Margaret CPA in OH

Gail in Virginia, when you switched to an electronic fax service, were you able to maintain your original number? We are likely moving this summer so will lose our land line including the fax line. I can change my business number to a cell easily enough but not the fax, I think.

Oh, I use Verifyle and love it as do many of my clients. But a surprising number of them still want a printed client copy of their returns. When I began my own practice I used and still do use twin pocket folders with the year label on the outside, my card inside and copies on the right with acknowledgements and my invoice on the left. So many long time folks still want those folders because that's how they keep their records. Of course, most of my clients are 'of a certain age' and the younger ones (most, but not all) just retain digital copies. One year I tried gray folders. Didn't go over well. My business cards and stationary are light gray and wine. My office is about 99% digital. I never keep paper copies of client data either downloading the pdf copies from Verifyle and/or scanning provided records with my trusty ScanSnap 1500!

I've been very happy with my Bother HL-L2325DW.

What came up was Filing as surviving spouse. I looked at 1310 and the box autochecked is Surviving spouse requesting reissuance of a refund check received in the name of both the decedent and the surviving spouse. So no efiling of a return with a decedent spouse and direct deposit into a joint account? Based on this: https://www.irs.gov/faqs/irs-procedures/signing-the-return/signing-the-return I don't think a 1310 is called for as no check has been issued in both names.

Is this possible? How is the return signed for the deceased spouse?

No question about your statements, Corduroy Frog. My question is in regard to the losses when that trust becomes irrevocable. I did not ask about the basis only the losses. Or are the losses taken when the trust becomes irrevocable?

joanmcq, the sister indicated that it was the gold that was sold. I don't understand that as I was also told that the scammers brought a box to the porch to 'prove' they had bought the gold, told client not to come out on the porch, then other scammers quickly arrived and took the box for safe keeping (or something). I think it could as easily been a box of rocks. Client really is having trouble with memory along with great embarrassment that this happened to her. This is why I want to see the entire 1099 packet from the investment company along with all the statements from 2024, especially those in the months of the scam activities. I'm hoping to get these this week. Sister had a migraine Friday and didn't want to deal with this at the time. I'm not surprised, this has to be tough on her especially as they were estranged for many years.

A few years ago I had a client of about 3 years and I noticed that there were lots of st trades - lots! I asked her about her understanding and she had no clue. I suggested that she take her portfolio to a couple of other firms to review and ask how they would invest and manage her account. She changed investment advisors within a couple of months. It certainly looked like churning to me and it was. Yes, there are too many greedy people out there just waiting to take advantage of the vulnerable.

Good question here which brings to mind the issue with my client having a condo in a revocable trust. As it has been determined that the losses for 2024 cannot be taken (short term rental, etc.), when the client dies (within months) and the trust becomes irrevocable, what happens to the losses? Since it is in trust, is that the same as being considered disposed of? I wouldn't think so. I think the surviving daughters will likely be named as the heirs to the condo but do the losses go with it? I doubt I will be preparing the final return for this client as the daughters will take over but thought I might be prepared, just in case.

Sorry, I thought you were indicating a combined code J/T which I did not see. I am very familiar with Box 7 and have selected many codes including either a J or a T. I just misunderstood what was written. All good now!

Judy, AHA! It was confusing to me to sort of co-mingle 1009R boxes with 1040 boxes. Dave T, I still don't see where the code box with J/T is an option. Surely I am still missing something (far to easy for me these days). I would appreciate clear directions in case this situation arises with me.

This has been an interesting discussion as I've never seen a code T. I am confused about the references to boxes 4a and 4b. I do not see those boxes on any of several 1099R's or the input worksheet. Box 4 is Federal tax withheld. I see Boxes 2 and 2a as Gross distribution and Taxable amount. Am I missing something critical? Also I cannot find a checkbox on the ATX 1099R worksheet for a code J/T. Clearly I am missing something important and feel pretty dumb just now. Most of my clients have 1099R's and these are new things to me so I had better 'get with it!'

Alas, a whole $12 was withheld for federal, nothing for state. And now another wrinkle: reminiscent of the thread about checking prior year activity and comparing. I asked for the 1099DIV from her investments and a few small ones held alone. The sister found most of the documents and, sadly, it appears as though she liquidated nearly all her investments for about $162,139 with a LT gain of $132,200+ . $92,152 had no basis. I'm not impressed with the broker. I asked for some statements before this began and all the statements for the rest of year to try and see the securities and figure out something. It's so sad that her memory is failing and this situation just overwhelms her. With these transactions (I had only page 1, will get the rest later) she now owes IRS almost just over $5000 if IRS allows it. Ohio is the killer at $25,500. I hope they (client and sister) don't find more. I do want the backup pages but I think we're close. My head and heart hurt for her. She's been with me since 2004.

Max W and others. by using Form 4684 and following the memorandum mentioned for those scammed of income producing assets, her tax was reduced to basically the tax on her SS due to the high income prior to the itemized deduction from the scam. OIC is not an option anyway for federal as the limit is $50,000 owed. Ohio tax pro line person said the only option for the huge tax due is to work with the AG office after nonpayment and she gets the nasty gram. It's "only" $20,000+ at least not $200,000+. I will research further to see if there is something via the AG similar to CNC. Haven't found it yet.

Ohio starts with federal AGI which, of course, is before the standard or itemized deductions. Then there are state specific additions and deductions such as SS, not taxable in Ohio. I called to see if there was any way to take into account the scam. Nope. It might be something for the legislature to address while they are trying to eliminate income tax altogether.

Okay, I input the details on Form 4684 Section B, Casualty or Theft Gain or Loss, and the loss went to Sch. A minus $100. Her tax went from$190,000+ to $1700+ . Unfortunately the state has no mercy. Her state tax is $20,000+. They also do not have an easy payment plan without jumping through some hoops. But she is in a much better situation now. Thanks so much to you all, especially to BrewOne, for guiding me ultimately to the Memorandum mentioned above. This group is just great!

As above, "I tried to use the tool for an OIC but 'we are experiencing technical difficulties at this time.' " I now have found the Memorandum from the Office of Chief Counsel IRS, Number 202511015, release date 3.14.25. I am now comfortable listing it as a Casualty Loss because I am of the opinion that her situation fits Taxpyer 1-Compromised Account Scam. Client was told that her identity was stolen and the only way to preserve her retirement funds was to turn them over to the scammer who would invest in safer assets, the Bitcoin and gold. I'm now trying to fit this into the inputs for Casual Loss on Schedule A. Unfortunately the tax is still due but it may be reduced somewhat as the itemized deduction will now be pretty huge.

Found it but I'm not sure it is helpful in this case. I suppose an argument by someone could be made but she was responding to 'identity theft' and trying to protect her retirement fund from being accessed. So I guess I can input for a theft loss but this still applies: "The memo shows that the IRS recognizes that it can’t give taxpayers relief on the tax consequences of investment account withdrawals despite the theft of those funds, Lanning said. The theft loss deduction doesn’t eliminate the income..." Perhaps it may offset some of the taxable income. I'll try. Thanks for your help, even the lol.

I put that exact phrase into the search box and it just brought up your post. ????

Long time client apprised me a few weeks ago that she was scammed to the extent of her entire retirement, some 624,000. She has, I think, some dementia and is in denial. She eventually reported it to the FBI but they told her, sadly, she is one of thousands. She is holding out hope that she will not have to pay the $200,000+ in federal and OH tax due despite my caution that I can see no way out of it. She willingly withdrew all this money to buy bitcoin then gold and never saw any of it. The scammer told her that her identity was stolen and the only way to protect herself was to give them the money and they would invest it. So here we are and all I can see is an OIC. An installment agreement is for up to $50,000. I tried to use the tool for an OIC but 'we are experiencing technical difficulties at this time.' Does she need a tax attorney which she cannot afford? I've managed some installment agreements and a discharge due to inability to pay but not an OIC. Fortunately her competent sister was finally brought into the picture and I've advised her to get Form 2848. Other suggestions?

I just read the instructions for Form 5695 and I see this on Page 1: My bold. It seems to me from your description that the residence is not her home. I wouldn't do it. Who Can Take the Credits You may be able to take the credits if you made energy saving improvements to your home located in the United States in 2024. Home. A home is where you lived in 2024 and can include a house, houseboat, mobile home, cooperative apartment, condominium, and a manufactured home that conforms to Federal Manufactured Home Construction and Safety Standards. You must reduce the cost basis of your home if a residential energy credit is allowed for any expense for any property. The increase in the basis of the property that would result from the expenses will be reduced by the amount of the allowed credit. Main home. Your main home is generally the home where you live most of the time. A temporary absence due to special circumstances, such as illness, education, business, military service, or vacation, won't change your main home. Costs. For purposes of both credits, costs are

This is a good discussion and the client does not materially participate nor is an active participant, all is handled by a management company. I'm not worried about the losses, just wondering if they will offset future income. It doesn't sit right with me on Sch. C as I don't believe there is really a profit motive in the usual sense and it was used for strictly personal vacation time until the clients became too frail to travel. As it is in the trust and the surviving wife will not last more than a few months at most, and the Sch. E option seemed appropriate, I'm going with Sch. E and let the chips and losses fall where they may for 2025 when it becomes a trust asset.

Schedule E and selected Vacation/Short Term Rental which seems to exactly describe the unit. No personal use, though. After wife passes, I don't know where it goes from her trust but am certain I will no longer be involved. It may be split between surviving daughters who are in tax brackets I could only dream about and they have 'their people.' The ailing, aging wife has had a special affinity for me for 25 years since I managed the business book for her software company. She is very special to me. I will miss her greatly.

Yes, you can edit, add, subtract lots of things. Click on the client letter, Edit Formatting. Select the letter to edit and scroll to the place you would like that option to be included. The Save and you have the choice for only that client or all subsequent. I use this tool with some frequency, mostly to tailor for a specific client.

No, not 49 days, 49 weeks with 38 different renters. It was a available for 49 weeks from Jan. 20 through year end and apparently was used the whole time through the end of the year. Most folks were for 1 week but several were for more than one week. The huge loss is because of depreciation of a unit valued at $880,500 ($30,685), high commissions ($11,066), and high real estate taxes ($14,421) as well as HOA fees of $7200 and a special assessment for insurance of $5148. This is Amelia Island FL. The total rent received was $50,500. I couldn't afford to stay there!