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Y'know, sometimes the instructions HIDE the information until AFTER you ask. I think it's to keep us humble, or something.

Thank you. I did this, and even restarted the software. The box is unchecked, but it is still flashing the *()&*(^&*^&% triangles at me. Thank you so much for responding. It probably is a ransom request ... getting my bitcoin ready.

I'll chime in too, although a lot has already been covered. Back when the FBAR was on paper, I prepared them for clients to sign and mail in. Now that they're 100% online, once I read the possible peril to *me* I figured no one would pay me enough to make it worth the risk. What I have done, after providing the online link, has been to review the preliminary (basically the paper/pdf version people fill in to be ready) and made sure boxes were checked, etc. Yes, much of the same info is needed for the 8938 - and part of the reason I "review" the FBAR form is to make sure I have all the required 8938 information (if any). As far as the "weird pension" goes, boy there is so much there. Tax treaty needs to be read, first off. Many pensions are like social security here, or defined benefit plans here, where there is no reporting requirement for FBAR purposes because the person has NO control over the funds. They show up in a bank account on some schedule. But sometimes they're more like a 401k, under some level of control, and therefore reportable. That makes "weird pension" not always an issue. I'm glad it turned out well for you in this case as they were not willing to pay your fee. But in your copious free time, read the preparer liability on the FinCen site. No way, Jose; I'm never going there.

Very clear, thanks. I did split the distribution over 3 years. Turns out the whole fam damily had COVID. Easy qualification. She had 2 other regular 1099Rs, normal code 2 early retirement accounts. But, the $60k was code 1. Paid tax on 1/3 of the $60k, the rest will follow in the next 2 years. Zero penalty. And, I'm a hero. Who'da thunk it.

There is a difference between income and support. Gifts received are not income, but may factor into support calculations. Food stamps are not income, but they are support. Child support payments are not income, but they are support.

Ha! Same thing every year, so I finally wrote it down. Preferences>Open Return>uncheck Display Tax Research Tool Tips

Maybe it's a "Trojan". Are they asking you to send $$$ in bitcoin to the Ukraine?

Remember that the tax break is only for $100K. That means that if I took out $150K. I have a choice of paying everything in 2020 tax return which will mean that I will pay $5,000 in penalty and taxes on $150K. If I decide to take the breaks, I will have to pay taxes and penalty on $50K (no break for this portion of the distribution). Then I will have to deal with the other $100K that do get a break. I will elect to pay taxes on the next three years and possible to put back the money so the tax liability dissipates. If I decide to put back $33,667.00 before April 15, 2021, my 2020 filing will reflect only penalty and taxes on the $50K. If I don't put back any money after those $33,667.00 mentioned above, but on April 10, 2023, I put back $66,333.00, I will pay no taxes on the distribution on my 2022 return AND I will have to amend my 2021 so I get back the taxes I paid. I love to say comprende compadre? Let me know if I am wrong. I think I will be the first tax preparer proven wrong but that's OK.

A novel idea is much better than a novel coronavirus! Tom Modesto, CA

A client just informed me he will not pay it back and wants to pay tax on the whole amount in 2020. So I don't think I need to wait on Form 8915E. If I mark the 5329 code 12 so there's no penalty, the regular tax will just calculate as usual.

Many states have specific guidelines for those UI fraud issues - so be sure to look those up for your state, too.

Always, always, ALWAYS report the house sale and exclude the gain. The last thing anyone needs or wants is a nastygram from the IRS, two years post-sale, demanding tens of thousands of dollars in taxes not actually owed. The younger folks just have to change their pants before they call you, screaming or in tears or both, and I frequently wonder how many heart attacks those letters have caused in the elderly.

And still, CA will stick to the minimum wage base allowed by the feds, and the feds will not raise the minimum wage base, so even without the fraud, the CA fund will be upside down again, until the PTB slip some funds out of the general budget to cover the shortfall, probably after a few years of credit reduction. Example for one employee, no claims in ~30 years, for a recent year. 51% of the amount paid in is covering expenses caused by failed businesses, over payments, and by the fund not collecting enough from ongoing businesses. This is before the effects of the pandemic, on the state funds, will have to be accounted for. Several states considered changed for UI collection for 2021, with MN holding up their calculations until just a few days ago. CA, and most other states, just plowed forward, and are falling behind. As of a few days ago, 18 states are upside down in their UI fund (borrowing from the fed fund). The amount is over 48 billion. This amount is likely growing by the day. Employers in those states should consider planning for the first level of credit reduction of (.3%).

A client I have cashed out a qualified plan to pay off credit card debt. She had operated a small business which she was unable to do because of merchandise supply issues so it looks as if she would not need to pay the 10% penalty. Of course, she being absent minded failed to have withholding set up. Oh well. Another client drawing significant unemployment insurance did the same darn thing. "They were supposed to have taken out federal tax". He never checked to insure they did. I can see not a few long faces this season.

Knowing I'm reluctant to file the FinCEN form, I skimmed through their 2019 return, just looking at the forms, to see if I could meet the price they wanted to pay. No way! He earns over $400,000, so things like NII and phaseout of QBID come into play, CT and NY returns, FL condo rental w/missing depreciation schedule, FIVE partnerships such as oil & gas/passive loss carryovers and restaurants in NJ, huge mortgage interest so may be some refinances with non-buy/build/renovate uses, many interest/dividend accounts plus stocks, and lots of other forms/schedules. And, she'll start drawing her UK "some strange kind of pension" next year. I gave her my price range, which is well over what they want to pay, and told her I will not file the FinCEN, mostly because it's feeling like these would be problem clients after all her emails. She was nice enough to call me this morning to thank me for looking over their returns and is picking up her 2019 folder shortly. Thank you, everyone, for your thoughts and experiences with FBAR.

In my annual cover letter with the engagement letter, I include a full paragraph U.S. citizens and residents have an obligation to disclose a financial interest in any foreign bank accounts. Title 31, Section 103.24 of the Code of Federal Regulations (“CFR”), 31 CFT 103.24, applies to any person or entity subject to the jurisdiction of the U.S., having a financial interest in, or signature authority over, a bank, securities or other financial account having a value exceeding $10,000 (at any time) in a foreign country. The Foreign Bank Account Reporting (FBAR) is now done with FinCEN Report 114, Report of Foreign Bank and Financial Accounts and is only available online through the Bank Secrecy Act E-Filing website, (http://bsaefiling.fincen.treas.gov/main.html). Please see this website for full details. NOTE: This is now due April 15. There are substantial civil and criminal penalties prescribed for failure to file. The civil penalty can be as much as $10,000, regardless of whether the violation is willful. Criminal penalties are much more severe. Please consider the dollar value of any foreign accounts carefully. Please call with questions. I do not and will not prepare myself. All the information the client needs is, I think, shown here. It's enough for me to manage the usual things!

The 1040 SR is a regular tax return only the print is larger. It is only available if you are over 65, I believe. I don't use ATX so I am not sure how it works in that program, but in my software there is a box on the info page to check if you want the return to print out in the 1040-SR format.

Randall, You have the opportunity of tax planning even if the clients say they want to pay in 2020, you might want to see if they will make more or... less money in the future. Paying $6K now in taxes is not as good as paying $3K or less in a year and another $3K or less in 2 years. What if your clients put their hands on a quarter of a million dollars within the next two years...... I guess they put the money back and amend returns. Also, since you didn't mention the amount, it is not worth it if they only took out a few hundred dollars out.

On the above post.... there are three figures that are wrong but the idea stays. $33,667.00 should be $33,333.00 which is $100K\3. The same number is wrong on the next line and finally $66,333.00 should be $66,667.00. My head some times betrays me and sometimes refuses to use calculator. It is too late for me to change it, but may be an administrator can make the changes and delete this post.

Hey, I had a novel idea and READ THE INSTRUCTIONS so kindly posted above. Sorry for the dumb question!

Yes. You never know when a 1099S is out there. What Gail said. And, if they look at her return when she's 69 and disabled, will she be able to recreate the house basis? Just report it now and start the SOL. What Patrick said. Report it. Depending on your software, just one/two lines to report and claim 121. You don't have to charge her any extra if you don't want to. But report it.

My client is 66, disabled, and receiving Soc Sec. He took $12k from his IRA. So far, he's not required to file. BUT, he sold his home and he didn't yet receive his second stimulus payment. So, I was going to file so that the 1099S won't come back on me, and to claim the stimulus. Should I?

I also believe it starts the clock for the statute of limitations in case there are issues down the road. Leave it off and the return is not complete so no running clock.

When I skimmed over your post, I first thought $400 was what they wanted to pay. But then I thought, "sounds like $400 should be a reasonable fee for looking over that return (before declining)".

I'd like no extensions forms, automatic extensions like FBAR. Maybe a 15 July payment deadline or no penalties/interest only to 15 October or some other reduction of P&I later than 15 April. I hate breaking my stride to stop to prepare/e-file extensions.

Agree with those above. 5 minutes of your time in reporting it can save many headaches of having to deal with the IRS down the road.

I have had many clients tell me they did not receive a 1099S but when I ask for the closing packet, lo and behold! there is the 1099S. I had an interesting one this week where the homeowner was deceased, and the mother was the sole heir (no will.) The 1099s was made out to mom, sole heir of son's estate and did not show any tax identification number! I had to call the title company to see whose tax id they actually reported this in - mom or the estate.

I agree and report it, claiming the exemption. A client signs a lot of paperwork during their closing and might not know they received Form 1099-S in their packet, or it might be mailed to their old address. It takes almost no time to report it and exclude it; but it takes a lot of time to answer the IRS letter, calm your client, and even figure out what happened in the past.

I have always reported it then claimed the exemption to ensure that my client doesn't get a letter, which I would have discuss with the client and respond to the letter.

You have to report it if they received a 1099S, but code it on the Sch D to claim the exemption.

As a general rule I rarely raise my fees but this year is going to have to be different. All this folderol about the EIP, the second EIP and, of course, the clients don't have the reporting forms and have NO CLUE about the amounts received. This along with the AGAIN delayed filing deadline (like last year) and these sticky Covid restrictions. Yes the fees got to go UP.

Given all we are dealing with this tax season, I think you have to raise fees to justify all the extra time spent on each return. This tax season will be unlike any other.

If they requested an EIN from the IRS, the IRS will be expecting a tax return for each year until they are notified the EIN is no longer in use. File a 1041 for each year with $0 in income.

I'm adding a line item for The CARES Act and another line for the Consolidated Appropriations Act. How much I put on those lines will depend on how much time I spend on that client's questions, issues, etc., and whether or not they asked questions BEFORE they did things like take money out of their IRA. Yes, this is my way of increasing my total fee for almost every client.

That's why I state to call with questions. The first and only one I did was with a German client sitting with me. I typed in the information for him but it was his account and he had all the numbers. He was about 80 and not so great on the computer at the time. All the others now are all quite computer literate and are all professors of something. They can manage. Most of my other clients, yeah, could not, but they also do not have foreign accounts so no worries.

Yeah, I heard the scream of Liability as soon as I received her email. I have about three clients that I remind and check up on their FBAR requirements, but all file themselves. In fact, one decided that their Singapore bank account wasn't needed with their US TDBank account with online bill paying and a credit card, so she closed it years ago and filed her last FBAR the following year. I have enough to do to keep up with the IRS/Congress enacting tax laws. And, I do take CE in international issues, previously scheduled a webinar for next week re FBARS because I do have to advise my clients. Thank you, everyone, for sharing your thoughts. I'm leaning toward declining this client.

There really isn't any liability... until there is.

Not touching the FBAR and do as Lynn and John described above.

I never touch FBAR. Too much liability at stake. I document that I advised them of the filing requirement & penalties and leave it at that. If someone tried to insist that I file it, I would view that as a deal breaker.

When the TDF form was filed It was a mixed bag. That changed when the FBAR filing is allowed only on the FINCEN site . I provide general FBAR filing requirements but do not want the liability of doing so. My 3 individual clients with foreign assets all file their own FBAR and provide a copy to me. The FBAR for a US trust is filed by the trustee, who also provides a copy to me.

The IRS letter is easily satisfied with a letter stating the trust had no income in the years cited. I've had the same letter come when a person died demanding 1041s for six years. In this case it was a grantor trust and reported on the individual returns for those years, satisfied by a letter and some back up docs showing income docs in the deceased's own Soc Sec number. In your case, since the interest is reported to the trust, you will have to file the 1041 with just the statement pushing the income to the surviving spouse. While you're into the situation, document the step-up basis of that real estate for future transactions. If it's jointly owned, half of it gets step up.