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Thanks go to Don de Drain a guest blogger on the Procedurally Taxing website: "FREQUENTLY ASKED QUESTIONS: 1) Q: Who came up with the idea of issuing Frequently Asked Questions? A. On advice of counsel, the person who came up with the idea of issuing Frequently Asked Questions is refusing to answer this question on the grounds that it may violate their 5th Amendment right against self-incrimination. 2) Q: Has the issuance of Frequently Asked Questions actually proven to be helpful? A: The issuance of Frequently Asked Questions has proven to be very helpful to attorneys who like to challenge in court the validity of IRS rules that have not been published in the Federal Register under the Administrative Procedure Act. 3) Q: How often are Frequently Asked Questions actually asked? A: Frequently. 4) Q: Seriously, how often is “Frequently?” A: Once. After the question is asked here, no one else ever asks the question again. 5) Q: Who are the people who actually decide which Frequently Asked Questions to include on the IRS’s website? A: See the answer to Question #1. 6) Q: Why does the IRS issue guidance like this in the form of questions? A: Why not? 7) Q: Can we rely on the answers to Frequently Asked Questions? A: Yes, except that you cannot rely on the answer to this question. Q: Will I be penalized if I take a position on my tax return that is contrary to the answer to a Frequently Asked Question? A: Only if the answer to the Frequently Asked Question is unintelligible. 9) Q: Are these Frequently Asked Questions binding on the IRS in Court? A: Only if the Questions have been written by someone living in Thailand. 10) Q: Why is that? A: Because it’s the Thai that binds. 11) Q: What do we do when there are conflicting answers provided by two different Frequently Asked Questions? A: You pick the answer you want to pick. Then the IRS will pick the other answer if your tax return is audited, and the Tax Court will decide which answer it likes better. 12) Q: What is the actual location of the United States Tax Court? A: We are not sure. We looked in the pocket of IRS Chief Counsel and did not find the Court there. We also looked in the pockets of some random taxpayers and did not the Court there. The Tax Court appears to be an independent body located somewhere in the penumbras between Article I and Article III of the U.S. Constitution. As a result, the Tax Court is considering renaming itself the United States Tax Court of Quantum Physics."

I am in California and semi retired this tax season. This year I eliminated my out of state tax returns and eliminated the procrastinators who wait until October as well as the clients that I just didn't want to interact with any more (high maintenance). Last year was difficult for me, so reducing the work load to a very manageable schedule is working out well. I am four years in remission from my cancer, but that nasty beast will come back in the future. Now my client base has been cut in half it will be easier in the future to close up plus I don't have the stress of getting the "I don't know...let me explain!" answer to a simple yes or no question. Simplifying one's life has a lot going for it!

You are correct in that, since the charitable organization was a named beneficiary of the retirement fund, it is not part of the estate, and it is not considered on the 1041 in any way. It's the same as if an IRA named a person as a beneficiary -- not part of the estate. On the sale of the home calculation, it got a stepped up basis at owner's death, so if it was sold shortly thereafter, there should be no gain. There actually may be a loss due to expenses of sale, such as real estate commissions paid, legal fees, administrative fees, taxes, etc. (Do not include any items related to a mortgage.) Review the HUD-1/settlement statement carefully regarding real estate taxes debits/credits. See page 2 of HUD-1 for details, seller's column.

Among the posters on this board we have a wide variation in skill levels from those who are just be beginning their careers to those who are winding down their careers. While you have a right to your opinion, I think your posts are excessively sarcastic and don't belong here. Perhaps you have had a really crappy day and you normally wouldn't have posted your comments?

This year I have forgotten to click the "donate" button so that the electricity/maintenance is paid for this site. Please don't make that same mistake and I will click it soon.

As Sheldon would say, "It's funny, because it's true!"

Not at all contradictory. Who says H&R is market rate? My fees are almost always higher than non licensed preparers. Among one person CPA offices such as myself and EA's, sometime my rates are higher and sometimes lower. Like I said, I charge what I feel is fair. Your comment of I think so little of myself and saying I'm stupid in the post Judy deleted says more about you than about me. Peace out.

I expect to retire in the next 3 or 4 years. Hopefully, it will take them that long to make it happen.

Yep, I think I'll lose my CA returns before next tax season. A couple kids are grown and doing their own now. Some clients moved back to the NY/CT area. Two very nice couples remain in CA that I hate to send away; I inherited them from a CA preparer friend who retired. And one long-time client who moved to CA that I would hate to send away -- except her return jumped in complexity this year with the death of her mother and inheritance of multiple partnerships holding multi-family apartment buildings and lots of other investments. With the CA extension for filing AND paying now 15 October, I might put her on extension and then tell her to find someone local to her. I don't think I can charge her enough to make it worth the time I'll spend. Then there's MY return for NR CA !!!

Coming to other states soon as well. Emboldened by the Wayfair (anti Quill) ruling, states are eager to "follow" the Multi state tax commission guidelines. For instance, the guidelines (not law, just suggested for member states) have clicking on an email or chat link, from within an adopting state, as triggering nexus in the state the customer or potential customer's machine is in.

I ran across this site years ago and find it quite interesting. I put in my town and Lion's Fairfield, CT. Her cost of living is close to double mine, so it make sense she should be charging double. https://www.bestplaces.net/cost-of-living/

Thanks for the reminder. I've been AWOL the last couple years due to some health stuff. Now that I'm back in the game, I need to help pay the freight.

Holy canoli...I'm apparently waaaay undercharging! I've actually had several clients tell me that. You'd think I'd get a clue! I think because I deal mostly with clergy and/or elderly folk, my fee structure is partly based on altruistic impulses. In fact, I generally do about 20% for free. It's too late to change this year but next year I think I'm gonna raise my fees more than the $2 or $3 dollars I 'jacked' 'em up this year

I love this! Thanks for sharing it!

PS: The real estate tax debit/credit transfers from/to buyers and sellers will be shown on Page 1 of the settlement statement. There are almost always transfers shown unless the settlement date is exactly the same date the tax is due.

K1 always goes to the beneficiary. Payments of nondeductible expenses are considered distributions to the beneficiary. But if you have a loss, there will be no numbers on the K1.

Good point, Robbie. However, both those charts use gross income and then AGI from all sources on the federal return, but based on CA law -- NOT just CA-sourced income. We're working three jobs with our two RMDs and hubby's teacher's pension to stay afloat, so have gross income greater than $52,000 and AGI over $44,000.

There would be a K-1 if taxable income was distributed.

I don't think so, unless there is some special rule for community property states.

Should be treated like the sell of any other business and recognize goodwill.

Off the top of my head, I am going to say probably not. First of all I don’t think it would be allowed since it was not spelled out in the will. Secondly, I don’t believe the retirement account would be included in the gross estate of the decedent. It should be excluded as a charitable deduction regardless of whether a 706 was filed. Therefore, if it was not part of the estate, I don't think the estate is not entitled to take a deduction on 1041.

Moved and merged the 2 topics

Check the Ca 540 NR instructions for "Do I Have to File". It could be that your CA source income is below the threshold for filing. Ca source income would be income only from your Ca residents. https://www.ftb.ca.gov/forms/2021/2021-540nr-booklet.html

Wait, wait, we get a chance to slow down and scale back, too, don't we? At 77, I'm ready for the raising rates to thin the herd but still make enough money to keep traveling - off to Papua New Guinea for scuba diving April 24-May 11. Stress relief writ large.

Been saying for years we need to slow down and scale back. Getting older !!! So maybe the strategy of raising rates and getting rid of problem clients is a good path to travel. Less stress !!!! Send our problem clients to Margaret and other Ohio preparers.

I'd charge about $225.. I have gone up 20% this year if same amount of work.. and no one has squawked except the bar owner who I had to do all ther bookkeeping - $880 - taxes and $700 books - They went and bought a $1500 scanner and laptop and think that will fix it! Best, Darlene - i like the one about all new clients!! $325 I am charging $50 more for PIRA's and harassing - where are my taxes.. this year

"New clean vehicles placed in service on or after April 18, 2023, are subject to the critical mineral and battery component requirements even if the vehicle was ordered or purchased before April 18, 2023. A vehicle's eligibility for the new clean vehicle credit is generally based on the rules that apply as of the date a vehicle is placed in service, meaning the date the taxpayer takes delivery of the vehicle." Updated EV Vehicle Credit FAQs: https://www.irs.gov/pub/taxpros/fs-2023-08.pd

Quite a few are posting that they know they don't charge enough. Don't give your work away. If you have spent time on education, spend time on a return and with the client, charge for it. If it takes work and multiple calls and emails to get needed forms or info from a client, charge for it. If a client contacts you often throughout the year with this or that question, don't forget that either when you decide on your fee. I work at a firm and am paid regardless of what the client is charged, so I'm not making more or less money based on my billing. I just try to charge what my work is worth. We all have clients in trying circumstances and don't raise their fees sometimes for years. We probably have a client or two whom we don't charge at all some years. Then there are those who consume our time. Like one I had who asked one month about the tax consequences of selling a commercial rental. Lots of work on that question, calculating depreciation etc. Next month he asked about selling a different rental. After that it was about maybe gifting one or the other or both to a relative. Yes, his tax prep fee that year went way up. On the other hand, a client contacts me every month or two all year with this or that issue. I charge him $1500 for his individual return and don't increase his fee because I feel I'm already being compensated for the extra work. I don't usually charge for help with W4s or questions about potential 401k or IRA distributions either. I'd rather folks ask before the damage is done.

Many of my low income clients are extremely classy, kind and appreciative individuals.