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It's based on this quote by Upton Sinclair: “It is difficult to get a man to understand something, when his salary depends on his not understanding it.”

Oh....I love that. Is that your own or is it a quote from someone else. I am stealing that line. Tom Longview, TX

that was able to use a passive loss carryforward - in full! I have been waiting for a very long time.

That's why we need to move to Colorado. Our son DIL are there to help us. My step-daughter came over today and cleaned and dusted since I don't have a robot that can dust or clean bathrooms yet. This was a first in 34 years and I was super grateful. I highly recommend RoboRocks! I had a Roomba and a separate mop before, but they are not nearly as advanced as the RoboRock. Hubby came home yesterday with 24-7 oxygen so now I have 50 feet of tubing running through the house. I have to find a way to get it off of the floor. This is a new phase for us, but we will figure it out.

Sounds like a good client - or like you have decided they are a good client. Back to the original post. FMV of the items on the date contributed to the partnership is the Basis of the Fixed Assets. Depreciate under the normal rules for used equipment. Most conservative approach is to get an appraisal. If they want to be a little less conservative, use Garage Sale or Craigslist pricing for used items of similar value. If they insist on using the amounts they say they paid for them (and if you believe them), get them to write a letter to you signed and dated that says this is the value of the property they contributed to the partnership. It does not have to be confrontational, just explain that you are there to protect them from audit risk. and the riskiest way to go is take their word for the basis of the property. Tom Longview, TX

I always take the word of the client, unless there is a suspicious reason not to. It is the job of the IRS to audit them, not mine. One concern is that these assets were purchased prior to the formation of the partnership, and were contributed as capital investment - i.e. "hot" assets. They will have to be tracked if that is the case for five years. Also, my experience is that the partnership will not last long, unless they are bound together like family members. I don't know how many of these partners love each other to start with, and after six months they are ready to go their separate ways. Running a business is not the same as painting.

I have a client who was seriously lacking intelligence when he put the cash in the bank; then ate out and bought groceries, etc. with his credit card. The Hammer fell and he is on a payment plan to the IRS well into his senior citizenship and retirement. Regarding your client, Lee, I would give him the benefit of the doubt for now. I know when I started my business many moons ago, I placed into service used equipment that I happened to already own before I operated as a business. (tax returns for family, friends, etc.) Only you can get the "feel" for the honesty of your client. If you believe in him; educate him on how to conduct a business going forward. I don't like the idea of a Partnership starting out; but then who knows? My husband started a small Partnership 50 years ago. Even though our son bought out the other partner several years ago; they are still going strong and I am the one who gets to crack the whip.

Is this a client you would want? Would you have confidence that they would count the sales they receive cash payments? Don't forget that if they paid cash there is likely use tax due on purchases.

Panels are next to the house, connected to the house, for the house. Lots of reasons - including structural and where the trees are - influence the location of the panels. I would not hesitate.

First question I have is how much money are you talking about? A couple thousand bucks of ladders and drop cloths and stirring blades? Or tens of thousands including scaffolding and compressors and sprayers? If the latter, and they honestly don't have invoices, send them to get you (1) a detailed & annotated list including item, who purchased from, for how much and when, and then (2) prices for new same-type items from Lowes or Harbor Freight or specialty suppliers, showing prices. If comparing those two shows a reasonable price paid for used - as opposed to new - equipment, then I would accept it. After reading them the riot act (in print - and get them to sign & date that, give them a copy and you keep the original) that they are never, ever, to buy substantial equipment again without at least a sales receipt showing date, amount, what, and from whom purchased. If the former, I'd still do the letter riot act, and have them bring price sheets for similar ladders etc., but not necessarily require as strict an itemized list. If that means they go on extension while they dredge this all up, that is not your problem, but theirs. Of course, if you think they're cheating, or that they stole the equipment, hand 'em back their docs and wave bye-bye.

I'm such a dunder brain. Client withdrew $250,000 from an IRA and had no withholding, but there is no way he can possibly owe taxes because he withdrew it over several months and not all at one time. Absolutely no way. After a 30 minute conversation (30 minutes that I'll never get back) and haranguing my staff for another 30 minutes, unfortunately, we still do not understand. I wish I were better at my job. Do you think if I recommend one of the big box preparers they might have someone who could understand more easily? I would say Rita hugs all the way around, but I'm in no mood to be that close to him or his offspring, who came to join the 'this has to be wrong' chorus. Happy Wednesday.

Absolutely correct!!!

Taxation of the social security with MFS depends on whether or not they lived together. If they lived apart for all of 2023, they would get the same "base amount" of $25,000 that a Single filer would get. If they lived together at any time during 2023, the base amount is zero--in this scenario she would probably have a filing requirement. Ideally, you could plug in all of their income into the software and show them the total tax liability MFJ vs MFS. But it is their decision and it is not always about what would be saved that year--new couples sometimes find out about their spouse's unpaid liabilities when they file jointly.

It's a quote I've used many times when discussing total market indexing with financial advisors.

It's very difficult for a person to understand something when they recognize that understanding it is going to cost them money.

My panels are on my 'extra' building. Holds my hubby's game stuff, tv & stereos. I look at it like if the panels were on land next to the house. The panels are for my 'main home'.

I'm glad I'm winding down.

NECPA, that is a heavy load that you are carrying. I hope that you have family or close friends that can help you.

I've had a lot less of forgetting all the dividend pages since I've had my portal and more clients are getting their 1099s in PDF form. They just upload the PDF and voila! I've got it all.

My daughter gave me a placard for my desk that reads, "I can explain it to you, but I cannot understand it for you."