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It's my Gwen's 24th birthday today!

Happy St Paddy's Day to you too Bill............And every one else on our Community...

May I just say that I absolutely DETEST having to amortize bond premiums on tax-exempt bonds because (unless the client has been one for a LONG time, AND you get purchase details as well as a total) you NEVER have enough information to do it right. Grrr. Don't get me started...

I am laughing so hard. We finally got there and it was a team effort.

I'm makin' hay and counting beans. But someday........

HOH: Living with spouse during second half of the year comes into play only if married. So, if divorced with a qualifying child, then HOH. Support test: How much did she pay toward son's support, how much did dad pay, how much did son pay, how much did anyone else pay? If she paid more than half that total, then she passes the support test. (I realize the real question is how much did dad pay, but you have to do the best you can with what you have. Or, have your client put down the numbers for you and you look them over for reasonableness. I don't create the numbers when it's not clear cut; I have the client put them down on paper and sign. I just provide the definitions.) But, yeah, I don't have these close calls very often and have to drag out the flow chart and go through the questions with the actual client facts and the lists.

I am taking a rare tax season dive trip April 6-15 to Cuba. I have been on trips early in the season, January or February, but this was a not to miss opportunity and only cutting by a week and a half. And clients were alerted in January mailing of engagement letter. Swamped now!

This year I took a vacation Mardi gras week (2/24-3/4) and went to ride my bike in Arizona with PAC Tour. Other years I have gone to Natchez Ms during Mardi Gras to ride my bike. And of course some years I stay home and just go to work during Mardi Gras.

Me too, next week, my daughter is off for spring break and can't wait to have fun

Client of mine goes to the Masters every few years. He says there are ALWAYS tickets available to buy on the street which shocked me. My wife's cousin did a corporate event at the Masters 2 years ago and confirmed - sponsors get a TON of tickets and whatever is left over get sold to the public. I've gone to the US Open 2x - eventually the Masters will happen but I'm not pushing it with the wife - we do an SEC football trip each season and she never complains. We generally always schedule vacations for May or September. Gotta go when everyone's kids are in school so that they aren't at our destination. Next summer the wife won't be able to get off work - I'm going BACKPACKING!!!!

Happy Birthday..Gwen...

I think I'd tell client that the people who program the DC computers have absolutely no common sense.

My wife and I are leaving Mar 29 - Apr 5 for an Israel tour. First trip there for both of us. I wouldn't necessarily have chosen those dates, but the timing was beyond our control. Anyhow, that means lots of extensions (clients have been warned).

ATX has a line to enter 1099-Q earning in the worksheet for line 21. Jump from line 21 and you will find it.

When a trust is irrevocable, it is its own person/entity. Someone else's death does not change things inside a trust. If it had always been irrevocable, there never would be any steps-up/down. If the trust was revocable until the father died, then the trust "was" still the father and not a separate entity, reported on father's tax return, until the DOD. So, when the father no longer existed, the trust became irrevocable and all the assets stepped up/down as they passed from the father/revocable trust into the separate entity/irrevocable trust. Only the beneficiary changed when the mother died. No assets of the irrevocable trust moved out of the trust/moved to the son; they remain in the irrevocable trust. The trust did not die. You will need to read the trust document, though. There are as many ways to set up a trust/intertwining trusts as there are trusts.

But I'm not sure we're there yet: https://www.irs.gov/publications/p970/ch08.html#en_US_2016_publink1000178534 Taxable earnings. Use the following steps to figure the taxable part. Multiply the total distributed earnings shown on Form 1099-Q, box 2, by a fraction. The numerator (top part) is the adjusted qualified education expenses (AQEE) paid during the year and the denominator (bottom part) is the total amount distributed during the year. Subtract the amount figured in (1) from the total distributed earnings. The result is the amount the beneficiary must include in income. Report it on Form 1040 or Form 1040NR, line 21. Just remember to include room and board in the AQEE.

When I secure tickets to the Masters.... I am out of the office for a week in April. Clients be damned. I had to go to San Diego for week in January for Rotary this year, however. Rich

That's funny. My wife still knows the Rheingold Beer jingle since she was a kid. I just asked her to sing it for me. Think of Rheingold whenever you buy beer.....It's not bitter, not sweet, it's the extra dry treat......Won't you try extra dry Rheingold beer.... Happy St Paddy's Day everyone.

My sister's first word was "beer," because of that animated Hamm's beer commercial with the jingle about...In the land of sky blue waters. Colorful, and we had a color TV by the time my younger sister was talking. She'd watch the beavers or whatever wildlife singing and chime in on the last word -- beer. It was a small house, so if parents were entertaining, playing cards with the neighbors, etc., and Jan piped up loudly with Beer, my mother got very embarrassed.

Schlitz or Hamm's beer, in the neighborhood I grew up in, every bar had a Schlitz or Hamm's sign, did I mention there were up to three or four bars in each block, I'm not kidding, they were everywhere even in front of schools and churches.

Oh, you split it ALL out. Gross, basis, what was spent for qualified ed exp's. Make sure you take a look at the possibility of using *taxable* portions of the proceeds to qualify for ed credits; often worth far *more* than tax savings on earnings.

Sorry for your husbands loss Catherine...Have a safe trip.

The Russians have hacked ATX and are financing their hacking process $3 at a time...

And, traditional IRA with basis. A ratio. And, a pain during busy tax season. Charge for it !! (And, keep your calculations.)

Only if QC, not if QR and she pays 0. And, HOH still requires over 50% of costs of keeping up the HOUSE, so has its own support of house test as well as qualifying dependent test.

As much as the IRS insists we round off to the nearest dollar, in their own instructions to forms, for instance, they themselves truncate. It leads to some silly letters like you mention from DC. And, clients have brought in letters saying they were missing interest from ABC, as an example, for sometimes large amounts like $123,456, when we reported $123,457 from ABC; the IRS is reporting a second amount from ABC was missing instead of just a mismatch of $1 on the one and only ABC interest. Time consuming. I even had a client bring in a letter stating they owed $0.00. It was obviously a less than 50 cents rounding difference that showed as $0.00 on that computer generated letter. I told her to ignore it, that the computer or a real person would catch it next month. Nope. At least one more letter asking for $0.00. So, I told her to write a check for $0.00 to mail in with the payment voucher from the letter. That did the trick!

That was exactly my point. The people who program the IRS computers have some common sense when it comes to minor discrepancies - the people who program the DC computers apparently have none. Rounding to the nearest $5 (or maybe the nearest $10), should be the norm. Anyone who doesn't understand this simple principle shouldn't be allowed to design a tax checking program for any government agency.

The IRS computers are that way also. When you request your W-2 from the IRS they drop all pennies. Except that the IRS doesn't generate a letter for $5 or less discrepancy.

the key is that they are receiving a series of substantially equal payments over their life expectancy or if joint beneficiaries over the joint life expediencies. Lots of people retire before age 59 1/2. when paid as an annuity it is not premature; a one-time distribution is premature (unless there is an exception)

I put the earnings in the Line 21 worksheet. Then input qualified ed expenses up to that amount as a negative amount at the bottom of the worksheet.

Thanks, @Elrod - she outlasted her younger sister (my husband's mom) by about a year, and was 96. She had a good, long run. But she was a sweetheart, and she is missed.

Facts & Circuses!

I grow corn and soybeans in IL and have sharecroppers who pay me both cash rent and via crop shares. My tax return includes Schedules E and 4835. I file a non-resident IL return. I don't know much more than that, because I don't have any farmer clients in Fairfield County, CT. I just do what my cousins do because they own a lot more land than I do, have been farming for much longer, and their land is contiguous to mine.

Ah, very good. Sorta like the ole exempt savings bond Interest and education expenses deal.

Happy birthday to her!

Yeah, it ain't logical; it's the law.

The trust became irrevocable on the father's death is what I am hearing here. That being the case, there would be no step up at time of mother's death. The stock, at mother's death, was actually owned by the irrevocable trust thereby not allowing a step up in basis on her death.

The ATX Board has had a flurry of posts with similar problems from several different states.

I have enough trouble taking time off during the SLOW season! Although we are going to Missouri next weekend (25/26) for a memorial service for my husband's aunt, who passed away last fall. Not sure that counts as vacation; fly down, service, fly back. Ugh.

Thanks. I unchecked the "complete" box and opened one of the returns and it changed the calculation.

I might try that but for now prefer not to give out my cell to clients if they aren't friends otherwise.

Texts are very easy to memorialize. Just take a screen shot and send it to a printer. (So far I haven't started twittering or snap-chatting with clients - don't know how that would play out...)

Per our buddy Tom T Hall...... Whiskey's too rough.....Champagne cost too much....Vodka puts my mouth in gear. This little refrain, should help me explain, as a matter of fact I like beer. Makes me feel mellow............

I am getting impatient here, when are we going to talk about beer for the non-wine drinking whipper snappers?

Last year a new client informed me that his daughter lived with him 90% of the time. We went through that multiple times and every time he informed me of this fact. After e-filed his ex-wife informs him she wanted the child dependent care credit so I need to amend the return for free because it was MY fault that I prepared the return wrong. I sent him a copy of his own emails with his words and his response "yes I said that but you should have known what I wanted." He had $5k withdrawn from his paycheck for dependent care so yeah, I should have known. He's no longer a client and when he wanted to return I reminded him of his proclamation of my being at fault and why I wasn't doing his return this year. Having everything recorded is a good idea.

Elrod, you make me laugh out loud at work.

I should have clarified a little. Since I start very early (sometimes before 6am), by 1pm it's like dinner time for me. After that glass of wine and "Linner" I go back up to the office and make all my phone calls, no computer work. It makes those calls a lot more pleasant. You may want to try it someday. I find it ups my patience tolerance and my hugging standard for those who deserve it.

Text to Joe: "Hi Joe. I heard your voice mail. Probably can't get back to you for a couple of days - too many appointments right now. If you'll text me the answer to my question, I can at least get your return back in the queue. Right now it's on hold until I get that info from you. Thanks, John": How's that? I'd be tempted to add "Rita already gave me permission to kill you if you don't respond."

You know when you text a client a very simple question and instead of texting back a very simple answer they call and leave a voice mail to call when you get a chance? It's ok to kill those clients.