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Pacun, thanks for the recommend. I *liked* your post above, and the part below gave me a good chuckle. Yes, I know that is not what you really meant to say, it struck me funny though.

It might be wise to set it up now in anticipation of the numerous questions to come rather than to wait and move them later. If there isn't much in the way of activity, it could always be merged back in.

One of the problems mentioned in an overview-type seminar I took recently that will be a problem of missing information is that people may know that they are exempt, or think they are, but they will not have obtained the exemption number from the marketplace for 2014. That number is required entry on the form 8965.

You should ask for a refund... Please stop the snarking, and if not, I'll lock the topic because it seems that the actual topic question has been discussed and exhausted. Thanks.

Form w-2 preparation is done in the ATX payroll program that was separated out a couple of years ago.

Have you looked at MS Office online for a template? It wouldn't be cloud based, but should be a fill in the blank form. If client is preparing this for a specific lender, the financial institutions can usually provide the exact form needed, sometimes as a fillable pdf.

In service date is the date it is available for rent, whether it is rented or not. Once it is available for rent, expenses may be deducted.

^ That is incorrect. Ordinary and necessary expenses for managing, conserving, or maintaining the rental property are deductible from the time it is put in service and available for rent.

Here's the Drake software home page: http://www.drakesoftware.com/site/default.aspx The link to the forum is the very last item on the right-hand side of the page Now that you've purchased, you need to make sure the program has your actual EFIN. If you haven't already, you'll have to provide Drake with a copy of the IRS letter assigning the EFIN to you, and Drake's accounting dept will update their records to include that. Once that is done, sign in to the "support" area from the link upper right on Drake's main page. Once logged in you'll see categories over to the right, each containing LOTS of information and resources.

Link to IRS site: http://www.irs.gov/Tax-Professionals/Enrolled-Agents/Maintain-Your-Enrolled-Agent-Status Maintain Your Enrolled Agent Status Keep Your Contact Information Current If your contact information has changed since the time of your last renewal, please notify us by fax or mail your address change to: Office of Practitioner Enrollment P.O. Box 33968 Detroit, MI, 48232 OR Fax: (313) 234-1622 Please include your name, prior contact information, new contact information, social security number or tax identification number, and the date. Page Last Reviewed or Updated: 13-Nov-2014

I think you should call support. They answer the phone within a couple of rings and are very helpful. If the person can't answer right away, they WILL get the answer and call you back. The longest I've waited for an answer was a couple of hours during their busiest time. I'm not sure of their hours at this time of year, you might have to wait until tomorrow. ETA: I just spoke to them about a password issue. Support is open until 10pm tonight and the rep confirmed that printing should not be restricted in any way in the demo version. I don't recall having any restriction on printing from the demo copy. It is fully functional with the only restriction being not able to e-file because they set up the demos with a temporary EFIN, not your real one. It could be that you are missing some setting specific to your printer, and support would be the best place to get an answer.

Yes, the IRS shut down efile on 11/22 until sometime in Jan when it opens for the next filing season.

???? Creative, but not what any filer should be doing, and just because you've been doing it that way for many years does NOT make it correct, only that your creativity hasn't caused your clients in requiring additional documentation. You should NOT file a state return for a state that the taxpayer truly has no connection to other than a c/o mailing address.

Margaret, as you probably know, a durable POA is for all matters but is not for tax matters. The IRS will not accept this as valid unless it contains all the required information that a standard 2848 contains. Your client and his son might want to consider perfecting this durable POA so that it is also valid for tax matters. Pub 947 has the details. Sorry I don't have the easy answer about the address. Are there any other trusted relatives nearby that the father and son could work with?

I'm pinning this topic so that it will stay at the top of the post listing and be readily available without searching.

I was having trouble with the formatting and might have added this to my post above after you'd already read it: The custodial parent is the parent with whom the child lived for the greater number of nights in 2013. If the child was with each parent for an equal number of nights, the custodial parent is the parent with the higher adjusted gross income. For details and an exception for a parent who works at night, see Publication 501. The noncustodial parent cannot treat the child as a qualifying person even if that parent is entitled to claim the child as a dependent under the special rules for a child of divorced or separated parents.

From pub 503: Child of divorced or separated parents or parents living apart. Even if you cannot claim your child as a dependent, he or she is treated as your qualifying person if: The child was under age 13 or was not physically or mentally able to care for himself or herself, The child received over half of his or her support during the calendar year from one or both parents who are divorced or legally separated under a decree of divorce or separate maintenance, are separated under a written separation agreement, or lived apart at all times during the last 6 months of the calendar year, The child was in the custody of one or both parents for more than half the year, and You were the child's custodial parent. The custodial parent is the parent with whom the child lived for the greater number of nights in 2013. If the child was with each parent for an equal number of nights, the custodial parent is the parent with the higher adjusted gross income. For details and an exception for a parent who works at night, see Publication 501. The noncustodial parent cannot treat the child as a qualifying person even if that parent is entitled to claim the child as a dependent under the special rules for a child of divorced or separated parents. Dependent defined. A dependent is a person, other than you or your spouse, for whom you can claim an exemption. To be your dependent, a person must be your qualifying child (or your qualifying relative). Qualifying child. To be your qualifying child, a child must live with you for more than half the year and meet other requirements

Yes, must be paper filed.

I think there are other states that already had laws prohibiting preparers from adding fees for bank products and fee collect. New York comes to mind, but I don't know the details since I keep things simple by not handling these kinds of transactions.

That's very nice, Tom. I see you included a selfie in the second picture.

Hey, I was on a roll. Tom summarized it nicely in 2 sentences.

Jack is answering about the recipients basis where the recipient acquires the donor's basis (steps into the shoes of the donor). If you are actually asking about how to prepare the gift tax return and about determining the fair market value at the date of the gift to report on Form 709, Sch A, column F, that is a much more complicated answer about how to determine the value of an ownership interest in a closely held business on a piece of property. If that is really what you are asking about - If by property you mean real estate, I'd suggest your client use a qualified professional to appraise it because the documentation of how the FMV was determined is required to be attached to the gift tax return, and gift tax returns are reviewed by humans at the IRS. That is a risk area for tax preparers since doing valuations aren't within the normal scope of a tax preparation business. A typical scenario that I've encountered a few times goes something like this: A parent owns his own residence and a 2nd house that the child is living in (for little or no rent) and transfers that 2nd home to the child by gift. Yes, the child's basis comes from the donor's basis, but in preparing the gift tax return, the preparer must explain the method used and report the FMV on the date of the gift because that determines how much of the unified credit is used up by that gift and calculates whether there is a taxable component to the gift at all. Business valuations are much more complicated and especially so when the business is closely held. There are business appraisers that do that too. There are methods that the IRS finds acceptable and that take into consideration a variety of factors that I feel are really beyond the scope of something that could be easily or completely explained here. Again, an explanation of the valuation method used must be filed with the gift tax return. If you are considering doing this, you might want to check with your malpractice insurance agent to make sure that type of service is covered. As an example, I had a C corp client that gifted 76% of his ownership in his closely held business to his son in stages over several years. To highlight a few of the areas considered in that valuation, those factors included the type of industry, the size of the business by volume or asset base, its locale, its competition, stability of client base, discounts for lack of marketability due to being closely held, adjusting for owner compensation that might be in excess of what the business would pay an outsider or manager to perform those same duties, and much more. That list of factors isn't meant to be a full discussion, obviously, so don't shoot the messenger. I was only trying to show how business valuations are complex. A full explanation of how those valuations were done was attached to each and every gift tax return that was filed. No funds changed hands, the son received something that had appreciated close to 50 times more than the dad's basis in the company, and son's basis in the company is equal to 76% of dad's basis. The gift tax return filed by an individual tracks the total gifts given by that person over his or her lifetime so that one knows how much of the unified credit has already been used up while he/she was living, and that is used in determining if there is a taxable estate or not at the person's death. To be basic, the current law says that a person can transfer $5.34 million of assets either by gift during his lifetime or at his death via his estate without paying tax. That is what the unified estate and gift tax exclusion is all about. Does that help you at all?

Are you asking about the method to determine the FMV of the gift to be listed on the gift tax return filed by the donor, or the basis of the gift in the hands of the recipient? What exactly is being gifted?

What is being gifted?

Sorry about not including what Lion added to make it completely clear. I thought it was obvious since each person would be filing their own Form 5329, so the form would limit the amount excepted from the penalty, limited to the amount of the withdrawal up to the max exclusion of $10K, whichever is less. Of course, each person must qualify to be a first time homebuyer too to be eligible for the exception.