Pacun

Depending on income and other Sch A deductions, the 2% floor will bother your client. He will have to enter 17K on line 21 and 17K on Sch A (subject to the 2%).

I fired a client a couple of years because after we finished the IRS return, he wanted me to prepare another return with less money paid to employees and subcontractors. The second copy was going to be shown to his insurance company so he could pay less. On the spot, I told him I didn't do that and that I couldn't continue preparing his taxes.

On the question at hand, let's imagine that I have filed my taxes reporting $19,000 to the IRS but I come to you (CPAs) and I say, "I haven't filed for 2005 and 2006 and I would like you to prepare my taxes". I continue to say "I made $90,000 and I had very few expenses on both years". What will you do? I guess you will prepare the taxes and give me the envelopes to send to the IRS and to the state. I pull out the forms from the envelopes and try to get a loan with that information.

Believe me, taxpayers are smarter that what we think and they play these games. So, next time your client gets nailed by the government, do not feel sorry, maybe they deserve it. Also, I do not feel sorry for the greedy people that lost their homes because they knew they could afford it to begin with.

I have noticed that we do not have to keep form 8453 anymore, unless certain situations apply when we efile. I am only keeping form 8879 regarless if I enter their pin or client enters their pin when they efile. Is this correct? (I also keep the state's efile form).

EIC due diligence, I am supposed to keep 8867 and a work sheet. Is the workshee include on EIC form ATX enough to comply with this requirment?

In short, what worksheets and forms should I keep for someone who e-files, has a child and gets EIC?

"Are their computers capable of filtering through all the tax returns filed and determine who gets how much".

You guys use computers and ignore how powerful computers are. In 5 years, computers will be able to audit each return every 5 years as stated by some IRS employees. Do you know how much the IRS software programs cost? Don't you think that it is capable of doing queries much better that MS word? If you get the bible on your computer and you want to find out how many times the word Jesus is mentioned on the bible, the computer will do it in seconds or less. A better program will do numerical queries much better.

On the printers properties, configure printer to use the tray that you want to print from. OR pull out all trays and leave paper on the on you need to print from.

Keep in mind that cost or FMV at the time of donation (whichever is less) will be used. So the $12,000, is not the number you will use (most likely).

"Why can he not claim the dependent and head of household?

And she single no dependent."

NO EIC.

She can claim single with a dependent and he can claim Head of Household with no dependent. Who said that getting married in this case is a good tax advice?

I am not sure if he donated a tangible asset. If he donated the place, you can use cost or FMV (whichever is lower) to calculate donation. If the land was only used for 2 years, I think your client cannot claim any donation.

For those concerned with disk space, please configure your ATX to only keep one version of backup. That will eliminate the duplicate files.

EXTREMELY important question. If the IRS gets a court order to see your computer, ATX will have (by default) up to 3 back up copies of the same return. Let's say that a client comes to your office and tells you that he is ready to file and that he will not claim a dependent. You prepare the return and gets backed up. Then the client calls you and tells you that he lived with his child and that he wants to claim it, you prepare the return again and gets back up. When you are ready to file, your client tells you that he has other deductions to claim, another back up will take place. If the IRS see all of these backups from your computer, it will leave an aroma that you playing with the returns.

This is a straight forward and honest return but sometimes we use current year's software to calculate next years tax liability during tax planning and the returns will be backed and it might not look as clean as this one. Did you get the point?

On the intended benefit, I have worked on a return and then I had wished that I kept a copy of the old return. With the 3 default backups, I will have it.

What I do is, I type the long lastnames and print everything and I give them their copies. Otherwise Marybeth Frederick-Hernandez and her husband Benustiano Hernandez-Martinez will think you made a mistake if you give their copies with Marybeth Frederic and Benustiano Hernande.

start deleting a character from each client's last name from the back until you get to create the efile. As you know, the first 4 letters of the last name (or last names) are crucial for the IRS matching program

I got my first client appointment for Saturday at 11AM. Since I had the software, I thought I was going to call, pay and get the installation code. Saturday at 9:15AM I called and I gave them my credit card information. Then I was told the codes were going to be sent my email to me in the next 2 business day. I AM GOING TO CHANGE SOFTWARE NEXT YEAR. I work with computers for a living and I don't care if I have to learn one more program next year. I hope next year we call this site Taxpreparerscommunity.com

Usually, in December, I receive a letter from the IRS stating that I can continue efiling. This year, I have not received such letter. Has anyone received it or we have to renew?

Possible. But... at no point the original requester said that he purchased the sofware from ATX. Maybe he was using Turbo Tax. Who knows. If he was using ATX, a simple call to ATX would solve his problem.

Please do not share copywrighted software on this forum. It is illegal!!!.

ATX has a minimum charge of $100 for any past year software, as mentioned on one of my previous posts. I had ATX for years 1999-2006 and I needed 1998. I called and I was told that no matter what I ordered, it was going to cost me $100. So I asked them to send me 11 years for $100 (1995-2005).

I liked it!!!!

We need to get half of each greeting for the independents. Can someone come up with something for the independents?

Thank you for your replies.

joanmcq, If this is a major painting job, you would depreciate it, how many years?

Tax payer bought rental house in 1999 and in 2006 had these expenses:

Painting $2,000.00

Replace Dishwasher $500.00

Replace Faucets, showers, $800.00

Replace Kitchen floor $565.68

The rental house adjusted basis is $170,000 after depreciation for 2005. The house was painted in 1997 and repainted in 2006. I understand that I need to depreciate the floor, painting and the dishwasher. Do I add the painting and kitchen floor to the basis and continue regular depreciation? Or I have to start a new depreciation for those items using 27.5 years? Should I expense or 179 the dishwasher?

Thanks in advance.

It seems that, in this case, they are splitting their wealth because they are divorcing. Alimony is an allowance for support and not money to pay for a car. I think one spouse had a car that cost about 22K and the judge said that the other spouse should also receive a car.

You should also read careful about the lump sum payment.

Hello everybody

Just got off on phone with IRS, Section 121 exclusion is not available since they did not occupy the house for minimum of 2 years within past 5 years, this is FYI

This is what I said before....

""now" is irrelevant. Was he a legal permanent resident when he sold the house? If not, maybe you need to use 1040NR. He would qualified for the exclusion if he was a permanent resident, lived in the house and own it for 2 years out of the last 5."

"now" is irrelevant. Was he a legal permanent resident when he sold the house? If not, maybe you need to use 1040NR. He would qualified for the exclusion if he was a permanent resident, lived in the house and own it for 2 years out of the last 5.

I think you have to report income on 1040 for the part that he lived in the US and 1040NR for the part of the year that he lived in India. You get your permanent resident status at the airport and if you sold your house prior to check in with the airport immigration officer and you sold the house before coming, you need to use 1040NR.

Keep in mind that getting the visa, does not make you a U.S. Legal permanent resident.