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You have to smile when you hear these types of responses from "professionals". When was the last time the IRS randomly accessed an individuals account electronically just because?? I think that preparers approach is a disservice to his clients. Processing returns electronically is more efficient and I believe more secure as well. I would never inform a client they should not efile, I actually encourage it and it's been quite a while since I prepared a paper return. There isn't much you can do to sway the opinion of some people, you just have to grin and move on.

I'd question whether the reason for the paper file is because they are using non-professional / free tax software. There is a guy who produces a free excel spreadsheet tax return. I'd wonder if they aren't using something like that or Turbo Tax for individuals.

Marie's post is that the parents gave the farm to two of the three brothers, which implies that brother # 3 is not an owner. To compensate for that Brothers # 1 & # 2 are going to pay brother # 3 cash equal to 1/3 of the farm's value. Assuming that brother # 3 is not an owner then the cash paid constitutes a gift.

@Patrick Michael I searched your posts and found that you use Drake which does offer practice returns and the solutions. I logged in to its site and scrolled to the last item in the menu at left that is "Training". This has a clickable link to all the practice returns available for 2020 tax year including #12 that is for a 2-person domestic partnership. These come up as pdfs that you may download or print, and the solutions contain the correctly completed returns.

Is there something wrong with me? I just got put down for electronically filing tax returns by a client's daughter. Her tax person does not e-file and has all of his clients say that they refuse to efile so he files the 8958 (or whatever it is). His reasoning is that the IRS can get into your accounts too easily and take their money anytime that they feel like it and they know too much about you. I normally expect their neighbor,barber, etc. not a "really smart guy" that they love so much to say this crap. She just kept going on about why not mail it. I told her that I have to efile and it would be wrong of me to tell my clients not to efile, if that was my personal preference.

I just confirmed with Drake that their cutoff date is Nov. 20.

I had clients make the decision to receive a ranch as gift vs inheritance while remaining parent was still alive, even though they were well advised on the loss of step-up-basis. It was century plus operation that had been handed down from generation to generation by gift.

Been busy and haven't logged in for awhile. I appreciate all the comments. I have taken courses in partnership accounting and taxation and have a fairly good grasp on the concepts. My reason for asking for practice returns is to become familiar with the software while I have some down time before busy season. I hate wasting time looking for that illusive check box or worksheet that's needed to get the numbers to flow to the right line on the return when I have returns waiting stacked up.

There were only 2 legitimate possibilities here, if the owners received distributions in excess of basis, capital gain could be triggered, otherwise the 64k is a suspended loss. How did it ever end being reported as other income?