Terry D EA

Okay, I can't remeber the dollar figure of the penalties that can be assessed for not using the red forms. Whatever that amount is,(it may be substantial), it is worth going through the hassel to get the red forms. The IRS will send them to you for free or you may be able to pick some up at your local IRS office. Personally, I would not print the SS or the IRS copies in black and white. Get the red forms and use them in your printer

Ha Ha! :spaz:

I think what you are saying here is it would be best to check with the Secretary of State of the State where this company is located or incorporated in to see if that State has any special requirements for a Professional Corporation. If so, then I agree BColleen should do this. Under the Federal Code, as you have indicated, a PC can elect S-Corp or C-Corp status.

What amazes me is the number of people who think they can tell what the IRS will do or how they will act in a given situation. This is not directed at anyone in particular. But, I have seen the IRS stand strong and intimidate a client for 5.00 and add interest and penalties because the IRS (who never makes mistakes), could not calculate the ETIC credit amount correctly. After several attempts with various documentation, they refused to budge, isisted they were right and it was in the best interest of the client to pay the $5.00 plus interest and penalties. I would never go out on a limb and say what position the IRS or any other taxing authority will take. In this situation is may be unlikley that the IRS will catch up with this but I would always advise the client of what he/she should do to correct the error to avoid any unnecessary heart ache and expense. Here is another scenario, a client owed the IRS 1600.00 in 2004. He took a stand and protested paying taxes (put this guy at the top of the DA client list)and that amount has turned into 8,000.00 dollars. Now I ask, which would you rather have to pay? Bottom line, any taxing authority can collect on any amount they claim is due within the statutes and make the tax payers life a living hell for non payment.

One thing you might want to do is make sure your clinet throroughly understands that all S-Corp shareholders who actively perform services for the S-Corp are required to be an employee and are subject to the same withholding taxes as the other employees within the corp. I have seen people try various attempts to get around this. Anything but following the law is unethical which you should not be part of. I dumped a client this year because he willingly and knowlingly misclassified employees including himself and refused to do it any other way. I showed him in black and white to ensure that it wasn't my quirky way of doing thngs and he disagreed and my engagment came to an immediate halt.

You can buy perforated paper just about any where. ATX does sell it as a blank uni-form. You are not violating anything by electronically filing all 1099 and W-2 forms. The IRS prefers this but be sure you are filing the W-2 forms with the SS admnistration. Some folks even print the W-2 and 1099 forms on blank paper and cut them with a paper cutter. Doing this and e-filing is the most economic method.

Hey JB what happened to Jerome and the other lady who were preparing taxes? Did they get their PTIN or have they discovered some work around that the rest of us could benefit from? Tax season just wouldn't be the same without them.

Well thanks for the reply and I certainly don't blame "teachers". I am a teacher and have taught college level as well as high school. Currently, I am teaching HS and will continue to do so for at least 6 years and then retire. I do blame the parents and the educational system. Some systems have dumbed down testing, adpoted multiple attempts, facilitate low level of student accountability and cannot institute a dicipline plan that is effective because of parents and federal laws as well. Contrary to what most think, the Bush no child left behind act has not improved education. I agree every child can learn and should have the opportunity to learn so he/she can be successful. However, the only thing this act has done is placed a higher level of accountability for the teacher, increased paper work, increased administrative duties that take away from the classroom planning and instruction. School systems receive funding based on student performance so you can see where a major part of the problme lies. I am of the opinion that poor parenting is a major contributor as well. Of course, I can't leave out the medical profession. The general fix all is to shove a pill down their throat and expect it to correct a problem that the parents lack the ability to do. Simply put, we are doing our young people a disservice by not educating them properly and holding them accountable. Again, I am a teacher and do enjoy my teaching job and will continue to do so to the best of my ability. I love watching my kids succeed. My rewards come when they walk across the stage in June. I get especially touched by those who I made them work thier tails off to accomplish their goals simply because I knew they could do it despite all of the other things they have been told.

I totally agree. Had the employer listed the bonus checks correctly under payroll items in QB, then the QB payroll program would have calculated it correctly. For future reference, if the employer wants to give a bonus in a specified net amount, they are allowed to gross up the bonus to cover the withholdings. It appears by your statement there was only one employee affected and I would advise them to follow the regulations in the future. I can't offer any way to correct this. Backup withholding I think only applies to FICA taxes so that would not be an option either. This is why companies shouldn't do their own payroll

It is form number 8948 which is still in draft form. I do like the cover letter as well. Don't think you can overkill CYA on compliance issues. I know I use a client interview form that asks all the due diligence for EITC which I require the client to sign prior to preparing the return. Stays in their file with the 8867. Here is a link to the draft form: http://www.irs.gov/pub/irs-dft/f8948--dft.pdf

Here is an article from the IRS site. If all conditions are met, then yes they can elect to be an S-Corp but there are some timing rules as to when the election can be made. http://www.irs.gov/businesses/small/article/0,,id=98263,00.html

I have had several people tell me I should create a Facebook page for my business. Has any of you done this and if so do you use it for advertisment? What are the benefits? Do the benefits out weigh the aggrevation of having to check and update another program? The only advertisement that has worked for me is word of mouth. All other forms barely and sometimes not at all, pay for themselves. Please give some comments

Exactly, which is why I moved from your area to NC in 1996. However, I did have to get out the snow shovel this year. The difference is it only lasts a day or so. The other problem is nobody knows how to drive in the stuff here. They don't use any salt but do put a brine solution on the roads prior to the onset of a storm. Either way, snow and cold weather are not my favorite and I am definitely looking forward to the middle of March when temps change and you can tell you're in the South again.

I have used ATX for over 10 years and up until 2008, that feature wasn't available. JB gave you the best advice. I did not like the statement format of ATX and chose to create my own using Excel. Unlock the form and enter in the cell "STATEMENT 1" or "SEE STATEMENT 1" then lock the form. When the form is unlocked, you choose the font size and work everything like you would in any spreadsheet program. Yes, the statements in ATX do identify the form and line number which I also included in the manually created statements. TRX does the same thing as Drake, however there is not a provision to unlock a cell or field to manually add a statement the program is not associating one to be completed with the return. Hope this helps

Welcome back JB. As always, your posts are always generating a good laugh. Happy tax seasonh. Are you digging out of snow up their in Ohio??

The only thing I can add to this is the IRS may and can require the employer to do backup withholdings if an error was made and they are aware of it. With that said, it is up the employer as to whether he chooses to pay the employees part which in my opinion, it is the least they can do to make up for their or their accountant's mistake. I agree with checking with SS admin as verification if the correct amounts were paid.

Tom, I bet the loan isn't free. It is sad that they make enough money off of the crappy loans that they can afford tol prepare the return for free. Oh yeah, as you mentioned, the preparers will take the hit on that one, no commission and at minimum wage only costs HRB about 7.50. Again, whatever it takes at some poor undeserving soul's expense. I gotta sleep at night and I am so glad I don't do these things or use these kind of tactics. I guess greed overshadows the fact that good service and honest transactions will gain just as many clients.

The problem is, most of the folks filing a Sch A don't know they can't yet. As usual, the ads are mis-leading and these bottom feeders will probably be loaning them their own money (if they have any left, or come up with some other scam to get the business. In the past when the IRS computers locked up (2003 I think) my local JH offices told folks that they had a connection with the IRS and they could get returns filed and got them more money than I did because they didn't know the tax laws, lied to the client, took their money and said see ya later. They forgot to tell the client when the folks at JH screwed up, they (the client) would be left holding the bag and they didn't get their refund when promised due to some other gliche. Geez, will they ever stop

We are anticipating inclement weather here in the middle of NC. More than 3 snow flakes or less (give or take a few) within a 2 minute time window causes the grocery stores to empty of all water, milk and bread, school closings, church closings, business closings;etc. So, as I am enjoying a day off, I see this Jackson Hewitt and Walmart ad that says come to Walmart and get your taxes done and get a huge check all for $38.00. I think one part of the ad said starting at $38.00 and another part said $38.00. They once again forgot to mention how they were going to fleece the client once they got them there. Other ads have large words stating come and get your Refund Anticipation Loan and guess what, HRB has the same ad. I want to be the first person who gets their taxes done for $38.00 and walk out with a huge check all for $38.00. I think I will try it or set someone else up to do it just to see. Demand the prep and huge check for $38.00 per the ad.

Well here is some news. I just read an article in the Journal of Accountancy that the IRS office that is handling the PTIN's said it will not reject and returns that are prepared by someone who uses a non-registered PTIN or social security number. They will, however, send a notification letter at the end of the tax season. They do not want to put a burden on the tax payer just because the paid preparer is not registered. Now, how does that work with compliance to ensure the paid preparer is qualified???? I had no trouble at all registering my 14 year old PTIN. I do know that some did and still are experiencing difficulties. But this article seems to say it really doesn't matter. Here is the article http://www.journalofaccountancy.com/Web/20113715.htm

Thanks Eli, I am aware of the ERO data base but would like to see the IRS list a database of preparers who are registered with a PTIN and not necessarily as an ERO. Some folks are preparers but not ERO's. I am both but it would be nice to direct potentially new clients and existing ones to a site where they can verify credentials.

Does your client understand that paper filing will take at least four to six weeks to get his/her refund (if they are getting a refund) and if he waits for another week, he will have it much faster. I agree with the frustrations of the IRS not being ready. But, for the last fourteen years I have not seen them ready on time. The last minute changes are a PITA as well but there isn't anything any of us can do about it. Try to make your client understand that it is best for him/her to be a little patient and efile.

Well I might agree but I don't think the IRS would reveal the assigned number but, could indeed allow the consumer to verify that their preparer has indeed met the requirements. There used to be a way for folks to see if a firm or individual was listed as an authorized e-file provider. I was, and if it is still available, listed there but my EFIN was not. I don't think the IRS would be that stupid and post something that would cause them to looser virtually all control

Is there a data base on the IRS site or another place where our clients can verify that we have registered with the IRS and are authorized to prepare and file their returns? I think this would be an excellent tool to use to obtain new business. Telling a potential client to check online to verify credentials is a plus. Also, how will a client know if a preparer is using a bogus PTIN? Just wondering as I am getting ready for the season.

I too left ATX for the same reasons. I had to contact them this year to purchase one return on a PRS for 2004 and did receive poor service. The offered me the one lonely return for $100.00 and not the original 12.00. I can understand the price going up a bit but $100.00?? Really?? Thanks to friends on this board, I got the return completed. This is my second year using TaxWorks thru TRX and while I have had minor issues, the support has been above average. Last year most of my issues were the learning curve for me and their support was more than patient with me. If you have noticed, the level of incompetence from employees of alot of companies is reaching ridiculous proportions. I blame it on the attitudes and education received or attained by our younger generations. I can say that as I am an educator and sometimes, I am embarrassed to say so. I have been teaching quite a while and you can see the changes over the years. Good luck to all with the support folks this season regardless of who you purchased your software from. As for all of us old timers here, as long as we are here for each other, we will get thru.