Pacun

Who ever has a social security number, must use it. In this case, if the W-2 has "his old SS# number", you will have to paper file.

Client is abroad and sold a condo at a loss but real estate company correctly withheld 10% and send it to the IRS. The next day, client filed form 8288-B and got the money back because it was sold at a loss. Now it is time to prepare form 1040NR and I can enter the amont withhold but I cannot find a place to enter the amount that was refunded. I am thinking about asking for a huge refund and let the IRS adjust it. What if the IRS doesn't adjust it and send the big check to client? What it I just ignore the withholding and the IRS claims that a huge refund was issued and now wants it back. I guess $52K earns a lot in 6 months and that's why the client wanted the refund back in August 2012.

I don't think this is a rental business since no one will pay rent. I would be incline to a second home rather than a rental. Technically, he is not renting it at FMV and that makes it personal.

When the bank repossessed the condo, they were some papers signed. You need to see those documents or the client should have a form listing the amount owed to the bank and the FMV of the condo. You have to report that sale on sch D. You wil have to deal with form 1099-C when your client brings it to you, which could be at any time within the next 3 years or never since the bank might never forgive the debt.

Use adjusted basis and $170,000 as the selling price. I believe the amount owed to the bank(s) was $305,383 and that's why 1099-C shows that amount. Your client should have the documents sign at short sale to list some figures. If the short sale happened in 2012, you must report the sale on Sch D and since you have a 1099-C you have to use form 982.

Ask the clients about the assets and when they were purchased. Maybe it is only one or two. Get an extension and if copies of tax returns don't have much info, get a copy from the IRS for the last three years.

TP bought a condo in 2009 and put it on rent. He is overseas and he sold it in 2012. Gain was 12K and depreciation taken was $20K. When I entered the asset there was a basis for Federal taxes, one for AMT and one for the state. There is no other income on this 1040NR form and the ATM tax makes the amount due $54K. Is that possible?

On the top right corner, pull down the menu from Christian and then select profile and then change profile and you should be able to change the picture. As a general rule, you should place a picture of yours that was taken 10-20 years ago.

You can only get income transcript after August 1st.

Clients bought a house in 1996 for $150K and made improvements for $52K. 6 years ago they bought a second house and started renting this house and took about $30K in depreciation. The bank repossessed the house in 2012 and the FMV of the house is $212K and the outstanding loans is $300K. The document also states that the client is personally liable. Clients filed for bankcruptcy and they said that the attorney told them that they shouldn't pay any taxes on the capital gain, to which I don't agree. Before I reply to my clients' email I want to make sure I am correct. I told them that they will have to pay taxes on $40K of which $30 will be recaptured as ordinary income. I said that filing bancruptcy will allow them NOT to pay taxes if the bank forgives them the $88K remaining of the unpaid loan. Is that correct?

As long as she didn't finish 4 years of College/U before, she qualifies.

Do we agree that support has nothing to do with EIC and support doesn't have anything to do with dependency when the child is qualifying child for the tax payers as long as the child didn't provide more than 50% of his her own support? In this case, the grand mother lived with the children, her daughter and her daughter's boyfriend. The children are qualifying children for the grand mother, the mother and the father. Since the father lived with them more that 6 months, he qualifies to file single not claim any children and file EIC form listing them without claiming them. As long as the parents don't claim the children, the grandmother can.

For the record, you should calculate FMF of the house at the time of death of her husband and increase the basis by half of the gain of the house. So, 8 years ago (when the husband died and the market was good) the house might have reached the FMV of $144K. That means that the gain at that point was $114K (144K-30K). The basis the house was at that moment $30 plus half of the 114K which is $58K for a total basis of $88K. In this case, it doesn't matter but if this were a rental property for the last 5 years, it could make a big difference in taxes.

Not exactly correct. Father can claim EIC without claiming anyone on the return and let the grand mother claim children and mother and qualify as HOH.

I don't know what happened in your case, but I save as soon as I finish entering name, SS# and address of the filer. This saves me at any time since the auto save kicks constantly. If I don't save the very first chance you have, I risk: 1.- A power outrage 2.- A child pulling the power from my computer 3.- My client stepping on my surge protector and turning it off when it start looking at the ceiling looking for numbers to answer my question 4.- My ATX software failing and closing itself 5.- My OS claiming my ATX software "performed an illegal action and it will be shut down". 6.- My OS shutting down my computer 7.- My computer freezes 8.- My computer restarts because of memory reason, etc. Keep in mind that if any of the above happens, I will lose only few minutes of work instead of hours.

The best? How would you rate the others?

Unmarried couple moves to her parents and lives under the same roof the whole year with their five children ages (by Dec 31, 2012) 19, 16, 13, 10 and 7. There were no sleepovers or vacations so all of them slept 365 nights at this house. Parents of the mother are married (ages 68 and 69) and had earned income of 30K of which half was arned by each. They entered the workforce 5 years ago and had no other income. The mother earned $15K The father earned $28K The 19 year old child went to school half time and earned 8K and didn't provide more than 50% of his own support. All of them are US citizens with valid SS numbers and lived in the US the whole year. They decided to claim the children this way: Parents of the mother will claim the 7. The mother will claim the 10 year old. The father will claim 13 year old. The 19 year old child will claim his 16 year old sibling. It seems that all 1040 forms will include EIC. The children ages 16,13,10 and 7 are qualifying relatives for all of the taxpayers so each EIC worksheet will have "yes" checked. So how do I answer the following question: "Relationship to the other person": Do I say "bother or sister" to each and all of them or I type "Son or Daughter". How will you answer the question the next question for the 19 year old or grandparents "will you win the tie breaker?" Extra point: If no other income or economic benefit got into this household, (all of them helped to pay the rent of this house) can anyone file as HOH and how to document it?

Tie breaker rules only apply if two or more people claim the same child. The first tie breaker is parental relationship which will be won by the father, which will be end of the conversation.

Yes, they qualify for EIC.

I agree but with EIC you don't get it if you let the default (which is nothing) be entered on the key questions. In this case, I think it is different.

Please check every AOC you have requested and make sure you have checked yes to "half time student". The easiest is to check form 8863 instead of the input interface. ATX is allowing refundable AOC even if that box is checked no, which is the default answer.

I guess she is a very nice woman who doesn't receive child support and YET pays half of the expense for the house where the husband lives WHILE she is upkeeping a home which is the main home for her child.

Mileage in this case is deductible regardless of the signs on the car. Technically, you should depreciate the sign on the car and enter it on advertisement.

What kind of business do you have?

I normally just tell them about the consequenses of their actions from the past. I suggest to amend but I don't amend returns from other preparers. I ask them to go back to the previous preparer if they want to do the right thing. I tell them up front that the return I will prepare will look different than that of the last year because I will do it right. If they want to stay, fine. If not, I give them back their documents and they don't owe me anything.