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Pub 936 has easy to understand explanations and the worksheet you need to calculate the interest that is deductible. You'll need to use that since you have pre- and post- 12/16/17 debt over one million. You will need the average balances of EACH mortgage and the totals are used on the worksheet. The pub also has excellent examples for you to follow.  There are 3 methods for calculating the averages, and you can choose which one works to your clients advantage, depending on the actual circumstances. 

Points are separate and aren't included on the worksheet's calculation, BUT they will be limited based on the percentage of nondeductible interest you arrive at using the worksheet, and that reduced amount is what you will include on Sch A.

I don't personally but Googled and found this Drake KB of states that accept the Federal extensions. It shows all types of returns.

https://drakesoftware.com/Site/Browse/16498/States-That-Accept-Federal-Extension

If you scroll to the bottom of that page, it has additional links for states' deadlines and states that will accept extensions via e-filing.

Cigarette smoke and couldn't wait to get them out of my office.

The firm I worked for early in my career had a seafood market, and the stench from its papers was nauseating. The owners knew it too because they and the kids would shower and change clothes after work.

AIr out as best you can, keep the docs sealed up and in a separate area until ready to work on them, and get the work done sooner than later. Maybe you could put a box of baking soda or some odor absorber/neutralizer in a bag with the papers.

 I'm as confused as everyone else by this. This sounds more like a partnership with one partner selling to the other, and that this was incorrectly handled as two proprietorships. If not, how does your client explain the shared checking account?

You have an asset sale to report on the sale of the proprietorship to the new owner.

Then, as Abby said, the withdrawals of cash by him do not create income. He is just taking his own money out.

Has he officially closed the LLC down with the state or keeping that open for some reason? Why is he keeping the SMLLC bank account open?  He could close that at any time without any tax effect. 

I think it should still work. In the case I mentioned, the husband was listed first on the return as the taxpayer and the wife signed the returns.

When you check that box and create the explanation, a statement is generated that goes with the return, and "see statement" will print just below the husband's signature line on pg 2 of the 1040.  The 8879 doesn't have any indication, so I'd have the wife sign both lines and keep a copy of the statement with the 8879 in your file.

If that makes you uncomfortable, you could switch the wife to the primary taxpayer and husband as spouse.

I don't work on these. Glad you found your answers.

I believe if injury or disease prevents one of a married couple filing MFJ, the spouse can sign the return. There is a checkbox that will allow you to attach the required dated explanation.

In Drake, this is found on the Misc tab and then on the screen entitled MISC-Miscellaneous Codes/Notes. Look to the right side of the screen where you will see "Special Signatures". Check that box and click "SCH" to attach your explanation.

I used this method for several years where husband suffered from several alzheimers and was in a facility, and the wife didn't have POA, and at that point husband lacked mental capacity to grant POA anyway. 

I received an email with a pdf attachment this morning from "Department of Public" stating that the FTC has evidence that my SSN has been used in NM and TX for international wire transfers to blacklisted bank accounts. The sender's email addy is some gibberish through gmail. 

I never click links in email or open attachments, but unfortunately when I moved my phone out of the dog's way as he tried to jump on me, I touched close enough to it on the screen this this morning to open it. 

Have you tried looking at that website's Help or FAQs?

I'm with Bulldog Tom and Lion. No matter the year being prepared, if it is current work it is charged at my current rates. If the clients are late because of procrastination or disorganization, then they are paying more for that because I raise rates each year, and if the work involves me working even more on it because of that disorganization, again a higher fee will be the result. 

I also had trouble this week with a multi state return where I tried to split the returns and save the spouse's file. I saved it more than once and each time the program could not find the wife's split return. I finally rolled over last year's split return for the wife and entered all of her data separately again. I did not want to waste time with support.

I've had issues with the program repeatedly crashing after using the tax planner and trying to go back to the current year actual return. Program simply closes, but it may have to do with me not calculating in the planner before trying to go back to the actual current file.

I also had trouble with installation and communication with Drake's server. Every time I launched the program, MS Edge would open on top of it, and the Drake tech people couldn't explain why. Some helper file didn't install properly and also was an environmental issue with my computer and anti-virus or firewall, but it did not help for the basic support person to suggest I change my internet provider from Firefox to Chrome. I could NOT make her understand that my ISP was not the cause. Many calls later, I finally got to a person that could help.

RDP= registered domestic partner.

If you want to know, you could Google RDP vs marriage.

Here is the excerpt from 2023 540NR instructions regarding filing status. Not sure what your issue with this is. Seems clear to me.  Be sure to expand the quote box if the entire thing isn't visible.

https://www.ftb.ca.gov/forms/2023/2023-540nr-booklet.html

Quote

Filing Status

Use the same filing status for California that you used for your federal income tax return, unless you are an RDP. If you are an RDP and file single for federal, you must file married/RDP filing jointly or married/RDP filing separately for California. If you are an RDP and file head of household for federal purposes, you may file head of household for California purposes only if you meet the requirements to be considered unmarried or considered not in a domestic partnership.

Exception: If you file a joint tax return for federal, you may file separately for California if either spouse was either of the following:

• An active member of the United States armed forces or any auxiliary military branch during 2023.
• A nonresident for the entire year and had no income from California sources during 2023.

Community Property States: If the spouse earning the California source income is domiciled in a community property state, community income will be split equally between the spouses. Both spouses will have California source income and they will not qualify for the nonresident spouse exception.

If you had no federal filing requirement, use the same filing status for California you would have used to file a federal income tax return.

Lion is correct.  If no 1116 is filed, then there is no carryback or carryforward.

NQ deferred comp?

Many times the year-end paystub has the details in the YTD figures used for the W-2.

I agree with Marilyn.  Each category of component added to that residence has a limitation that shouldn't be exceeded for that item or category of items. Give it to one or the other. Obviously the exception to this would be if they are filing separately and costs are attributable to two homes.

Tom, I did an advanced search on this forum for "database" specifically posted by Joe.  See if any of these helps:

https://www.atxcommunity.com/search/?&q=database&quick=1&author=Abby Normal&search_and_or=or&sortby=relevancy

The link is safe to click. It will take you only to the search results within this site.

If truly gifts, the rules for basis of gifted property should be used:

• sold at a gain, the basis in the hands of the donee would be donor's basis
• sold at a loss, donee's basis is the lesser of FMV at the date of gift or donor's basis

I am willing to bet that this basis information does not exist.  Was this activity a multitude of generic mass-produced toys accumulated since childhood that were sold off, or more valuable pieces considered collectibles that either held their values or possibly increased (true antique pieces, or something like the original handmade cloth Cabbage Patch dolls, etc)?

I'd say that the schedule or form where to report these depends on the client's intention. Did the client view these toys as an investment, or is client talking about this as a business where more toys may be obtained as inventory with the intention of flipping for profit?

I'd smile like this if my Robbie Robot could prepare the one I just finished and meet with the client too. 

Be sure to advise about the IP PIN requirements. These are some small things compared to the i.d. theft, but clients should know before getting an IP PIN:

• The IP PIN is permanent and can't ever be cancelled, and it will be required to e-file each year forever.
• A new IP PIN IS issued each year at the beginning of filing season.
• If taxpayers move during the year, they must file form 8822 for IRS to send the subsequent years' PINs to the correct address, or filing will be delayed until the new PIN is retrieved. This is easier now with clients being able to set up IRS account access, but who knows what security measures and hurdles will be in place in future.

In case anyone here needs a laugh today besides me, it is so corny that I couldn't resist sharing.

41 minutes ago, BulldogTom said:

We need a clapping hands emoji.

Tom
Longview, TX

We have it. Click on the smiley face in the formatting bar of the reply box and a popup box with all of the emojis will appear.  You can search for "clapping" from there.

Why are we exactly?  The CTA still applies for now.

Stay tuned is correct!

The plaintiffs in the case are the National Small Business Association (NSBA) and one of its members who sued for a permanent injuction.  At this time the ruling applies to only the plaintiffs, and it is unclear if the injunction will extend to all ~ 65,000 individual members of the NSBA or to only the association itself.

An appeal in the 11th circuit is likely with the U.S. government also seeking an interim stay of the ruling in both the trial and appellate courts.

Reporting entities that were not plaintiffs in the Alabama case are still bound by the CTA at this time.

There are a number of states that have passed or are planning to pass their own versions of the CTA.  Today's ruling would not affect states' ability to pass these similar laws because it is based on U.S. Congress's authority under the U.S. Constitution.   The court declined to address different grounds raised by the NSBA that could potentially be used to challenge legislation at the state level.

The above are.main points from this law firm's analysis:

https://www.akingump.com/en/insights/alerts/federal-district-court-in-alabama-holds-corporate-transparency-act-unconstitutional-and-enjoins-enforcement-against-plaintiffs

15 minutes ago, Christian said:

So the phase out limit for singles begins at $50,000 which is of course one half of the MFJ amount of $100,000 ?

Oops, no, I'm sorry.  I put a strikethrough on "singles and" in my post above.  The amount for singles is the same as MFJ.  The limits are halved for MFS living apart all year. Single would still phase out at the $150K.