Leaderboard

It's tax season. If we don't vent about something, anything, we'll explode at our family or hug a client and have to lug him to the workshop at Rita's. This forum is our steam valve.

That is a great sentiment. But like Ronald Reagan said "Trust but Verify". I trust a lot of people on this board to point me in the right direction. But I do my own research and I reach my own conclusions. After all, it is my signature on the bottom of that return, not Eric. Tom Modesto, CA

It sounds like the client has sold and/or wants to sell property that was inherited and said property was given a low appraised value for probate. Evidently, the lower value helped the taxpayer at the time, or the attorney thought so anyway. Also sounds like the client wants to sell the property now and wants the "true" value of the property. How wonderful of the client that wants to do things the "truthful" way now!!!!! I'd say he is stuck with the appraisal that was given to the property at the time of the succession or probate. Cathy

This is the time of year where the little bothersome tick in the software becomes a full blown outrage. Why is it that on every freakin return I have to navigate through 4 clicks to check that one box that every paid preparer in his right mind would check? Why is it not the freakin default to have it checked?????????

I posted that too quickly just responding to what NC DOR rep told me. I kept pursuing the KB which referenced something from TaxWise in 2015 but decided to look further into it. Although the field for standard deduction had 8750 in it, I didn't check the box at the top of the page to take the standard deduction - of 8750 - which populated that field. Then went through. Why the hoops? Tech support said something couldn't be fixed about it. At least it's done and I got to vent a bit although needlessly.

Me too, but I just started in January and we had a bookkeeper who did payroll until around Feb 22nd. (LONG story.) I have had to change payroll completely, get a new bank account, get new W-4's, check addresses (many of the papers dated back to the early 2000's; far too old to assume they were right). Then people rush me and lollygag themselves. The last delay was something that had to be approved by someone who just got back from CA after a family funeral... but yeah, they're going to toe the line. Starting as soon as I have a minute to get out a whip. Hey, Jesus used one, so it's completely appropriate for a church group, right?

This is mindboggling ! Where do you find these clients ? LOL

Excellent answer, Tom, and I agree with you completely! One of the dangers of relying on any advice from others, here or elsewhere, is that it's entirely possible to give a correct answer to a question asked, but as we've seen in several topics very recently, after multiple queries from those trying to provide useful guidance and answers, the actual fact pattern was revealed to be vastly different than as originally presented to us! And that, my friends, is one reason we never help those from the general public that stumble in on occasion.

Just to add, for NC Drake automatically selects either the standard deduction or itemizing for NC based on the input in the program. Because I know the standard deduction amounts, all I have to do is look at the page 2 of the return to see which deduction was selected. Of course, there is an override if one would be foolish enough to take the itemized deduction when standard is higher. Although there are many hoops and in Drake you can write macros to automatically fill in some common areas, it is still better than paper, pencil. Just my 2 cents worth.

The only thing I place absolute faith in is advice from the people on this forum

mrichman333, As others have said, you are correct and H & R is H & R.....enuf said! I know how you feel though. You can't imagine anyone making the mistakes you see coming out of H & R's offices, and a little part (very tiny part) of you wonders if you are wrong and H & R is right! Have no fear...it will happen again and again and again until you get used to it and no more have to go through the shock part of it! Take care, Cathy

Actually, I believe under current law the wife would get 100% unless there are children are from a previous marriage. And I believe the value that requires probate is now $100,000. However, your other comments are spot on - especially the part about how the property is titled. Perhaps if you point out to the heir how much of the value of the farm might be lost to taxes if sold now as opposed to later, he will understand your point. Use actual dollar amounts as examples as well as telling him the percentages. But in the end, you can't control what they decide to do.

My hubby made me pie

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'll nominate Margaret for her foreigners and their rental issues.

Yep, tell me about it. A few years ago one came to me and suddenly I am the foreign tax expert and they keep coming. Being German (not the Aussie), they are incredibly organized and precise but also arty type folks so we often really don't speak the same language! The Aussie - she's a real problem child and not even in the country. She came to me last year never having filed since being in the country since 2011. So we caught her up as she was trying to get her green card and was worried not having filed could be a bad thing (ya think?). Some years were out of statute but filed fed and state anyway and she got back over $10,000. She loves me now.

I modified the master to check that box. And a bunch of others. What bugs me are the increasing number of input sheets that won't let you create links, so every time Schedule C changes, you have to remember to change the Ohio Bus form, and the RITA 37 tax form. My kludge there is to mark them as estimates, so if I forget, at least I get an error on my final check. But I shouldn't have to enter Schedule C profit anywhere else--that's what I pay ATX to do.

Yep, I noticed that message too, early on in the season because it is a new message for Delaware this year. For the Drake users, the program apparently assumes we consent and doesn't require anything like check boxes or sign anything, but it is including it in the preparers "notes" page of each return.

And now the box whether in the office or remotely prepared. What about clients that come into the office to drop off stuff but are not present when returns are prepared? Where's that box? And to efile Ohio, there is now a User Consent box: "By using a computer system and software to prepare and transmit my client's return electronically, I consent to the disclosure of all information pertaining to my use of the system and software to create my client's return and to the electronic transmission of my client's tax return to the Ohio Department of Taxation, as applicable by law." ARRRGGGGHHH

Son also needs to make sure that being in "assisted living" that there are no agreements that the facility or maybe even the state get the farm. Many times this is overlooked and a big surprise. On the tax issues, yes if the property was purchased by THEM, then probably the step up is only on the fathers basis when he passes and mom's remains at her cost. Depends on the wording of the deed, etc.. As an aside, make sure the attorney he "settles things" with acts on tax knowledge and law and not on just what the attorney thinks. Some do not and are also surprised.

These rates are still a bargain for a taxpayer who can't pay. Even after adding the FTP penalty, they're getting a reasonable interest rate for what's essentially an unsecured loan.

I've had lots of parents who diligently plunked money into 529s and ended up with lots of earnings that escaped tax. Plus in most states they get a deduction for contributions that lowers their state tax bill. UGMA accounts belong to the minor and can't just be taken back--there have been lawsuits filed by grown children when that kind of theft has happened. US savings bonds for education have to be in an adult's name (purchaser must be at least 24 years old), so you'd have to buy them in the child's name and report accrued interest every year. That can be a pain to calculate, especially now that all bonds are "paperless" through Treasury Direct and don't allow the nice "inventory" you could create with the paper ones and quickly see the annual accrued interest. (Just had one today where over $3500 in interest will escape taxation altogether.) I do agree that people shouldn't put all of their savings dollars into retirement plans because if they do need the money the penalties are steep. I thought clients were the ones whose minds were stuck in the 1990s (and before). How many clients do you have who want to deduct their credit card interest? (Went away in 1986.) Who think they have to buy another house within two years to avoid taxable gains? (1997) That they are Head of Household because a working adult child lives with them? (circa 2006)

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

Another client just came in who lived in the house for 1 1/2 years before he got divorced. The house was eventually foreclosed on and he is still paying it back. I looked at the exceptions for him, but it is my understanding that since he didn't live there for 3 years, he has to keep paying it back. HE probably needed to pay it all upon foreclosure, so I'm going to research this "up to the profit" section and see what it says. I can't believe I have 2 of these.

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.

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.

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?

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?

This is complicated so please bear with me. Couple from Germany (she a professor, he a house husband now) lived in KY, she worked in OH. Last year they bought a12 room house in OH needing major rehabbing done by husband. Two rooms were available in October and a third in November so another German professor moved in although house was not yet really ready. She needed a new place to live. Couple says KY house rented as of Jan. 1, 2018 to students. So they apparently became OH residents at that time (haven't changed driver's licenses, etc. yet). House in KY was bought with cash and husband rehabbed so basis is really low. Tenant of rooms in the OH house has been paying (by way of debt forgiveness of loan from couple) $650 per month. The value of the property changes almost monthly due to ongoing rehab. Getting a value as of October is a challenge at the least. Second professor (tenant of rooms in OH house) has a condo in Germany rented now by third professor (from Australia, but that's another story) waiting for her visa to be renewed. Condo owner charges tenant moving amount monthly depending on utilities and other factors. Also, the condo is legally owned by parents but she pays the mortgage (private loan from rich Swiss uncle) and all the bills. The value of the condo has doubled since owner first purchased it. She thinks market rate rental is fair at about $500 per month. So ideas on valuation of KY property (they haven't kept all the expenses put into the house)? Valuation for 2 then 3 rooms in a house not really ready for prime time inhabiting? Allocation of expenses? (I'm inclined to call this 'house sitting' or something since no money changed hands and for other reasons.) What about the condo in Berlin? Seems I have to report income but what about expenses that she pays but is not legally required to? My brain hurts. It's a good thing these are all super nice folks. Then the Australian has a house here in OH that she had to rent because she had to be out of the country for a year. Sheesh! I'll worry about that one tomorrow.

I could complain about RITA all day, and also the way ATX messed up the form to make it efileable, but I guess I should work on another tax return instead.

Or, Form 3115...

I think you misunderstand capital distributions. When you have paid-in-capital, you have added basis to the shares of stock. Even though it is shown on the financial statement separate from the other basis of stock (because of par value) it is for tax purposes an equal basis addition to the stock (like glue). If you "take it out" you are actually distributing a fractional share of stock at fair market value, therefore any distribution would require a 1099 to report the FMV which is reported on 1040 Sch-D as capital gain or loss. Determining FMV my require an outside appraisal. Shareholder loan is easy, peasy to document and tax free to repay. Also you may be ignoring the intent of the owner which is not your decision.

On Pi Day?! What a nice hubby.

Get his end of year pay stub too, may have items that were added to the W2 but not reported in box 14. I had a client with these (Rusch) RSUs & SSARs. Hopefully your client saved all of the statements. They were truly confusing, but then again my guy was retiring and had no idea his vested options were worth what they were. Always missed a few zeroes when looking at the statements.

Must be specific form issues because I have filed a few NC returns this year with zero issues.

I disagree. You can amend a return after 3 years but you can't claim a refund.

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

Neither can WE! (Good luck.)

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

um - don't you just lump them?

I love this. That is all.

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 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.)

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 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

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.

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

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: