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TerryD, tell the client to call the IRS himself! Give him the date the original was filed and the amendment, and tell him to ask why he is still getting bills. Then he can have it from the horse's mouth. More often than not, I have the clients call instead of me when it's not a complex notice because I do not have the time to wait on hold for half the day. I have a hunch, though, that maybe your client can't quite substantiate that extra deduction and fears it might be rejected. Why else would he be looking for an excuse to blame you? Warn him that IRS doesn't have to accept amendments, but you won't know if they do or don't until they process the return.

You could also just use the typewriter function within Adobe Acrobat too.

I am surprised at guts of this pro bono client. Have this client call IRS directly & find out more details.

Better version Tax Office Cyber Security Plan-Fillable.pdf

Okay, I love the discussion on this. To address what Catherine has said, yes I reviewed the conversions from the IRS with the client via telephone. I offered a brief written summary as JohnH suggested. The client said there was no need. After an hour or so had gone by, the client then asked for not only the summary but wanted me to add to the summary that I ask their tax preparer advised them to ignore communications from the IRS regarding this case. That I never did and only repeated what the IRS agent stated. That is what has raised the suspicion on my part. Also, that gave me the rear tire feeling from the bus. Now, after all of this, I am considering again what JohnH suggested to give the summary without anything that indicates any input from me. Maybe that will satisfy the client.

Yes, but. If you actually try a meeting you'll get a pop-up offering to double the time. But I went for the paid version anyway; my online classes go two hours.

FIRE HIM ASAP. Your professionalism is worth much more that the freeloader.

The key here is proper allocation of the contributed goodwill. If that has been done then gain will properly flow from from the basis of partnership capital accounts upon sale/liquidation of the partnership, or sale of the contributed asset. There is no special tax rule for contributed goodwill, it is treated like any other 704(c) property which the amortization or depreciation is allocated to the partners under reg 1.704-3(b) in respect to a Built in Gain. The allocation is made to prevent disparity between the book and tax capital accounts of the non-contributing partner as well as to prevent shifting of tax attributes among partners. Basically, the contributing partner recognizes the built in gain over the remaining life of the asset through a reduction in the amount of amortization or depreciation allocated to him. Here is a basic example where A and B form a 50/50 partnership. A contributes goodwill with fmv of 10,000 and basis of 5,000 = BIG of 5,000. B contributes 10,000 in cash. The built in gain is reflected in the difference of A's book capital account of 10,000 and tax capital account of 5,000; while B has a 10,000 balance in both book and tax capital accounts. Now assume the contributed asset has 10 years remaining life. Therefore the book amortization is 1,000 and tax amortization is 500 for the partnership. The book amortization is allocated 50/50; therefore each partner receives 500 in book depreciation. However, under the reg, the tax amortization is allocated first to the non-contributing partner B in an amount equal to his book amortization of 500. Therefore in this case, B is allocated the entire 500 of tax amortization and A receives zero. Now look at the effect on A's capital accounts. His book capital account has been reduced from 10,000 to 9,500 by amortization while his tax account remains at 5,000 since he was not allocated any amortization for tax purposes. So now the amount of BIG reflected in the difference between A's book and tax capital account has been reduced to $4,500. If you fast forward the calculations to 5 years his BIG will be reduced in half to 2,500 and at the end of the ten year life of the asset, he will have recognized 100% of the BIG through his reduced allocation of amortization. While that was a simple example it can get a lot more complicated and additional rules kick in. For example there might be not be enough income to cover partner B's amortization; or there might not be enough tax amortization to cover B's book depreciation. Those situations are covered in the reg. Now in answer to your question, when the partnership is sold, any remaining BIG will be recognized by the contributing partner as a difference in book/tax capital accounts; provided amortization or depreciation has been properly allocated. If not you have "BIG" PROBLEMS to resolve. That is the correct answer!

This looks like it may be a good place to start. It gives 4 different scenarios with bookkeeping entries. Your case is simpler as there are only 2, not 3 persons involved. https://www.yourarticlelibrary.com/accounting/partnership-account/admission-of-a-partner-goodwill-revaluation-and-other-calculations/54425

I used Kofax (formerly Nuance) to make the Drake form fillable. Unfortunately it skipped some areas and one page entirely, so I had to create some fields by hand, and they look a little rougher than the fields created automatically. When enter the business name on page 1, it will link to all the other business name fields on the Acceptable Use Policy page. You might have to abbreviate the name for it to fit and be readable on the Acceptable Use Policy page. Let me know if you find any bugs or changes you'd like to see. Enjoy! Tax Office Cyber Security Plan-Fillable.pdf

I liked @Margaret CPA in OH's for the retirement comment, but @Possi made me laugh out loud.

Gee, I wonder when the IRS might impose this upon themselves. The 12th of Never. No kidding, retirement is looking better and better.

I use the form from AICPA slightly modified for my practice as a sole practitioner. I believe it largely mimics the one from IRS in Pub 4557. It's hard as so much really doesn't seem to apply to the likes of me with a home office and no employees. But my IT guy builds my system and internet protection (don't use wifi for the business computer) and works for several other small to medium sized local accounting and tax firms. I also carry the additional network protection insurance through AICPA and have covered all their requirements. Retirement looks better every single year!

Thanks for the heads-up. I will get it installed later this afternoon.

Update: I have been using zoom as a teacher since last spring. I did speak with a zoom rep today and asked about the security or encryption for both video and audio. They stated they are very secure with both items and each it encrypted. My concern was using the screen share and who could hack into it. I have also used Webex. Webex, does have some glitches. When I use Webex on one of my machines which is a Win10 Pro with all of the latest updates, Webex knocks out the audio and all of the audio settings get changed and I have to reset them. So, I'm now thinking that zoom maybe the better way to go. Zoom has a free platform that still has the same encryptions as the paid version. The only difference is number of hosts allowed and meeting length. The free version is 40 minutes and the paid subscription is 24 hours. Hopefully, this will be a good way to meet with clients during this pandemic and very well may entice new business.

Now, I have been assuming that @Terry D actually DID provide that information to the client, at the time of the calls. Perhaps not in that specific detail, or in that detail but by phone instead of email. (I frequently email a client telling them that I spoke with the IRS today, and they said X, and leave off the agent's name and number.) It was the wanting copies of the specific notes to "prove" the contact and the recommendations that set off my warning bells. If someone just needs reassurance, that's one thing. But when they are asking me to "prove to them" that I contacted the IRS that's different. For the first, I'll refer them to the original email, or review my original call with them. I'll reiterate the backlog and maybe even send a link to a press release talking about letters going out in error. But as soon as a client wants me to put in writing something that "proves" I did something for them, my radar goes off like tin foil in a microwave.

Yes, but you could not efile 2019 amended returns until August. I wish I knew in May they would be getting this efiling available soon. Back in May, paper filing the amended returns was the only way. I think the Covid situation brought this on faster. At least going forward, we'll have efiling for amended returns.

You would think by now, some one at the IRS would've figured this out and had software companies insert a "Resubmission of a paper filing" check box to avoid any confusion.

I am kinda on the other side of this. If the client wants to know when and who you talked to at the IRS, just tell them. By acting like you have something to hide, you fuel their concerns. I would "dummy down" the notes if they are very detailed. Change to something like "Spoke to Mr. West ID#1000XXXXX on xx/xx/2020 concerning client 1040X. Mr. West confirmed that IRS is still in backlog and that interest and penalties will clear up when 1040X processed". And that is the truth, so why not put it in writing. What is he going to do, sue you? Wait till he sees the backlog at the courts because of Covid. He will get his refund, and the next 3 or 4 refunds, long before he gets a hearing. Sometimes, people just don't trust anybody and they are looking for a reason to be upset, especially now. If you give him the notes, or the summary version of the notes, the problem goes away. My humble opinion. Your practice, your decision on how to proceed. Tom Modesto, CA