Leaderboard

I don't think that makes any difference. Case law has established a general rule that an expense charged to a credit card is treated as paid with borrowed money. Rev rul 78-38; Granan v. Com; and other cases confirm this. Your client is borrowing from Citibank to pay Home Depot so go ahead and take the deduction.

I think your interpretation of "cash" payments is too literal. The IRS recognizes that payments of expenses are frequently made via credit card, basically a third party extending a loan to pay the expense, and that expense has been paid at the time the charge is incurred. I don't have an IRC to provide, but you migth read Rev Proc 92-71 that discusses proof of payments including credit cards. There's a general discussion in the background section, and then paragraph .06 is specific to credit cards. Give me a minute to get back to my desktop and I'll update the post with a link. https://bradfordtaxinstitute.com/Endnotes/Rev_Proc_92-71.pdf

I live and work in CT, so have no idea why I received an email from TNSEA. But, it could make a good two-day destination education for many of you. You'll have to ask CA if TNSEA is an approved provider.

@Lion EA, I am thinking this is how I end up in @RitaB back 40 with a cold 40 oz in my hand on Saturday. But my spouse is a CA Registered Preparer and I would want her to attend and get credit for her hours as well. I think because it is IRS approved material it will qualify for her CPE, but I think the organization has to report it to CA. Any chance of the TNSEA reporting hours to CA? Love the class selections. Sounds real good to me. Tom Modesto, CA

Anyone who says violence isn't the answer hasn't given it an honest try.

Now that tax season is behind us ... except for the abundance of extensions, we are ready to turn our attention to our TNSEA Annual Conference for 2018. This year we will hold our conference in Tunica, MS on June 21 and June 22. We have three exceptional speakers for this event and are offering a dual track of Representation and Resolution on the second day of our meeting. On Thursday, June 21, Dr. Marilyn Young will be presenting three topics including our tax update on the TCJA tax legislation with fresh insights and up-to-date clarifications. On Friday, June 22, Jeffrey Schneider and Kevin Huston will be sharing the spotlight with each presenting four hours on tax preparation and four hours on tax resolution. Plus, we will have IRS representatives on site to answer questions and provide guidance on problematic cases you are working through. Click Here! to learn more about the conference and to register. Gary J. LaRoy Enrolled Agent NTPI Fellow Sent on Behalf of The Tennessee Society of Enrolled Agents by TaxProEZ 404 Brandywine Drive, Old Hickory, TN 37138 Phone: 615-562-1903

I thought it would be a good idea to attach it to the return. I mailed the POA to the amended return address. Figured they could get it to where it belongs. Or not. I guess MA DOR really deserves their 1 star ratings that I saw on Yelp or someplace. One guy said he wished he could give zero stars!

Max: That's the issue. I have one reference from a CPA firm that differentiates between open accounts and store credit cards. Their view is that store credit cards underwritten by credit card issuers are essentially the same thing as general-purpose credit cards, because of the existence of the third party. Fact is, the money is owed to the credit card issuer rather than to the store. My problem is finding clear IRS guidance either way.

The IRS has different definitions of certain words than the rest of us, i.e. "voluntary", "random" are two. Audits are selected in two ways - one is the reported document matching process. Most of these are CP2000 audits and 1099MISC underreporting. The other way is through a program that takes all tax returns and compares them with statistical norms, and those with anomalies undergo three layers of review by personnel. The IRS is not going to waste resources on auditing a return unless they think there is a reasonable likelihood of recovering enough tax to make it worthwhile. But, there are criteria throughout the process. I guess this is what the IRS means by random.

Store credit cards (Home Depot, Macy's, etc) get a different treatment. The deduction is taken When Paid.

Can't believe the typo I overlooked. My second sentence should read: When he charges expenses to his credit card (Visa, Amex, Master Card), we deduct December purchases in the year of the charge, rather than the year of PAYMENT. Thanks for the link, Judy. That helps.

That seems to be part of the problem diagnosing what ails this old body. I know where I hurt, but I don't know where it comes from.

Thank you all - we are also writing a more laid out letter for any WI/IRS letters and we do now ask since about 6 months ago for retainers,,, live and learn. Cannot hardly trust at all, and also letting them know they can do this all them selves - her co-worker, well she does not work at the company anymore - is doing hers herself - as I do not think she has much back-up, called the IRS and said they were being targeted as the original company was audited - and of course the IRS said it was random..

well I do think I have an engagement letter - so am going back to that first... and sending her back her check and her invoices and statement... and letting her know she lied about TA and I am revoking my POA as advised by TA and I will probably take her to court so it is on her record... - altho' I might ask for another judge if she is asking him for advice

Thanks, Catherine! How long did it take you to get comfortable with Drake after ATX--2 weeks, 1 month, etc?

Congratulations and welcome to the club! Drake tends to try to group like items together, so that might be why instead of putting depreciation directly on C or E, instead they hot-link from those pages to the 4562 input screen. It annoyed me as well, at first (I switched during the 2012 debacle) but then I had to trace some depreciation between a couple of rental properties (I forget why) and it was SO much easier having them all together. As for the input screen entry - every year the input screens become more and more like the forms we get from our clients. And remember that in any input field you can make a break-out list by hitting CTRL-W in the filed and it will give you a worksheet list. Great for charity, or tracing property tax payments from HUD-1's, or anywhere you want more detail. While I was not crazy about having to "View" the return every time I wanted to check something, once I realized that Drake would calculate and go to view significantly faster than ATX (back in 2012, at least) would swap screens, I was appeased. A year or three back they added the look-back from View mode to see where it's drawing info, if something doesn't look right. Better than the jump-to-bunny that used to take me in circles sometimes! Always check how depreciation figures converted - no matter what software or what direction, those are always the weak point.

The 2017 form is used for fiscal years that begin in 2017 and end in 2018, or for 2017 calendar year reporting. Please note that the estate's year can NOT exceed 12 months, so if the decedent died during May of 2017, the latest fiscal year that could be valid would end on April 30th. EDIT - I was just typing the same thing!