Pacun

Good job Marco. Congrats.

Thank you. Can you comment on this based on the rulles for separated parents? Let's say that children lived with both parents for 7 months and 12 months with the other. If the parent who lived with the children only 7 months wants to claim them, that parent needs to secure form 8332 from the custodial parent. A grand father in the same situation doesn't need form 8332, correct?

You didn't let us know important information, such as how much was the withdrawals and distributions. You have to read the tax treaty between "la madre patria" and the USA. You are better off hiring someone to do your taxes.

I just want to make sure I am correct. Father and mother are married and have 5 children. He makes about 32K and wife makes about 10K. Every year around tax season wife goes with all her children to her mother and lives there for about 3 months and the chidren are claimed by wife and her family. In 2010, father lived with the children for 7 months and I paper filed MFS and claimed all children. I sent a letter to the IRS giving dates when father and children lived together and asked the IRS give him the exemptions of any child who was not claimed by the mother. IRS agreed with my letter. For 2011, father lived with the children only 5 months (none of them qualify for HH because they were back and forth). They both are fighting for custody in court but due to the fact that "there are NOT irreconciliable differences between the parties", the court has not issued a divorce nor has given the custody to any of them. Do you think that the father will win the tie breaker against any family member (other than the mother) with whom the children lived more 7 months? Mother will not sign form 8332 and children lived with her ALL year in 2011. I do believe the father will win the tie breaker against any family member who makes less than $32K but I want to make sure.

I guess you guys do only hard returns. If you prepare 400 returns in about 80 days, your average is about 5 returns in one day. If you are solo, you do need someone to make copies and prepare folders for you. I have a regular job and I only prepare taxes at the end of the day and on weekends. It makes a big difference if your assistant picks up the forms and prepare the folders. The phone and the mail is also handle by your assistant and you have more free time. The problem with assistants is that it is hard to find people you can trust. Now that the IRS is going to test preparers, it will be easier to hire someone without being affraid that that person will take your clients.

Tax season just finished and I already miss the extra cash flow. How about you?

There is nothing to be worried about. You did everything right and the attorney doesn't have the whole story. Do not provide any other service for this client and just tell their attorney that they wanted you to prepare a return incorrectly and that's why you charged for your time. Let the attorney know that you told the consequences of not paying taxes on their SS and fired them following circ 230.

Don't forget that you have to use the lower and then deduct the land price.

The basis for depreciation is adjusted basis or FMV, whichever is lower.

1. Individual Tax Return Deadline – The due date for 1040 returns and extension requests is Tuesday, April 17, 2012. A return or extension must be filed before midnight, IRS Service Center time, to be timely filed. Tip: Avoid any potential high-volume delays by transmitting returns and extensions throughout the day. 2. Extension Requests with Payment Due – An extension request only extends the time to file. Clients who may have a balance due must pay an estimate of the amount owed to avoid penalties and interest. Tip: Alert clients filing on extension of the April 17 payment deadline. 3. Rejected Returns – The last day to retransmit a rejected timely filed 1040 return and extension request is Sunday, April 22, 2012. Tip: Even if no extension request form was filed, you can continue to e-file returns after this date. This includes 2010 prior year individual federal returns.* * Not all individual federal forms are supported by Modernized e-File.

They need to amend her return and parents should paper file their return claiming the daughter. I would send the 1040X at once and wait to the last day to paper file the parents 1040. Since parents have not filed yet, no need for a 1040X for parents. If parents are getting a refund without claiming the daughter, maybe you should efile their return without claiming the daughter and then wait a month and file 1040X for parents claiming the daughter. As you know, the 1040X from daughter will take a couple of months to clear. If you send her 1040X and a month later send the parents 1040X (which will also take a couple of months to be processed) everything will be OK.

OK. I will see if others comment on the other post.

If he uses tuition and fees deduction, he will zero his federal taxable income but he will still have to pay SE taxes. How about saying something like on Schedule C.... "I got a 1099 for $$$ and I am going to report it on Schedule C. In order to make that amount of $$$, I was required to spend and pay $$$ to this institution and therefore, my net income subject to SE taxes is zero".

I hope Jainen can reply to my post on another similar post.

You need to find out if the loss was personal or business. Scenario 1.- Let's say that I purchased a house in 2005 for $500K and lived there until Dec 31, 2009. I start renting the house on Jan 1, 2010 and the FMV of the house was only $275K. I rented the house in 2010 and 2011 and I took depreciation for $20K. Then in January 2012, I sold the house for $300K. In this case, I will have to report a gain of $45K of which $20K will be depreciation recapture. Scenario 2.- How about if I sell the house for only $275K? Then, I will have a gain of $20, all of which will be depreciation recapture. (the end result will be 0 gain and 20K recapture) Scenario 3.- How about if I sell the house for $260K then I will have a business loss for gain of 5K and I will recapture depreciation for $5K. Where will my loss go? Where will the rest of my loss go? Well, it went to my pocket in the form of depreciation. How will I do report those scenarios? You will dispose a rental asset and a personal asset?????

I will enter "1099 Tax" and see what happens. Thank you.

I have entered the country which is Canada but nothing flows.

"Neither son has gainful employment and neither is required to file a tax return" Do you mean they make $1 (one dollar) in income last year, or do you mean they make $8K? How much did each make?

Thank you. Are you entering anything beyond part 1 question 2?

Client got 5K in a lump sum distribution and paid $1,250 to another country. I have filled out form 116 and nothing flows to the 1040. Any suggestions?

Client got 1099-C for 4k from a credit card company. I have form 982 and I have check 1b (client is insolvent). On line 2, I have entered 4K, which is the amount "excluded from income". Is this all we have to do? Do we have to enter amount on line 21 and then enter a negative number to cancel it out?

Combine them. Keep in mind that the FMV of the is ONLY one (not the combination of the two).

My worries are gone. I am not going to pay extra taxes in 2012. I checked my numbers and I didn't win.

For matching purposes, you might want to wait the form from the bank stating the amount of the distribution.

Each year, I try to pay less taxes. That's my number 1 goal. Why will I go out of my way to pay more in taxes? I guess I am not thinking correctly but I have bought some numbers just in case. Good luck anyone.