can organize their donations into separate group types, such as clothing, furniture, small appliances, kitchen supplies, etc. In this case, they are way too casual in plopping down a $6,500 figure and expecting you to not push back. They know better. My Dad always said, "Pigs get fat. Hogs get slaughtered." I think they both end up at the butcher shop, but I got his point.

I tell them they need to take things up with Congress, AND that they remember their tax returns every time they go to the polls in November.

Jack, I know that is what it says, but since the clients don't always get the 1099S that was filed, I would put it in anyway. Nothing changes, but if a 1099S was filed, you are covered. If not, no harm done, and you can show the client were it's reported, so they have peace of mind.

I actually like the smart ones, because they are teachable. Plus their returns are more fun. P S She could just increase her withholding at her wage job.

No, it's not required to be reported at all. Unless there is taxable gain. Or if the taxpayer received 1099-S. Though, I can't see any harm in reporting it when not required.

Doesn't that depend on whether they receive a 1099S? I was under the impression that if they receive a 1099S it should be reported. With that said, what harm is there in showing it on Schedule D even if they didn't receive a 1099S?

This sounds just like New York! One Step foot in and you have Nexus so we can tax the hell out you. Sales Tax is the first step they use to get their foot in the door for other taxes they can justify to balance the budget. Don't get me started on Property Taxes...

The banks shouldn't have any sort of preference, other than a preference for the facts. If they spent $27K related to their jobs, the bank should certainly want to know about that. But $27K related to one's job would not be itemized deductions - it would be business expenses. Any banker who doesn't want to know about that is a sorry excuse for a banker. (But I also think we may be combining bankers and loan brokers in the same conversation - they are different animals. The one thing they have in common is they generally know very little about taxes).

If I were in her position, I would report all of the income on my return, then take the after-tax balance attributable to the ORRI and split it with the parent but in increments to preclude a gift tax if giving it all in a single year triggered the gift tax. Don't forget to take the depletion on GROSS royalty, not net of severence tax, ad valorem taxes, gathering, compression and marketing cost deductions.

I provide my clients with a "draft" copy of the completed return (including a copy of the 8879) normally via a secure email (unless they choose to come in personally). I normally call and go over the return and ask them to also look it over and then, if all looks okay, please sign the 8879 and return it to me. It's their return and since nothing is filed yet, they can do whatever they want to do with the draft. If that includes taking it to their banker, so be it. They can come back and ask me any question they may have or ask for changes they feel are necessary (even if those changes were suggested by the banker.) That doesn't mean the changes would actually be made to the return. Ultimately, my signature is reflective of my belief that the return was prepared accurately and abiding by IRS regulations. I personally wouldn't get overly caught-up in the nature of the email they sent you, Jack. They requested a copy of the return and I would provide that to them.

I'd ignore the email, or else just reply that we will let him know when the return is ready. I wouldn't even acknowledge the reference to the lender. If he asks about it later, I'd just tell him he is my client, not the lender, and that I don't have conversations with lenders. There is some sort of worksheet the client can look at. It's called the tax return. The client does have the option to review the return before you e-fling it. But if he comes up with any "adjustments" I'd tell him there will be an additional charge for the changes (that is, assuming the "adjustments" are valid). If there were any questions in my mind about the adjustments, I'd do what jasdlm did.

I had this happen once (client took the return to the banker before returning the 8879 - I was unaware the banker had asked). You would not believe the changes the banker recommended? I was gobsmacked and told the client that the banker was asking her to commit fraud. She fired the banker, and I still do her tax return.

And don't live in Detroit!

I used to be more casual about sending extensions for the procrastinators, but now I am reluctant to send extensions for clients who are not communicating with me. We make calls to confirm that the client wants or needs an extension before filing. The extension also keeps the statute of limitations clock running on returns that perhaps the client wants to put behind them and would prefer that the look-back window closes asap. If another preparer has completed their returns on time, then we may be out of line to make the assumption that an extension is helpful to them. I've read that we may actually be setting ourselves up for liability if we automatically file extensions because the clients assume that the past history of filing extensions for them, sets the precedent that they can assume that we are responsible for filing them always.

I had an attorney client in my office Friday, reminiscing about the days when he got audited all the time. Seems it all worked out fine because the preparer mistakenly set up a mobile home for 39 years, and everybody knows it's 17 years. Besides, he could have 79ed it anyway. He was communicating ok, he just didn't know what he was talking about. I just let him think he was right. They like it that way.