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If the full 24 month/730 day residency test isn't met but otherwise qualifies, then the second step would be to prorate the $250K gain per person by the amount of time of residency. In your client's case, 425 days / 730 days x $250K = potential gain exclusion for the taxpayer would be $145,548. If a joint return with spouse also having ownership and meeting the tests, the spouse would also have that exclusion, so the total exclusion could be as high as $291,096. Your client's gain is only $30K and is below the prorated exclusion in either case, single or joint, and is fully excludable.

No, it doesn't. FTA doesn't give the ability to request removal of the estimated penalty or accuracy-related penalties. The 2210 underpayment penalty is sec 6654, and the IRM here shows only those penalties that can be abated under the FTA:

Yes, there seems to be problems with the figures. In the original post, selling expenses including loan payoff were $84 and intermediary received $361, so that example has a $20K difference. And now the loan payoff was supposedly $70? Problems all around.

During the shutdown I found out that there are many that no longer have printers too. I am doing the same as you others that send securely, client prints and signs, and sends back to me.

I looked this up, and according to Form 8594 instructions, business books and records would be in Class VI as sec 197 intangibles.

Well, if the thief e-filed the day IRS opened the season, there's no way that the client instantaneously received a notice in the mail and could have known about this and filed that early as you suggested.

Sorry, this isn't exactly what you asked about resolving the 2021 issue, but in addition to what they've already done, they should consider a freeze on credit with all 3 credit reporting agencies, obtain a credit report to verify no new credit using their names, make sure AV software is current and working properly, consider using MFA and change passwords to all financial-related accounts, check activity with banks and investments for any unusual activity. Sorry, there was more I wrote but lost it when I exited to another screen and the editor didn't store my response like it usually does. Follow this page: https://www.irs.gov/newsroom/taxpayer-guide-to-identity-theft You should also go to the IRS site and compare the number of returns filed using your EFIN to what you've actually processed to make sure you haven't been hacked.

How is that even remotely helpful if the client just received the notice and didn't know about the fraudulent filing until now?

Yes, the PA-40 is used for all individuals, whether it is resident, nonres, or part-year. Your software should have some sort of checkbox to tell it the dates of residency and possibly a box for PY. If you look at the PA-40 at upper right side you will see where a PY resident would have a "P" entered and a place for the dates.

Agree with Tex above. If the taxpayer has basis and has received a distribution, then a percentage of that is a return of basis.

It has other fees. Below is from the site, and the fee schedule booklet can be found at the link "RHF Fee Schedule" on its legal and disclosure page.

Yes. Have you completed the rest of the form with the FMVs, and are the distributions flowing to the 8606 also?

I hear you! My software also has the worksheet. I just finished one that had 3 mortgages, a refi on the principal residence with costs rolled in making it mixed use, and a beach condo with points purchased mid-year, and the couple also files MFS. I have a beautiful Excel spreadsheet to calc the averages and each of the amort schedules too. Once I had all of that finished, the software worked well for the limitation and then splitting the joint return into the two separate ones.

Pub 936 has a worksheet at Table 1 to calculate the deduction. I'm surprised that ATX doesn't have this built in also. My software does and handled it easily.

Yes, true, it did act like it recognized it as a new device. I'm surprised it affected the browsing so much.

Sure, I'll pin it to the top b/c I just unpinned the topic on SSA wage uploading.

For the past few days my computer has been so slooooow when browsing the internet and slightly slower launching programs and files. Tonight when I woke it from sleeping I had no mouse or keyboard, so the first thing I did was to unplug the USB receiver and use a different port. Instantly my browsing was back to normal speed. Could someone explain why that would make such a difference?

So precious!

No, it's the withholding that is considered paid in ratably throughout the year, but if the preparer has payatubs and it benefits the taxpayer to use actual amounts paid in during each period, that is an option to do so.

Terry, maybe you won't believe this CPA either, but the advice is basically correct. We have a "pay as you go" tax system, and that means that the taxes owed should be paid in throughout the year as it becomes taxable. It is possible to have enough paid in via withholding and quarterly estimates throughout the year to have a refund shown on that year's tax return and still be short and underpaid for a particular quarter's estimate. I think everyone here knows the safe harbors for avoiding the penalty: 100/110% of the last year's tax or 90% of the current year's tax, and *that* should be calculated on a quarter by quarter basis to determine the amount of the estimate needed. That is exactly what annualization is all about. This is all in Pub 505 in the section for the "Estimated Taxes". Here are some excerpts, and there are more that discusses the annualizing that I didn't copy: Also, I would say the reference for this is code sec 6654 that is the section for the penalty for failure to pay estimated tax, or enough estimated tax.

Form 3115 is not needed since the depreciation omission didn't continue beyond two years, so amending is the proper way to correct this.

https://www.irs.gov/retirement-plans/self-employed-individuals-calculating-your-own-retirement-plan-contribution-and-deduction https://www.irs.gov/retirement-plans/retirement-plan-faqs-regarding-contributions-what-is-a-partners-compensation-for-retirement-plan-purposes Draws aren't earnings, and guaranteed payments can't be used in isolation because the partnership could have a loss from operations that could offset some of the guar payts and s.e. income would be less than that. You have to follow the formula that starts with self-employment income and then further adjusts for 1/2 of the s.e. tax and the retirement contributions themselves. (Example - That is similar to using the reduced rate of of 20% for a retirement contribution max of 25% because that difference factors in the owner-employee's share.)

Margaret and cbslee are correct. Employee deferral should have been withheld from payroll, and those amounts are to be contributed by the end of month following the month of deferral. OP's client now wants to go back and make those changes that never occurred, and I wouldn't want to be a part of that. Also, employer contribution can't be increased unless the company was using a reduced percentage below the 3% maximum, or by inflating salary after the fact, and again, something I would not do.

Might be ATX because I transmitted returns yesterday during day and evening and again this morning, and each time received the acks a few minutes later.

Adding to what others have said, you also need to consider that being totally and permanently disabled is: not being able to engage in any substantial gainful activity because of the physical or mental impairment.