jklcpa

From the IRS site (same info is on healthcare.gov too): http://www.irs.gov/uac/Questions-and-Answers-on-the-Individual-Shared-Responsibility-Provision If my income is so low that I am not required to file a federal income tax return, do I need to do anything special to claim an exemption from the individual shared responsibility provision? No. If you are not required to file a federal income tax return for a year because your gross income is below your return filing threshold, you are automatically exempt from the shared responsibility provision for that year and do not need to take any further action to secure an exemption. If you are not required to file a tax return for a year but file one anyway, you will be able to claim the exemption on your tax return.

IIRC, with ATX, the federal vouchers were printed 3 on one sheet and the one more for the 4th, and then in more recent years were printed one per sheet that was blank at the top. Are there any instructions at the top now? Drake is printing the instructions at the top of each sheet with the voucher at the bottom. If I cut them, then the client loses that part of the instructions. For the estimate vouchers, I give printed labels now instead of envelopes because most of my clients are paying online, and some of those will add all 4 state vouchers together and pay all 4 in April. There are still a few that get envelopes though. I still give envelopes for the balances due on the return though.

I don't cut them either. Give them the whole page. Some of the forms my program is now printing have the instructions on the top so I can highlight those and no need for a separate sheet of instructions. Win all around. I also highlight the words, "cut on the dotted line and send the payment with the portion below" for the ones that can't figure that out for themselves!

You would use the exercise date of 4/25/13 as the date of purchase. The grant date is the company giving the employee the chance to purchase the shares during a specified time and at a discounted price. The exercise date is the date that your client actually did make the purchase and acquired the shares.

Some mortgage company's 1098s are accompanied by a statement that shows the monthly activity for the year with a breakdown of P & I and escrow additions too.

Yes, I check HUD-1 back to county records for the real estate taxes pd in advance by the seller that the buyer is charged for because my state's fiscal year end is 6/30 with tax due date of 9/30 or 10/1 and these aren't included in the 1098 r.e. taxes paid from escrow many times. I'll also tie in the mortgage interest shown on the 1098 to make sure the interest in advance paid at closing is included.

It's a trademarked word...because they are that special.

That's what I tell them too, and they all agree with me.

Yesterday I scored a 6.5 out of 10!

In addition to all that MAS listed, there's also the time spent doing these: roll over from last year or set up as new client input the data maybe reviewed the return with client had them sign the e-fle authorization forms, scanned those in transmitted returns received acks and documented those

OK, you aren't selling the corporation's stock, so the company is selling some sort of asset. You said it isn't inventory or equipment, so what exactly is the purchaser paying for? Is it a customer list, the company's name, goodwill, or what? Whatever it is, it doesn't go on line 21 of your personal return. It sounds like the company is selling something of value that should be reported through the S corporation.

No, if it's a sale of a capital asset, then you are actually selling the stock of the S corporation and it would be taxed as a capital gain. That is one reason why a seller of a business tries to structure the sale as a stock sale instead of an asset sale, so that it gets taxed at the cap gain rates. In that case, the purchaser becomes the owner of the corporation.

I had 2 easy ones in today, pretty much the only ones that I do while the client waits. Other than having to get 2 folders out of my closet and a paper jam in the scanner, they were in and out in a short amount of time. I don't want to work like that all day, every day though.

She can give $14K this year, and if she is married, her husband could also gift $14K to her dad, all with no gift tax or estate consequences. She/they could repeat the same for 2015 and have given her dad $48K if she is married, or half that if she is single. Also, there won't be any gift tax to pay if she has enough unified credit to cover the "taxable" portion of the gift(s) if she wants to give the entire amount in 2014. If your client made any prior gifts, the amount of the credit available has to be recalculated in this year for prior gifts that used some of that credit because of the increase in the unified credit due to the law changes in 2010. If she's never given any gifts during her lifetime, she could give dad $50K this year, $14K is completely free of any gift tax effect, and $36K of her unified credit would be used up, but she wouldn't pay any gift tax at all. That's a hypothetical based on her receiving $100K; I know you said $100K+, but that's how it works.

What if the client signs the 8453 or 8879 but doesn't pay within 3 days? According to pub 1345, and ERO is considered to be stockpiling returns if those aren't transmitted within 3 days. CHAPTER 3 Electronic Return Origination Submitting the Electronic Return to the IRS An ERO must ensure that stockpiling of returns does not occur at its offices. Stockpiling is collecting returns from taxpayers or from another Authorized IRS e-file Provider prior to official acceptance in IRS e-file; or after official acceptance to participate in IRS e-file, stockpiling refers to waiting more than three calendar days to submit the return to the IRS once the ERO has all necessary information for origination. The IRS does not consider returns held prior to the date that it accepts transmission of electronic returns stockpiled. EROs must advise taxpayers that it cannot transmit returns to the IRS until the date the IRS accepts transmission of electronic returns.

I think the age requirement applies only to those without a qualifying child.

From the IRS site, that error message says 'SpouseSSN' and the 'SpouseNameControlTxt' in the Return Header (or Line 6b 'ExemptSpouseNameControl' in the return - For 1040/1040A returns) must match the e-File database. From Thomson Reuters, here's some more: Error Reject Code R0000-503-01: Valid for 1040/A/EZ/SS(PR) - Spouse SSN and the Spouse Name Control in the Return Header must match the e-File database. Resolution This is a master file rejection, which means the SSN and name control does not match what the IRS has on their master file. Verify the spouse's SSN and name. If these are correct, then you will have to contact the IRS or file the return on paper. Note: This normally happens when the spouse just married and has not yet changed her last name with the Social Security Administration (SSA). If the spouse has multiple last names, see Publication 1346, Electronic Return File Specifications and Record Layouts for Individual Tax Returns (Tax Year 2008). Section 7, Formats for Name Controls, Name Lines and Addresses, contains examples and general rules for determining name controls for Hispanic, Asian Pacific, Native American, estates, and hyphenated names. If you are the tax professional, contact the IRS e-help Desk at 866.255.0654 for assistance. If you are the taxpayer, contact the IRS Accounts Management at 800.829.0922. If the secondary taxpayer has changed their name but has not notified the SSA, have the taxpayer contact the SSA at 800.772.1213. It may take the SSA up to 10 days to notify the IRS after they have updated their files. Afterward, an electronic return can be resubmitted. If the SSN and name control continue to reject, a paper return must be filed.

...and some of them do understand but pretend that they don't so that they can yell at someone for their stupidity besides themselves.

The difference might be if Jack's firm has all of the entity types or many more (or all of the) states installed vs. those that might have only the 1040 installed or have one (or only a few) states loaded.

My clients would have to bring PJs if they wanted to be here while I worked on their returns. That's a visual I don't need.

KC is correct. Add the PA return to the client's return and then you will have to exclude the items that aren't taxable in PA. Assbackwards PA is! I'm thankful that DE is one of the states that piggybacks the federal laws for depreciation.

Do you mean that the taxpayer's IRA invested in a partnership, and the K-1 was issued to the IRA as the owner? If that is the case, then you don't report that anywhere. It is no different than any other investment that the IRA makes.

At beginning of year, taxpayer lived and worked in the same taxing jurisdiction. Beginning of April she moved to another jurisdiction and continued working for same employer. Wages are only $1200. On the back of the local EIT return is schedule ITR-1. I know she must report 9/12ths of the wages in the new jurisdiction with -0- withholding and pay the $9.00 (a 1% tax in this area). My questions - I think she has to file a return for the 3 months in the former area, is that correct? Does she report only 3/12ths for the time she lived there even though she continued to work there and had the taxes withheld, or is she liable for the full year's tax for that local because the employer is located there? TIA

Margaret, while this snip is from the IRS pub 947 Practice before the IRS, it talks about POAs, perfecting non-tax POAs, and when the IRS will allow a non-tax POA representative to sign a form 2848 on behalf of a client. Maybe the part about perfecting a non-tax POA and the example at the bottom will help you figure out your situation. Here's that section: What Is a Power of Attorney? A power of attorney is your written authorization for an individual to act on your behalf. If the authorization is not limited, the individual generally can perform all acts that you can perform. The authority granted to a registered tax return preparer or an unenrolled preparer is limited. For information on the limits regarding registered tax return preparers, see Circular 230 §10.3(f). For information on the limits regarding unenrolled preparers, see Publication 470. Acts performed. Any representative, other than a registered tax return preparer or an unenrolled return preparer, can usually perform the following acts. Represent you before any office of the IRS. Sign an offer or a waiver of restriction on assessment or collection of a tax deficiency, or a waiver of notice of disallowance of claim for credit or refund. Sign a consent to extend the statutory time period for assessment or collection of a tax. Sign a closing agreement. Signing your return. The representative named under a power of attorney is not permitted to sign your income tax return unless: The signature is permitted under the Internal Revenue Code and the related regulations (see Regulations section 1.6012-1(a)(5)). You specifically authorize this in your power of attorney. For example, the regulation permits a representative to sign your return if you are unable to sign the return due to: Disease or injury. Continuous absence from the United States (including Puerto Rico) for a period of at least 60 days prior to the date required by law for filing the return. Other good cause if specific permission is requested of and granted by the IRS. When a return is signed by a representative, it must be accompanied by a power of attorney (or copy) authorizing the representative to sign the return. For more information, see the Form 2848 instructions. Limitation on substitution or delegation. A recognized representative can substitute or delegate authority under the power of attorney to another recognized representative only if the act is specifically authorized by you on the power of attorney. After a substitution has been made, only the newly recognized representative will be recognized as the taxpayer's representative. If a delegation of power has been made, both the original and the delegated representative will be recognized by the IRS to represent you. Disclosure of returns to a third party. Your representative cannot execute consents that will allow the IRS to disclose tax return or return information to a third party unless you specifically delegate this authority to your representative on line 5 of Form 2848. Incapacity or incompetency. A power of attorney is generally terminated if you become incapacitated or incompetent. The power of attorney can continue, however, in the case of your incapacity or incompetency if you authorize this on line 5 “Other” of the Form 2848 and if your non-IRS durable power of attorney meets all the requirements for acceptance by the IRS. See Non-IRS powers of attorney, later. When Is a Power of Attorney Required? Submit a power of attorney when you want to authorize an individual to represent you before the IRS, whether or not the representative performs any of the other acts cited earlier under What Is a Power of Attorney. A power of attorney is most often required when you want to authorize another individual to perform at least one of the following acts on your behalf. Represent you at a meeting with the IRS. Prepare and file a written response to the IRS. Form Required Use Form 2848 to appoint a recognized representative to act on your behalf before the IRS. Individuals recognized to practice before the IRS are listed under Part II, Declaration of Representative, of Form 2848. Your representative must complete that part of the form. Non-IRS powers of attorney. The IRS will accept a non-IRS power of attorney, but a completed Form 2848 must be attached in order for the power of attorney to be entered on the Centralized Authorization File (CAF) system. For more information, see Processing a non-IRS power of attorney, later. If you want to use a power of attorney document other than Form 2848, it must contain the following information. Your name and mailing address. Your social security number and/or employer identification number. Your employee plan number, if applicable. The name and mailing address of your representative(s). The types of tax involved. The federal tax form number. The specific year(s) or period(s) involved. For estate tax matters, the decedent's date of death. A clear expression of your intention concerning the scope of authority granted to your representative(s). Your signature and date. You also must attach to the non-IRS power of attorney a signed and dated statement made by your representative. This statement, which is referred to as the Declaration of Representative, is contained in Part II of Form 2848. The statement should read: I am not currently under suspension or disbarment from practice before the Internal Revenue Service or other practice of my profession by any other authority, I am aware of the regulations contained in Circular 230, I am authorized to represent the taxpayer(s) identified in the power of attorney, and I am an individual described in 26 CFR 601.502( b ) Required information missing. The IRS will not accept your non-IRS power of attorney if it does not contain all the information listed above. You can sign and submit a completed Form 2848 or a new non-IRS power of attorney that contains all the information. If you cannot sign an acceptable replacement document, your attorney-in-fact may be able to perfect (make acceptable to the IRS) your non-IRS power of attorney by using the procedure described next. Procedure for perfecting a non-IRS power of attorney. Under the following conditions, the attorney-in-fact named in your non-IRS power of attorney can sign a Form 2848 on your behalf. The original non-IRS power of attorney grants authority to handle federal tax matters (for example, general authority to perform any acts). The attorney-in-fact attaches a statement (signed under penalty of perjury) to the Form 2848 stating that the original non-IRS power of attorney is valid under the laws of the governing jurisdiction. Example. John Elm, a taxpayer, signs a non-IRS durable power of attorney that names his neighbor and CPA, Ed Larch, as his attorney-in-fact. The power of attorney grants Ed the authority to perform any and all acts on John's behalf. However, it does not list specific tax-related information such as types of tax or tax form numbers. Shortly after John signs the power of attorney, he is declared incompetent. Later, a federal tax matter arises concerning a prior year return filed by John. Ed attempts to represent John before the IRS but is rejected because the durable power of attorney does not contain required information. If Ed attaches a statement (signed under the penalty of perjury) that the durable power of attorney is valid under the laws of the governing jurisdiction, he can sign a completed Form 2848 and submit it on John's behalf. If Ed can practice before the IRS (see Who Can Practice Before the IRS, earlier), he can name himself as representative on Form 2848. Otherwise, he must name another individual who can practice before the IRS. Processing a non-IRS power of attorney. The IRS has a centralized computer database system called the CAF system. This system contains information on the authority of taxpayer representatives. Generally, when you submit a power of attorney document to the IRS, it is processed for inclusion on the CAF system. Entry of your power of attorney on the CAF system enables IRS personnel, who do not have a copy of your power of attorney, to verify the authority of your representative by accessing the CAF. It also enables the IRS to automatically send copies of notices and other IRS communications to your representative if you specify that your representative should receive those communications. You can have your non-IRS power of attorney entered on the CAF system by attaching it to a completed Form 2848 and submitting it to the IRS. Your signature is not required; however, your attorney-in-fact must sign the Declaration of Representative (see Part II of Form 2848).

Yes, the wife signed the statement and I kept it in my file along with a copy of the POA, and she signed the 8879 for both of them. Maybe that wasn't entirely correct, but she had the authority to sign for herself and for her husband with the statement and the POA.