mimi

Thanks everyone for the great feedback. Just to clarify - He lived in MO while working in KS (common in the KC area since it lies on the border of both states). Moved to TX to take a promotion with same company. Bought a house in TX. Lived there 2 years. Moved back to MO and started his own business. (Thus he only moved back to MO once.) Did establish a residence in TX. His CPA in TX did reply to the 1st notice, and they believed it had been taken care of. Client (and possibly former CPA) continued to have conversations with MO (I'm not privy to the nature or results of those conversations.) I told him this project would have to wait until after the 18th, so I don't have exact details of his or his former TX CPA's previous conversations with MO, other than a copy of a reply correspondence.

Just to clarify - He lived in MO while working in KS (common in the KC area since it lies on the border of both states). Moved to TX to take a promotion with same company. Bought a house in TX. Lived there 2 years. Moved back to MO and started his own business. (Thus he only moved back to MO once.) Did establish a residence in TX. His CPA in TX did reply to the 1st notice, and they believed it had been taken care of. Client (and possibly former CPA) continued to have conversations with MO (I'm not privy to the nature or results of those conversations.) I told him this project would have to wait until after the 18th, so I don't have exact details of his or his former TX CPA's previous conversations with MO, other than a copy of a reply correspondence.

Any Missouri experts out there? My client has just received notice of lien on his property because MO says he owes taxes on income he made in TX after he moved there in 2006. He did live in MO, worked in KS, then in Aug 2006 relocated to TX for the same employer. TX has no income state tax, so MO says there is no other state's credit to be applied (there is for KS of course, but that is while he lived in MO.) He has since moved back to MO. It does seem unreasonable to me that MO wants income tax on income made in TX while living in TX. Any suggestions, please??? Thanks in advance for your help!

Thank you for all replies. I thought I remembered it being around $50. Yes, the person may have been an employee instead of independent, but I think it's too late to take that one on!

my client hired help around the house while she was recovering from surgery and paid the helper >$600 so should have done a 1099-misc. client is under a lot of stress and said she didn't really want to deal with it right now. she was certain the helper was reporting the income on her tax return. what is the penalty for not submitting a 1099? and how likely is the irs to figure out she didn't do one? can we submit one after the 1099 deadline (i realize it has already passed), or will that draw unnecessary attention to the situation? thank you for your help!!!

I clarified this with client today. Had health issues related to an accident around Sept 2009. Was reinjured by another accident. Was terminated by employer in Dec '09. Employer was fighting unemployment, and client found out employer had cancelled his health insurance in Oct 2009. He took the distribution to pay bills while dealing with health issues that progressively became worse as the year went on. I don't think the client realized at that time that the health issues would progress and lead to disability.

Thank you for your reply. I am aware of the doctor's note option. My question is can the exception be applied if the client took the withdrawal first (Jan) and was later declared disabled (Sept). The pubs state "distribution taken DUE TO disability", so was wondering if it made a difference which came first.

My client withdrew from his IRA in January 2010. He was deemed disabled in Aug 2010 by SSA. Does he qualify for the exception to the 10% penalty even though he withdrew the money before being officially declared disabled?