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Hi folks, The server move I mentioned last month will begin soon: You'll know it's in progress when the forum is replaced with a static message, and you'll know it's back up when the message is gone and there's an update on this post. I've done a trial run of the migration and although it went smoothly, I expect a few bumps over the coming weeks as it starts getting real traffic. Thank you for your patience!

I don't like the practice of criticizing other professionals because it's not, well, very professional. When a client brings me a return prepared by someone else, I never say "that person messed up," but maybe something like "s/he did this differently than I do" or the code changed that year or whatever. We never know if the prior person had all the docs the client brings us, or if the client answered questions the same way. I respect letters after names, like EA and CPA, because I know how hard it is to earn them. And all of us, letters or not, make mistakes. Think of McDonald's commercials. They never even mention competitors (unlike their competitors) but just highlights how wonderful their own offerings are. I disagree and have only been there maybe once in five years because it was the only quick place around, but that doesn't mean they don't know how to cook.

I've just set up rules to issue a captcha challenge for any visitor not from the US or Canada to help with the bots and spammers. I'm interested to know if anyone on the forums gets caught up in those--if not, I may block traffic from outside North America entirely. I wouldn't normally do something like that, but this is a very US-specific site. Can anyone think of a reason not to?

Alright, everything is moved and at first glance, things appear to be working normally. A lot has changed behind the scenes--more than I'd normally like to change all at once, so please report any issues or broken features you encounter.

^^ This! Your client's basis is now the basis she and former spouse had as a joint couple, and there is no step-up. She is now selling as sole owner so the exclusion is only the $250K, assuming she meets the requirements for the full exclusion she is allowed.

I buy the 1040 package for family and friends. It costs about 1,000 and you can do up to 75 1040 forms at no extra charge with up to 3 states. Entity returns are about 75 each extra. I charge for some of the returns I do and that ends up being more than the cost of the software.

You are welcome! I ironed out and documented the process yesterday, and everything went smoothly this morning.

Wow! Quick work, Eric. We appreciate your knowledge and hard work to make this move and to continue to monitor it for us. Thank you!!

So it will be $11 until the third party contract is renegotiated in 2026 at which time the PTIN fee will probably be revised again. https://www.thetaxadviser.com/news/2024/may/regulations-finalize-ptin-fees-for-tax-return-preparers.html#:~:text=The IRS arrived at the,training%2C supplies%2C and overhead.

I switched and have had no issues that couldn't be resolved with a quick phone call. I did the practice returns when I first tried it and by the time tax season started for the most part I was up and running at about the same speed as ATX. It just gets a little getting use to, but overall I am very pleased.

I'm using CloudFlare to manage DNS and as a proxy in front of the site. If I set up the rules to block traffic from outside of the US at that level, they won't even hit the web server. My only worry is that if a forum member is blocked for some reason, they're not going to have any way to let me know they can't get in. Since enabling the captcha 30 minutes ago (click the checkbox to prove you're not a robot), out of 910 challenges only 4 were solved. It may not be necessary to block the traffic completely if the challenge is effective against the type of traffic I'm trying to prevent.

I agree with Judy (which is almost always the case!). I don't know that he will be better off if he took investments at the same value because we don't know the basis of the investments that he got. But for sure she gets full basis in their combined hands to calculate the gain and then 250K tax free of that gain. I don't see him getting 250K tax free gain from the investments. It could be her lawyer got her a better deal because the investments are very low basis and he will have a bigger tax bill because of it. If it was my client, I would stay out of questioning the divorce settlement. She had a lawyer to protect her interests and what came out of that is now fact. Looking back at the divvy up of assets will only run you down a rabbit hole you have no business sniffing around. Not telling you how to run your practice, but I am telling you how I would run your practice, because, well, you asked..... Tom Longview, TX

But you need to know the formula for calculating. They usually involve accumulating inflation amounts until they reach a certain threshold, before an increase is allowed. So prior year calculated amounts that weren't enough are added to the current year calculation, if they didn't reach that threshold in the prior year(s).

Been with Drake for over 20 years and am very happy with it. There is a little bit of a learning curve as it is not always intuitive. Customer support, although not as good as used to be, is still very good. Usually answer in a couple of rings. A lot of new people answering now and don't always have the answer right away but are very good at calling back within a day. I really like the macros that you can write to automate the routine data entry that has to be entered on every return, saves a lot of time. I don't believe Drake low balls you for the first year. I have always paid the same with small increases over the years. It integrates well with Grunt Works and their portal, although not perfect, is good and works well with the tax program. The portal has gone up in price quite a bit over the past few years and I will be looking for a replacement for next year. I do mainly 1040's with a couple of simple 1120's and a 990. I have heard that Drake does not handle multi state business returns as well as the higher priced programs. PM me if you have any specific questions.

Thanks to all who responded. I was able to recover Windows 10 in about 15 minutes once I figured out how to do it. Abby, the information in the link was really great - step by step for someone not very good at I T stuff.

https://answers.microsoft.com/en-us/windows/forum/all/downgrade-from-windows-11-to-windows-10/84a2416d-ccfb-4d87-9eee-e1056591e91f After upgrade to Windows 11, if you realize that your system is not working correctly, or some of the crucial features you need are not working as expected, and troubleshooting didn’t helped you, you might want to go back to Windows 10. You can only downgrade to Windows 10 within the 10 days of your upgrade.

This may well not help that much but I am a bit surprised about the amount of HO depreciation. Does that also include allocation of expenses? Would it be worth checking for the Simplified Method of $5 per square foot. There would be no depreciation, etc. but also no recapture and may not be as large an impact on the overcontribution.

This is a great reminder that many should be filing, even if no requirement. We have been doing so for quite some time for our disabled daughter, for this very reason (sets the clock). She does a small amount of paid work for me each year, so her income is <$500. Once she is no longer subject to means testing, she will hopefully have assets and income which will trigger required filing, so we want to prevent look back issues once her first "major" return gets filed.

Thanks Judy. That was my thinking too. I'll advise the client so and probably file. She was advised by the broker rep that she may have to file and pay some tax.

I agree with virtually everything stated so far in this thread. I too switched to Drake in 2012 and never looked back. It takes a little getting used to because it isn’t forms-based, but forms based software is way over-rated (especially since forms-based software still relies upon worksheets to a significant degree). Drake is great software and it still amazes me how stingy Drake is with memory. Startup is rapid, operationally it’s nimble, and backups are lighting fast. One hint if you switch to Drake. As soon as you get comfortable using it, spend some time learning how to construct “macros”. You can use them to design a lot of customization to automate numerous repetitive and routine tasks.

I don't know if anyone on here is mainly retired, except for immediate family and self. My consultant sent me a PRS package for $799. I'm not even sure what all it includes. I will have to call him. I don't even know what else is out there yet. I am not getting paid, I just don't want to force my family to a big box place. I had forgotten that I still will have my C Corp to prepare, but most of the family will be fairly simple. I will probably keep the Corporation open until the statute of limitations is over with tail insurance. I am hoping that I can just paper file it in the future, because it won't have any income. I wasn't even going to think about this until after I got more caught up. I decided today that I am going to get a full knee replacement in 11 weeks so I had better get my work done. My ortho said today that I am in so much pain because my knee has so much bone on bone and that he cut out so much of my miniscus to repair it that I lost a lot of my knee support. I could not figure out why my knee kept feeling like my shin was breaking below it and I miss being active. I worked out every day until this mess happened. I know that PT will be tough, but it's better than continuing cortisone shots and not improving. If any one has retirement tips, please pass them on. I will be calling the state board to see about turning my permit inactive (just in case this is a big mistake and I can't find a part time job in Colorado that will get me out of the much smaller condo.) Thanks! Bonnie

They don't come to us before. Before the divorce. Before dividing assets. Before dividing children. Even my own son left all his tax return copies that I uploaded to my portal for him to give his lawyer, so his lawyer saw nothing about their partnership, nothing about the tax returns before his ex quit working, nothing about all the monies they took out of his Roth to run the partnership and to live off while the ex's TIRA kept growing, nothing. Sorry, tired and cranky today!

After using ATX for many years, I switched to Drake mid-season during the 2012 filing season debacle. Support is excellent (if not quite as good as it was before Phil Drake retired). Not quite as intuitive but the search box works really well. No bunny-hop endless circles as I ran into in ATX on too many occasions. If you switch, you get (or at least always used to get; ask about current terms) the current-season software free to roll over returns, or re-create them (to learn how the s/w works), plus prior-year programs free. I don't use Portals but use Verifyle instead. Gruntworx - that was once standalone but got bought by Drake and integrated with it years ago - is something I now consider essential but rarely use more than the non-verified (i.e., automated) bookmarked/indexed pdf creator. It makes methodical entries far easier, but the best use is looking for substantiating documents for the tax agency "send us proof of withholding" type letters. Boom, found in an instant, instead of endless searches through vaguely-named pdf's. It also has The Tax Book as an integrated add-in but I prefer the standalone version. Pricing has been remarkably stable. This year there is a price break for single-user offices (like mine) which I like. TL;DR version: jumping in the deep end worked and while it's not perfect I would not go back to ATX.

It's rounded to nearest $50.

must be tied to inflation and the way the numbers are rounded off.

How could the depreciation be that much unless that also includes office equipment and furniture? I thought home office was 39 year property?

Just give you a comparison, I have used Drake PPR for the last 2 years. For the 2024 tax season it will cost $350, which includes 10 personal returns. Additional personal returns are $40 and additional business returns are $60.

In determining gross income for the filing requirement, gains but not losses are used in that determination. It is not the proceeds, but the gain that is taken into consideration. That being said, even when the basis is reported to IRS and no gain exists, the AUR will be using the sale side only and this new client may receive a CP2000 in about 18 months. You should explain the filing requirement to the client, and personally I'd advise this client to file a return to avoid the notice. Even without an extension, there shouldn't be any penalties assessed since no tax is due and the client doesn't actually have a filing requirement. If penalties are assessed, those should be easily explained and abatement requested. Filing also establishes the statute of limitations date in the event that you are missing some piece of income from this new the client. What about a state filing requirement?

https://brasstax.com/products/form-3115-line-by-line-correcting-depreciation/

Sara has a great view. Still, there is something to be said about all remembering advice from anyone is really only as good as the E&O backing said advice. ESPECIALLY in accounting and tax practicing, since the odds of a mistake being caught are actually slim, many are fine pushing limits/living in the grey, some don't mind being wrong and asking for forgiveness, and so on. Add in the advice only being able to be as good as the information being fed, and there are often errors and misunderstandings. Oh, don't forget, someone called someone, and the someone who picked up the phone gave advice, so it must be true.

Divorced client tells me (in advance - hooray!) of her plans to sell (in 2024) the house she got in the divorce that was final in 2023. She asked about tax repercussions of that plus some other queries. In response I asked if she bought him out, or if there was an agreement to share proceeds of the sale. Neither! She got the house and in exchange he got more of their investment assets. Total value of assets was the same. My first thought is that she gets 100% of the gain with only $250k exclusion and no step-up for "his" portion of the house. But that's just a first thought. Pub 504 and Code Section 1041 talk about basis in the property being the same as if it was a gift from one spouse to the other, with nothing about any step-up even being possible. Yet that seems to leave her with a bigger tax bill than he'll have from their investments. Making me wonder if I should be asking if there was anything in the divorce agreement that talks about equalizing basis. Any advice/references/thoughts for me?

Not questioning the settlement per se, but rather if there is something IN the settlement where, for example, his larger share of investments was designated as because she was getting the house. If there is wording specifically stating the house as his reason for getting more investments, that could be a de facto purchase of his part of the house, increasing her basis. TIA to all for answers; I'm just going to tell her she gets to exclude $250k, their joint basis from purchase, plus any major upgrades done while they/she owned the house.

Dad got back to me; situation is different from what I understood from grandfather. BB Yacht Club scholarship (even though check was written by BB Church). Family is NOT members of the Yacht Club. Offered annually to all graduating seniors in the DEHS Band. Essay contest with 3 prizes in the form of a check. My client won 1st place of $5,000. Check was made out to him personally with the memo " A BB Yacht Club Member's Name Scholarship." (Member wanted to support HS music.) No other paperwork. No mention, verbal or written, on a restriction on the use of funds. Knowing this family, though, it was no surprise that they worked the DD Tech to split the funds between 1st and 2nd semesters, applied to student's account via cashier's check. Dad did keep photos documenting all the process, if I need them. I think dad is saying the funds were used for tuition.

A few things I had done some country blocking with .htaccss on the old server, but never felt confident that I had a complete list of IP ranges The new server is running nginx, so no .htaccess Cloudflare keeps the traffic from even seeing the website, since they manage DNS and issue the challenge before a request to the server is made Aside from the country blocking, they're doing other bot detection magic, plus I'm adding custom web application firewall rules that are specific to the forum app. I'm a fan of doing as much of this as possible at the proxy, but I also have nginx rules set up for anything that gets through.

Thank you to all who responded. The OP talked the client into claiming an office of 600 sq. ft in an 1800 sq ft. house, so the business use is 33.3% I asked the client if he could justify regular and exclusive use of his entire basement for use in administering the farm operations and he responded "of course not!" I think I can talk him into amending the office to a more reasonable 250 sq. ft, in which case we can amend both returns and still leave the 401-K payment intact since we will also reduce the other expenses for the office from 33.3% to 14%. Ringers

I believe this is it (I've asked the hosting group for confirmation, too). https://www.bigmarker.com/tax-practice-pro-inc1/When-1040s-Go-Wrong-Navigating-a-Tax-Train-Wreck

How can that be though? The amounts for 2024 are exactly double at $4,150/$8,300, so applying the same inflation percentage should result in the amount for 2025 family being exactly double that of single coverage if what you say is true. Something else must be factored in because the amounts for 2023 weren't exactly double either. The 2023 amounts were $3,850/$7,750.

Congrats! It's a shame Microsoft was so tricky in getting you to "upgrade." My new computer came with 11 and it's annoying and took me awhile to tame, but it works and seems to be getting better with each update. But the average user wouldn't want to have to deal with taming a new OS.

AI Overview Here's how to find the version of Windows you have: Click the Windows Start menu Select Settings (the cog icon) Select System Select About You'll see the edition and what version of Windows you have Generative AI is experimental.

This is how you uninstall a normal Windows update. I don't know if this will work in your situation?

It is 39 Year property. 3K of depreciation makes 117K the office basis, which if it was 10% of the home it gets you to a 1.2MM home. Plausible. 3000 square foot home with a 300 square foot office? 7K of expenses does not sound like such a stretch if the home is worth that much, especially if there is a mortgage on it. Not sure about IL property taxes, but again, if the home is worth that amount, the tax bill is not cheap. Not saying these are facts, just making an observation that everything is plausible. If you wait until you file the 2024 return, you could slip in a 1310 and get the depreciation back....that is not the correct way to do it, you should amend and notify the plan administrator of the corrective distributions needed and pay the penalty for the excess contribution. You will get a 2024 1099R from them that includes the earnings. Tom Longview, TX

In addition, I like the three licenses from Max as I have two locations that I can work from and one license on another computer for my assistant. As for this year, we have some really complicated returns who have not gotten all their information in yet. I am taking next week totally off.

I am keeping the full MAX for one more year at least. My husband and son are a Partnership and I am still training my assistant. I haven't found anything else that would fill all of my needs right now, although I want to start cutting back. I thought that the full Tax Act was enticing, but not enough of a savings to justify the stress and worry of learning a new program. I am getting tired, but hate to waste my knowledge. Family and friends are being wrapped up now after the rush is over (including my own). It's been a pleasure working with all of you.

If you read the article, there is an interplay between the step up in basis and the passive loss allowed ,otherwise there would be a doubling of tax benefits.

That's why everybody was got off guard. ATX didn't prepare the software. I believe they are working on an update as we chat. Other sanctuary states might follow suit next year or in the years to come.

Praise God!

I had to file an amended return for 2022 for a client and it wouldn't efile because 'the withholding was wrong'. I got the Wage & Income transcript and lo & behold, the wife's 1099-SSN wasn't in the transcript. Nor her withholding on the 1099. But I had a copy of the 1099 issued in my sweaty little palm. It was weird and now you've got one too.

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

They got a letter even with basis reported? Are you sure? That defeats the whole purpose of the reporting mandate.