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Hahahahaha my buddy Abby knows I'm playing. I do love you all immensely. ((((Real nice hugs only)))

Yeah, we should be saying 'real estate investors' who had REITs added to the 20% QBI deduction at the 11th hour.

I don't think it is politics to state the obvious facts. The republicans needed to ensure that one of its senators voted for the bill, and they added language at the last minute to the bill, and after that language was inserted, the senator in question signaled his support. That is just how the sausage is made in DC. And it is apparent that the insertion at the last minute made the interpretation of the section hard, as the change to the bill is not harmonious with the rest of the sections. If this was inserted earlier in the process, legislative staff probably would have had more time to integrate it more properly in the bill and signaled a more clear intent of the impact to Sch E rental properties. No comments about whether this is good or bad, or who it favors...just a statement of the facts as we know them to have happened in the legislative process. This is no different than the last minute changes to the refundable portion of the Child Tax Credit. However, that change was just a number change, and not a change to the structure of the credit which was already written into the bill. After that change, two other senators signaled their support. And the sausage had a slightly higher content of one ingredient. Tom Modesto, CA

"Most" of the issues may be resolved, true, but were any expenses (only insurance was mentioned) charged to the corp? What about the licensing and plates renewals? Maintenance such as gas? What is meant by the daughter using it 'in business?' Whose business? And there is still the gift return issue, I should think. I've had ugly situations before but this one is particularly, um, interesting!

I am glad I am not in Tennessee right now. I declare a "hug free zone" on this board for the next 3 hours. Tom Modesto, CA

Good catch, Mr. Normal. I agree.

Imagine that! <Steps slowly back from the edge of politics.>

As far the depreciation goes, I would file a 3115 to remove the depreciation expense and any related expenses from the from the corporation. instead of amending all of those years. As far as the purchase price of the jeep, I would record it as a stockholder receivable, then clear that out with a 2017 dividend. This would resolve most of the issues with the least amount of work.

Need to put emphasis on "should be" or change to "might be". 199A (c)(4) specifically refers to " reasonable compensation paid to the taxpayer by any qualified trade or business of the taxpayer for services rendered with respect to the trade or business" and guaranteed payments. However, it is possible reg's or technical correction could extend that to include draws by sole proprietor in amount considered reasonable compensation.

First of all, stay away from giving any advice in regards to corporation vs LLC, that is legal advice for lawyers to handle. LLC'S are a creature of state law and have nothing to do with tax law. It looks to me like he should file as sole proprietor, Schedule C. The income would then be taxed at 24% vs 22% at the corporate level according the information in your post. Even if he goes with C. corp, he will need to pay a reasonable salary which will come back to him at 24%. A reasonable salary would probable eat up most of the $30,000 profit anyway. Also, as a sole proprietor, he should be eligible for the new section 199A deduction. As I read the code, a sole proprietor is not required to reduce Qualified Business Income by a reasonable salary. Also, per 199A (d)(3), he should fall below the threshold amount for service income.

IMO at the income level he is expected to earn via the LLC he should leave well enough alone. Gifting the spouse 6% stock renders the default partnership, with the need for filing a 1065. If he elects corporate status the tax rate on net income is 21%, not 15%, with the need for payroll and its accompanying reports, and filing an 1120, complexity which he would more than likely not appreciate. If he leaves it as a SMLLC then the default filing is a schedule C as part of his 1040 package. If his other earned income is near the FICA limit then his medicare liability will not be much (under $900). Just my $0.02, whatever that is worth. Lynn

I had heard this was coming this year. Guess who has one on their W2? Me! Our company uses Paychecks and they have included the verification code on our W2's. Looks like the long computer generated passwords that you get on some sites. I missed seeing it, but my spouse picked up on it. @Medlin Software Are you putting these on your W2's? Tom Modesto, CA

The RT record is the "total" type record. The RW record is the "employee" record. The message is saying the actual number of RW records, since the last RE (employer) record, is not the same as the number reported in the RT record. The date contains 7 RW (employee) records. IN the RT record (the total record) there is some other employee count given.

Twice I've gone through the new drill. Fortunately, I didn't have clients sitting in front of me, which would have created an awkward situation. NATP has taken an active response to the new requirements, with suggestions that hopefully the IRS will accept. https://www.natptax.com/TaxKnowledgeCenter/GovernmentNews/Documents/PPS Issue Paper.pdf

I personally think 20% is high enough. For anybody. Seriously, I do.

Refundable Child Tax Credit. My first thought was, "Hmmmm. They managed to cut taxes on people who don't pay [income] taxes." I ain't gonna tell y'all what I think about refundable credits. I'm too busy working up in here.

If we have to start entering them, I'm going to make my scan searchable so I copy/paste the code in. I already make my complex clients scans searchable so I can find things easier, like when they have 6 brokerage accounts I can search for the account number.

I agree with both posts above. I too feel he should leave well enough alone.

Maybe the numbers are just randomly generated--try hacking that! Anyone been to an IRS liaison meeting lately that discussed the use of these numbers? My hunch is that tax pros did not religiously seek and enter these long drawn-out alpha-numeric strings or always enter them correctly, especially when things got busy. I suspect we are in for a scolding and maybe eventually will be required to enter them or face fines. (The IRS needs money and Congress won't give it to them, so someone has to.)

Received mine today!

The submission ID, that is how states should be able to find the return in their system (like the old DCN's) You can check the e-file manager for the number

Just guessing the code is created using some of the data on the form (similar to how one can verify a CC number is not invalid). This way, the SSA/IRS can decode it. The code will be useless once the algorithm leaks, which it eventually will. Unless there is some sort of method where the software vendor has to provide the code to the IRS, and the code can be created in many ways. It will be interesting to see if this "group: ever makes the code process available to all, or whether this is yet another attempt to block out those not "in the know", so they can pretend their software is "better" because it generates the code. Or, "he he", it needs to be used by the software companies who put employee data online, and have been hacked

I never understand why people switch tax prep packages??? ATX has been flawless for years!! <cough>

I have one client who claimed $89k in NY state and NYC taxes last year. Bought a house on Long Island this year which will add $36k in property taxes. Sum of both limited to $10k in 2018. Won't be pretty. But his tax rate will go from 39.6 to 37%. Whooo Hooo. The others who will take a big hit are salespeople who get only partial reimbursement from their employers. I have one who gets a Sch A deduction of $20k just for unreimbursed mileage. With Misc itemized deductions gone, this will hurt.

Shoot, my clients are all over the place whether the law changes or not. It's terrifying. "Hey, Rita, how do I fill out this W-2 thingy again? I'm up to about eight and a half here on this worksheet blah, blah, blah..." Me: Drive over here and I'll have a thingy ready for you. Don't trouble yourself [for the love of God don't].

in 2011 the daughter received from the corporation a jeep. however, the corporation did not tell us the jeep was a gift for the daughter, and let us put the jeep on the corp books and take depreciation. in 2017 the jeep was in an accident. I am informed via sticky note. "We no longer have the 2011 Jeep." Ok - so I ask the usual questions - was it traded, sold, wrecked, etc. I am informed that the daughter always held it personally, and used it for business, and that it was titled and registered in her name and that she had always paid the insurance. So in April 2017 when it was totaled, the daughter received the insurance and bought herself another car. Ugh. So wrestling with how to treat this. Was the shareholder dad supposed to file a gift tax return for this back in 2011? (I think so) But do I back peddle and do that now? But then I have to deal with the depr that the corp has taken over the past 6 years. Maybe the proceeds are shown as income now on 4797, and I ......this is draining my brain......and yes, yes, then income would be essentially the amount of depreciation taken over the years. This would make me feel better. But the insurance check went directly to her and the books show no record of the insurance money. Why? why do people do this to me...... whine whine whine. This is my first return for the year too.