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Just venting. Got off the phone after an *hour* talking with (at?) a client. Why do people spend the first fifteen minutes of a call meandering their way from one half-formed thought to the next? And the next forty-five minutes asking the same questions a dozen times but never listening to your answer? Plus drag in all manner of unrelated, stupid, items into the middle of it all, for extra self-confusion? I had a cup of tea and a piece of chocolate, and put on some soothing classical instrumental music, so I am slowly calming down. But I really, really, really wanted to dope-slap this woman all the way down to Rita's and leave her there for hugs. I'll calm down the rest of the way before I bill for the time because right now I'm thinking that $1,000 for the torture of the past hour is too low a price.

"The Internal Revenue Service is inundated with the volume of returns yet to be processed and phone calls for assistance, and is working hard to remedy the situation. While there are many factors contributing to this, it is overwhelming to the agency, according to Stephen Mankowski, tax chair of the National Conference of CPA Practitioners, who attended a recent IRS meeting for stakeholders. “The National Taxpayer Advocate reported they are working to remedy this in multiple ways. The level of service is at its lowest historically, with more calls coming in daily than ever,” he said. “Hiring and training take time. The automated callback program has been successful, but the number of people in the queue is limited to the number of assistants available,” he said. “The number of calls coming in, particularly regarding the Child Tax Credit, are exacerbating the problem.” “Paper returns have piled up — there are 5.5 million Form 1040s and over 4 million business returns that have been opened but not processed. The goal is that by year-end, the paper returns will be processed. However, there are an additional 4 million returns anticipated by mid-October,” he said. National Taxpayer Advocate Erin Collins is empathetic, Mankowski commented. “She truly feels our pain. She understands the taxpayer issues that exist, and the problems getting through to the IRS. She’s dealing with a lot of calls from practitioners and taxpayers trying to get resolution on issues. It’s just a matter of not having enough bodies to do the work." It will be a miracle if the IRS can get anywhere near normal operations this coming tax season

Got three emails today from one I hoped was gone. First one "No wonder I put this off. I didn't make anything! Oh, I did get a $17,000 PPP loan that was forgiven..." Second one: "Here are ten screenshots of my closing documents where I bought a house." Third one: Also, I think I get to claim Buffy for 2020. Yeah, no.

So I am glad that you had the soothing remedies of chocolate, tea and music but, yeah, sometimes that isn't enough. Those adventures haven't happened to me often but they do try one's patience. When that happens, I do remember that I am billing time. One client this past spring was shocked! shocked! at my invoice but I pointed out the umpteen calls he made about so many things many of which he could have researched himself. This is a higher 6 figure IT person, too. I'm not sure he will be returning - don't care. My current thorn is waiting for the neurosurgeon (yes, that one) to deign to reply to my emails, calls or even the return to review in Verifyle. I can't make the horse drink the water. Oh well, maybe she won't come back either so less work for next season and inching ever closer to calling it in.

I remember years ago when my wife was a Girl Scout Leader ( we had 3 daughters ), she was calling a girl's mother to ask her to help with something. All of a sudden right in the middle of the phone call, the mother yells , "Dog Fight" and hangs up!

The K-1 would show the s.e. income before the sec 179 deduction. The netting will occur on the individual return because there are limitations at the individual level that must take place to determine whether or not all of the sec 179 from that particular entity will be allowed or not.

I didn't throw any out. However, they look just like all the offers I get for credit cards, for AARP and other memberships, and for so much junk mail that includes a plastic card. I'm not surprised that people tossed them out thinking they were junk mail.

This is overkill. When a business is audited, the first thing asked for is bank account statements, so that info is available when there is "need to know." If they actually looked at just about all bank accounts, there would be so much data it would be impossible to mine anyway. As for hiring more employees, we all know how badly the IRS needs them to conduct audits, answer the phone, open correspondence. We never thought about the people who do those things until this year when there aren't enough workers to get them done and it's affecting us and our clients.

I've been telling people November. So far only one has raised a fuss. She sent me 30 pages for her bank statements to find her EIP1 and EIP2, not sending me any 2021 pages where EIP2 might be. And, her 1099-B is dozens of pages long; I hate to use summaries (prefer importing) but it'll be summaries if October. Is your back 40 getting crowded? I own a few acres in IL, so I could start my own land of former clients. Does it help increase the yield of corn and soy beans?

If it helps, I had one client that saved all the paperwork including one EIP that came on plastic. It seems very clear to me that it was from the U.S. government and what it was for. From some of what I blacked out though, I believe this client received this in June 2020, so maybe there was more awareness that payments were being made on plastic by then whereas recipients earlier on may not have realized that.

We also know that the IRS will look at bank-to-bank transfers (such as from operating account to payroll account) as "income" going to the second account. So they will wildly overestimate the income for anyone who transfers their own money from one account to another. Those who put money into money market accounts to earn a bit of interest until it's needed will have to "prove" to the IRS (who won't have the personnel to process the proofs submitted) that the $5,000 was not income to their checking account, but savings transferred to pay for the end of year mortgage, utilities, plus Christmas gifts. It's a nightmare waiting to happen. The only good to come from it would be if trying to process all that data melts the processors on all the IRS computers, and they go back to the Stone Age for a decade.

@Eric - whatever happened to our wonderful little emoji of banging a head against a brick wall? That would be the *perfect* response to this post!

I could see myself as a regular customer at the cool coffee shop, just talking with anybody and everybody about whatever comes up. But not working. Ha.

I have a client that calls all year but she always adds $100 to my invoice because she knows she can be a pest. But this year or the last month is different, her college son has been day trading, big time and early on she has been telling me the kid is awesome, making tens of thousands of dollars. First thing I told her was to remind him to watch his wash sales. Didn’t listen and after 176M of sales and over 2M in wash sales he has 326K in gains. But only 50K in the account. She wants to strangle the kid and worst part she’s trying to hide it from the father. Can’t wait to see how this turns out on 10/15.

The EIP1 and EIP2 letters were sporadic at best. But, the IRS has said they'll send a letter. CNBC described it as... Finally, the IRS will send Letter 6419 in January 2022 detailing the total amount of advance CTC payments that were sent to each household during 2021. It's encouraging recipients to hold on to that letter in case they need it when they file their 2021 taxes next year. Jul 16, 2021

The question is really twofold: legal, and tax. Was it part of a QDRO in the divorce agreement? Is there anything in that agreement that states "husband will sell property X and give half of proceeds to wife" and then is there anything like "after provision is made for payment of taxes"? If he is to pay all the tax, then she should get her portion after the tax amount is paid, and it would be part of the property settlement and not taxable income to her (since he took it all, and paid tax on it all). If there is no provision for him to pay the tax, then she gets her portion on a 1099 as nominee, and she reports half the sale and gets half the basis (as of date of divorce; should have been listed there with a value) and pays tax for herself on the then-taxable gain (if any) but not on the part that is basis (i.e., her property) under the divorce agreement. Hope that it at least as clear as mud.

My messy, hard, voluminous, international, dead, and anxious clients are left. And, our own with two SE spouses, IL, CT, IRS, etc. Thank you all for sharing your knowledge. I second Donna: please stop in each day through the 15th.

D I continue to be astounded by the variety of clients that you have and the unusual issues that arise I am so thankful for the clients I have.

No, no; I'm not tryin' to proselytize you or hand out Witness phamplets; I saw a Help Wanted KFC sign yesterday which may appeal to those of us who are sick/tired/fed up (I'm in there somewhere) translating taxes for the terminally obtuse. It offers $15-20 an hour (possible manager training for those who can tell the difference between Original and Extra Crispy), 401-K, full health insurance + dental & vision, two weeks paid vacation, and fast-tracking for the skilled employee (if only I'd played basketball instead of majoring in business; accurate burger-flipping is probably a plus). Yes, yes, it's cheap pay, but think of the enticing attraction - soothing that wrung-out, worn-out brain of yours with a desperately needed island-class rest. The only thing you must really know is not PPP ins-and-outs, back-door Roths, or tracking CTC advances, but merely this (50% errors are tolerated): "Did that guy say with cheese or without?"

Gail, did your client's debit card perhaps get stolen and used by a thief? Anyone get one and know how they get activated? Is it easy for someone else to do? And how did IRS decide who gets a debit card? I have one client who got the 3 stimuli payments all three ways--direct deposit, check, and dr card. I find it hard to believe that so many people just threw them out. When an envelope contains a plastic card, you can feel it. When you get a credit card the month your old one expires, it too comes in a nondescript envelope. Do people throw those out too?

Put the foreign wages on the FECWK! You don’t need to paper file

Many pieces of history out there for those who are interested. My current curiosity is how Dawes freedmen will or won't be accepted by the tribes. The government classified many on the freedmen rolls incorrectly, but it seems like the tribes are considering following the Cherokee lead. I find it fascinating because tribal membership (via BIA) is based on degree of Indian blood, which is based on flawed Dawes listings, rather than who the tribe accepts as members. Also fascinating as the federal government has been asked to set rules for sovereign nations... via monetary pressure.

The Wall Street Journals position on this proposal: OPINION REVIEW & OUTLOOK The IRS Wants to Look at Your Bank Account Its quest for missing revenue would threaten taxpayer privacy. By The Editorial Board Oct. 4, 2021 6:43 pm ET On your next trip to the ATM, imagine that Uncle Sam is looking over your shoulder. As if your annual tax filing wasn’t invasive enough, the Biden Administration would like a look at your checking account. Charles Rettig, commissioner of the Internal Revenue Service, wants banks to report annual cash flows for ordinary account holders. Treasury Secretary Janet Yellen is promoting the plan, and the House Ways and Means Committee is debating whether to include this mandate in the Democrats’ $3.5 trillion spending bill. Ms. Yellen says the reporting will help to catch wealthy tax dodgers. In a recent letter to the committee she said the plan would reveal “opaque income streams that disproportionately accrue to the top.” Treasury and congressional Democrats hope taxpayers will report income more accurately if they know the feds have their account information. Yet the IRS plans to review every account above a $600 balance, or with more than $600 of transactions in a year. So every American with a job could get looked over. A group of 41 industry groups recently warned congressional leaders that the plan “is not remotely targeted” to detect major tax avoidance. It’s also a privacy breach waiting to happen. Not long ago the confidential tax records of Jeff Bezos, Mike Bloomberg and other wealthy Americans were exposed by ProPublica. Whoever leaked or hacked those records committed a crime, but the IRS has revealed nothing from its promised investigation. Adding bank account info to the IRS trove would risk the disclosure of savings and spending information of political adversaries in the same way. Twenty-three state treasurers and auditors signed a letter last month opposing the plan, calling it “one of the largest infringements of data privacy in our nation’s history.” Nebraska Treasurer John Murante says his state won’t comply if the reporting rule takes effect. Casting a wide net over personal finances is a longstanding aim for Democrats and the political left. President Obama in 2009 formed a panel to discuss closing the “tax gap,” arguing that widespread underreporting of income costs the government hundreds of billions a year. The House continues to debate the bank account proposal, but the spending bill already includes $80 billion for the IRS to hire thousands of new staffers. Treasury estimates that these changes would collect $700 billion in revenue over the coming decade. But Rep. Kevin Brady, the top Republican on Ways and Means, points out that the tax gap is murkier than Democrats admit. “The IRS will admit their data is seven years old,” Mr. Brady told CNBC in July, noting that the agency’s estimates don’t account for the 2017 federal tax reform that limited many loopholes. “What they’re saying is give us a ton of money, let’s hire a bunch of auditors and we think this will create revenue.” Overestimating the results of greater enforcement lets the Biden Administration attach a higher revenue number to its multi-trillion-dollar spending proposal. That’s bad enough. But the bigger threat of giving the IRS access to the details of your bank account is that politicians will eventually find a way to control how you save and spend your own money. This is a bad idea that deserves to die. Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8 Appeared in the October 5, 2021, print edition as 'The IRS and Your Bank Account.'

Honey chile, some of us have been unbalanced from the start!

A short year can also be a powerful planning tool on the front end, especially in a complex estate that will be open for awhile. For example, say there was no activity in the estate until the $15,000 came in July. In that case you can file a short year ending on June 30 2021. That allows the estate a full 12 months to incur expenses to offset the income until June 30 2022. The estate can also elect accrual accounting to deduct additional expenses at that point.

Hahahaha, hey, everybody! All is well! Best wishes to everybody finishing up. Remember, they need you more than you need them.

The last two tax seasons have thrown me very off balance!

Selectively asking 'how can we afford this' makes me . Also, there's a lot of overreacting on this and I suspect the reality will not be so bad. Wait until we have details and real world examples.

I vote for hide under our desks now.

Extending the use of your most-wonderful appellation from earlier, we are now in Q7 of 2020, almost to Q8. Can we all go hide under our desks now, and stay there till this is all over? Please?

That's great! The great-er news is that I sold my business and finally grew up to be an employee! So thankful to have the responsibility off my back, and excited to help the next one build her business. I'll work for a few more years, just because.