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I had an elderly client, gone these many years now. He had interest from a dozen or more different banks every year, chasing interest on 1-year CDs. His great joy and glee in life was calculating (by hand on paper!), and paying, his estimated taxes such that he owed less than $25 in April, each to the state and the IRS. But always he wanted to owe and never overpay into refund. I got a real kick out of him and he (and his wife) were lovely to work with.

Reseller programs can be a savings, but there is a reason. The support may be offloaded to the reseller, or some fee per use from the developer (assuming the reseller pays the developer and reports your sale to the developer). At one point in the 90's, our product was available from a reseller or two. One sold many licenses, but never paid us, or reported the customer information. As inevitable, the customer contacted us (at the time, via phone) for help, and we were in a Catch-22. Help them for free, supporting the thief/reseller, or explain the theft which made us look like the bad guy. So for us, it quickly became a lose-lose and was ended shortly after starting. Unfortunately, back then, the reseller was able to keep going the about a year, as it was just a matter of copying the software onto another floppy to sell. IIRC, either the same or a different reseller was supposed to handle their own support, but they did not, or when the customer found out how to reach us, they did, making the agreement a money loser in that manner. The reseller, once we went to a different license method, resold their own license over and over too. We eventually noticed (for the same reason, via support inquires) and came up with a way to prevent that type of theft too. We still get issues when someone orders for another, sometimes collecting more from the customer, then the customer complains to us. Happened last week. For me, I avoid resellers for anything major. My current computer is a new model, in short supply. Resellers had some inventory, but I figured out when the manufacturer updated inventory, and was able to order in the few minutes/seconds when they had stock. Why? The return policy was cleaner, and they give a longer warranty option (which for a new device, for me, is important).

The price of $999 is thru Sigma Tax Pro who is a reseller of several software providers including Drake. This price is for a single user as I have no employees. I got a "demo" of their " DR" software desk top version (Drake) from them and it is exactly the same as my regular version of Drake and appears to work the same. I was able to register with them for the 2024 tax software for $49.99 payment now and will not have to pay the balance until the software is released late in Nov. This will be my 1st year with them so I will update my post as next season progresses.

It could be deducted on a Sch C as ordinary and necessary, since they're essentially borrowing the money from the IRS to fund their business. If line of credit interest is deductible on Sch C then this is just a substitute. Facts and circumstances apply.

Reimbursements of actual expenses are not taxable. You'll get a 1099-LTC with Box 3 indicating that the amounts were reimbursed expenses. You'll file Form 8853 showing nothing is taxable. But if they are paid on a per diem basis, Box 3 will indicate per diem and any amounts in excess of the actual expenses OR an excluded minimum are taxable. The excluded amount changes each year and can go up or down ($390 for 2022, $420 for 2023, $410 for 2024). So if the actual expenses amounted to $300/day for 2023, they would only have to pay taxes on payments in excess of $420/day. If actual expenses amounted to $500/day, the excluded amount is irrelevant and they pay taxes on payments in excess of $500/day. (You look at the totals, not the actual per day expenses) Accelerated death benefits from life insurance are reported in Box 2, but are not taxable if terminally ill (otherwise, they are treated as Box 1 amounts and are only taxable to the extent they exceed expenses or the excluded amount).

I have a client who purposely has no Federal taxes withheld so that he can use the money all year. What part of "penalty" don't these people understand?

I'm sure many of you have heard the same story. Some clients ALWAYS have to pay...never get a refund. Client speaks up with an air of genius: "I don't want to let the gubbermint use my money interest free for a whole year, so I keep the money for myself." As if we should admire him for his financial prowess. Funny, I've never had a single one of these "genius" clients have any interest income to report. I believe the threshold for a bank to issue a 1099-INT is only $10. Go figure...

Well that's very user friendly

I can't think of any reason unless they plan to pay scholarships.

don't know if anyone else has experienced this, but I had a number of clients in the past two years whose wage withholding dropped and they told me they didn't change anything at work. Not knowing what their payroll department is up to, I usually advise an additional $ amount based on how often they are paid, rather than try to rework a W-4. for retirees who owe, I usually print out a W-4V for them to file with Social Security. Although not ideal (often 12% is too little and 22% is overkill), it is an easy method of getting more withheld. The State of Florida used to have a surprisingly simple W-4P form but that went by the wayside. But sometimes all we can do is point out how much they are paying in interest and that it is currently at 8%. You can lead a horse to water...

I had a self-employed client who owed in the five digits every year. The first time I prepared his return I dreaded telling him he owed something like $20k. He didn't even flinch. He said he makes better use of that money in his business during the year and the profits more than make up for the interest and penalty. He had figured out what was best for him. I like Dennis's idea of having all the withholding in December. For clients who take their IRA distributions in December, they could have their year's taxes withheld and not bother with estimates. Now that banks actually pay decent interest, putting the estimate money into a savings account could yield some profit. I usually pay all of my estimates at once in April since I make most of my income in the first quarter and have the cash. I might rethink that strategy.

I make all my tax payments/withholding in Dec. I am within 500 either way. I have interest income. But, a significant % of my income is on Dec. AND I understand the rules, such as withheld on or before Dec. counts for the entire year. Just part of the game we all make money playing. Use/cost of the money has a value even if there is no interest collected as described in the OP. Many fail to account for that.

Double "YEAH!" to everything you both wrote.

I feel better just from saying "YEAH!" to everything you wrote.

That is the 64 thousand dollar question. I am amazed that the IRS spends so much energy on not talking to the very force multiplier that they need, US! We can talk to them and get them what they need to close their cases, but they have treated us like the problem and not the solution for the last decade. Congress and the tax code are the IRS problems, not reputable tax pros. The IRS knows who I am. They gave me my EA license. They hear from me every three years when I renew. They gave me my PTIN. They collect a check every year for that number as well. They gave me my EIN for my company. They gave me my EFIN number. They gave me my CAF number. They know my SSN. They require my software provider to know my information before I can use a software that they approve every year. They can look up how many returns I prepare and how many POAs I have on file and how many times I call in and the number of returns that are selected from my client list for audit and the resolution on those audits. The Commissioner knows me better than anyone except my spouse. And they treat me like I am the problem instead of the TurdoTax software they allow on the market. I am just so fed up with the incompetence of the IRS leadership, especially the Commissioner. I wish he would realize I can get his backlog on my clients through the system faster than his staff can without me. Just staff the PPL line and let us work with the quality revenue officials, like we used to do when I first got my license. Stepping down from my soap box now. I feel better. Tom Longview, TX

I have been with ATX MAX since its birth and will never change. That is a lot of years since 2005. It ofers everything I would ever need and then some.