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Terry, you need to slow down and research this more. The IRS was proposing back as early as 2020 that these plans should be considered as insurance (they weren't in the past) if the particular plan meets the minimum essential coverage (MEC), that "premium" (aka member dues) should be considered a tax deductible expense, and that reimbursements should be tax free. That all being said, that does not mean that these plans would qualify as a HDHP. Sorry, I don't know the status of these IRS proposals and don't have time to look into that for you. A quick google found a couple of articles and blogs but no authoritative references. With regard to the actual medical expenses paid, I don't see how this client could deduct those either way since, basically, someone else footed the bills.

I believe that taking some cash out and creating boot would allow that amount of PAL to be utilized, creating a tax-free aspect to the boot. That would involve more planning though, and they also have different rates.

They carryforward and attach to the property(ies) received in exchange. It is because the property was exchanged in a nonrecognition transaction, not disposed of in a fully taxable transaction. It's under sec 469, sorry don't have the exact reference. It's the same section that says the PALs can't be used in other nonrecognition transactions such as 351 and 721 transfers and when a passive activity property is sold as an installment sale (PAL allowed as gain is recognized in that case).

For support for minors, there is an obligation to provide shelter and its related costs, food (whether at home or providing an allowance for meals outside of the home, clothing, health care costs, possibly some nominal allowance to meet those needs not provided at home. I'd include travel costs to school (but not for vacations/parties), so that part of operating the vehicle and its related costs could be included in support. I would also include cost of a laptop/computer and internet access in support at this point too. Clearly, if the parents purchase a car for a 26 year old titled in the child's name, that is a completely different scenario. Gifts would be contributions to UTMA, 529, IRAs; larger amounts not for support; a car; other expensive gifts not required for their health/well being. Also, this is an older article on the subject of dependency of college students but still worth the read: https://www.thetaxadviser.com/issues/2010/aug/nichols-aug-2010.html

If you would like to continue this as an extension of the topic, please do so via PMs.

Yes, the client must have an account to retrieve online. IRS also has a # to call for assistance, but I'm not sure of the wait times or availability at this point, and it's been a year or two that one of my clients had lost their pin, iirc actually never received it because client failed to notify IRS of an address change. More info here: https://www.irs.gov/identity-theft-fraud-scams/retrieve-your-ip-pin

So this is why @RitaB hugs 'em first.

Were you able to resolve this with the agent so that the return will now be processed? Were there items of income or deduction on the return that would have been filed with IRS on paper 1099s. Remember, only paper-filed documents were shredded, not anything electronic. Does the return have items that the IRS may be waiting to verify with outside sources that may not have been filed yet such as IRA or HSA contribution made before 4/15/22 for 2021 that would be on a form 5498, or something like excessive federal withholding on a W-2 that would be filed with SSA? Maybe something else that is not within an acceptable parameter to the IRS? We're all just guessing at this point, and I'm concerned that the agent couldn't tell you why this return was held up.

Maybe a stupid question, but is that the IP PIN for the 2021 tax year, or for 2020? Client could try to retrieve her 2021 IP PIN from the IRS tool to verify it and to make sure it is the one for the year you are trying to file.

Not enough information to answer you. What was the reason IRS denied the claim? Was it something about the loss itself or its calculation, some calculation made with the claim to the carryback year, or you didn't supply all information with the c/b return? Did you include AMT calculations? You have to include that even if it is fairly obvious that AMT doesn't/can't apply, and if you don't, IRS will not process it. Depending on answers to those questions, I suspect you will end up correcting something with the carryback to 2015 to move forward with processing.

Why is e-filing the 941s so complex and separate? That form certainly isn't complicated compared to the 1040 series, the 1065s, or 1120 series. Why can't a version of it be included in MeF?

The scanning technology that IRS uses for paper-filed 1099s is very old though and that is why the service requires those be prepared on forms printed in red dropout ink.

No, I do that too and did not take offense so there is no need to apologize. It just bugs me when I make stupid mistakes in haste.

Yes, well, that is the thing because I do know something about this and made another stupid mistake on here by shortcutting my calculation by not separating out the catchup.

Yes, I agree with those final figures. To be totally clear and expand on your statement about each being able to contribute the $1,000 catchup, the husband's additional contribution will be limited to 5/12th for those months prior him going on Medicare. Husband's form 8889 will show $1,520.83 ($3,650 x 5/12) on line 3 and $416.67 ($1,000 x 5/12) on line 7. @BulldogTom Tom, sorry I was wrong and guess I should stop trying to help anyone at this point.

Yes, this is the figure I get too. For the overall limitation, changing the allocation within the first 5 months won't affect the final annual limitation but will determine which HSA can receive the funds. That may or may not matter to your clients.

The difference between family and self-only is the number of persons covered, so if/when the wife drops coverage for the husband, the policy will become self-only unless there is someone else still on the policy so that it covers more than one person. They currently have family coverage and can avail themselves of the monthly family HSA contribution rate during those months, but once he is dropped from that ACA policy, at that point the wife's policy will become self-only for purposes of the monthly HSA contribution rate starting with the month he stops being covered by the ACA policy and goes on Medicare Part B. With that month and going forward, he becomes an ineligible person for the HSA contribution and his monthly contribution limit is -0-, and wife's monthly maximum contribution will be for the self-only amount.

Form 8962 is used to either claim the PTC on the return being filed or reconcile the PTC with the APTC used during the year. If either of those pertains to your client, you need to include the form, otherwise it sounds like you can probably delete it and ignore the 1095-A. To be sure though, you should review the instructions for Form 8962 under the section "Who Must File"

That's great. Hope they fixed the prior years too.

That is true, and if/when he does sign up late, there is a special form to tell the government why he didn't sign up at age 65 so that he isn't permanently charged a higher (penalty) rate.

You have to fill out the contribution limitation for each person separately, then add the monthly amounts together. Because H wasn't covered by the HDHP for the entire year and went on Medicare during the year, fill in -0- for the month he started on Medicare and subsequent following months. From your fact pattern, it should work out that wife will be entitled to contribute for her half for the entire year and husband's half will be prorated for the number of months covered under the plan. The instructions for Form 8889 may be more clear.

If adult child isn't a qualifying child but does meet all the tests to be a qualifying relative that the taxpayer can claim as a dependent, is related to TP, and who lives with the TP more than 1/2 of the tax year, then that QR would be a qualifying person that would allow the TP to use HOH. See this snip of Table 4 from Pub 501 below:

Does this mean the entire desktop versions are going away for those of us that use it for write up work, or is it only the payroll functions and reporting?

Thank you, Margaret, FDNY, and Catherine.

From an article posted by The Tax Advisor, posted in entirety for those that don't click links: