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I always think that with enough espresso I can power through 20 returns a day at full capacity ... until I spend 15 minutes of my day (that I will never get back) trying to figure out why there's no place to enter/flow through the basis from a 1065 K1 to form 7203, which I actually went to the trouble to manually added to the return (the form adds automatically for an 1120s k1, of course, as appropriate). DUH moment didn't come for a full 15 minutes. Called myself an idiot, deleted the erroneously added form, and finalized the return. Oy Vey! I hope I'm not the only one.

Right there with you all. One of the things that also happens to me is when I'm working and see a blunder made on the prior year's return, like completely missing the kiddie tax or some such thing.

You are definitely not alone - lots of good company around here!

Glad to see this post because last month I made a blunder on a NYS return that was so basic for a class of clients that I handle flawlessly on a regular basis. I only found it because of a local return that kept getting rejected. I’ll amend it but I was hard on myself for not being more thorough in my review. And the embarrassment telling the client, that’s the worst.

I too have uttered, "What the hell was I thinking?" when reviewing a prior year return I did in the heat of battle. It's always a wake up call.

Been there, done that.

Thank you, Abby Normal. I've never heard that about the UBTI before, so learned something new today.

You get to be the hero by amending and removing those K1s from the return. The only time a K1 can impact an IRA is when there's unrelated business income, and it has to exceed a certain amount before it creates taxable income. It's usually recommended to NOT buy these K1 investments in an IRA. https://www.fidelity.com/tax-information/tax-topics/ubti

Count me in as well!!

Maybe you should do a wellness check on him - he may have had a heart attack!

From the link: Tax considerations An IRA is an exempt entity separate from the beneficial owner of the IRA and can be subject to taxation on its own. UBTI is subject to taxation in all varieties of retirement accounts, such as IRAs, retirement plans like Keoghs, and health savings accounts (HSA). When total positive UBTI across all applicable investments held in a retirement account equals $1,000 or more, then Form 990-T must be filed. Sounds like fun, right? Tell client to get rid of these investments in an IRA because they're not good for IRAs.

Hope they both have mild cases, and hope you can stay healthy!!

I had a client who owned a bunch of publicly traded partnerships in his traditional IRA. I tried to keep track of the UBTI and told him that we could run into trouble in the future as he kept buying more PTP shares in the IRA. I even used to lay in bed thinking about it..........but then he died and my problems went away. I know that sounds harsh. But tax season makes me that way.

Client got the 1098C from the charity, when you fill in the boxes, everything flows perfectly in ATX. Attached the 1098C to the return and I think I am good. Waiting for another unrelated piece of info from the client and I should be able to efile this return tonight. Thanks for all your responses. Tom Longview, TX

I did a client last night who withdrew $350k from inherited IRAs I think to buy a new condo in NYC. Took maybe 20% withholding from one, 10% from another and nothing from the third. Owes approximately $96k just in federal tax and $18k in NY tax. And I haven’t seen what the gain was from selling his coop (he’s single). Sent him an email last night but haven’t heard back.

Yes, he's ineligible because of her coverage if her plan covers the same things as his. If you need a reference, it is irc sec 223(c)(1)(A). If the excess was discovered last year, it should have been included back in taxable wages. His options now are to leave it in, include it in income and pay the 6% excise tax, and he could apply it in 2022 as a contribution assuming he is eligible this year. OR, he can withdraw the excess + earnings before the due date and it would be as if the contribution wasn't made. I believe there is also a rev proc that allows one to make the correction after the due date also. I remember seeing that in the instructions for form 8889 when I was looking at that the other day. There is a whole section on excess contribs by the employer.

I'm hoping this is the last season with the pandemic tax provision stuff. Stimulus, advance credits and all that. Maybe much smoother next year.

I believe the character remains as IRA income which is non-taxable in IL. I presume the K-1 is showing this as portfolio income? If so, the K-1 preparer should have included a footnote that discloses the nature of the portfolio income. If you have a copy of the 1099-R to the trust that could be used as support if Illinois questions the deduction.

Pick one, his barber, bartender or next door neighbor told it would save him lots of taxes

love how these companies can't be bothered to put the codes in - leave it to the tax preparer.

I can't really, either, consistently, but its the goal I have for myself from now until the 15th (not the 18th). If I can come close, then given the extra weekend (sans Church and family meal on Easter), I'm hoping I can get done with everything that's here. Goal in the past has been 12 a day once corporates were finished and the individuals one can get done before the corporate deadline, and that has by and large been manageable, but with added clients and the first 'real time' season in two years, that increased to 17.286/day (I know, I know ... but we're bean counters, right?). I figure if I aim for 20, maybe I'll make it? Hmmm. Not going to lie ... as I get tired, I start picking up returns out of date order (line jumping) so I can do easy ones (clients kids, etc.) to boost my numbers for the day so I can sleep at night. Works until I run out of those :(. I can't believe how we (tax preparers) live for 65 days out of the year. 96 if you count January and everyone's year end mess. Eeegads. Curious about others' daily averages, or if I'm the only weird one who plays this numbers game to try and motivate/encourage myself to work harder/longer.

Everything is tagged in the Master File using the first 4 or 5 letters, only, of the surname. I have two couples (parents, married son) from India, whose names go on for several paragraphs (maybe that's a tiny exaggeration) and while Drake will truncate on its own, back in my ATX days I just whacked off letters until it fit and filed. Never had an issue.

Well, you now have a known liar as a client. Your requirement for documentation just skyrocketed, because you can't trust a thing from him. Good luck! Hug him; maybe that's the best thing to do.

On our calendar for tomorrow is an all-day event: "Everyone gets an extension!" Every client whose return is not complete and ready to submit will be put on extension. We'll send them payment coupons *if* we've gotten that far. Not our problem if folks who owe didn't send us their docs in time. Our cutoff for completion by 4/15 is 3/15. That means all docs in-house. Nothing outstanding (missing statement, missing basis, missing DL dates, missing whatever). Which nearly no one meets. But it's in our letter every season, too, so it's not a surprise to anyone. We'll spend the day prepping and submitting extensions for everyone on the list noted above, and then move one with the season, completing as many returns as we can without regard to the 4/15 (18, 19, whatever) date. When I started getting seriously hard-nosed about extensions, a lot of the season-end pressure evaporated. I still work hard, and long, but without that horrible feeling of "gotta get more done!" that hounds us.

There are blank lines at the bottom.

Thanks so much Catherine. My client finally called the IRS and they approved for payment. They didn't say why they hold the payment.

Just a side note. My mechanic told me good use cars are selling for 20 to 40% over book value. I attended an auction this past week looking for a good used car for daughter to use at school. Dang it he was right.

Are you sure the partner's basis is the same as the capital account for this partner? Many times it isn't.

It will work fine We always keep a backup, so you might as well buy two !!! Buy generic toner cartridge's. Alot cheaper than Brother OEM cartridges. The cartridge that comes with the printer will not last long. They ship new printers with "starter cartridges". You may get 2,000 pages out of it. I checked all of our Brothers the other day for number of pages printed since new. Wow !! One has printed about 250,000 (oldest one). The others are around 100,000. My finger tips always get dry from handling paper all day !! Sucks the moisture right out of you !!!! We go through about 10 cases of paper a season. Our Brothers like Boise X9 paper. Never jam with it.

I told two different clients yesterday that I was going to help them find an accountant who could better meet their expectations. First one said, we want to use you ... sorry I was a b****. Second one sent a very nice email asking to stay. My son and husband both have Covid, and by best count, I have 250 returns left to do. DON'T even think about messing with me.

That's exactly what I did. I entered the total proceeds and total cost of all the transactions on two lines, one for short-term and one for long-term. Used code M and C. Moved on to the next return.

8283 instructions says 1098C or othe similar acknowledgement, and those instructions has details of what is required. As to the value, I wasn't implying that the value was overstated but was merely making a general observation about how prices of used vehicles have increased since the beginning of 2020. Sorry I brought it up.

Rules for individuals may not be the same for trusts, but if the income was passed out the actual beneficiaries (not designated gifts) on a K1, they might be able to exclude it. This is why you normally want individuals as bene's for any retirement accounts. Why run it through an estate or a trust?

Problem is the charity did not give him a 1098C. It is a normal donation receipt like you get from Goodwill or Salvation Army. And it is not signed. I went to the Master Tax Guide and I am coming up with the need for a 1098C from the charity (or a substantially similar document with all the required information that is on a 1098C). Also, as soon as I hit the drop down for vehicle on the 8283, ATX pulled in a 8453 with the box checked for a 1098C. I think I remember that you have to attach or send the 1098C in the mail to the IRS. Need to dig some more on the exact procedures for claiming the donation. As to the value, the client is a retired mechanic and he still likes to tinker with cars in his garage. He bought it for $2900 and put about $400 in parts into it. Used it as a daily driver for a while until he gave it to the charity down the street. The valuation does not bother me, because I know he is a really good mechanic. I am certain he would not have given them the car if it was not mechanically reliable. Tom Longview, TX

Agree with Lion that possibly using the 1098-C may help. Client has met the exception to using proceeds because the charity is keeping the vehicle for significant use for itself. If the 1098-C has all the required information including that the charity is keeping it, the deduction should be allowed in full and not limited to either -0- or the other $500 limit. It's interesting that in today's market that this older car's FMV is higher than basis. I know there could be lots of reasons for that, but the value of used vehicles has risen dramatically since the shutdown and supply issues of new cars, parts, and computer chips.

I don't use ATX, but can you enter via a Form 1098-C to make it flow? https://www.irs.gov/pub/irs-pdf/p4303.pdf

Thank you all. I'm sure this guy didn't tell me everything. I'll press him on who got the car. He lied about what he had when he called March 10 to see if I could do his return. I saw the 1099 to "My Deceased Third Wife Hyphenated Last Name Estate" when he came in on March 14. Record scratch sound. Umm.... I start asking him questions and whoo boy. The 1099 was not all. Imagine that. I say "lied," not was "mistaken" about what he had, because he came to me from another preparer here, and the 2020 Form 1040 was fine.

I just finished a client who owes a total of $73,000. to IRS and WI because he rolled a LOT of conventional IRAs into Roths. He said he would have had to pay the taxes sooner or later. Does anyone see anything wrong with his line of thought? I couldn't believe that he did this and then brought me a big, delicious chocolate torte for doing such a good job on his return. (Oh, he cashed in another IRA to pay the taxes)! What is wrong with people?

The few times I have had this happen, I just removed letters from the last name until it was acceptable.

According to this KB from my vendor (not ATX), total characters and spaces for both names combined can't exceed 35 characters. Try eliminating middle initials, use first initial only for spouse, and possibly shorten last name to 5 or 6 characters. http://kb.drakesoftware.com/Site/Browse/Name-exceeds-35-characters

Damn, how long is the name? I’ve gotten messages that the names are too long and have been truncated to fit IRS specifications (usually when spouses have different last names) but never the error message you indicate. Are you using ATX?

The heirs would have formally relinquish their rights to this asset in writing.

Here is an accident getting ready to happen or maybe already did. Executor's just can't give Estate property away without other heirs approval or bequeathed in the will.

Finally figured it out! Thanks

Did Block maybe file the IRA distribution with a code 3 for disability and check the box that he is under normal age of retirement? Then it does go to line 7.

Logic is not welcome, Abby.

My biggest problem with extensions is the local governments (for businesses and that includes rentals) require their separate extensions with some payment.

Lion - that is my life!! And Abby Normal - so right!!! especially the way ATX has added even more steps to the extension!!! Takes 2 weeks to just rollover and do extensions - started and still doing in between!! And the issues I am getting! I am further behind than ever and I wanted to be ahead this year! Yikes!

Both!

I think I need another drink or two.