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Lady came by today; package in hand; we've been doing it for years (has retirement benefits, savings interest, farm rental, taxable social security, needs 1099). Says she's decided to do it herself (been looking around online I suspect), but she's going to let us e-file it for her (gosh; thanks a bunch). She did mention that she "might need a little advice" because "the forms don't seem to look like last year's." She was crushed when I said "We don't do that." Going to be crushed even further when I tell her the fee (up $50) isn't like last year's either.

Agree that young people may choose the DIY route, but I'm not that worried about the profession going extinct. For one, people are strapped for time so they are used to paying for a lot of services they could do themselves, like car washes and mowing the lawn. A lot of people fear the IRS and what will happen if they make a mistake, so they would never risk doing it themselves. More people are entering the gig economy or becoming consultants and will get lost in the rules. Way back when I worked for HRB, they said that big tax changes usually drove crowds in the door and they were right. Maybe after this year when people realize they will no longer itemize, some will shift to DIY. On the other hand, small business owners will come in flocks because they will never understand QBI and will trust that we do. (Please don't let on that we are just as confused as they are!) These people will stay too, and that is exactly the type of client we want. I do see estate work diminishing because of the higher exemptions, but many states still have Probate filings. Trusts will be around as long as the "free dinner" folk spread fear. Tax advice should be in hot demand too, particularly when new businesses choose an entity type. And when the new law sunsets, we'll start all over again. In our practice we are not concerned about losing clients because we do a lot of small businesses as well as professionals with complex situations. If some of the Sch A folks eventually leave, this is who will replace them. Maybe we all should plan on fewer clients but higher fees, which isn't so bad.

Not so fast... I like the answer "Who's yo daddy?". Let's not assume and ask our clients. One time I had a similar situation... a client told me: "my girlfriend moved to my house with her two children and I pay more than half to upkeep the house". After a few questions a couple of questions I said "You do qualify for HOH". When I asked "who was the father of the children?" he replied... "my brother".

I always encourage young, newly married or single to do their own returns, free file, Turbo or whatever. Come see me this summer and I will show you how to fix your return. Seems to work, I fix them,for a fee, and now have 3 or more generations of same families in multiple states. One this afternoon is the Granddaughter of one client and she Came from Colorado, where husband is working at the Air Academy. Did not give a thought to looking at other alternatives. Including the free service from the Academy. "If it is Free not sure if it will be done right". 800 plus miles. here yesterday and going home tomorrow. That is typical in our practice. No worries about future, except how do we get out when it is time?

tells me trying to buy a house needs tax return for mortgage company says w-2 shows 21,000 for job as pizza delivery says he made 14,000 on top of that in tips told him about tip reporting.. he told me it was done wanted me to pick up 14,000 unreported tip income, i suppose to qualify for loan did not feel comfortable about this. suggested he talk to employer about tip reporting and i passed is how i handed it reasonable

For the next few days, you can tell them it's frozen in place... stay warm, friends in the central states!

LOL! Thank you, I will treasure this as long as I can keep thinking. After that I won't know what it is.

See? This is why I always print everything to PDF first.

I agree. I can efile the federal and when GA has posted the changes, I can send the state as un-linked. I might do that. I'm going to check with TW and see how long I have to send the state after the fed has been ack'd.

I am in the opposite boat as you. My practice has not been big enough to support my family so I work full time and have the practice on the side. Now that my kids are graduated from college and off on their own and working their careers, I am hoping I can build it big enough, soon enough, so that I can "retire" to just doing tax work. That is what I love doing. Tom Modesto, CA

The rental safe harbor is just that...a SAFE HARBOR. facts & circumstances can also make rentals qualify for the 199A deduction. Just like 3 years of losses does not automatically make a business a hobby. You have to look at things like profit motive, experience of the owner, etc. Not to mention that case law is on the side of trade or business designation. As someone on another board put it, “when was the last time you put the sale of a rental on Sch. D?”

Thanks. I herewith award you this accolade: https://www.nga.gov/collection/art-object-page.1005.html

According to the IRS, in 2017, 53,395,000 were efiled by individuals, since Turbo tax is the leader, I will say AT LEAST 35 million returns were efiled using turbo tax. So technically we lost 35 millions tax payers to Turbo tax and let's be generous and say that we corrected 1 million returns for the people that got letters, do the math and tell me if Turbo tax is not a threat.

But you can use 3- 5- and 7-year assets that are fully depreciated for 10 years from the date of acquisition. Those of us who like to clean up our asset lists from time to time will wish we hadn't.

If you get an error that some component needs to be updated, go to Support, Customer Service Utilities, Refresh App Configurations. I never knew/needed this, but it just showed up in a topic on the official forum.

FYI - form 4137 is used by the employee for unreported tip income.

DITTO!!

One reason why I *do* print to pdf. My printers never seem to meet the form requirements from Drake for font something or other. But if I print to pdf first, then all is well.

ahhh. that's it.. i knew something but had a fog.. the tax credit for 2018 it sounds like.. thank you.

For the following discussion, I assume that the taxpayer remains a U.S. citizen while she is a Canadian citizen. To be able to take the foreign earned exclusion on Form 2555, the taxpayer must meet either a (1) bona fide resident test, or (2) physical presence test. Under the bona fide resident test, the US taxpayer must be a bona fide resident of Canada for a full calendar year. She can apply first in 2019, and if she does, her bona fide residency period can extend back into 2018. If you need a full 2019 to qualify, you can request special extensions to file the return by January 31, 2020. Under the physical presence test, the US taxpayer must be outside the US for 330 days out of a 365-day period. If she is in Canada not returning at all to the US, you can probably find such a period beginning in July 2018. You would need to extend her return until after the qualifying 365-day period ends in 2019. If the taxpayer doesn't meet the qualifications for income exclusions, she can claim tax credits on her US return for Canadian taxes paid.

From Publication 970, Can You Claim the Deduction? Generally, you can claim the deduction if all of the following requirements are met. Your filing status is any filing status except married filing separately. No one else is claiming an exemption for you on his or her tax return. You are legally obligated to pay interest on a qualified student loan. You paid interest on a qualified student loan. I think your response is right if the student is the only person legally obligated to pay the interest, but if the parent is legally required to pay, and does pay, he meets the requirements.

Tom, my practice is not very big, compared to a lot of other small practices. It's just big enough that when my husband became very ill and could not work, I was able to move it home and save a ton of expenses. I have great clients that are pretty much like family, so that makes it more enjoyable for me. I've been doing this since I was 19 when I loved every minute of my job. I still like tax work, but I really stress out about the liability of having my own practice, paying for health insurance, and would love to have more freedom the first five to six months of the year. I hope that you can grow your practice enough so that you can quit your day job.

Perhaps purchasing an existing small practice from someone who wants to retire will give you the jump you need?

Security will be an appealing reason to upgrade.

Input of the numbers is simple, but deriving the numbers is the devil in the details. Section 199A income - You have to adjust the ordinary income from the business by items on Sch K, such as charitable contributions made by the business and the Sec. 179 deduction. Section 199A W-2 wages - There are numerous methods for coming up with the number, but I think the easiest one producing the largest number is Box 5 of Form W-3. Section 199A unadjusted basis - You can't use assets older than 10 years old unless they are still being depreciated. You have to include only depreciable assets. If any assets are in the business through like-kind exchanges there are special rules, and if a partnership has increased basis through a Sec. 754 election you can't use that.

The extra reporting on the K-1 has found to be a lot simpler than I had originally imagined. There is a box for W-2 wages and a box for the unadjusted basis and boom!

Who's yo daddy?

But I do think that Pacun makes a good point. My older clients tend to value the relationship. Younger clients tend to value convenience. Younger clients are getting used to everything being self-service - order on-line, or ring up and bag your own groceries, pump your own gas, etc. As the apps and programs available get more user friendly and more cost effective, I think we will probably see our younger customers go that route. And our older customers eventually don't have to file for whatever reason. Those who are in business for themselves and need bookkeeping in addition to tax preparation will probably stay but our business model is going to change. But I also don't usually see a lot of young people at tax conferences I attend, so maybe we are a dying breed too. Or the younger crown gets all their education on line and doesn't see a benefit to the networking at conferences that I enjoy so much.

ETax...I agree wholeheartedly with your post. I've built my practice with this philosophy. With that said, there will always be a segment of my client-base who react to price. I'm not naïve to that. There comes a point where clients, when offered a much more economical or free option, will choose to make a change regardless of how good a service we provide. I'm experiencing that currently. For the longest time, my prices were no where near what they should have been. After last season, I made all my clients aware that my prices would increase 25% to 50%. I received notification from some clients who have been with me for 20 years, they will be going with someone "closer to home." I'm okay with that...I expected it. Those individuals who truly value the relationship and all that we offer will stay, for the most part. We do need to continue to be aware of the free file and other low cost options. Some base their decisions totally on that, whether its in their best interest or not.

I agree with the original posting and a few years ago, I said that if Turbo Tax would come with a pricing method that will allow users to buy only what they need, they will drive a lot of preparers out of business. Now people will only itemized if they have documents from the mortgage companies and letter from the church, they will not need us anymore. Someone said that they sell customer services not tax returns... well if you have a market of 100 million tax payers, then no problem, but if that market shrinks to about 20millions and a lot of preparers are "selling services", you do the math. Time is changing and changing quickly. Between HR Block, Turbo tax, and other factors, our market is dissipating and whoever thinks otherwise... you will be thinking similar to what companies thought of Amazon. When Amazon started, most business said, "we don't sell goods, we sell customer services and human interaction"... today they are out of business.

I changed the title of the pinned post for QBI and I'm putting a link to this topic for future ease of finding. Hope this works for everyone, or if not, let me know.

wi is by county but many counties are not online yet.. and some sites are a misery to navigate!