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Indeed. Had a client with dependent care benefits on W2 but no child care expenses listed. He told me they paid cash and could not deduct it. I opened 2016 return while on the phone and he had preschool expenses, so it wasn't taxable last year. But as I was hanging up I realized we (be a team player, it diffuses the blame) had missed entering the DCB on the W2. I try to be efficient when reviewing returns, and we only see DCB once or twice a year, and the DCB was off to the left all by itself on the W2, but it was still a mistake we made. I had to sit with this for a few days before I emailed him the bad news. Frell. (I always had the hots for Chiana, even though I prefer brunettes. She was a bad/tough female character.)

I would stay away from BHoffman and paper if I were you. And don't let Catherine walk behind you. Other than that have a good time.

Congratulations to Rfassett, this week's winner!

Once they die it becomes an Irrevocable trust and you need to apply for an EIN number. Everything after the death is reported on a trust return.

Well, I have a new client, who moved and began renting her residence 2017. We did a lot of back and forth and waiting on answers as she had no idea what I needed as sometimes happens here. (Who am I kidding? It happens every day here.) Anyway, I somehow gave her the Tuition and Fees Deduction instead of the Lifetime Learning Credit for her son's college expenses. Her son picked up her return to take to her and she was to review it, sign the 8879, and pay me. She texted me last night and asked if it was ok if she let her brother in law look at it. Well, my first impulse was to be angry. You know. because I am Super Tax Pro and everything. I somehow had enough sense not to respond. I was up all night worrying about this and realized something was wrong, and that she should have had the Lifetime Learning Credit on there. I got here this morning and discovered I had not entered the address of the University. I explained the error to her and apologized this morning. She was very gracious, but I am so embarrassed. Not as embarrassed as I would be if I had responded to her text last night in anger. So, there's my confession of dropping the ball royally. And my unsolicited advice to everybody is don't respond to people when you are livid. I will say that till the cows freeze over. And I really wish it was impossible to create the e-file without the address of the University on there. Just saying.

Yes, please proceed as if our answers are correct because there is no way you can convince the IRS that your clients deserve the full credit as you requested it.

Something for your file - Cornell Law's online code, sec 152(d)(1)(B) reads as "Qualifying Relative...whose gross income for the calendar year in which such taxable year begins is less than the exemption amount (as defined in sec 151(d))." Gross income had this pop up (can't link to that directly) that says this:

I do exactly what Sara does, because I seldom see basis listed for the fractional share. If Terry has the brokerage breakout with basis assigned to that fractional sale, then I would make the tax return match the 1099-B.

Yes, and I can do that well enough without anyone's help!

I usually get a series of naps totaling 5 - 6 hours a night. Last night I was running a fever and was hit with an overwhelming need to sleep, so apparently I needed all of that rest. Being sick is the only time I sleep as soundly as I did last night. I managed to drive to a client's today, although I don't remember much of that, but no way I could have driven safely at all yesterday. Thanks for the well wishes.

Egg? I had scrambled eggs for brains yesterday. Lack of sleep, husband sharing his man-cold (tyvm, not!), nyquil and daytime cold medicine, and feeling lightheaded, I wasn't making much sense of anything. I reread an email that I sent to a client yesterday and I repeated myself in it. After sleeping for 12 hours, I am marginally functional again.

We all make mistakes. It happens. Wipe the egg off. What made you determine the LLC should have been taken over the Tuition & Fees?

Nope. My new policy is $500 ;).

Yes

Thanks to all for suggestions. Resident bookkeeper is proficient only with coding invoices and doing basic banking. I'll answer questions about my resistance to QB - too user-friendly to non-accounting types. Like giving a 5-year old kid a loaded gun. The owner doesn't like them either, after having them mess up her multi-state payroll for 2 years. Was not the owner's fault either. One of the problems QB gives no resistance - keypuncher can doing anything they want. We all have problems with commingling personal and business expenses (and this can happen with any software, and the problem is universal for all of us who have clients). But when they bought an entertainment set for $1900 out of business funds and entitled the account "TV" its time to back off.

Thanks to all. Not the answer I wanted, nor is it fair, but I will proceed as if your answers are correct. Apparently I didn't work through Form 2441 or didn't enter anything from box 10, W-2. Either way, my bad.

Hi jklcpa, the distributions we were talking about was paid-in-capital which becomes a part of stock basis rather than income accumulation (retained earnings). You are correct that distribution of accumulated retained earnings income is a different type of distribution. Paid-in-Capital is not Retained Earnings. From a tax standpoint there is no difference in distributing shares of stock or paid-in-capital. Both are Capital Distributions not distribution of earnings. S-corp distribution rules only apply to accumulated earnings.

There always seems to be that one missing piece of information that prevents you from completing the return and allowing you to feel some sense of accomplishment for the day!!!

They really come up with some incredibly creative ways to try to WASTE our TIME, don't they?

I guess if we only had that one client, then that might be something one could do. I agree though, no way. I guess the guy isn't concerned about security issues.

Not quite, Max W - the penalties are VICIOUS. They start at 50% of the maximum value during the year and go UP from there. And that instance is for negligence (forgetting to report), rather than intention not to report.

That is not necessarily true. This topic is specific to S corps, and the S corp distribution rules and taxation of distributions depends on whether the company was formerly a C corp with E&P or if it was an S corp from inception. If formerly a C corp with E&P that convered to S status, the distribution might result in a taxable dividend. If it has been an S corp from inception, the distribution may well be a tax-free return of basis if it doesn't exceed existing basis, and of course, that includes taking into account the ordering rules of basis changes in the current year.

Thanks Judy and yes I did have a typo in the OP. I did enter it as a capital loss on Sch D. I guess for some reason I had to get my head wrapped around this. Once I did, it made perfect sense. It is just one of those things when you have been working too many hours and the brain begins to get clogged. But... thanks to all who gave input here.

Yes Jack, even with QB, they need a real accountant in-house.

Yes, it is a capital loss that is on Sch D. Holding period goes back to that of the original security. This usually results from a stock split or spin off where x number of shares are issued to existing shareholders for every existing share held, and a portion of the existing company's basis is assigned to the new company. Then, the shares that are issued for the new company are in whole numbers with the fractional share portion being paid in cash instead of issuing the fractional share. Example - person holds 1390.313 shs of company A that has a spin off of a division into company B and issues 1 sh of B for every 4 shares of A that is held. The spin off results in the person being due 347.57825 shs, but the person will receive only whole shares of 347 and cash in lieu of the fractional shares of .57825. The effect on the investor's tax return is like he received all of the shares and then sold the fractional ones back to the company in exchange for the cash. I don't know if you have a typo in the basis of 34054 (?) but this should be reported on D/8949 as: Proceeds $2.19, Basis $34.54, Cap Loss $32.35

I had one of those EDU problems this year too. Took me some time to realize I needed the address of the college because there was no error or yellow warning. Couldn't figure out why program was not allowing the LLC. Luckily I eventually found it because I do need the sleep.

12 hours? I would be happy with half that much straight through. But then again, I am healthy as a horse. Hope you get to feeling better soon! I am so looking forward to my Easter nap!!! Just two short weeks from tomorrow! Yeeaaaaa!!!

If the foreign cash gift is under $100K, there is no reporting. Over $100K, file form 3520. As for the condo, as long as she is the owner and not a foreign corp, only financial assets have to be reported. Of course if she starts receiving rental income, that would have to be reported. Be sure to ask if they have any foreign bank accounts that had a value of over $10K any time during the year. The penalties are steep for not reporting. https://www.irs.gov/businesses/corporations/basic-questions-and-answers-on-form-8938#CashQ2

I think you misunderstand my clients.

This week was a killer for me, too. I kept thinking: Wait, there's always a March lull. What is going on here?? I had the client whose co-workers were deducting the difference between the per diem for lodging that the employer COULD have reimbursed them and the actual hotel bills that the employer paid directly to the hotel. The employees had no expense at all. It is hard to prove a negative, and I always try to back up everything I say with an article or the form instructions. I did print Instructions to 2106, but you know about how much that means to people wanting to go for gold on Form 2106. I finally said, "I may or may not have one of your co-workers who came to me in 2016 after having his @$$ handed to him in a audit of 2015." That was tacky, but effective.

That is so true. Some of my best ideas have arisen after thinking about a difficult situation for several days, after I have calmed down .

Math. I was laying awake and realized 25% of 4,000 was less than 20% of 10,000. I couldn't remember the limits and all, but I knew her marginal tax bracket was no more than 25%.

That describes most of my client's returns this year. Yesterday I called one for missing stock basis and he wanted to set up an appointment for me to connect to his computer via Skype so that I could watch on his screen while he searched for his information. No way.

OMFG! Isn't that the truth... Give me the freaking childcare providers info! Someone just texted me... Oh, I have a 1099-C for a credit card, do you need that? And I paid it off as well...

Because we charge $45 for an 8283?

For K-1s to people who aren't my clients, I print out page 2 with the codes. From there, they're on their own.

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.