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http://www.journalofaccountancy.com/issues/2016/jul/infrequent-sale-not-subject-to-self-employment-tax.html First off, sounds like to me the bankruptcy trustee really screwed up if he valued 300k of scrap steel at zero. And I suppose after bankruptcy the basis in the steel was zero? I really think this could have gone either way.

Yes, but all of those analysis are quite subjective. A different court could well have reached a different conclusion.

He sold scrap 12 - 24 times a year for seven years. Averaged $45k a year. That was his only income. I think he's a lucky dog, too.

I agree with court decision. Taxpayer passed majority of tests for inventory not being held for resale & not part of trade or business and it was one time event.

I think the taxpayer got VERY lucky on this one. I'm glad for him, but I'd have never predicted that outcome. Certainly wouldn't suggest it to anyone as a course of action.

That's a real toughy one....but as you said...agree... could have gone either way. ...

My Fujitsu ScanSnap S500 is about 10 years old. They are not updating drivers for it. When I got my new W8 computer two years ago, my scanner wouldn't work but I found a way to make it think it was working with W7 and it's been working fine with W8. I assume when I get a new W10 computer, I'll get a new scanner at that time.

The IRS does audit these 529 withdrawals--even said it was a "priority" item. As I recall, the pubs say don't report anything if used for education, but the IRS doesn't read its own pubs I guess. Last summer we must have had five of these audits. I recommend don't report anything (like the pubs say), but tell your client to pull the college payment transcripts now. They will be needed when the letter arrives.... And don't get too complacent that all is okay because the funds were used for school. Dates matter. If the withdrawal was made in December but spring tuition wasn't paid until January (or vice versa), you have a problem. I had this happen with one client who also made too much to claim any education benefits. He ended up scrambling to find receipts for books, computer, etc. Our joy that the IRS is finally requiring schools to report "amount paid" instead of "amount billed" on the T was short-lived. Schools pleaded that they need more time to adjust their computer systems so were granted a pass until 2017. When the T first came out (in 1997), they were granted time to adjust their computers. How long does it take? Do those 20-year old computers still exist?

I installed TBird email on my new computer with Win 10, and I like it much better than Outlook! So, I bought Office Home and Student for $150, and then bought Office Home and Business just because it has Outlook for around $230. I could have just installed nice TBird, but nooooooo.......and my desktop scanner driver won't work with Win 10. And my HP printer/scanner/fax/copier is making very crappy copies only if I use the top feeder and I can't figure out why. It also either scans a very crappy PDF or a very huge PDF. Those are the choices. Bah!

And regardless of how she ultimately is able to file her income tax return, she may still need to file the FBAR.

I knew I could depend on everyone's support. This job started as a strip the wallpaper and paint, she said it would only take 2 days like they said on the show. Not my bathroom...so I come to find that the walk in shower water control was loose. Needed to open a wall to get in there and brace everything. Then she thought an efficient water flow toilet would be nice. That medicine chest you see should be recessed, I'll be fixing that. New fixtures on the vanity may as well be done as my new knee pads are getting broken in. It's like a new client who says, I don't have much, won't take long at all, not long at all. It'll be a week for this one, but at least I could say, she's appreciative, and that's a lot more than you get from many clients. Thank you all, you made me smile, makes me forget the back pain.