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Talk about luck! I just had a client from 2019 come in with a CP11 asking for just short of 4K. They aren't disallowing the exemption for the daughter who was in college, but they are disallowing the LLC and Tuition Credits because they say that the 8863 was incomplete or not attached to the return. This client hasn't been back since that year but he wants me to fix it. I pulled up his return and printed the forms that the IRS said that they never received. That is all that I plan on doing. He can pick up the printed returne and contact the IRS himself. They wouldn't talk to me anyway. This is from 5 years ago. What are they doing in their spare time? I have clients who still have not received their 22 and 23 returns. I might jump ship with Margaret.

On prior years, I can sign into ATX without any kind of MFA.

I should say also that if the corp is not registered to do business in any other state, all income is CA sourced. Tom Longview, TX

California taxes the location of the benefit of the work to the business. The employee location determines who taxes the wages. Where does the income for the Scorp come from? If the client or the work is in CA, then your K1 income to each shareholder is CA sourced and taxable to CA. If only a portion of the work is in CA or for CA clients, then the Scorp should apportion the K1. Where did the business employees work? If they worked in both CA and OK, then they apportion their wages on the W2 and pay accordingly. If they exclusively worked in 1 state, the W2 should reflect that. Shareholder 1. Some or all K-1 Income is CA sourced. Some or all of the W2 income is CA sourced depending on how much work is done in CA. Need to apportion on the W2. Shareholder 2. Some or all K-1 income is CA sourced. All W2 income is OK sourced. Shareholder 3. Some or all K-1 income is CA sourced. Hope this helps. Tom Longview, TX

Some people have all the luck!

What about the older ATX programs on your computer? Customer files?

Not at the time of the gift, but by the time the return is filed. Thanks folks for the correction.

Thanks, Lee B, for the reply. That's pretty much my position, too. I may get flak but then I'll just retire Or retire from her. Yes, I do seem to get them, don't I? And I haven't touched on the new client with 7 rentals in 5 states with a 1031 exchange in 2022 that took me for a loop when I saw no depreciation in 2023. Now I know why. Then there is the Air BnB he bought in 2023 with $7000 in 'consumables' and sold in 2024. Why, oh why, did I say yes to this guy? Sigh, partner of recently deceased neighbor's son, so a sympathy gesture, I guess. At least the data entry in my 2023 program results in the same bottom line so that's good. And he is very well organized...unlike some others. And according to his 2022 and 2023 invoices, he is accustomed to paying a fair amount of money. So there's that!

Margaret, I must say that you have some of the most interesting client tax situations In your client's case I don't see a way to claim any business expense for the rent

IRC sec 170(f)(8)(C): scroll down linked page to 8C where it says:

"Contemporaneous" was taught to me as meaning: by the time the taxpayer files their return. So you are supposed to have it in hand when you file.