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Before you go to a manger, you need to guide your client through the reconstruction of his mileage records. If he is in construction, he has records of jobs with dates worked, bills for supplies picked up etc. This auditor is bit over the top but her position is correct. If you don't push your client to reconstruct his records he will never learn the importance of keeping them.

Please verify my understanding on the digital assets question on form 1040. Client purchased digital assets through her Robinhood broker account. That was the extent of her digital activity, no trades or sale. It's my understanding that simply purchasing digital currency is a "No" response. Here is what I found on the IRS Website. I don't believe any of these situations refer to purchase alone, unless that is what "mining" means? Thoughts please. When to check "Yes" Normally, a taxpayer must check the "Yes" box if they: Received digital assets as payment for property or services provided; Transferred digital assets for free (without receiving any consideration) as a bona fide gift; Received digital assets resulting from a reward or award; Received new digital assets resulting from mining, staking and similar activities; Received digital assets resulting from a hard fork (a branching of a cryptocurrency's blockchain that splits a single cryptocurrency into two); Disposed of digital assets in exchange for property or services; Disposed of a digital asset in exchange or trade for another digital asset; Sold a digital asset; or Otherwise disposed of any other financial interest in a digital asset.

I tell my clients to take pictures of everything they have that we put on the tax return. When they buy it, when they have major overhaul. And with vehicles a picture of the odometer at year end. Or if its a pick-up truck, and has to haul trailers, take a picture when the trailer is on and loaded. We had a logging company that had an Oscar Saw mill. Any quick google search shows you it's a piece of equipment, but our IRS auditor who lives in NYC thought it was a building and wanted to depreciate over 39 years. We sent a picture. "Down by the old, not the new, but the old mill stream..." Nope. If she keeps giving you a run around ask to bump up to the manager.

That is how I understand it as well. Tom Longview, TX

Ha, I plan to come in really early to get a couple of hours work in before they start. Then I'll take a nap and run some errands.

Sounds to me like they are now conducting all their business activity in state #2 and should re-register there.

Forced day off sounds like a welcome snow day for school kids. Enjoy it and sleep late.

Too late to do anything at this point unless the Corp wishes to recognize gain on the distribution of the installment note to the shareholder. The distribution of the installment note to the shareholder is a taxable event to the S-Corp; unless they meet the exception under sect 453(h)(1). In order to meet the 453(h)(1) exception, the corp. must adopt a plan of liquidation before the installment sale is closed. Then there is a 12 month time period to compete the liquidation.

At least this year, we don't have all the stimulus and temporary incentives. Ah, but for me, my office building (a house converted to offices) had a water pipe burst several weeks ago, no interruption to my work but now they're having an electrical wiring test Friday, should take over half day, no power. I'll have to be out.

This tax season stinks so bad we're celebrating almost 1/2 way. Ugh. And I have to go out of town Thursday - Saturday to pick up my daughter who has been in Denver. And 10 more corps to go. Double Ugh. I feel those extensions coming on.

My experience with special needs adoptions have been that the children have some special need - emotional control issues, mental development issues, physical challenges. And in those cases, there was paperwork from the agency showing that this was a special needs adoption.

Yes.

Should have read instructions more closely. If he meets other requirements, he must file it regardless of dependency or not.

As Lion said, as the ERO you are REQUIRED to have the signed 8879 in your possession before e-filing the return, and you ARE REQUIRED to keep it for 3 years from the later of the due date of the return or the date the IRS received the return. You do NOT send it to IRS unless the IRS requests it. Also like Lion, can't help with OK.

You are required to have a signed Form 8879 before e-filing a return. You are required to keep the signed Form 8879 for the appropriate number of years. Sorry, I can't help with Oklahoma forms.

When to check ‘NO’ Normally, a taxpayer who merely owned digital assets during 2022 can check the "NO" box as long as they did not engage in any transactions involving digital assets during the year. They can also check the "NO" box if their activities were limited to one or more of the following: Holding digital assets in a wallet or account; Transferring digital assets from one wallet or account they own or control to another wallet or account they own or control; or Purchasing digital assets using U.S. or other real currency, including through electronic platforms such as PayPal and Venmo.

Some years ago at a CPE Class, I was talking to another EA who had a good sized construction client with a number of vehicles. His client ended up in a very nasty audit where his client made no attempt to keep any mileage records and decided not to make any attempt at reconstruction. The auditor denied all vehicle related deductions and made it stick. It cost his client in the high 5 digits in additional taxes.

Limited partners are given limited voting rights. They are limited to voting on certain issues, but not on the day to day operations of the company. That should be spelled out in the partnership agreement.

My body can't wait to get away for a couple days. My brain is having a fit about it.

My construction clients never empty out their vans and covered trucks. They have other vehicles for personal use.

"If assets in a 529 are used for something other than qualified education expenses, you'll have to pay both federal income taxes and a 10% penalty on the earnings."

I would file the PTS return in the state where it was originally formed and still located.

The employer knew. Unless the person was commuting somehow, they knew the person was not working in CA.

I don't bother unless there is state tax withheld.

The ones I've seen have always been in the student's name and the student's SSN. Those are reported on the child's tax return, and any education expenses used to reduce the taxable portion of the distribution on the child's return are not allowed as education expenses for purposes of the AOC or LLC. It's best to run both scenarios - if it is better to allow the expenses to reduce the portion of 1099Q distribution that may be taxable to the child or to allow the parents to claim the education credit. In my clients' cases, the parents income was so high that they couldn't claim any education credits anyway, so those definitely were used against the 1099Q income.

Yes, but only to the extent there was a tax benefit. See Worksheet 2 and the discussion of "Itemized Deduction Recoveries" in Pub 525.

A current client of mine and his friend each own 50% of a large apartment building. All income and expenses are split 50-50 on each persons individual returns and have been since 2003 when they purchased the building. I prepared the return for the other partner in 2012 and he has prepared his own return since 2012 using a software program which we who use Intuit's ProSeries refer to as TurdoTax. Because my client and he are thinking of selling the building, he asked me to again prepare his taxes for 2022 to get an idea of his tax liability on a sale in 2023 or 2024. I asked him for his 2021 return in TurdoTax just to see if the depreciation and loss carryforwards on his returns were the same or very close to the depreciation and 8582 carryforwards from my client. Both he and my client had MAGI's of over $150000 for just about all the years. I was shocked when I looked at his 2021 return and found no 8582 at all while my client had an 8582 unallowed loss carryforward of about $170000! So I asked the partner to send me the file copies of all of his tax returns from 2013 through 2021. ProSeries lets you instantly transfer any year of TurdoTax to the same year in ProSeries, thus saving a lot of work when you have to do amendments of a poor soul who was caught in the TurdoTax web. However, even though 2013 ,2014, and 2016 transferred flawlessly, 2019-21 all came up with errors that ProSeries could not figure out and would not transfer over. I was able to go into the client's TurdoTax folder, and it showed all of the 2013 through 2021 tax files, pdf files, and everything else for each year EXCEPT FOR 2015. When I clicked on 2015, the message came up that the client must not have used TurdoTax for 2015 because no file exists. TurdoTax technical support cou9ld not get their screen sharing program nor theoir BACKUP screen sharing program to work, but they assured me that 2015 was NOT done with TurdoTax!!! Later the agent said that Intuit only stores 10 years of files, so that 2015 would no longer exist anyhow??? When I reminded her that 2015 was less than 10 years ago, she put me on a brief hold to confer with an associate. When she came back, she said that she had erred and that Intuit only kept 7 years rather than 10. Doing the math for her again, I show3ed her that 2015 should still be there. She could not screen share with me--if she had been able to she would have seen ALL of the actual tax files dating back to 2013 neatly arranged in my client's file!!! The fact that I was being lied to by TurdoTax really got to me and I said "Look, what we have here is a $150000 error on the part of your program, which will represent approximately $50000 of Federal and State tax reductions for my client. Under the 7 Year 100% TurdoTax Guarantee, they are going to have to write him a sizeable check, since even after I amend all of the years from 2016 through 2021, three of those years are now closed for refunds. Since the year n question, 2015, "lost" that large loss carryforward, the IRS may not even allow us to recapture that loss at all!!! She then disconnected the call after an hour on the phone as a conference call with me, her, and my client. We had to call back and go through all of the same material again. Finally, I got an agent to escalate the call to the managing supervisor of TurdoTax, "James." James was able to get the screen sharing to work, finally, and I showed h8m the files in my clients TurdoTax folder. James also noted that for 2015, no files existed and so he must not have filed with Turdo in 2015. Fortunately, my client had saved a 2015 pdf of his return which I opened on my screen for James. There was about a minute of silence. The 2015 pdf had as its first page the 2015 1040 with a big red TurdoTax emblem on the page. Page 44 of the pdf stated "intuit has efiled you return on April 6, 2016 at 8:06 PDT with the IRS. Farther down the page was the statement that "the Intuit server has received notification from the Internal Revenue Service that your Federal 1040 has been accepted." Then I showed him the 8582's from 2014, 2015, and 2016. A loss of $142196 was shown as unallowed on the 2014 return. The loss carried to the 8582 for 2015 on the pdf was EXACTLY - $142196. The 2015 current rental loss was -$12834. The total loss available was thus -$155030. Based on his MAGI, the allowable loss on the 2015 return was -$10730 (remember this number!). His unallowed loss to be carried forward to 2016 was therefore -$144300. I then showed him the TurdoTax 8582 for 2016. It shoed a prior year unallowed loss of -$10730!!!!!!!!!!!!!! Over $133570 of rental loss carryforward had been WIPED OUT BY TURDOTAX!!!! Another long moment of silence by James, who finally said "I am surprised you have been so calm with us. I would be out of my mind!" He understood the program, he understood accounting, he understood rental losses, and he understood that he was not high enough on the chain to do anything about it. I also mentioned to him if the 2015 program had glitched for other rental entrepreneurs and perhaps there was a whole niche of TurdoTax users who had not noticed their accumulated rental losses evaporating because it was not their job to know tax. Maybe my client's removal of $133000 of useable loss was just one of perhaps hundreds or thousands of Turdo users. We set up a conference call to the number he had given us, now having been on the phone for over 4 hours straight having gone through 3 battery recharges on my cordless phones. Nevertheless, I set up a call to Intuit Corporate. The phone was answered by a machine telling us that we should probable be talking to TurdoTax, or Quickbooks, or Mint, or other thins, but to leave us alone. It then put us on a hold, we got to hear 7 minutes and 4 seconds of music, after which we were cut off. I called the number again today, was told again to bother TurdoTax or one of the other Intuit entities, and then told to press 0 for an operator to continue the call the Corporate. After 15 rings, the phone was answered by A SECURITY OFFICER. He said I had the correct number, but no one from corporate was in (!!!!!) and there was no way he could transfer the call. I then wrote an email to an address which is supposedly someone in corporate per the Intuit website, so I will see what happens next. Thanks for letting me vent and letting my blood pressure get below stroke stage. Any suggestions? As always, I value your combined wisdom and experience. I myself have been doing tax returns since 1971 and began using ProSeries when it was called "Chipsoft" before Intuit got their greedy hands on it. Ringers