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Excellent advice. I assume you already agreed on a price for the business based on percentage of invoices of retained clients. In that case, your question is how much should you be paid as an employee of the new owner. Do you really want to be paid on commission? That tactic is used by HRB and others to ensure that employees actually work instead of play on their phones all day. You are a professional and unlikely to do that, so you either need an hourly rate or salary. With your credentials and experience, and being in VA Beach, I would think $40+ an hour. I think commission-based pay can be detrimental in the tax business. People will decline to do returns they know will require research, or slack on the research. They may cut off clients who need help with say W4s or an IRS notice. No one is going to want to do an amendment on a return a former employee of the company messed up. Face it, a lot of what we do as a service to our clients is unpaid but is excellent client service, which is what keeps them coming back. On the other hand, if I was paid on commission I would never take another phone call about the stimulus payment or advance CTC!

Yesterday I decided to learn more about the new CTC, advance, repayment etc. I ended up more confused than when I began. The advance phases out after AGI of $150k MSJ, $112k HOH, and &75k all others. The phase out is $50 for every $1k over. I didn't do the math to see where it ends. The normal $2k credit begins to phase out at $400k MFS and $200k everyone else. Repayment has a couple of safe harbors but I couldn't figure out how they intertwine--something like no repayment for AGI $120k, $100k, $80k, and full forgiveness up to $2k if IRS claimed the advance on too many kids for AGIs less than $60k, $50k, $40k. I might have the above all mixed up, but notice how every calculation has a different AGI starting/ending point? Who came up with this confusing/complex/no rhyme or reason perplexity??? I think we're all going to have to do something we hate to do--blindly rely on the software. Or maybe we should all demand that any politician who wants our vote have to submit the answer to the CTC for, say, a couple with three kids making $190k, and show proof of work done by hand!

Lock the doors when all of Congress is in session, and do not allow anyone to leave until all of them have prepared their own tax returns by hand. And, maybe, wait until the IRS processes them, too!

Well, it is looking like I will be selling my business and working with the new buyer for as long as I want, at least 3 years! So, y'all won't be rid of me yet! I feel really good about this. Y'all know how stressed out I was last tax season, and I need to get this office out of my small house. I do have a question though. I'm in Va Beach. How much should I expect to be paid while I'm working for the new owners? I have no idea! Thoughts?

Congrats! You are worth a Million Bucks in my book! Seriously, don't sell yourself short, you are worth a ton to keep those clients coming back to the new owner. And keep the sale transaction separate from your work. How much they pay you for the book of business is one thing, and your services as an employee are another. Don't let them muddle the water. FYI, I pay my employee/Spouse 50% of the billing fee on all returns/bookkeeping she does. But she does other office work for me (scheduling, postal trips, office supplies, etc) so I may be high. I started her at 30% when we first started working together (I stole her from HRB) and I have increased it to where it is now over the years. If I were to start someone new, I think I would offer somewhere around 30-35% of the invoice, with the option to increase or bonus depending on the volume produced by the employee. Tom Sparks, NV

One way of doing it is as a commission based employee is 30 % of the tax return billing fee.

I always felt that membership on the Ways and Means Committee of the House of Representatives should be conditioned on passing the EA exam. Tom Sparks, NV

I am envious. I would love to be able to work for someone else doing just taxes from late January through April, and then leave the bookkeeping and payroll issues to someone else the rest of the year. Congratulations, Possi!

Congratulations! I hope the arrangement you settle on works well for you.

I think the essence of the deal is that Mom sold property to son for $170K. The fact that it was not completed until the sale was closed by son not withstanding. That is her transaction, basis being whatever it was in her hands to get to gain. Son Sold his property and the property acquired from mom for 610K. His basis is the DoD value + the 170K he paid mom for the other property. The proximity of the gift, the sale, and the written agreement bring me to this conclusion. Tom Sparks, NV

Congratulations, enjoy your new stress free job.

Good luck with your future endeavors Possi, and get all the THAT YOU CAN GET. You're A Pro.....

SNAFU straight ahead.

And so it begins. Client called and wondered why she got $500 deposited to her account for "CTC." Filing status is single. She has no children. We will never be able to un-screw this lightbulb.

C'mon Tom. It's the gub'ment. You know nothing can go wrong.

From the kiddie campfire song: "The nearest branch was ten feet up; I'd have to jump and trust my luck... I missed that branch away up there... Now don't you fret; now don't you frown - I caught that branch, on my way DOWN!"

You make a great point. Personally there's no way I'd stand that close to a mother bear and her cubs. If one of the cubs begins to make its way in their direction, the mother bear may spring into action in an instant. Then you'll hear someone screaming "You can't outrun that BEAR!" And the response will be "I'm just trying to outrun YOU!"

That's really something. The mother bear is so accustomed to human exposure to fear no harm from humans to her cubs otherwise all those hefty critters to the right would have been heading for the hills.

Oh, I can't bear to think of what direction these comments may take.

They probably needed to take a paws from the heat and cool off.

I did a look-back, and she was the primary TP on the 2019 MFJ return with HIS 2 children on the return. We filed the 2020 return on MARCH 7th, 2021. It looks like the IRS based the CTC on the 2019 return and not the 2020 return. How many times will this happen across the nation?PLUS, on the 2021 return, he will most surely be able to claim the entire CTC because HE (likely) never received an advanced payment. I still need to check with him.

My first thought is someone with a dependent used the same account for direct deposit. Maybe a grown child or ex. Ok, no, that thought was way down the line. Let's be honest here.

I would be wary of scams where a deposit is made (which later turns out to be fake and is cancelled), and the person is called, told it was a mistake, and is asked to return the money via wire transfer or gift cards.

She can't "opt out" because when she went to the web site, she "doesn't qualify for child tax credit." I'm not even making this up.

My guess is that it'll be reconciled on her 2021 income tax return in 2022, a lot like the RRC worksheet but NOT keeping the excess. Tell her to opt out. Or buy a nine-month CD to hold the funds until next spring.

I told her to keep the money, but to expect to pay it back.... in 2025 when they catch on. LOL

One interesting possibility might be to conjecture whether IRS will "forgive" excessive CTC payments which were not justified.