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I hope they're better than most of the other chat bots I've used. Some of them are just horrible and I end up typing curse words at them.

I see clients who received the substitute 1099-S with a stack of papers at closing, stuck the whole stack in a drawer, and are sure they never receive it. Of course, I report the sale.

IR 2022 - 56 "IRS unveils voice and chat bots to assist taxpayers with simple collection questions and tasks; provides faster service, reduced wait time" "The bots are now available to help taxpayers with: How to make One-Time Payments Answers to Frequently Asked Questions Collection Notice Clarification" It will be interesting

With a sale so close to death, the FMV at sale and death would be virtually the same, and factoring in closing cost, there is most likely a loss on the sale. Does the estate have any other assets or reason to stay open for more than a year?

Wow !! Just did a forms update, and K2 K3 dropped !!

If the initial return is not also the final return, the cap loss will stay in the estate until the final return. If there's no income being earned in the estate, I'd mark the return final, let the estate pay you and the attorneys, etc. then distribute the cash now.

In a final return, all income tax liability, even on capital gains, rests with the beneficiaries of the estate. The final Schedules K-1 will carry out all the income. Source: https://www.journalofaccountancy.com/issues/2012/may/estate-planning-20125011.html It's a good article. I never thought about choosing accrual method for an estate, but it would have come in handy a few times.

The other day I caught that ATX was allowing AOTC for a kid who was not pursing a degree or credential. I realized I had to tell ATX twice that he wasn't. I hope this helps, I know it's not exactly what you asked for - it's a post I made on the Facebook ATX Tax Software Group: "You don't check the box on the "Education Expense Input Sheet," and you then also answer Question 2 on the "Education Expenses Detail." That may be how it's been all along, and I just don't remember them needing to be for sure for sure."

Total income? MFS? Have you answer the questions where it asks you if the person is a felon?

WOW. Hijacked your own thread.

This thread is kinda amusing in a weird sort of way.

I see that a lot too, Lion. And many times the 1099S is right under the copy of the client's statement answering all the questions that would allow the title company to not prepare a 1099S.

Thanks for the link. The TIGTA report is a real eye opener. IRS did indeed destroy loads of paper filed information returns, betting that the risk of needing them in any eventual audit was minimal compared with the risks created by not doing all the other things employees had to do instead of processing this paperwork. As we all look at the piles of work towering over us right now, this report makes me feel like I have no right to complain. The overworked IRS employees are facing what we have times millions; it's a wonder they can even find their desks.

Sorry, I guess I understood your question incorrectly ;o) I don't think there is a downside. If the IRS gets a 1099S for your client, I would hope they would look at the 1040 and the schedule D before they sent out a letter....but this is the IRS. At any rate, the response letter would be pretty easy "Taxpayer did not receive the 1099S, please see details of sale related to 1099S on the attached Sch D which was part of the e-filed return." Tom Longview, TX

I don't think I've ever answered that question in ATX. If I don't get a red error, I don't mess with it.

I always ask the client to check to see if a 1099S was issued. If in doubt I will record the transaction without checking if 1099S was issued.

I was filing a late MD return with only an IRS transcript. MD asked for copies of the W2s, so to mock up a W2 to feed the bureaucracy, I had to call MD and ask THEM how much MD withholding there was on each W2. I think I just edited a PDF of the IRS transcript to add a line for MD withholding and MD processed the return. And, yes, that does sound like the basis for a Monty Python sketch.

MassDOR is famous for demanding proof of withheld tax from the Mass Teachers Retirement system. Who administers that system, sends out the payments, and withholds the taxes? If you said MassDOR, you'd be 100% correct! So they ask retired teachers to prove to MassDOR that MassDOR withheld the tax they say they withheld. One poor lady they demanded the same thing every year for about four (or five, or six) years, when I finally got a POA from her and lambasted them for harassing her. Politely, but I reamed them one. They did not ask the next year...

Me - making mountains out of mole hills in my stressed state. I deleted the K1 and re-entered. Duh. On another note- Can I strangle someone for allowing deferral of tax on IRA distributions last year..........

You pick up where you left off, BUT if the FMV of the house is now less than the original cost, you must use the lower number as basis.

This proves why DIY software can be dangerous. It takes a tax professional to know what the return is supposed to look like and catch these data entry errors. To me, the most important part of tax prep is looking at the return when it's completed to be sure everything makes sense and is where it's supposed to be. Believe me, I am not looking for new business and rarely take new clients, and I would be beyond bored if all I did was easy 1040s. (At this time of year, is there such a thing?) Lots of folks could easily do their own returns with no problems, but EIP and ACTC and premium tax credits and on and on make that less likely for many. As I've said before, at least half of the returns I do have something missing, and if software doesn't alert the DIY folks who knows what they're missing out on. Like attempting your own electrical work or plumbing, it's important to know what you don't know and turn to a pro.

I found it ! left off line 30, once that was done it worked as supposed to.

You are my hero. I spent 20 minutes trying to figure this out before I stumbled on this post. Thank you, thank you. I love this forum. Reminds me to go make my annual donation!!

You must use Part III of Form 2441. The W-2 box 10 amount should flow to line 12 and will reduce the credit to zero.

"The IRS plans to hire 10,000 new full-time workers to play a direct role in helping the agency reduce its backlog of millions of unprocessed tax returns and other mail from individual and business taxpayers, according to the leader of the union that represents most of the IRS workforce. The National Treasury Employees Union “has received notification that the IRS has been granted Direct Hire Authority for roughly 10,000 entry-level positions in submission processing and accounts management, presumably to help address concerns that the agency’s hiring process is difficult and slow,” said the union’s national president, Tony Reardon." This won't help this tax season. Hopefully, they can get the backlog reduced some by the beginning of next tax season.

I have NOT taken this instructor's classes, but for anyone frantically trying to get 1065s and 1120Ss out the door in the next 11 days... Expanded from 1 to 2 Hours. March 8, 2022 - 3PM ET Live 2-hour Webinar: Schedules K-2 and K-3 Knock 2021 Form 1065 Out of Orbit How to Prepare (or Not) K-2 and K-3 for 99% of Clients Presenter: Bradley Burnett, J.D., L.L.M. https://accountantsaccelerator.com/schedules-k2-k3-cpe-course/ NASBA Sandra L. Leyva, Inc. is registered with the National Association of the State Boards of Accountancy (NASBA) as a sponsor of continuing education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Our NASBA sponsor number is 112525.

Taxable SS at 25K/32K have been that way my entire career. And I've been at this since '88. And just to stay "on topic", I have a kid living off of an inheritance who has this FTC problem for a couple of years. Reporting the c/o is a pain, and will (probably) never benefit him.

I asked for them all. I have only 4 partnerships and S-corps and prepare the personal returns for 2 of those businesses that are H/W only and work closely with the personal preparer for a single owner S-corp and know the H/W for the 4th, but don't prepare their personal returns. I did NOT have the 2021 personal information for any of the individuals when I began the biz returns. I knew at least 3 out of the 4 businesses (suspect all 4) had owners with foreign taxes paid in 2020 &/or 2019, but not over $600; but did not know their 2021 personal situations at the time I needed to start the biz returns. I gave the double-letter forms from Compass Tax Educators (biz version plus individual version) to each biz and asked them to survey their owners (themselves) and touched base with individual preparers for those where we work as a team. All 4 businesses returned signed letters from the biz and from each partner or shareholder. I did begin the biz returns prior to the most recent notice. Don't know how I'll feel next year. But this year I wanted to cover my butt, and those businesses, owners, and personal preparers, too.

Tom's class is about 15 minutes with two of them discussing the Forms K-2 and K-3. Then, when the most recent Notice came out, he/they did a 10 minute update. Look for the links at the Compass site: https://on-demand.compasstaxeducators.com/

FOUND THE OTHER VERSION I HAD FROM ANOTHER CLASS. DON'T KNOW IF THIS WAS MARC'S. Schedules K-2 and K-3 Client Statement Owner Name:-----------------------------------------------Owner SSN: Partnership Name:__________________________ Partnership FEIN: The IRS has instituted 2 new form requirements (K-2 and K-3) comprising 39 pages of disclosures that could double or even triple your company’s tax preparation fee. These forms are not required if your partnership or S-corporation has no foreign activities and if the individual partners or shareholders are exempt from filing IRS Form 1116 (Foreign Tax Credit) with their 2021 individual Form 1040. I you do not acknowledge that you are exempt from filing Form 1116 with your 2021 Form 1040, we are required to complete these new forms and your fee will increase dramatically. IRS Notice 2021-39 allows us to rely on a good faith safe harbor of your statement that you do not personally have to file IRS Form 1116 with your 2021 individual Federal income tax form. If you are not required to file Form 1113 with your 2021 individual Federal income tax return, please sign below. Please reproduce and have all other owners individually sign as well in order to avoid our required filing of Schedule K-2 and K-3. “I confirm that I am not personally subject to filing Form 1116 (Foreign Tax Credit) with my 2021 individual Federal income tax return Form 1040.” Signature of above individual:___________________

Keeping the LLC Name is a state registration function, so as long he he renews his state registration and pays the related fees the name continues. So filing a final return does not impact the Name. In addition, the EIN should be closed to avoid fraud etc. Later if he wanted to activate the LLC as an S Corporation, it would be like starting over, applying for a new EIN etc.

We desperately need a tax law that indexes EVERY amount in the tax code to inflation. I swear the $25 business gift limit has been that way since the 1960s or earlier.

"Taxpayer Experience Office formally established to improve service across the IRS WASHINGTON – As part of a longer-term effort to improve taxpayer service, the IRS has officially established the first-ever Taxpayer Experience Office and will soon begin taking additional steps to expand the effort." I needed a good Belly Laugh this morning

Not to derail this specific discussion, but take a look at some other posts on the IRS site that came up in my search of IRS.gov. These include: Accelerating Digital Communications to Solve Pandemic Challenges and Improve the Taxpayer Experience Enhancing Systems and Processes to Better Serve Taxpayers Taxpayer First Act - IRS Organizational Redesign Strategy, and IRS Face-to-Face Saturday Help

Direct from IRS.gov:

" The office is part of the effort envisioned in the Taxpayer First Act Report to Congress, which included input and feedback from taxpayers, tax professionals and the tax community that helped develop the Taxpayer Experience Strategy. Visit IRS.gov to learn more about this new office. " So this office was created by Congress, Hmmm

The only problem I have experienced with your approach is that the State(s) return(s) are not checked. I usually create the efile files for both the IRS and the State, when I read the errors or suggestions, I make the corrections and save the return. That eliminates the efile file and marks it red. If no errors are found, I go and delete the date you are talking about and save it.

I wonder when the last time was that they increased that $300 threshold. That figure should be more like $1,500 per person on dividends and interest reported on a 1099. At least most 1099's are now breaking out foreign dividends paid so I don't have to spend 20 minutes searching for them and adding them up.

If I'm not ready to create the efile, my final check is typically to try to create the efile without filling in the signature date, and look at any errors other than the missing date error.

I also disagree with Slippery Pencil. Drake gives some messages within the program's calculation function and many more messages when one looks at the notes and e-file error messages that are part of the return that has been created. I always flag the "e-file ready" box to hold the return so that there is no way anything can be inadvertently e-filed in advance of having signed authorization forms.

I must disagree: one does not get "the same suggestions". My experience accords with Pacun's: UNIQUE problems surface upon attempting to efile a return which are not divulged merely by checking the return. That some small number of returns have been efiled prematurely is the lowest but not common denominator to which I do not feel compelled to stoop.

I just did this for an S corp. Only one shareholder. The 7203 info was imported and I double checked it with the Basis Statement in the 1120S. I attached it as a pdf. Haven't efiled it yet. Working on the shareholder 1040 now. I don't know if this was from a recent ATX update or not.