Margaret CPA in OH

Does anyone already have and be willing to share a prepared list of questions to ask and document answers (Form 8867 Part 1 #3 Interview the taxpayer, ask questions and document the taxpayer's responses...) for 8867? The clients that I have with children have been known to me since before children were born and I feel weird asking whether the kids live with them, for example. Maybe if I had a standard page of questions it wouldn't be so awkward. I really hate this part...

https://www.irs.gov/tax-professionals/ptin-top-faq-5 It's the first question so must be common.

Thanks, all. I think I've got this now. Parents mfj claim both, 11 yr old gets them $2k child credit, 21 yr old gets them $500 credit. No ed credit as they make in excess of $200k. 21 yr old is dependent, wouldn't get credit any way, doesn't even need to file. I now understand the 'other dependents' credit which can be a child 17 or over who is otherwise a dependent.

See above - parents make too much money to qualify for ed credits. That's why I was so confused as to the benefit of even claiming him as my initial reading was that, being over 17, he didn't qualify for 'child' tax credit and the $500 was for 'other' dependents.

Okay, then, NECPA! I just kept going round and round with this. Just dizzy by now. The parents may not be at the phase out level just yet, so all is good. Thanks again!

Yes. Apparently they are very friendly there but probably normal business hours.

Deb, I thought that $500 was for other dependents, not dependent children. The 21 yr old is a qualifying child as he is a full-time student under age 24 and meets all the other requirements, support, etc.

I understand that parents can 'claim' him, he meets the requirements, but for what purpose? Without the exemption, the parents get no additional tax benefit now, right? I'm just trying to get through my increasingly thick head how claiming children 17 and over are tax beneficial unless there is EIC or education credits for which these folks don't qualify - way too much income. I suppose it doesn't really matter whether 'kid' claims himself or not. I do know he can file for tax refund as he is under the limit required for filing. Just trying to truly grasp the rules - it will be painful enough to get the required docs for 11 yr old CTC.

I do have a client in Milford who takes their documents, including for Sch. C from the 1040, to the tax office. The tax folks there prepare it for free. Work city for spouse withholds workplace tax (Cincinnati). No credit anywhere, alas.

It would seem to me that it may not be necessary to file the RITA return as taxpayer has no choice in employee tax withheld so no filing obligation to that RITA muni. I am assuming that you mean the return you did shows the residence muni tax owed and needed estimates since no workplace credit. I think it costs extra to efile the RITA from ATX.

Clients have children, 11 and 21. Older one is in college so still dependent but parents get no benefit by claiming him on their return, right? Mom is physician so EIC is not applicable. Older one earned $4800. It seems he could file for refund of tax withheld but does he file as single as there is no benefit to parents to claim? With no exemption at stake, what am I missing as to whether he would file as single and claim himself as opposed to still being a dependent (which he actually is) on his parent's return? I'm sure there is something obvious but this is just weird to me and my history.

Randall, that's why I really hate the RITA form. Well, and for a few other reasons, too. Perhaps the answer is to do as Jack suggests and file the generic return for his residence muni. If the residence muni does not give credit for other tax paid, I think he may be SOL. There are a number of small munis in the Cincinnati area and residents and employers with the same problem. Many allow credit for the workplace tax withheld, but not all. I guess one just has to understand the rules when choosing where to live and work. I doubt just filing a RITA return will give the result you seek. Work through the form but it probably recognizes who gives credit and who doesn't.

Now that's funny - triple posting the reassuring reply. Ah, the memory retrieval thing - it gets increasingly weak these days.

Nevermind - I just looked again at that 2017 return and actually did it correctly depreciating everything for just a half year but didn't dispose as waiting for the sale. Yay, me! Note to self - do a better job of reviewing situation before asking already answered questions.

Client had rental vacated in July 2017 so decided to leave vacant and renovate for sale. Sale took place in February 2018. In January 2018 I had the total for the renovations paid in 2017 and booked but did not depreciate. However I did not dispose (or take out of service) the earlier building costs for 2017 as they were going to rent again if it didn't sell. In ATX was there a better option to choose for 2017 with knowns/unknowns? Is an amended return required? What normally happens when a rental is removed from service for a period of time?

On Schedule 1, line 10, follow the arrow and choose the first option m 1040, Individual Income Tax Return and Schs 1-6 Ln 10, Sch 1 - Tax Refund. I think that is the worksheet you want.

Well, dang! I shall ignore instructions and go for this now. It will make my life easier, for sure. Guess I wasn't bold enough once Silverton did this: Questions regarding the new tax code should be directed to the Regional Income Tax Agency (RITA). and this: EFFECTIVE JULY 1, 2008 THE VILLAGE OF SILVERTON EARNINGS TAX IS ADMINISTERED BY THE REGIONAL INCOME TAX AGENCY (RITA). I did just reread the tax code effective January 1, 2016, and it does, indeed, state a generic return will be accepted. Many thanks, Jack! I hate the RITA return, did I say that already?

Right, but RITA isn't, as you know, a municipality. It is Regional Income Tax Agency collecting for many municipalities. Locally, for example, Silverton utilizes RITA and does not have the ability to collect its own taxes.I just dread the time when munis mandate electronic tax payments. I believe OSCPAs is really pushing for everything to be centralized, which admittedly has some appeal. It wasn't great when one contractor client I had was required to file 27, yes, 27 different local returns. I had General City Returns up the wazoo (technical term). Glad when I fired him.

I thought it was not possible to use the General City form for RITA. I hate that form by the way. And it is now 'improved.' It is also annoying that suddenly last year ATX decided it wasn't a regular municipal form that could be e-filed. Nickels and dimes...

Yes, it worked for me. It was a pain to re-enter the data I had already entered but less painful than re-entering all the assets.

Hah! In today's mail a corrected 1099-MISC! No rents, just royalties. So waiting for the other shoe/form to drop with the sale. At least this makes more sense for now.

Thanks, Max W. I will look over this now keeping in mind the second 1099 MISC received with just royalties reported. I need to call those folks again.

Oops, I apparently forgot to post the reply above. Meanwhile, back at the ranch, I don't think I would be comfortable creating a dummy W-2 - matching thing. It seems your Sch. C in and out should work with back up documentation for when the nasty gram arrives to show that the allowance was properly and timely authorized and reported incorrectly by entity which refused to change it. Yes, let us know the outcome.

Thanks for the reminder. Purim does sound right. Methinks it would be a good thing to study up on world religions and be less uninformed. Who knew one could learn more than tax stuff here even by accident?

Aha! Learned something new, thanks to you, Lynn. I have no experience with the Jewish faith and the relationship between congregations and clergy so all very interesting. When we lived in Boston, our son's best friend was Jewish and we did attend some service with them that included noisemakers. So limited experience, for sure. So how do you intend to handle the housing allowance (given that no W-2 is forthcoming)?