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Jack, that is very similar to DE. They want paper-filed returns to include the other states' returns, but have no attachment method when efiling with any software. For efiled returns, DE contacts those other states' revenue depts later in the summer to verify the credit is accurate and only asks for the actual return if there is a problem. I bet IN works in a similar manner. Lion, PA has the ability to accept pdf attachments of the other states returns from within the software. Both ATX and Drake handled it that way, and I can't believe that your more expensive program doesn't have that function.

If you are asking about the post I made regarding the Sch A deduction for estate taxes on IRD, that deduction is limited to the federal estate taxes only, and is allowed only in years in which the recipient reports IRD income. No deduction for state taxes is allowed.

If the estate was large enough to have paid estate taxes, there may be a deduction for income in respect of a decedent. Here's a snippet that explains how it works: An overlooked deduction. Most taxpayers and even many tax advisers are unaware of the deduction for 'income in respect of a decedent. But many people who inherit a substantial IRA are eligible for this deduction, which essentially is a deduction for the estate taxes that were paid on the IRA. The deduction is best explained with an example. Suppose someone left a large estate with an IRA. The estate tax accountant computes that the IRA was responsible for 36.7% of the estate tax paid, and that the IRA's share of the estate tax was $175,000. When the beneficiary takes distributions from the IRA, a miscellaneous itemized deduction (not subject to the 2% floor) of 36.7% of each distribution is allowed. This continues until the beneficiary has deducted a total of $175,000 over the years. The estate tax accountant should determine the data for the deduction. Details can be found in the IRS Publication 559, Survivors, Executors, and Administrators available free on the IRS web site, www.irs.gov.

U.S. Dept of State website with foreign per diem rates listed by country and effective dates. Some countries have multiple cities or regions listed: http://aoprals.state.gov/web920/per_diem_action.asp?CountryCode=0000 Same site, discussion of per diem and additional links: http://aoprals.state.gov/content.asp?content_id=184&menu_id=78 Clicking on the 2 links at the left under per diem brings up more information and other links including a search by country if you don't want to use the chart I linked to above. The chart seems easier though.

You could try the IRS Business & Specialty Tax phone number 800-829-4933. Her bank may also be able to provide the EIN if an account was opened in the LLC's name.

I have an external hard drive that backs up data files automatically. It is a Western Digital that came with WD SmartWare that is a total memory hog. It is using a very significant amount of physical memory that continues to tick upward and that is causing noticeable lag time in other programs. I never noticed how much memory it is using until fairly recently. I've read that the company had an update that fixed some of the memory usage and leak issue, but the program's design is such that it is continually trying to scan and categorize the files, and that is part of why it uses a lot of memory. I can erase the drive that will delete all of the data including the program and drive monitor. What program do you like for local backup? Also, the drive is about 3 years old. Is there an age when one should consider replacing a drive such as this?

IRS says we must keep the 8879s for a period of 3 years from the due date of the return or the date the return was received by the IRS, whichever is later. I am keeping the 8879 in electronic format with the return for that year. I haven't had any late filers recently, but when I was keeping a paper file of the signature forms, I kept copies of the signature forms with each of the returns and also copies of all the signed forms in one folder that was for all the returns filed during that year.

The worksheets aren't sent with the e-file. I'd create either a pdf of that worksheet or create another pdf document with the required information to be attached if you are planning to e-file the return. Otherwise, paper file the return with the documentation.

Does this help? From Pub 925: http://www.irs.gov/publications/p925/ar02.html#en_US_2013_publink1000104579 Passive Activity Income Passive activity income includes all income from passive activities and generally includes gain from disposition of an interest in a passive activity or property used in a passive activity. Passive activity income does not include the following items: Income from an activity that is not a passive activity. These activities are discussed under Activities That Are Not Passive Activities , earlier. Portfolio income. This includes interest, dividends, annuities, and royalties not derived in the ordinary course of a trade or business. It includes gain or loss from the disposition of property that produces these types of income or that is held for investment. The exclusion for portfolio income does not apply to self-charged interest treated as passive activity income. For more information on self-charged interest, see Self-charged interest , earlier. Personal service income. This includes salaries, wages, commissions, self-employment income from trade or business activities in which you materially participated, deferred compensation, taxable social security and other retirement benefits, and payments from partnerships to partners for personal services. Income from positive section 481 adjustments allocated to activities other than passive activities. (Section 481 adjustments are adjustments that must be made due to changes in your accounting method.) Income or gain from investments of working capital. Income from an oil or gas property if you treated any loss from a working interest in the property for any tax year beginning after 1986 as a nonpassive loss, as discussed in item (2) under Activities That Are Not Passive Activities , earlier. This also applies to income from other oil and gas property the basis of which is determined wholly or partly by the basis of the property in the preceding sentence. Any income from intangible property, such as a patent, copyright, or literary, musical, or artistic composition, if your personal efforts significantly contributed to the creation of the property. Any other income that must be treated as nonpassive income. See Recharacterization of Passive Income , later. Overall gain from any interest in a publicly traded partnership. See Publicly Traded Partnerships (PTPs) in the instructions for Form 8582. State, local, and foreign income tax refunds. Income from a covenant not to compete. Reimbursement of a casualty or theft loss included in gross income to recover all or part of a prior year loss deduction, if the loss deduction was not a passive activity deduction. Alaska Permanent Fund dividends. Cancellation of debt income, if at the time the debt is discharged the debt is not allocated to passive activities under the interest expense allocation rules. See chapter 4 of Publication 535, Business Expenses, for information about the rules for allocating interest.

Reconciling the bank accounts helps ensure that the client has recorded the payroll properly in the subsidiary records or journals, and also that the payments of liabilities have been recorded at the actual amounts paid. If you are doing the bookkeeping, that should be part of the process. If you aren't doing the bookkeeping, you should ask if the client is reconciling the bank accounts, otherwise, how do you know if the transactions are recorded in the proper period and at the proper amounts.

I signed up too. It's free and only an hour so there's not much to lose by listening. With that short a time, I think it will be mostly an overview though, but a good place to start as a refresher before I get into the more detailed seminars on the topic.

It looks like residency isn't the important test. There isn't a clear answer, but if those 10 returns don't constitute a significant business or significant contacts within MD, then you don't need to take the MD test. From the MD website: 3. Does registration apply only to tax professionals physically processing a Maryland state tax return in Maryland, or does it pertain to the personal residence of the employer? For example, if I am a tax professional who resides in Maryland, but I work and process tax returns in the state of Delaware, do I have to register with the state of Maryland? Maryland Registration is not dependent on the preparer’s personal residence, but whether the preparer’s business includes preparing Maryland returns - either in state or out of state. If an out of state preparer is preparing Maryland returns as a significant part of his/her business, then he or she must register. However, those out of state tax professionals who prepare an occasional Maryland return for a walk-in client may not be required to register with Maryland. The legal opinion from the Board’s Counsel states: "[T]he requirement for registration would depend on what professional contacts the individual has with Maryland that concern providing, attempting to provide, or offering to provide tax preparation services in Maryland. If preparing Maryland returns is a significant part of the individual’s business, and the individual has significant contacts with Maryland, then the Board would expect the individual to register with Maryland." Here's the link to the page where I got that from. That page was updated as on 7/1/14: http://www.dllr.state.md.us/license/taxprep/taxprepfaq.shtml

Generally, for a C corp return with no tax due the late filing penalty won't be assessed (minimum penalty is $135 or 100% of the unpaid tax) if the return is filed within 60-day of the due date or extended due date. If you get it done and filed in the next 60 days, there shouldn't be any late filing penalty. See 3rd paragraph "Late filing of return" that references the extra 60 days beyond the due date or extended due date: http://www.irs.gov/instructions/i1120/ch01.html#d0e721 Numbers 4 and 7 here also reference the 60 days : http://www.irs.gov/uac/Failure-to-File-or-Pay-Penalties:-Eight-Facts

The statement made at the seminar makes no sense. The regs were just finalized in Sept of last year and are applicable to tax years beginning on or after Jan 1, 2014, and optionally in their temporary form to tax years after 2011. Why would every return with depreciation be expected to need a 3115?

The article from Catherine's link: 5M Gmail accounts hacked. Change your password *now*! Posted on September 10, 2014 by Dr. Eowyn Fidel Martinez for Fusion.net, Sept. 10, 2014: Time to change your password again. A database containing nearly 5 million Gmail user accounts and passwords was leaked on Bitcoin Security, a popular Russian website devoted to the cryptocurrency. The text file was published on Tuesday night by user tvskit, according to CNews, the Russian news outlet that first broke the story. The leaker claimed that the majority of the accounts belong to users who speak English, Russian, or Spanish, and that approximately 60 percent are active. The passwords not only give access to Gmail, but a slew of other Google services such as Drive and the mobile payment system Google Wallet. Svetlana Anurova, a Google representative, told CNews that the tech giant is aware of the breach and encouraged users to select a stronger password and enable two-step verification, a security measure where users are required to provide a passcode sent to their mobile devices before any changes can be made to their account. The Gmail leak comes on the heels of two other major security breaches leaked on the same Bitcoin forum, which targeted Russian email service prodiver Mail.ru and search engine Yandex. Those two breaches affected nearly 6 million Internet users. Find out if your account was compromised You can verify whether your account was affected by clicking HERE https://isleaked.com/en.php and entering your gmail address. It’s that simple. You can also enable Google’s 2-step verification by following the company’s easy steps. UPDATE 3:01 PM Google issued the following statement to Fusion: “The security of our users’ information is a top priority for us. We have no evidence that our systems have been compromised, but whenever we become aware that accounts may have been, we take steps to help those users secure their accounts.”

Article from Accounting Today - CPAs Sue IRS over PTIN Fees Washington, D.C. (September 9, 2014) By Michael Cohn A pair of CPAs have filed a class-action complaint against the Internal Revenue Service challenging IRS regulations requiring tax practitioners to annually register and pay a fee to the agency to obtain and maintain a Preparer Tax Identification Number. The class action involves more than 700,000 individual practitioners who are forced to pay for a PTIN every year. The lawsuit, which was filed Monday, seeks an injunction barring collection of the fee and recovery of the more than $150 million in fees the IRS has collected since 2010. The challenged regulations were issued several years ago as part of a broad IRS initiative to radically expand its oversight of attorneys, accountants, and other tax return preparers who prepare tax returns for compensation, the CPAs’ attorneys noted. Last year, the a federal court in Washington, D.C., ruled that large portions of the regulations issued by the IRS were invalid because the IRS lacked statutory authority to issue the regulations in the case of Loving v. United States, and that decision was upheld by the D.C. Circuit Court of Appeals earlier this year. The rulings invalidated the IRS’s program for requiring mandatory testing and continuing education of tax preparers. However, the courts allowed the IRS to continue to require registration of tax preparers through the PTIN, but did not rule on the question of fees. The IRS has announced plans to offer a voluntary testing program instead known as the Annual Filing Season Program, but the American Institute of CPAs has filed suit to stop the program (see AICPA Sues IRS over Voluntary Program for Tax Preparers). http://www.accountingtoday.com/news/irs_watch/aicpa-sues-irs-over-voluntary-program-for-tax-preparers-71366-1.html Congress allowed the IRS to require tax practitioners who prepare tax returns for compensation to place a PTIN on the returns to help IRS identify the preparer. The plaintiff CPAs argue that the IRS lacks the statutory authority, however, to charge fees to obtain or renew a PTIN and the IRS cannot use fees it has collected for unrelated activities. The IRS uses only a small portion of the fees collected to pay the vendor who manages the on-line PTIN registration process and uses the bulk of the fees for other IRS activities. Plaintiffs seek restitution of the fees collected by IRS in the past and injunctive relief barring the IRS from collecting similar fees in the future. “If an agency can charge U.S. citizens to fulfill a requirement, then an agency can tax,” said plaintiffs’ co-counsel, Allen Buckley of Atlanta. “Unlawfully, the IRS has been taxing Americans.” The other co-counsel Stuart Bassin of Washington, D.C., said, “The courts have rejected the IRS’s effort to regulate return preparers and it is time for the IRS to return the PTIN registration fees it has collected to support that effort.” The docket number of the case is 1:cv-14-1523. A copy of the complaint has been posted online by Kelly Phillips Erb of Forbes.

re: IRA - https://revenue-pa.custhelp.com/app/answers/detail/a_id/365/~/how-do-i-determine-if-my-ira-withdrawals-are-subject-to-pa-income-tax%3F re: 401K - https://revenue-pa.custhelp.com/app/answers/detail/a_id/273/~/are-my-contributions-to-a-401%28k%29-plan-excluded-from-employer-withholding%3F re: 401K early withdrawal - https://revenue-pa.custhelp.com/app/answers/detail/a_id/1469 Page 11 of the PA instructions contain the same info about the IRA, and also a reference to Tax Bulletin 2008-01 that comes up as an 8-page pdf from PA's website.

I don't think the article was totally clear about how that figure was arrived at. It says 26 fraudulent returns, but it goes on to talk about client copies of returns that show refunds being applied to the following year where this preparer received the funds, and returns that reported balance dues where those funds were turned over to him and never paid in on behalf of the taxpayers. It's very possible that the IRS can't collect on those balances dues from these taxpayers; maybe they are no longer in this country.

Info from healthcare.gov (below), I think your client would owe a penalty of $259. This is based on the excess AGI over the filing threshold of $25850 * 1%. The fee in 2014 and beyond The penalty in 2014 is calculated one of 2 ways. If you or your dependents don’t have insurance that qualifies as minimum essential coverage you'll pay whichever of these amounts is higher: 1% of your yearly household income. (Only the amount of income above the tax filing threshold, $10,150 for an individual, is used to calculate the penalty.) The maximum penalty is the national average premium for a bronze plan. $95 per person for the year ($47.50 per child under 18). The maximum penalty per family using this method is $285. The way the penalty is calculated, a single adult with household income below $19,650 would pay the $95 flat rate. A single adult with household income above $19,650 would pay an amount based on the 1% rate. (If income is below $10,150, no penalty is owed.) The penalty increases every year. In 2015 it’s 2% of income or $325 per person. In 2016 and later years it’s 2.5% of income or $695 per person. After that it's adjusted for inflation. If you’re uninsured for just part of the year, 1/12 of the yearly penalty applies to each month you’re uninsured. If you’re uninsured for less than 3 months, you don’t have to make a payment. You’ll pay the fee on your 2014 federal income tax return. Most people will file this return in 2015. Learn more about the individual shared responsibility payment from the Internal Revenue Service. Link to page where I took excerpt above: https://www.healthcare.gov/what-if-i-dont-have-health-coverage/ Link to the IRS site for an overview of the shared responsibility payment: http://www.irs.gov/uac/Newsroom/The-Individual-Shared-Responsibility-Payment-An-Overview

Doctors and dentists offices are a good examples of those that will report on the cash basis for tax purposes where tracking receivables is very important since it is usually a very large, or largest, asset that have many adjustments to arrive at the final collectible amount. No way would they want to pay taxes on the initial receivable recorded for services rendered when downward adjustments due to patients' negotiated rates are the norm.

Is the business one that typically would report on the cash basis? If Quickbooks is reporting on cash basis and the tax return is also, maybe that's the way it should be reported. I'd check the return 2 years back. Is it possible that the only thing wrong with last year's return is that the box checked indicates "accrual"? It's possible to use QB to track a/r and a/p while reporting on the cash basis. If that is your case, the QB chart of accounts and trial balance would show the a/r and a/p accounts. Reports can then be run for either cash or accrual.

You're welcome. I didn't see the actual article until I searched for it from here. The source was easy to find by highlighting the first sentence, right clicking, and choosing the option to search for that sentence or phrase.

To be clear, these weren't cbslee's assertions. His post was a direct cut and paste of an Aug 21st article by Ken Berry, CPA that was published in the CPA Practice Advisor entitled "5 Ways to Get Tax Deductions for Local Transportation Uses". I've added the title and given the author proper credit in the OP above.

They have the RACs and the fees that go along with them. Additional $68 in fees if the person chooses to walk out with a paper check. You can choose to receive your refund proceeds, minus tax preparation and processing fees, on an H&R Block Emerald Prepaid Mastercard®, via a physical check or deposited to an existing account. State RAC is disbursed using the same method you chose for your Federal RAC Typically receive your funds within 21 days. Email alerts when funds are available. Federal RAC Fee $34.95 State RAC Fee $13.00 (Additional $20 fee for a paper check) http://www.hrblock.com/financial-services/tax-refund-payment/

Oops, I've never clicked on that field because I thought that was only for offices with multiple preparers, so I didn't realize it had a choice for 'none' to indicate self-prepared. I would have removed the paid preparer designation from my own returns if I'd known it was that simple. I learned something new tonight. lol