Pacun

Can someone comment on this? If you have the tax code, it will be better. Client has not filed 2004, 2005, 2006, 2007, 2008, 2009 and 2010 (not a real case). Yesterday (Dec 6, 2011), we filed for all those years he WILL NOT request a refund for any of those years, except for 2010. I know we cannot request a refund for years prior to 2008 and we are not requesting ANY refund for those years. Please ignore interest and penalties for a moment and let me know if this works or if it is prohibited by code. For 2004, IRS owes him $2000 which he applied to his 2005 taxes. He did this by answering these questions: (I am using form 1040 for 2011 but they are the same in this area) If line 72 is more than line 61, subtract line 61 from line 72. This is the amount you over paid (which is $2000). Then we answered: Amount of line 73 you want applied to your 2012 estimated tax: (we entered $2000). We answered $0 on "Amount of line 73 you want refunded to you. For 2005, the IRS owed $1000 to taxpayer, plus the $2000 from previous year, we applied $3000 to 2006. For 2006, taxpayer owed the IRS $2,500 and he applied the remaining $500 to 2007. For 2007, taxpayer owed the IRS $300 but since he had $500 from previous year, he applied $200 to 2008. For 2008, IRS owed $1,500 so the taxpayer applied $1,700 to 2009. For 2009, the tax payer owed the IRS $1,700 so there was no overpayment or amount due. For 2010, the IRS owed the taxpayer $3,000 and he requested a refund. What do you think?

Can you suggest a place to get CPE credits either on line or live in DC, MD or VA? Inexpensive sites are always welcome. NATP's schedule is not good for me and I need this credits before the year ends.

DC allows you to collect unemployment when you get fired or laid off. If you quit your job, you don't qualify. When an employee goes to collect unemployment, even if they quit, they claimed that they were fired. DC calls the employer to confirm that the employee was fired. If the employer states that the person quit, the DC goverment has a hearing where the employee and the employer state their own version of the situation. The "judge" makes a decision and grants or denies unemployment. If unemployment is granted, the employer has the right to appeal the decision in regular court. Why does the employer show up to the first court or appeals if the money doesn't come from them? Do companies have to be present if the government send them a letter stating that a hearing is scheduled on the case? I do understand that each state has different laws. Please share what happens on your state or comment my questions.

We are still here.

I heard that the cost of a computer purchased by a student can be added to tuition and qualify for education credits. Can someone elaborate on that? I think it is gone but I just wanted to double check.

No, you are not required to report him. You are just required to let him know of the consequences of his actions. You don't want him as a client since he went to you thinking that, maybe, the IRS owed him some money.

At this point, since the extension date is gone, there is no question that MFJ cannot be changed to MFS by filing 1040X. I agree with previous posting but I am not sure if the rule includes extensions.

My question is about taxes not LLC registration. A friend opened an LLC in 2009 and because he didn't have any activity, he didn't file any forms with the state when he did his taxes. His federal taxes seem to be correct but I wonder if the LLC had to file any tax forms in 2009 and 2010.

I understand that MD charges $300 for LLC even if they didn't make any money or had any activity. DC charges $100. How about for LLC registered in VA? What forms do LLCs have to file even if there was no activity?

Any one else has an opinion? I believe you are an Enrolled Agent in good standing until the IRS says otherwise. When you brag about having Top Secret clearance, you brag about passing an FBI investigation, don't you?

Can I say this on an ad? Is the FBI involved on the background check for EA applicants? I believe it is because if you are on the wanted list, they could arrest you when you apply for enrollment. "At the ABC Center taxes are prepared and reviewed by a Tax Professional who is an Enrolled Agent in good standing that has passed the Enrolled Agent Exams administrated by the IRS and has passed FBI background checks. "

I am only answering a portion of your question. It is done in the back ground. Reduce the gain to 0 and see the effect. Then, make 10K profit and you will see it is taxed as ordinary income. Then make the profit $15K and you will see that $15K becomes ordinary income. Increase the profit from $15K and you will see that the portion above $15K will be taxed as capital gains.

No need from little siblings when big brother issued an ITIN to spouse.

"The IRS issued proposed regulations that would require paid tax return preparers, beginning in 2012, to file a due diligence checklist, Form 8867, with any federal return claiming the Earned Income Tax Credit (EITC). It is the same form that is currently required to be completed and retained in a preparer’s records." I wonder if we are going to be required to attach the worksheets.

I think reduction of basis for $400 is the correct way. The insurance company pays to repair the roof, it is not an improvement. I understand why this situation takes us off guard. A lot of questions on the EA exams mention that replacing the roof is a capital improvement and must be depreciated. Think for a moment that the insurance paid $4,900 because you house was flooded and you spent that amount of money cleaning and mold treatment. In the flood event, no one will think about capitalizing it.

Share with us the end result... will you pay taxes on the $400 or you will just lower your basis or there is no tax consequences after your finish with form 4684?

It seems that your client is not showing the last paycheck stub. It seems to be one more check after the stub you are looking at. It seems that this person will get a refund from Canada and, therefore, he should file.

No one will question your approach. I would add the $4,900 to schedule E on its own line instead of line 21 for simplicity. Have you thought about the $4,900 being return of capital and reduce the basis of the rental property? I wonder what others think. Keep in mind that insurances give you money to repair (or make it the way it was). The money is not intended to improve your house but to repair it from the damage

All institutions are asking for that and more.

This is good information and you should read it (I have posted on another thread). There is a time limit and it has to to with an "identifiable event". In tax court the IRS has lost because the banks issued the 1099-C too late. go to www.ustaxcourt.gov and click on "opinion search" and type 1099-c on "text search". Then click on the last name and look for the hyperlink to the decisions. T.C. Memo. 2011-233 UNITED STATES TAX COURT THOMAS AND MONICA L. KLEBER, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket No. 1545-09. Filed September 28, 2011. and please read this other case. T.C. Summary Opinion 2009-180 UNITED STATES TAX COURT THOMAS JOSEPH LINKUGEL, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket No. 28895-08S. Filed December 1, 2009.

As I stated above, there is a time limit and it has to to with an "identifiable event". In tax court the IRS has lost because the banks issued the 1099-C too late. go to www.ustaxcourt.gov and click on "opinion search" and type 1099-c on "text search". Then click on the last name and look for the hyperlink to the decisions. T.C. Memo. 2011-233 UNITED STATES TAX COURT THOMAS AND MONICA L. KLEBER, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket No. 1545-09. Filed September 28, 2011. and please read this other case. T.C. Summary Opinion 2009-180 UNITED STATES TAX COURT THOMAS JOSEPH LINKUGEL, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket No. 28895-08S. Filed December 1, 2009.

Client 1 has to deal with two forms 1099-A and C. Schedule D deals with A and 982 deals with C. You need to file both in this case. Remember that the loss is personal so you don't get 3K losses each year.

Property 1, report the sale on schedule D and report the loss as personal loss. When 1099-C comes, then you file 982. Property 2. Gets reported on Schedule D and it seems to be in the same category as number 1 since your client never held it as investment and it was never in the martket for rent.

A data recovery company might be able to recover your data if you know where it is. If you installed ATX in the default directories it should be under C:\program file\ATX20XX. It is expensive and I don't know how many clients you have but it might be worthy to give it a try. Remember that the backing up done by ATX is like saving your money under one pillow and then saving some money on the other pillow. This type of reserve or back up will work only if you bed gets burned only half way. Depending on how the technician programmed your computer, a data recover company will undo what the technician did and give you the hard drive virus infected but your data should be there. When a technician says... "I will have reprogram your computer but your data will be OK" What they mean is that "my documents", favorites and desktop will be safe. The word desktop means, the folder that holds the icons and all the crap you dump there. It doesn't mean your computer. When a tech uses that terminology, they have covered their basics and it is up to the clients to say "besides QuickBooks, I use ATX and I need all the data from that software. The folder name is ATX2010". Their lingo is like when you tell your client "I can see you sold your rental house in May last year and you got a profit of $300K and since you depreciated your house for the last 15 years, I will have to recapture that depreciation". In your mind, you are telling them that they will owe a bunch of taxes but the client doesn't understand what you just said. When you present the return and they owe a bunch of money, they don't like your work and don't want to pay you and they want their papers back. My suggestion is to negotiate with them to have the hard drive sent to a data recovery company and maybe they can share the cost. As the computer industry says... it is your responsibility to look for a good, certified tech. (Sounds similar to what the IRS tells taxpayers when they blame the preparer). I have said this before... Don't use your tax preparation computer as a regular computer.... I have a partner and I do not let her use my computer UNDER NO CIRCUMSTANCE because tax preparers should NOT get a virus on their work computer. Remember that if your computer is hacked, you have a lot of information from your clients. You have: Correct name SS# Address Previous addresses if they are long time clients Name of employers, addresses, FEIN, etc. Marital status (on most cases) Income amounts bank account numbers date of birth Mortgage loan information, etc.

I don't have an answer to your question but I want to advise others who might experience the same situation. Just for the record, when you get a virus, you are still able to recover your data if you get your hard drive and make it a slave on another computer. Do not reprogram your computer without knowing that your data is safe. A better solution is to buy another hard drive and program the new hard drive and keep the old one until you have pulled out your data.