jasdlm

Have you seen a copy of the Settlement Agreement? Usually, there is a section in the settlement agreement that addresses the division of income and deductions for the year of the split.

Would it be appropriate to report the income on schedule D and give it long-term treatment? It seems to me that the only difference in that approach and amending the 4 year old return is penalty and interest and the opening of the return for examination.

Absolutely beautiful. Congratulations to you. Sleep is overrated. ;)

Hello. I am participating in a class discussion (MS in Accting). The facts are as follows: Taxpayer invested $100k in a stock; company declared bankruptcy Taxpayer claimed the stock as worthless in the year the company declared bankruptcy (yes, erroneously) and took a $100,000 loss 4 years later, taxpayer received $40,000 from the bankruptcy trustee. Issue: Should taxpayer a) amend the 1040, report the $40,000 income in the current year or c) do nothing I have already posted my discussion response, so please no one worry that I am trying to cheat. However, I am really curious to get opinions from those who are experienced. In my post, I argued that the taxpayer should not amend the 1040 (statute of limitations not extended to 6 years because the 9th Circuit held in 2009 that overstatement of basis was NOT equivalent to understatement of income). I argued that there was no fraud, even though the taxpayer erred in declaring the stock worthless. I do realize that the IRS disagrees with this position, and that another appeals Court held to the contrary in March of this year. I also argued that the taxpayer should include the $40,000 on his current year's income tax return - schedule D with 0 basis. I spent substantial time researching, and I could not find any information about the appropriateness of amending a return where the taxpayer owes money (plenty of information regarding taxpayer receiving a refund) and the statute of limitations has passed. I assume the return could still be amended? Is it appropriate to claim the $40,000 on the current year's 1040? Thanks to anyone willing to respond.

I do payroll for a company where the insurance company autodrafts the health insurance at the end of the month prior to the month covered. The premiums are withheld from the employee checks 50% on the first of the month and 50% in the middle of the month. Essentially, I have a prepaid expense in July, for example, for August's health insurance. Does anyone know how I can zero out the payroll liabilities (after the second paycheck) without creating a dummy check or making two sets of journal entries? I am just wondering if there is a QB method for going directly from the prepaid expense to the liability account. Thanks!

I am working on my MS in Accounting. In 2 weeks, I will be half way through. I plan to sit the CPA exam next summer. I am just finishing my financial reporting class. Next up - cost accounting.

Keeping you (and all in the South) in my thoughts and prayers.

Client's husband collected Antique Tractors. He died in 2008. The tractors were appraised at the time of his death. Client had an auction and sold the tractors in 2010. Client's prevous preparer had depreciated many of the tractors on H's schedule F (although they were by no means used in farming). I have matched those up as best I can and show those sales on 4797 recapping depreciation, etc. My question is about the remaining tractors. The sales prices were substantially lower than the appraised prices. I'm not sure whether I should put this on Schedule D (realizing the loss) or just treat it as loss on personal items and leave the non-scheduled items off the return entirely (and the proceeds from the same). Total proceeds for non-depreciated tractors was approximately $50,000. Basis (according to the appraisal) is about $69,000. Thanks much!

Okay . . . I'm reading the instructions for Form 6781. Hopefully, I am on the right track. Twice in the last 3 days I have posted a question and then found the answer myself immediately following. I wish I knew how to delete. Sorry!

I have never even seen one of these before. I have no idea where to begin. Client says he 'lost about $15,000'. If I am reading the 1099-B correctly, he is right. Box 8 lists 3 positive numbers and a negative number (profit/loss on futures - converted to USD and then date). Box 9 - Total unrealized P/L converted to USD on futures - another date. Box 11 - Aggregate Profit or (Loss) from lines 8, 9 and 10 (although there is no line 10) - this is where the $-15,000 number appears. I googled this and now am even more confused. Does anyone have experience with this? Thanks in advance!

There are separate entry lines for 1099 income and non-1099 income. Yes, you can enter gross income without first putting it on a 1099.

I like it because, especially with 1099 DIV and INT, as well as 1099 MISC for clients with repeat customers, it is easy for me to tell if something might be missing. (I know, hard to believe a client would fail to give me all relevant information.)

Client: I got divorced this year. My wife kicked me out and I had to live in my car for two weeks. I want to deduct that. *** Client: I'm a musician. Here is the total amount of money I spent on movies this year. I was doing research. All movies have music. *** Client: I added my fiance as a partner in my business this year so we can deduct our dates.

Found it - 2nd page, MO A. Sorry! I dont' know how to delete this post.

What form do you complete do exempt the relvant portion of the pension, and where does it flow through to on the return. I can find the phased in exemption on the DOR site, but not the specific instructions. Thanks!

Client's deceased husband was a lottery winner. The benefiary of the lottery annuity is his trust, of which client is 100% beneficiary. Their is mandatory withholding on the lottery winnings. Because the client withdraws all of the money as soon as it arrives in the trust, there is no tax due on the trust, but the client owes substantial tax. I thought that I could assign the withholding amount to the beneficiary using a 1041-T, but now it seems that I can only do this for estimated payments. Does anyone know if I can assign the withholding to the beneficiary, and if so, how? Thanks so much.

Isn't Box 6 for a 1035 exchange? If so, I think the 0 in the taxable income box is correct.

Thank you. So many people had asked (actually, asserted that they were to receive a credit) that I thought I must be missing the big boat. Thanks again!

The only tax credit I can find for these energy efficient appliances is for manufacturers. What am I missing? Several clients have come in asking about this. I have gone to the energystar.gov sight,etc., and I can't find anything. Any confirmation/contradiction of the above information would truly be appreciated.

The contract just says he has a 1/32nd working interest.

Client paid $4,500 for a 1/32nd working interest and rights to .8125 oil production after royalties. Company drilled the well and it was a dry hole. Client wants to write off the entire $4,500 as a 'sunk cost'. I haven't seen a k1 or any other tax document. He did give me a copy of the contract where he invested the $4,500. Can I write this off? If so, how? I have tried to research this and also asked 2 CPAs in the building, but we must all be really tired, because I stil have no answer. Thanks.

NECPA - I am so sorry.

One more thing: I have had more than one instance where a brokerage account did not calculate the Min Dist accurately. I always double-check.

Distribution is based on the 12/31 value of all retirement accounts. You can aggregate among like accounts (IRA, 403(, etc.), but must calculate and withdrawal from each type of account separately. Take the 12/31 value and divide it by the 'divisor', which is the IRS life expectancy. IRS has life expectancy websites on the website. This is the amount that must be withdrawn. Be careful if beneficiary is 10 years or more younger than the Retirement Account owners. The life expectancy is different. IRS has tables for this, also.

I want to be a barista at Starbucks.