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Terry D

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About Terry D

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  1. Client apparently overlooked (their statement not mine) some depreciable items they had purchased beginning 2016. Form 3115 with a section 481 adjustment will be completed. I don't do too many of these so I was wondering what the average invoice is for preparing these forms. Thanks!
  2. You know sometimes these colleges get on my last nerve. The 1098-T is an important form. While I always recommend seeing receipts and statements from the bursar's office the 1098-T is important. If the son has not claimed himself and has no education credits on his return, mom should be able to claim the AOC because the son has not completed the first four years of school according to your post. If the son is over 24 and mom and he still qualifies as a dependent on mom's return then you should be able to claim the LLC. I am saying this without knowing all of the detail so I could be incorrect
  3. Max, as Judy said Box 16D is the amount of distribution to the shareholder that affects their basis. So the answer to number 2 in your OP is no. However, without further detail the amount in 16D could contain a portion of the gain of the sale that was distributed to the shareholder. Can't determine that unless you see all the transactions and basis history detail. I don't thi9nk you would make any adjustments just enter the items in the appropriate boxes as indicated on the K-1.
  4. Thankyou!!! This is exactly what I needed.
  5. Abby this will be interesting. I partially agree with your position. However, if a deceased person's tax return was checked as final, there won't be a filing requirement for 2020. Or if the return was not checked as final, the decedent would not have income (maybe some would as an estate winds down) and thus no need for a personal 1040. Not sure if this would be handled on the estate tax return if there was one. A lot of unknowns. I have a check for my deceased mother and plan on holding onto it until further guidance is given. I'm definitely not cashing it. The IRS mail is a nightmare and no
  6. I always question them and advise them as Catherine has said. I tell them I don't want any surprises in an audit. Also, if it is a new client, they get questioned a bit harder and if I think I smell a rat, then I set them free. Agree, document. I use Drake and keep notes in the client file. I add the date and time along with the details. I show it to the client for their approval.
  7. Sorry everyone, I typed the OP in a hurry and was not very clear. So, here goes, this client purchased this home approximately 5 years ago. After living there for three years, they converted the property to rental and it has been rented for the last two years. I understand the two years doesn't have to be consecutive and I also understand that any depreciation taken has to be recaptured when the property is sold. Because it is still rental property and they are looking into selling it, I don't think the 121 exclusion applies. I understand it would if they convert the property from rental to pe
  8. Client lived in the home for three years and two years ago and converted it to rental property. They are selling the property, I don't think the 121 exclusion applies here. Need a reference as well if someone could provide one.
  9. Terry D


    At the top of the general forum, Judy has pinned the all QBI posts and discussions. There is a wealth of information that will help. Everyone here has given you excellent and expert responses. However, under the QBI tab you can find resources and code references you may need. I didn't read all replies in depth but your client has to make the safe harbor election if they qualify. Depending on which software you are using, you may need to include this yourself. Drake has an election that will go with the tax return when it is transmitted.
  10. Drake provides both Federal and State tax comparisons with each return processed. Most folks don't give much attention to tax rates. During the review of the tax return, I explain the tax rates but the looks I get suggest they are not all that interested. Usually its the folks who are investing and my larger rental clients that are concerned with tax rates and capital gain tax rates.
  11. Exactly what I'm going to do. Gail made me take a second look at how the check was addressed. It is in my mother's name but the word dec'd was not beside her name.
  12. I received a stimulus check for my deceased mother. I know the envelope says check the box and drop in the mail. But....I don't trust the mail and with the current IRS back log of everything, I am feeling uncomfortable just "dropping" it in the mail. Has anyone seen any further guidance on how to return this? I've read several articles some questioning the legal aspect of the law regarding returning it, the fact it is a tax credit and will be reconciled on the 2020 return, Munchin stating the checks "should" be returned and future guidance is coming. As for my situation, there won't be a 2020
  13. I too would have never thought anything different. I guess the key word is "common sense"
  14. I believe I read somewhere that these checks issued in error would have to be reconciled on the 2020 tax return. I think it may follow the same example of the person who has not filed a 2019 tax return but received a stimulus check based on 2018 and their 2019 taxable income is above the threshold, they will be required to reconcile that with their 2020 filing as an additional tax due. Too many scenarios and mistakes makes me glad I haven't got mine yet. I'm one of those who paid by direct draft for 2018 and have not filed my 2019 yet. Working on it but it may be a moot issue at this time
  15. The link below is just hot off the press from the IRS. A lot of important information for answers regarding the employee retention credit and the PPP loan. https://www.irs.gov/newsroom/faqs-employee-retention-credit-under-the-cares-act
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