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Mod note - also deleted duplicate post in e-file subforum.

Reviving this b/c I was surprised to see one of my long-retired clients qualify for the EIC this year. He receives a state fireman's pension of $1,500 each year that falls under the IRS ruling that these plans are "length of service award programs" (LOSAP) and are like deferred supplemental wages to be reported on Form W-2. So, a usually fast and easy return now has the 8867 and due diligence questions and documentation with it and will require some hopefully brief explanation to this client. We will be seeing some strange returns again this year with the double dipping on some of the credits with no payback and other occurrences from law changes having some unintended consequences like this EIC.

Agree wtih Slippery Pencil. Those funds should have been paid to the taxpayer but not put into the HSA. If the funds were all contributed to the HSA and have been spent so that there isn't enough left in the HSA to withdrawal the excess + earnings, then the taxpayer will owe the 6% excise tax until withdrawn or designated in each future period until that excess+earnings is fully used as designated contributions.

As Danrvan said, the son assumes adjusted basis and tax attributes from the parents. I would add to that to note that if there are unused PALs, those unused PALs will increase the son's basis. Ref is Per Section 469(j)(6)(A). Son really needs the details of the depreciation allowed or allowable on parents return and how parent's adjusted basis was determined at the time of the gift so that if he sells the property, he can properly calculate the depreciation recapture.

Can't find it now so I took my post down.

At least your states didn't decide to redesign their entire individual forms. I currently have only page 1 of 3 showing, and that page only has figures on half of it with no calculations being performed. I printed the new forms from the state's website so to have a look at them, and with Delaware being so small, it probably doesn't get the developer's attention like the very large states do.

Now IRS says the new revamped site may also have incorrect information and taxpayers should check their online accounts at IRS instead. Are we having fun yet?

Abby, what is your method to have the POA on file with e-services. Are you doing that online that requires the taxpayer's to have their own online accounts to electronically sign them, or are you faxing or mailing them in? Does your firm have some standard practice of requiring POAs of your clients?

Letters may be wrong especially if taxpayer has moved or changed bank accounts. The suggestion is to check the amounts in the letters with amounts on the new IRS revamped site. https://www.accountingtoday.com/news/irs-child-tax-credit-letters-may-have-wrong-information?position=editorial_1&campaignname=V2_ACT_Daily_20210503-01262022&utm_source=newsletter&utm_medium=email&utm_campaign=V2_ACT_Daily_20210503%2B'-'%2B01262022&bt_ee=nOEDxhLpYf76%2BKr3%2B8RyP1pGdsv5fhS3Ipv9puUHWgt5zRDyEiZmOVMTXBQTTQhk&bt_ts=1643194964099

Be sure to close the return after deleting the 8879 and EF Info page, then reopen the return add them back and recreate the efile.

Capitalization may come into this if there are significant upgrades or additional features that were never there before, or that are betterments or restorations that would extend the useful life of the property.

Yes, when a sale price is spread over more than one tax year the default reporting method is the installment sale method reported on 6252. The election to report the entire transaction in the initial year of sale is accomplished by reporting the entire sale transaction on schedule D.

If the sale price includes future payments that are contingent on earnings, you might want to read the following article: https://www.cpajournal.com/2020/06/16/accounting-for-sales-with-contingent-obligations/

Installment sale on 6252 that will flow to Sch D unless you elect out by reporting entire transaction on D in 2021. Interest goes on Sch B and purchaser should issue you a 1099INT each year it exceeds threshold.

Sorry I can't help with the ATX input. Isn't there a tab to a worksheet where items for basis, at-risk, and carryovers are entered? There are many items that could be disallowed to carryover or track now, so I can't believe there isn't an area for these. Tom, found this that shows where to enter Sch E prior year losses coming forward:

Tom, that is exactly how the loss carryforward is calculated. On the 2019 return, Form 8582 pg 3, wksht 7, the net total of the current and prior years is shown in column b, the ratio in col c, the allowed loss for 2019 would be at far right in col e, and the carryforwards to 2020 should be in col d. Worksheet 7 for the 2019 return has subsections for each type of loss (from Sch E or from 4797) that should have the ratios and amounts for each type. Are there no entries shown there in col d?

@BulldogTom Sorry, just now seeing this again. I agree with Abby Normal that the allocated loss being allowed up to the $4K probably was a 4797 suspended loss from a prior year. I also agree with his answer to your distribution question. I'd be happy to take a look at the returns for you if you think that would help. Black out the names, address and ssn# and email to me if you want. Let me know and I'll send you my email address by PM.

Agree to expensing also. With the mention of cost seg studies and upgrades, it originally sounded as though this was part of a larger project.

Fwiw, I don't think this falls into the 15-year categories of either land improvements and definitely not qualified leasehold improvements. I think that, while this isn't directly within the building, it would be a 39-year leasehold improvement because it is related to the operation and workings of the building's internal systems and it doesn't fit into any other category.

Congratulations to Andrew. I hope it is everything he's dreamed it would be.

Not here. Water/sewer line laterals belong to the property owner who are responsible for cost of repairs or replacement.

Oh, sorry, I thought that was obvious from my answers. Anyway, cbslee's answer made clear how I would classify each asset.

Above answers - for sink is based on that it sounds like this is a new space or with new purpose and no existing sink that was being repaired. Also, this is assuming that the stove and refrigerator being "commercial grade' may possibly exceed the de minimis threshold. I'm sure someone here will come along with another viewpoint.

cbslee has been posting updates periodically, this one being the most recent from late last week:

Congratulations, Terry!