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(Journal Of Accountancy) - The IRS notified tax practitioners and taxpayers who use many IRS e-services that it is strengthening the authentication process for identifying users and that the new, more stringent procedures will require existing users to re-register. http://www.journalofaccountancy.com/news/2016/sep/irs-services-authentication-procedures-201615248.html

We had a recent topic on reverse mortgages that was about the proper handling of an heir's payment of the interest. Many of us have aging parents and clients, so I thought I'd start this discussion with the lists below that I copied from a page on a site called reversemortgageguides dot org. This should not be considered a complete list, so please add to the discussion as I have done in my next post, especially anyone that has firsthand experience. Pros of Reverse Mortgages Allows the homeowner to stay in the home. Can pay off existing mortgages on the home. No monthly mortgage payments are required, however the homeowner must live in the home as their primary residence, continue to pay required property taxes, homeowners insurance and maintain the home according to Federal Housing Administration requirements. The homeowner receives payments on flexible terms: Credit line for emergencies Monthly payments Lump sum distribution Any combination of the above A reverse mortgage can not get “upside down” so the heirs will never be personally liable for more than the home is sold for. Heirs inherit the home and keep any remaining equity after the balance of the reverse mortgage is paid off. Loan proceeds are not taxable. The interest rate may be lower than traditional mortgages and home equity loans. Reverse Mortgage Cons The fees on a reverse mortgage are the same as a traditional FHA mortgage but are higher than a conventional mortgage because of the insurance cost. The largest costs are FHA mortgage insurance and the origination fee The loan balance gets larger over time and the value of the estate/inheritance may decrease over time. A reverse mortgage loan usually does not affect eligibility for entitlement programs, such as Medicare or Social Security benefits. However, some needs based government benefits such as Medicaid and Supplemental Security Income (SSI) may be affected by a reverse mortgage loan. You should consult a qualified professional to determine if there would be any impact to your government benefits. The program is not well understood by most individuals. However, the availability of independent counseling helps.

There is a stand-alone called "FileInTime" that is low cost and may be useful to you.

Not only -- they work on the scared, too. The very success of these scams is a testimony of the mean-spirited and over-eager tactics the IRS has used in the decades of its existence. If they were not ham-handed and holding a well-deserved reputation of unreasonableness, these scams would NOT work. (That does not mean crooks would not find another way to scam people; they would. But it would take more effort on their part to succeed in stealing.)

Thanks, Elrod. Also, and sorta related, if you become an EA (and maybe if you renew, I don't know) you need to login to your PTIN account and update your credentials.

This is all a legal matter, not a tax matter. As tax professionals, we should not be giving out legal advice. The IRS does not care about all the court dramas. Refer her back to her lawyer and file or amend as the documents are presented to you. It IS a legal matter.

I agree with you 100% Terry.......... Praying, for the day it will be better.

Ok, with that being posted, I have a few comments and observations of my own to add and are posted here to keep them separated so no one thinks they came from that website. Here are some of my thoughts on additional disadvantages: An additional requirement is that the homeowner must be at least 62 years of age. This includes a spouse or anyone else that is on the title of the home, so this may preclude some from using these products if the spouse is younger than that or if a child or other person is on the title. There may be lenders that offer these products for those younger than 62. The lender will require that the home is maintained to its satisfaction and may require costly repairs be done. Some examples I've heard of are sidewalk repairs for any cracks or unevenness and damp basement remediation. If the borrower does not have the resources for this, it will have to come from the reverse mortgage proceeds themselves. Because there is no income requirement and solely based on the equity of the home, the interest rates +/or fees may be high. If choosing the monthly payment or line of credit option available with these products, each of those draws usually come with a fee attached to them as well. The loan does not have to be repaid as long as the home is the borrower's primary residence. It becomes payable when the borrower sells, moves out, or dies. Moving out also includes the borrower being placed in a long-term care facility, and that is usually when the family is looking to the remaining resources to fund this person's needs and care. Accumulating interest adds to the loan balance. Estates or heirs are required to pay off the mortgage so inheritance is reduced. An heir wishing to keep the family home in a cash poor estate will have to use other funds to do so.

I do not see this as the mother being forced to sign the 8332 under duress. A divorce decree is negotiated. If the mother agreed to sign the 8332 I would guess that she got some other consideration which benefited her.

In my original post I said 'working off of two computers" I totally agree that not having access to e-mail, internet etc.; is detrimental to our practice. That is why I stated to use one computer that stays off line until it is time to update and transmit. That can limit the hacks. It is a shame that technology is such a wonderful tool that has made our jobs easier but at the same time has allowed the crooks of this world to use it in a manner that it wasn't intended for.

I just got another call from "IRS" on my cell phone. Left a message about the "arrest warrant" so I called them back on a land line and said it was my wife's cell that they called on and she was out. I gave them a phony name and SS# and then played the game with them for 37 minutes and 14 seconds. They verified that the phony name and phony SS# did actually owe $9780 for "willful mistakes" made over the past 4 years. I told them that I take a standard deduction and only have 1 W-2 form, but they were "certain" that I had purposely made a false calculation and the warrant for my arrest, 5 years in prison, and a $95000 fine was coming my way! BUT, if I cooperated today with them, they would eliminate the big fine and jail time--all I had to do was pay the $9780. I told them i never have seen that amount of money at one time and that I only had about $200 in the bank. They asked about credit cards and I told them I thought I had about $2000 left on my only credit card. They kept transferring me to other agents and collection officers and I was put on hold many times. Finally the collection officer, a heavily accented "Patricia Wilson" said that she would work with me on a payment plan as long as I got them the $2000 today. She told me to drive over to Walgreens with my cell phone and purchase four $500 I-tunes cards. She gave me a tip--"don't tell Walgreens that the cards are for the IRS or they will charge you $50 more for each one." I thanked her for saving me the $200 and she said "You are welcome--at IRS we are dedicated to helping out the taxpayers." I told her that it was my wife's cellphone and I did not have a cell, so she told me to put the call I made to her on hold, drive to Walgreens and buy the cards, and then come back for further instructions. When I hit the 37 minute mark, I told "Miss Wilson" that I had just one more item to mention and then told her I ws an accountant and really enjoyed wasting her and her associates time this evening. I ended with "Have a nice day and perhaps get a real job." She ended with "(Bleep) you for wasting my time." And here I thought she was dedicated to helping out the taxpayer. Her number, if you care to have some fun, was a DC number 929-294-1482

Yes, I would put that on Sch C.

I am resurrecting this old thread as I have two election commission members, each works every year, going to meetings, training poll workers, working at the polls, etc. They each made $1705 in 2015, and the SSA threshold amount for election workers for 2015 is $1,600, meaning every dollar was subject to FICA. The county puts this in Box 3 of Form 1099-Misc. Every. Year. (It should be on a W-2, I know, but, I'm not chasing that rabbit.) So, to satisfy the tax gods, this belongs on Sch C, does it not? https://www.ssa.gov/slge/election_workers.htm https://www.irs.gov/government-entities/federal-state-local-governments/election-workers-reporting-and-withholding

Without research, I would say that this is based on the equity interest in the home, and that is its FMV minus the balance of any outstanding debt secured by the home.

This does not, however, necessarily mean the IRS will get it right. I have had letters go to clients who properly filed 2014 K-1's on their 2015 returns due to the fiscal year, who then received letters from IRS adding that income to their 2014 return. So far when that has happened, a simple letter and copy of the K-1 has resolved the issue. It is annoying, and apparently not handled completely by computer. I had a 1041 with 2 beneficiaries who received K-1s - one got a letter and the other didn't. Go figure.

Looks like the judge was following the directives of the divorce papers, so her choices were to sign or be in contempt of court. The bottom line is she signed the form so the dependents go to her ex.

No, the estate is filing a 2015 return and the Schedule K-1s are part of that filing, and they are correctly prepared on the 2015 Schedule K-1s that are part of that filing. Everything in that entire filing should be prepared on 2015 forms. As I said in my first post, when the beneficiaries receive those 2015 K-1s with fiscal year dates entered, the ending date of the fiscal year determines the year the individual reports it on his or her return. The actual 1041 K-1s instructions to the recipient do not say this, but that is how it works. That is found in IRC 662(c): (c) Different taxable years - If the taxable year of a beneficiary is different from that of the estate or trust, the amount to be included in the gross income of the beneficiary shall be based on the distributable net income of the estate or trust and the amounts properly paid, credited, or required to be distributed to the beneficiary during any taxable year or years of the estate or trust ending within or with his taxable year.

No, at the entity level the tax year is determined by when the tax year begins. Individuals receiving K-1s will report the activity in which the year ends.

Until the education level and common sense level of Americans comes back to the point where most people are not intentionally apathetically ignorant, these scams will continue to work. These scams only work on the gullible.

Adding to my post above, I'd probably deduct it. I don't think the character of the loan or its terms are changed simply because it was inherited. It is still a reverse mortgage, and if it is still in the estate the administrator or executor would handle it the same way the decedent would if still living, and in the heir's hands he is still bound by its terms and is required to pay it off within a certain time frame. From pub 936: Reverse mortgages. A reverse mortgage is a loan where the lender pays you (in a lump sum, a monthly advance, a line of credit, or a combination of all three) while you continue to live in your home. With a reverse mortgage, you retain title to your home. Depending on the plan, your reverse mortgage becomes due with interest when you move, sell your home, reach the end of a pre-selected loan period, or die. Because reverse mortgages are considered loan advances and not income, the amount you receive is not taxable. Any interest (including original issue discount) accrued on a reverse mortgage is not deductible until you actually pay it, which is usually when you pay off the loan in full. Your deduction may be limited because a reverse mortgage loan generally is subject to the limit on Home Equity Debt discussed in Part II.

It's true that the accrued interest does add to the outstanding balance of the mortgage since it is considered an additional advance since payments aren't being made. Generally speaking, interest on a reverse mortgage is only deductible when it is actually paid and also falls under the home equity interest rules. Now the question is whether the beneficiary inheriting that property can deduct it if he pays off the reverse mortgage. Without research, I'd say that he probably can because he is now the owner, the loan is secured by the property, he has the obligation to pay it off, he makes the payment, AND if he isn't otherwise limited by the home equity rules. That's probably why Abby mentioned it might be deductible if the heir didn't already have a second home, but even if he doesn't, he still has to worry about the $100K limitation.

From your question, I'm not sure if you mean working for a presidential campaign committe, or working at an election site. It's taxable either way. If it is working at the polls, it goes on line 21, other income. Do the bunny hop and on the list of other income, you will find "precinct election board duty".