Edward

I've heard that above documents from Fidelity have been delayed because of confusion of the new reporting requirements? Anyone else having similiar problems? If so, I understand that you should go for an extension using Form 1127-A rather than thse 4868. Any comments?

The instructions for line 13 of form 8863 appear to be kinda confusing. Anyone else having difficulty with these confusing instructions, or is there something wrong with my thinking? I would think that IRS could have made this into a more simple presentation? Any comments.

Couple were married in February 2011 - friend gave him some bad advice and said he should file as single and his spouse to file as head of household. He went to H&R and filed his return a week ago & is expecting 1400 tax refund; and neglected to file MFS. His wife came in today and told me what transpired. I did not file her return in view of the problem. I then proceeded to call him and mentioned that he had really created a disaster by filing the return as he did.. He then agreed to get things back where they should be. He brought a copy of the H&R e-filed return and his w-2's. Since they both DIDN'T file MFS I am confused as to what method I could use to resolve this. Should I prepare a 1040x & zero everything out so that he now has a balance due back to IRS of the 1400.00? Sounds like the most logical approach. Any advice on this?

Believe me, I admittedly was in a state of confusion when that post was written - but as always (as you've done in the past) came forward and relieved me of the misery -- I had done one of these way back and when I opened the depreciation book I noted the 280F looking me in the face and that certainly "rang the bell". Thanks again for your comments.

Basis when placed in service 010102 37479 Cents Per Mile recapture 2002 thru 2010 (3406) 34073 USING S/L DEPRECIATION: a. 2011: Total Miles 7364 w/business miles of 1571 = 21.33% business use, thus 17.50% x 34073 = 5963 x 21.33 = 1272 depreciation for 2011. b. 2012 - 20% SL c. 2013 - 20% SL d. 2014 - 20% SL e. 2015 - 20% SL f. 2016 - 10% SL If 7th year vehicle is not fully depreciated continue with the 10% SL depreciation based on business use percentage. This seems to be too easy - I did one of these years ago BUT THE one item that bothers me is: Am I also required to reduce the basis by the "Business Use Percentage" like in a. above, 21.33% x 34073 equals 7268.00 which would drop basis to 26805 for the 2012 calculations? OR, shold I stick with the presentation in a. thru f. above? I picked this guy up this year. Would appreciate any comments. Thanks.

Thanks JohnH - it worked - I had feared I was faced with a major problem - Greatly appreciated......

This AM I hit the Roll Over Tab and of course the 2010 alphabetical file comes up - but when the listing of clients for 2010 appeared the names were scrambled and not in alph order. I've never had this experience before. I then went out of the 2011 program and called up the 2010 ATX program and all the names were in alph order. Wonder why they are not in alpha order when I go the roll over program for 2011? Have I done something wrong? Anyone have a problem like this?

I received an acknowledgement at 12:00 am when I had efiled the return at 1:30PM same date and in same time zone. How can they put a time before I efiled the return, or am I misreading this? Too, I efiled a return @ 10:15pm on the 22nd, they acknowledged at 12:00am on same date? I am assuming we are in the same time zone as the efile manager shows Austin. According to the Refund Cycle Chart the refund should be in the bank by the 1st of February, correct? Now when I go to "where's my refund" it tells us that the deposit should be in the bank by the 7th of February which is 6 days later than what the Refund Cycle Chart says. A mailed refund would have arrived the 3rd of Feb, or 4 days earlier. It appears the acknowledgements are coming fast but shouldn't the deposits be equally fast? This dosen't make sense. ......Any comments?

Go to the My ATX board and there is a complete explanation by Kimmie on this subject.

Code D11: D=Elective deferrals to a section 401(k) cash or deferred arrangement. Also includes deferrals under a SIMPLE retirement account that is part of a section 401(k) arrangement. Note: when a year follows code D, you either made a make-up pension contribution for a prior year(s) when you were in the military service or you made a make-up contribution for TSP. To figure whether you made excess deferrals, consider these amounts for the year shown, not the current year. If no year is shown, the contributions are for the current year. I got this from the back of a military W-2 for 2010 so I suspect it applies also for 2011.

My niece is hosting a student from China and she is receiving 900.00 per month. Can she expect a 1099-misc for these payments or are they tax free? Pub 17 state that the host can deduct 50.00 per month for such students but has nothing about stipends!! Any help would be appreciated.

E-Filing officially begins on the 17th, tomorrow - other firms may be preparing returns but they also have to wait till tomorrow to e-file. Download a copy of the 2012 efiling refund cycle chart for details.

All clients that I do the bookwork in addition to their taxes, I make up the 1099's for them cause they don't even know what I am talking about. Anyway, I have all the info and its much easier for me to make the 1099-Misc for them. I do, however get them to sign the 1096's.

Last week received notice "Important Info Regarding Item #BOOKLETO5" concerning W-2's and 1099's: a. The NEW requirement to issue 1099's for Rental Property Expense Payments was officially repealed by IRS. b. Entry of Code DD in Box 12 of the W-2 for cost of employer-provided health coverage is voluntary for tax year 2011. c. Truncation is extended for 2011 and 2012 meaning that the SSAN or EID numbers may be truncated to just the last four digits on 1099 series forms issued to taxpayers ONLY but those going to IRS must contain the "full number". This action is supposedly to combat identity theft. . .

Was reading a TIGTA Press Release of Nov 19, 2009 and here are some astonishing highlights from the paper: a. In a review of 2006 and 2007 returns there was a total of 372,169 taxpayers who erroneously claimed a total of 532 million in Hope Credits. b. Some of the taxpayers who erroneously claimed the Hope Credit were IRS employees. c. TIGTGA is firmly against the educational institutions completing the box regarding "Qualified Tuition and Related Expenses" and highly recommend that "Amounts paid by the student" be completed ONLY as this figure is the amount used to determine how much credit the student may qualify for. d. The IRS requires educational institutions to complete and mail form 1098-T but it does NOT USE the Form or accept it as supporting document as the 1098-T and form 8863 is not matchable, and therefore not acceptable documentation to support educational expenses paid. e. Educational institutions expend approximately 5.1 million hours each year to complete Forms 1098-T at an estimated mailing cost of 3.8 million dollars. Interesting and confusing so wonder how TIGTA was even able to come up with the figures in a. above. Too, wonder how many prisoners took a cut on this credit? No wonder IRS has recently come forward with a "Real-Time Tax System Initiative" to cure similiar problems within the taxing industry.

For 2009 Drake provided several excellent EITC work-sheets that IRS should require for all tax returns. If anyone is using Drake could you show us the samples. These pretty well cover all the due diligence items including a questionaire regarding head of household. The three statements require a signature by both he taxpayer and taxpreparer.

HAFA is Home Affordable Foreclosure Alternatives - while HAMP is a program to avoid Foreclosure. We now know what HAFA AND HAMP are, but am not familiar with the HAFA details as I believe this is a new program.

I received the 1099-S from my client and the people that handled the closing (HUD-1) gave my client the 1099-S but the single 1099-S reflected the TOTAL of both (240,000), when it should have been split between the two transferors. I contacted the closing company and they are going to send corrected 1099-S's to show the split. Yes, I will be efiling the clients return.

Sorry but I goofed in failing to read a "NOTE" sentence of the instructions which read: FOR MULTIPLE TRANSFERORS: You must file a separate Form 1099-S for each transferor". So problem solved. Thanks.

Have client that inherited farm land (50/50) with sister. Settlement Stmt (HUD-1) shows both as sellers but the 1099-S has only his name with total gross sales 240,000. In looking at 2010 edition (Bookleto5) HOW TO PREARE 1099'S, pages 109 to 111 I can not seem to find any references to the "splitting" of Gross Sales price. Both will report their share (120,000) however. Is there a way for me to add a comment regarding the allocation before efiling? Any comments will be apprecicated. Thanks

I just talked to the potential client and found out that there are three people living with him and not two like he originally said. His responses are conflicting and don't match what he originally told me. In view of the "odd situation" here and the potential for IRS audits, I have decided to suggest to him that he return to the original preparer that he has been using for the last 6 years. He then told me that she charges too much; and after I informed him what I may be charging, he agreed that it would be better to go to the original preparer........so that ends this chapter..... thanks for everyones input....

T/P income vs expenses way out of line. Net Income 9800.00,(Sch C). Greeting Cards designer. He has a nice home of which the Mtg Interest, Prop Taxes and Insurance wipe out the 9800.00. and I'm certain he will end up with a loss. I questioned him on this and after a long session he finally admitted that there were two other men living with him and that they were contributing necessary cash to meet all expenses - he says the others are managers of well known local stores so I would say they have the ability to possibly assist him in the additional expenses. BUT, how can I include this info (or can I) on the tax return so that IRS will be aware of this odd financial arrangement? Any help will be appreciated...

House Bill, H.R. 4646 is a piece of legislation being proposed and passed around to various committees. It proposes to put a 1% tax on all financial transactions. This transaction fee would apply to checks, cash, credit cards, atms, stock and bond transfers, and retail and wholesale sales. The bill is referred to as the DEBT-FREE AMERICA ACT. There is mention that this "fee" would go to reduce the deficit and would be repealed after 2017. So here is another tax quietly squirming it's way through the socialist channels by a member of Congress!!! We must spread the word and voice our objections to our friends and lawmakers so that this travesty dosen't get past committees where it is currently. (Source: Google)

Pacun: You should go to FACEBOOK and present these comments to David Williams. He is in charge of all this and I'm certain he would want to know about what you said. In March I had a client that came to me and he had been seeing a lady that used TT on his tax returns, and of course in the preparers signature element it had "SELF PREPARED". Anyway, the guy did some business travel and you wouldn't believe how she handled it. One year she would give him the mileage and the next she would switch MACRS, then the next year back to mileage of course disregarding the limitations when you do the switching of such modes. When I asked the guy if he had any mileage logs, he stated negative and that they would just give an estimate which was way out of shape. Many of the other expenses were way off so I just told him I wasen't going to work with the return and told him to go elsewhere. These unregistered types are creating a real disaster for the tax preparation industry and I doubt whether they will ever catch them.

The following from David Williams of IRS on FACEBOOK yesterday: "Almost every one who has a provisional PTIN will be required to undergo a background check before Dec 31, 2013. The check is part of the phase two effort that includes the competency exam. To begin the suitability checks, you must submit fingerprints to an IRS designee so that a FBI criminal background review can be conducted. Also, the IRS will perform a tax compliance check. Here is what's new for late 2011-2012: The IRS has awarded two contracts to firms that will collect and review fingerprints for the background reviews. The background checks will begin in the fall, possibly October. The estimated fee amount for background checks is between $60-90. Two firms, Prometric Inc and Daon Trusted Identity Services will provided fingerprinting and FBI background review services. Prometric also will be administering the competency exam so preparers can complete both tasks at once. Daon will designate 450 "The UPS Store" locations nationwide as fingerprint collection points. Daon will handle fingerprint collection and background services only. The suitability check is a critical part of the compliance effort. Circular 230 states that if the suitability check uncovers "disreputable conduct" then the individual is not eligible to become a Registered Tax Return Preparer and therefore not eligible to legally prepare 1040 tax returns. The IRS, not the vendors, will make that determination. If you have outstanding tax issues, we urge you to get the issues resolved immediately, before taking part in the tax compliance check."