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What I do is duplicate the return and make all the adjustments. Makes it fairly easy not having to input all the info twice.

Gift of over 15,000. gift tax return needs to be filed. Her basis is fathers basis plus any gift tax paid. Now is the time to hunt down the fathers basis.

If can always buy some deer balls afterwards, they are under a buck.

I ended up testing for sure my bcc to myself then wrote a brief apology explaining that I was testing my email system to announce the portal and inadvertently addressed to all. No comments back except that one client really liked the portal and found it easy to use! I think it's over, lesson learned. Thanks for input, all.

We're actually seeing more returns that do better with MFS. Younger couples with student loans, where the loan repayment amount is calculated on income, for one. Filing separately the couple has a much lower annual payment required than when they file jointly. (Yes, then they'll re-pay for longer - they can always pre-pay, and for a lot of these younger couples, cash flow is the driving force.) Older couples with medical expenses higher for one person sometimes do better MFS. Luckily with Drake it really is a click of a button (and some care, later, to make sure you are opening the right returns) to split them and get a comparison - although it's not perfect, as some of the little credits, like retirement savings credit, don't calculate properly on the one-click first pass.

Lion, to get back on track. If the payments were considered reimbursement for travel expenses rather than payment for participation, then they are not taxable. If the participant in the study has a "rare" disease, then under the Ensuring Access to Clinical Trials act of 2015, they may not be taxable. I found this article that may help you to find further information: https://forteresearch.com/news/payments-to-research-subjects-what-is-taxable-income/

It's SE taxable if he does it a 2nd time.

Those messages on email have very little legal impact. The receiver didn't agree to anything so they aren't impacted by it. They do work to remind recipients a copyright may exist, that client privilege may exist and to maybe remind recipients that nothing in email should be viewed as a legal contract. They do zero to aid you in limiting liability because the recipient didn't agree to this when they opened the email. You have to force them to waive this legal right before they open it if you want to take it from them.

It's hard to feel bad for a child who is given a house, but they will have a heck of time coming up with dad's basis when they sell the house. It's best to file the gift tax return because we don't know what the estate tax laws will be when he dies, but gift tax returns can be done after he dies, if needed and there's no penalty. Papers? What papers? I don't recall any papers.

MFS doesn't work in CA for lowering student loan payments very often because it is a joint property state so you have to split the income equally.

Every MFS return I've done ended up with me getting yelled at eventually because they wanted it, didn't want to pay me and didn't consider the long term ramifications for why they were doing it. In one case the husband made a TON of money and wanted to avoid paying his student loans but when the wife found out she was P.O.ed because the loans were the excuse for why they didn't have kids. If I were a betting man I'd bet they are divorced by now.

at ILLMAS' youtube!

There is always an oddball lol:

I've never done a MFS, except for those occasional couples who keep everything separate, usually very rich, so I don't need a program to split it. Besides, I could split most returns in less than 20 minutes, and, as long as I'm getting paid for that, I'm good.

Other income, not subject to self-employment tax. They don't take oddball drugs on a regular basis hoping to make a cash profit!

Depending on your software, you can probably label everything T and S on the MFJ federal return with both states and have your software create the two MFS returns. Delete a state from each MFS return. You'll e-file the MFJ federal plus one MFS with AL only/no federal plus one MFS with PA only/no federal. Yes, three sets of returns. But, you're really only doing the work to create the first MFJ federal return with two states. Then your software is doing all the calculations to create the next two sets of returns. Follow the flow to see if you need to make any adjustments. Just make sure your lines all add up to the MFJ return, except the taxes, of course.

I don't know the university's inner workings. If it is accountable reimbursement, it is not taxable, nor does it need to be on a 1099. If not accountable, or if it is participation compensation, then if over 600 calendar, likely needs a 1099. The rare disease ruling allows up to 2k (non accountable reimbursement or participation compensation) to not be considered for things like SSI, but does not change tax liability. I have not researched this recently, but that is my memory based on another child being considered for a long term study.

I used to file my MD residents with one spouse working in DE as separate for DE, until I realized that it only changed the allocation of state taxes between MD & DE. The total state tax paid remained the same, because MD was giving full credit for all taxes paid to DE. Life is easier now because no software I ever used would handle a separate return for only one of the taxpayers on a joint federal return.

One of my kids manages trials at a university. Interesting field, and not what I would have expected. Most of the work is with new ways to use existing meds/treatments in a different way. One of the more fascinating was a blood prick test to rule "in" likely concussions. The goal was to have the test available even at youth sports level. He says most of his patients/clients are not repeat participants, as the testing is very specific with criteria. The payout, when there is any, are constructed to be expense reimbursements only.

Well, his early-onset Alzheimer's doesn't show up as a rare disease. However, wife's check was definitely for driving him back and forth to another town for the trial, and no 1099, so I think her money is not taxable. And, husband's check is for the exact same amount as wife's, so maybe also for travel time. At least I know what type of questions to ask wife and, of course, for any documents, contract, whatever paperwork they signed or received for participating in the clinical trial from which they received stipends. She is organized and keeps everything do do with money (she's self-employed and they have a partnership and two kids that work). The odd amount of $748 each suggests mileage reimbursements -- I hope! Thanx, all.

I much prefer Catherine's answer, since netting may not even change their taxable income if they take the standard deduction and probably trigger an IRS letter due to no match of the 1099s.

Abby Normal's post above shows why no program is a "one size fits all" for our practices. As well as checking for federal purposes, I check MFJ vs MFS for state purposes because I have PA residents working in DE and filing nonresident DE returns that allow the choice of joint or separate. With DE's graduated rate, the interplay with the credit back to other states, and splitting Sch A and other deductions, credits, exemptions, it's been extremely helpful to have the function built into the program that will efficiently and accurately create the split separate returns, and with my town being located right on the state line, I have a fair number of clients that are multistate where this may be of benefit.

Put it in with your medical expenses (reduce them) and then put your medical miles in. Treat it like a refund of insurance premiums. Tom Modesto, CA

Fat chance Abby. Governments do not impede other governments, in fact they can "tag team" and crush ordinary taxpayers.

Thank you for your response cbslee. You refer to "upper-end" pricing, and you are quite correct. One of the Nissans is determined by the IRS to retail at $4500 per year, when practically anyone can go in and lease this model for $300/month, tax and all. Nissan should have accounting personnel well-trained in the subject matter, and there is no real excuse if they don't. But I am finding out increasingly that Fortune 500 companies rush to hire $7.25/hr. clerks just like everyone else, especially in non-visible areas such as accounting. Nissan's own manual (see Judy's post) plainly says the taxation should rest with the amount of the discount, not the value of the lease. A few years ago, I saw a similar situation with an airline stewardess who used free flights. The flights were valued at one-day-notice first-class (most normal people ride "coach"), three-martinis, and where you tipped the flight attendant to peel you a grape. This stewardess might have been better off buying her own ticket or just staying home. My client and I are going to try - and we may not win. If not, they will simply quit leasing from Nissan. I appreciate the experience and expertise you bring to the forum.

Quack, quack. The program I use does the comparison and will split the returns. It doesn't cost a million and is less expensive than all but the most basic ATX version.

Thanks Lion, I really appreciate you posting this. I did copy both of them. While I do not practice law or financial advising, I will change that langue to reflect my business. Also, I will contact my E & O insurance to see if there is anything they would require. I hadn't thought of that until I saw you post.

Just remember how you do the allocations and the projected cost of a second return plus the time spent dividing up deductions.

To answer your specific question, the form to use when the employer has not issued a W-2, or issued one that is incorrect, is Form 4852. That being said, when and employee finds an error on his or her W-2, the first course of action should always be to go back to the payroll department to verify the amounts used in calculating the imputed amount and to ask for a corrected W-2 if needed. Before using this form so that you don't do a disservice where the client ends up with notice and assessment based on an indefensible filing, I'd suggest that you should have the actual the lease agreement and any other forms he was given at the time of the lease that may show other charges added in such as taxes, licenses, and insurance. He should have some sort of documentation that shows what was supposed to be added in to his compensation. Also, if the lease ended during the tax year, ask for any documentation that may have charged him for excess mileage.

If I found the correct Nissan document for the employee Lease Vehicle Program dated in 2012, the imputed income is supposed to take into account the amount paid and be the IRS market value less the amount paid. The way it is spelled out in the agreement is the proper handling...if that is what is really happening. Are you sure that your client is giving you the correct figures? This is on page 5 of the Nissan document: I have 2 clients similar to yours that work for Mitsubishi, and their W-2s each have lease vehicle comp also that runs around $3,500 per vehicle with one of them leasing a total of 3 cars for his family.

Those that notice, and who you do not contact to apologize, may think you did not see the error were trying to hide the error, etc. Those that did not notice will see you are a straight shooter, and own your actions no matter what. Honesty always wins long term. I would not send the apology the same way, as there is no need to repeat the same mistake. The apology email should be sent individually as the first one was meant to have been. Over the years, I have sent messages proving my human-ness, and the usual response is positive.

Thanks, Catherine. Only about 6 or so were from church. I'm pondering any next move. Another email may draw more attention to the first which may not have been received anyway - you know, lots of spam filters around. I just feel pretty stupid. Medlin, I usually ignore those things, too, and am aware that typical email is not secure. Kind of ironic that I was trying to alert clients to use a more secure method of transmitting documents. I really hate it when they send phone photos of stuff!

From handy dandy Quickfinder - If the business or rental portion of the taxpayer's home was used as a personal residence for two of the five years before the sale, the taxpayer can exclude the gain on the entire home (except for any depreciation allowed or allowable after May 6, 1997). An example provided even uses the same years as your client! So up to $250,000 less the part of the gain equal to the depreciation allowed while renting the house.