Margaret CPA in OH

Do you have the taxpayer's age entered into the data for the return?

Thanks for all the input. These folks were pretty low income so no 1041, definitely no estate return, all assets (mortgaged house, cars, etc.) jointly owned so not even probate. I first input it as SaraEA mentioned but wondered about it hanging out there with no reporting. So I tried it in her name but don't feel comfortable as it isn't in her ssn although she received the money and did use it for medical. I'll go back to line 21 and even put in 1099SA in his ssn. It's more accurate, I think. Thanks, all!

Thanks, but I'm not sure about this solution. I did some more research and, with the 1099SA in the deceased's name and ssn and code 4, it seems the estate, not the spouse (different code), was the beneficiary and should have been reported on the final tax return. Unfortunately that was 2015. I will try entering all as if it was in the client's name and social, almost sure to get a matching error. And client doesn't have an HSA. On 8889 I put it as HSA 2 and account holder died and paid same in expenses. The problem then is that the deceased's ssn doesn't show up so I get an error. There is no appropriate place to put the deceased's ssn. Okay, I unchecked the box that the account holder died. Error gone, nasty gram eventually arriving. Thanks!

Client's spouse died December 2015. In January 2016 client received the balance of HSA account and 1099 SA was in deceased spouse's name and SSN. As the filing status is now single, how best to report this? I put on Line 21 but is it taxable? I tried 8889 but that doesn't work as no spouse although I'm fairly certain that that amount of money plus was used for medical bills. Ideas? It makes a difference in client's tax.

Consistency is the hobgoblin of small minds. This keeps us on our toes to not take anything for granted, I guess.

She may be able to check the court records if she knows the location to see if final documents were filed and release was provided. Does she know of any relatives of the deceased? I wouldn't think this client would have any personal obligations to the other estate but, well, I'm not a lawyer (love saying that!).

What about that pesky part on the bottom of page 2 about declaring the return being true, correct, etc. ? I think I would file an extension but wouldn't file a false return with the knowledge that it wasn't true, etc. and knowing it would be amended when all the actual information is finally available. Just me, maybe, but I would not fill in numbers, even those already known, with the full knowledge that it wasn't complete.

I entirely agree. My computer has a login and password and, of course, the program once - I wish still! But it's just me in my home office. Changing every 90 days isn't too awful but this time out thing is driving me, well, I'm ready for a drink, too. You know, sometimes you just have to look through some papers, maybe answer the phone, look up a reference, double check something in last year's return and BAM! locked out. Grrrrr.... This is about the umpteenth time I've said retirement is looking better by the week, sometimes by the day. I do want to get through this and 2 more tax seasons to wring out the most from my license but am sorely tempted.....

Frankly, Rita, I and likely many others would be so happy to give that special 'Rita' hug to the RITA return. It's an abomination whether in paper or electronic form. But then, that sort of describes all the myriad Ohio local tax returns, too!

"Development is aware of this issue. A form update will be released... " Good to know!

Thanks for asking. Client paid $15,000, foreclosure property, did remodeling themselves spending $6139 plus $1750 on appliances and labor. The property was rented beginning in March 2015 at $795 per month, same amount. I think that is fmv for this property in this area. Yes, the market total value on the county website is $15,000 as that was the last sale value. My guess is next valuation will be higher due to improvements but probably depends on the sale price. Client emailed yesterday after I sent the comments: I have sent the info to the Attorney so that he can create a new legal Lease option for the deal this document will replace the existing lease option. The installment sale was not executed correctly and will be cancelled. Once the new Lease option is created and signed, I will get you a copy. So we shall see what arrives. Client also states that he doesn't plan on needing an extension. Nice of him to let me know his timeline!

Also posted on other blog: Full year resident with completed data sheet keeps giving error message that Either Street Number and Street Name and/or PO Box must be entered. Did that. Next error is Move date is required when prior address is present. Well, there is no prior address present so no move date should be required as I have checked full year resident. Box for moved during tax year is NOT checked. Now what?

Hmm, not working for me at all, either. I've tried everything suggested but not working. Oh well, nice thought!

Thanks, folks! I'll try these today. I was closing the box without realizing I was ending the program. Not intuitive to me, I guess.

I haven't done S-corps for a while but Form 3800 is in the 1040 program. Is 3468 the entity level form which then flows through to the shareholder with data going to the individual's 3800? Check the K-1 to see if the data from 3468 has gone there - or wait until someone here who is current replies.

The only time I see that box, and it has been twice, is when I search to find the .exe and reinstall it. I choose the enable option, see it in the task bar and, no dice. Guess I will just keep trying...

I downloaded this but can't seem to get it to work for me. I have to run the .exe every time and it shows in the task bar but doesn't prevent the timeout. Hints on what to do to make it work? Thanks!

Thanks so much for all this valuable input. It's interesting that rfassett calls this an installment sale; DNRVAN says lease or purchase depending (I'll get back to that); Richcpaman says installment sale; BURKE says 3 scenarios - lease, option to purchase, or installment sale. I thought I was fairly clear in the original post that the client LLC wants, over 36 months or less, $45,336. I also replied to Ron that my first thought was installment sale, too. So the intent of the parties is: for the current tenant to own the property, payments are above fmv of rent, not sure who bears rights and risk of ownership until time is up and deed passes (LLC I think would and would pay insurance and taxes), I assume the payments above fmv of rent is tenant equity unless tenant changes mind and I'm not sure about the option cost. For tax purposes the market value of the property is $15,000. The previous agreement they had was a promissory note for $37,000 at 9% interest so I provided an amortization schedule to prepare a 1099INT. Client then explained that really wasn't the intention. They meant the Lease with Option to Purchase with $3000 deposit, $40,000 option price paid over 36 months (option 'exercised' one month after prepared), with 0 of the rent paid applies as additional consideration to reduce the option price and a stated rent of $1176 per month. Client explained to me what I stated originally. They just want a total of $45,336 over 36 months or sooner. This began April 1, 2016. I'm just trying to figure out how in the world to account for the money LLC has already received. When I expressed all my confusion and strong suggestion to have an attorney do properly whatever it is, I was told they will 'void' the existing agreement but begin the 36 months April 1, 2016, but with the proper wording. I have copied the above comments and am sending to the client (hope you don't mind, no original names) to reinforce the necessity of doing this correctly. However, I still don't know how to account for the receipts and expenses already done in 2016. My head hurts. Rita, might you share some hugs this way?

Thanks, Ron. I also first thought installment sale as the outcome desired would be the same except - except - how do I treat the $795 portion of each payment which client has defined as rent? And, if installment sale, how to treat the other, regular expenses of the 'rental?' How are the re taxes, insurance, etc. accounted for as they are paid by the client not the tenant? I won't know the total cash flow until it's over unless the client decides now what it will be and then how to determine the interest as that will have to be part of the payment? I do understand that the client would take back the property if contract not completed but, if so and no sale results, then how to account for what then becomes rent but has been reported as installment sale income? Amended returns? I know a lot of business equipment is rent to own or lease option to buy but are the interim payments considered rent or installment payments which wouldn't be known until the term period is up and the option to buy is exercised - or not? I'm thinking extension for both LLC (partnership) and individual returns while I go relearn accounting for these things. Maybe I can still find my advanced accounting text book

I've read several articles and still have questions about this particular client. LLC wanted to flip houses. First one didn't sell so rented for a year. In 2016, tenant expressed interest in buying so client put together this option that is royally screwed up (from the internet with their own touches, don't you know). Bottom line is they are now voiding this notarized contract to get to the bottom line. LLC wants, over 36 months, $45,336. This is $3000 deposit (forfeited if option not exercised) and 36 months of monthly payments of $1176 - $795 per month rent and $381 payments towards purchase (forfeited if option not exercised). So I believe the rent is rent and typical expenses applied against this over the time period; deposit and $381 monthly payments in escrow until option exercised so selling price is $3000 + $381x36=$13716, total $16,716. (Low income neighborhood...) Sale would be on exercise date and reported that year. It is also possible that it would be accelerated if tenant comes up with the money to total what client wants. Does this sound right? I have strongly urged client to cough up the $$ to have an attorney put this together and, oh by the way, get the required disclosure form. I just want to be sure that the accounting and tax reporting is correct and am really second guessing here. Thanks for input!

I saw this yesterday and am so very annoyed. I really don't want the additional expense of a PO Box to finish a couple more tax seasons. And I really don't want anything being mailed there so I have to check it. If some of us do resort to a PO Box, does that change our official address for our efin? Grrr... Retirement may be accelerated. Oh, and thanks IRS for the great lead time to consider and make any changes. Uh, when, exactly, is 'soon'?

You didn't ask but I kicked in a bit to help cover the expanded band width we seem to keep gobbling up! Thanks ever so much for the support you give to our hardy band of internet colleagues. We wouldn't exist without you!

Thanks for the reminder about 8606 but I still need to figure out how to make the distribution non-taxable and have the QCD inserted on the line 15b (which I knew but couldn't figure out how to get ATX to input). 8606 data entry results in 0 taxable amount (as expected) on line 15 but this doesn't get carried over to page 1 15b and there is no QCD. If I delete the taxable amount on 1099R data entry, it still shows as taxable on 15b. Ideas? Or what am I doing wrong/missing?

How is the data entry in ATX when the RMD was directed as a charitable contribution? The 1099R states fully taxable but the funds went to a church. Should it just get backed out as negative Other income with explanation? Standard deduction applies.

Patience is a virtue, so they say. Today, I saw that both were accepted Jan. 24. Whew! Now on to the next worrisome project.