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The snip below is a life or death story of taxes (yeah, right!) that is too funny and simply must be included here to put @rfassett in the running for a star. Ron is another long time member that always give great advice and doesn't post often enough. I remember one of Ron's other life or death stories of how his wife gave him a very thoughtful gift that had a very strong magnet in it right after having a pacemaker installed! This is Ron's latest post from the RitaB's topic "Come again?" that you can vote for here:

Reminds me of a client that dropped off his stuff a couple weeks ago. I know he is in the midst of a divorce but the couple wants to file a joint return. No problem so far. This is a very long term client and all the associated risks and issues have been addressed. He calls last week and needs to see me immediately. I already had a very full day and told my secretary to make an appointment with him on the morrow. No way, he says, this is a life and death issue. That got my attention and I carved out some time for him an hour later. He comes in, we go to the conference room, and he starts crying and he hands me a 1099-K from a massage parlor (not the business that I do the work for). Turns out the girl at the massage parlor talked him into putting his information on the credit card processing because she does not have a green card, etc, etc blah blah blah! Turns out this girl - who has to be 40 years this client's junior - is the impetus behind the divorce. The life and death issue was he did not want the 1099-k showing up on the joint return for his wife to see. He was right about the life and death issue - I almost killed him myself for being so stupid.

I need an attitude adjustment. Every time one of my staff members speaks to me, I just want to scream 'be silent'. I started the morning with an 8283 because the client had enough $25 and $11 contributions (not exaggerating) to exceed the $500 threshold. Maybe I should start charging $500 for every 8283 I complete. That will teach people to think of others! Seriously . . . de minimis of $5,000 for depreciation, and $500 for old clothes to the good will? Aaaargh. Can I lease a bit of space on Rita's South 40? I'm going to need a place to 'store people' very shortly. Is it just me, or is anyone else the Bluebird of Happiness today?

Client's secretary just called to give me payroll information so I can figure and submit 941 tax. If it's not done today, it's late. She: Oh, good, when I got the machine earlier, I was afraid you were out today. Thought Bubble: "There's a little thing called tax season where else would I be and a good thing for you to do is get your head of out your @$$ and call me on one of the other 12 days in March that I've been here." No, I'm not grouchy at all. Everything's going great here.

He's wanting you to "massage" the numbers. I guess you told him that train has already left the station. (Or perhaps the cat is already out of the house). The possibilities for mangled idioms in the situation are truly mind-boggling.

It looks like I am going to learn a lot at the june meeting. Joint locking, paper cuts, back 40 with a dozer. Whats next?

Sometimes I think that instead of tax prep, I should just hit myself in the head with a brick. It would hurt less, and be over faster!

YES! Did you read my mind? Today is almost like one of those Monday's when the phone never stops ringing, every project is interrupted, and nothing is accomplished. I feel like I've lived an entire week since a woke up this morning.

I can't really think of anything I dislike more than Form 8283, except maybe my ex-wife-in-law.

Well, you achieved one thing, your post made me laugh

I hope there is a happy ending to your clients problems.

Oh snap is exactly what I thought, except not "snap". I know his records will be in ship shape. Ship. Shape.

New client is blowing up my phone and Email, "Where is my 1120S?" Give her a call, "I am working on it, will have an answer soon, sorry about the delay..." I look at the return prepared last year and the date on it after I hang up... Dec 10, 2017. I am SHOOTING the bluebird of happiness. ARRGHH! RIch

I'm treasurer of my Church (just started my term this year). Yesterday, the business administrator told me that the reason payroll is always so last minute (which affects ME) is because of one person who has to be begged for her time sheet every pay period. I just sent an email to all employees letting them know that anyone whose time sheet is not received by the close of business on the ___ and ___ days of the month will not be paid until the next regular cycle payday, assuming by then the time sheet is in order. NO exceptions. We'll see what happens. DON'T mess with me in March.

I needed to do a church payroll by YESTERDAY. Waiting for ONE item - the number of hours for ONE part-timer. I have been asking since Saturday. And of course since pay will be late it will be MY fault, and not the fault of the person in charge of getting me ALL (not just part!) of the information. So I'm not exactly Little Suzy Sunshine myself today. Plus we had over a foot and a half of snow yesterday, and I'm tired and sore from wrestling the under-sized snowblower through that mess. (Doug did all the shoveling, so I'm still better off than he is.)

Form 1116 beats 8283 all day long. Just saying.....it is not even a fair fight. Tom Modesto, CA

I don't understand the problems with 1116... and I'm afraid to ask. Just did one and it had it numbers on it and stuff.

Could do nothing, and if grand kids come about, transfer the remainder to them...

Sometimes, when donations of goods is in the 501-700 range, I get them to agree to 500 to save more on prep fees than they'll save on taxes.

I will sign put XXOO on his first invoice.

((((hugs))))

That extension will give you ample time to properly prepare a well deserving plot on the back 40.

Well, that one went poof some time ago and my brain was accessing information from the late 1990's. Another reason I never trust memorized standards - am I recalling this year's figures or the ones from a decade ago? Any chance either of these kids will go to grad school some day? Or take any kind of classes for fun and games? Basket-weaving, history of baseball, philosophy of Cicero? If so, hold the funds in the 529 until then. Else take it out over time to minimize the chances of bumping into a higher tax bracket.

I don't have any of these, but when you dispose of the residence before paying it all back, aren't you liable only for the remaining payback -- up to the profit from the sale? Your client probably had no profit. Do research it. You might be a real hero if you can get them refunds from amendments in the off season.

I can't stop laughing. Guy says he desperately needs me to save his life by doing one year of bookkeeping and his tax return. Me: Well, I would love to save your life after tax season, so bring in last year's return, I'll get you an extension and you can pay at least as much as last year's liability now, which will put you on a respirator, but you'll survive. Oh, thank you, thank you, thank you. You won't be sorry. I pay everything thru my bank account except for the stuff I pay by cash. I'm pretty organized.

Thanks, that's exactly where I was with it. I just could NOT find the rule. I really appreciate the post!

Yes, I believe you can. Since the casualty was before the conversion to rental, you would start with basis of the property and break out land. From there, concerning the casualty, this is what Pub 547 says about basis adjustment: I think you'll end up basically where you are intending with your question. The sum total of all of that should be the depreciable basis for the rental when it is put in service.

Have you seen the sales agreement David? Is the partnership listed as the seller? I don't see any other way than to allocate the gain according to each partner's share if the partnership received a check and/ or note for the sale price. How did the partnership acquire the property? Are you the preparer for the partnership and the partners?

Those exact words reminds me of a former client, I saved his life by completing a couple of years of zero quarterly returns, and to add icing to the cake, he promised I would be his accountant for his secret mix of roasted coffee bean business. This is me

Why? David indicated it was an outright sale of partnership property to a "purchasing member" at what sounds like fair market value. Maybe I am missing something, but why would that be treated a partial distribution instead of a legit sale? David also indicated the purchasing member will remain a partner in the partnership which will continue renting other property. So unless there is a 704(c) issue related to contributed property, then why would you not treat is as a sale from partnership to partner and allocated gain 1/3 each?

Quarterly Interest Rates Increase for 2nd Quarter 2018 IRS has announced the interest rates for the 2nd quarter of 2018. As of April 1, 2018, the rates increase to: - 5% for most overpayments (4% for corporation overpayments) - 5% for underpayments - 7% for large corporate underpayments - 2.5% for corporate overpayments exceeding $10,000 As in past years when a rate change begins April 1st, for purposes of Form 2210, the former rate of 4% continues to apply through the unextended due date, April 17, 2018. Revenue Ruling 2018-7 https://www.irs.gov/newsroom/interest-rates-increase-for-the-second-quarter-of-2018

#1 priority for any volunteer or quasi volunteer "job" is to make it easy to be replaced... unless you want to be a lifer. BTDT, and unless I can see myself completing priority 1, I will no longer accept that type of gig. Only took me three decades to figure it out (I took my first volunteer gig, to revive a dormant not for profit club, at age 21, and am enjoying my first "free" spring in two decades after letting another gig go).

I never see shareholder "loan" paperwork. So this makes sense Abby.

It builds character, increases neural pathways, and we could use the extra cash.

Oh, yeah, my long-term memory is waaay better than my short-term memory.

um - don't you just lump them?

And since I customized 3 records of the 8283, it's been a snap to fill out.

I love this. That is all.

I think you are on to something there.... I would look for court cases or regulations to support that position. It looks like there was definitely a threat of condemnation, and the fact pattern may fit with regs. Tom Modesto, CA

@Edsel - not the situation at all. Both are good kids. The first only got a two year degree and went into law enforcement. Was his dream to be a public servant in the fire department but was too skinny, so he became a cop instead. Even in CA, community college is cheap (except for books). Second kid is smart, and is attending a state college. When he is done, there will be money left over in the 529 plan. They saved too much. They are wonderful parents, the kids are good, and there is no drug use before they go to church every Sunday. These kids are not heathens. Keep your generalizations away from my clients, especially ones that I have known for over 15 years. That is probably more than you cared to read either. I do agree with your financial planning points. But it is too late now. Tom Modesto, CA

Do you have the paperwork he received when the transaction actually occurred, in addition to the year-end documents? I always go through those statements, which hopefully will allow you to tie the number of shares executed/price to the W2 amount and the 1099-B. Best I got.

Why in the world would you show a shareholder loan as paid in capital. That is what the IRS would prefer. A shareholder loan can be paid back anytime without question, paid in capital cannot. A loan can pay shareholder interest, paid in capital cannot. Why would you ignore the intent of the shareholder?

They will have a two part basis. First the 1/3 basis of the property distributed from the partnership. Plus the purchase price of the other 2/3.

A very familiar problem. Taxpayer doesn't want to pay for a competent appraisal, so he ends up with a half-baked, quick-and-easy number that is free. Most of these guys have been told they needed one, or maybe they haven't. The result is the same -- they're not going to pay for one. "Free" is worth every penny. Commonly used is a realtor's appraisal (almost always too high) or tax assessment (almost always too low). To answer the question (and to reference Danrvan's observation), the appraisal should be consistent for all purposes (except alternate value arising from farming usage). Ongoing consideration is the three-year statute of limitations when an estate, trust, or personal return is filed. IOW, after three years, the IRS will not attempt to adjust the value no matter how ridiculous. I believe we can assume that the taxpayer cannot change the appraisal for purposes of an amended return after 3 years either.

I guess I should have said that the purchasing sibling will show the purchase price (2/3 FMV paid to the 2 siblings) plus her 1/3 cost of the property distributed to her from the LLC as her cost on Schedule E. Thanks.

From what you are saying, the transaction happened outside the partnership; the exchange is between the siblings. The partnership did not or will not receive payments from purchasing sibling. That sounds like a case where you could treat the property as a distribution of undivided interest to three siblings. Then report the sale of property from 2 siblings to 1 because that is what effectively happened. Then there is no gain to report at partnership level and none to allocate to partners.

Sounds like he has all his records organized, should be a snap.