Margaret CPA in OH

Thanks, Abby. My home page is Chat. Think I will change it now. I don't want to miss anything!

I often forget to look at anything but General Chat. Today I looked at all the others and learned new things. Perhaps I'm the only one that doesn't check them all but wanted to remind others to do so. They are all great. I will be checking more often, my resolution for 2017!

Thanks so much, Judy! I was told that the shares were jointly owned having been bought with joint funds but I kinda, sorta doubt it. As noted, I have much reading to do before calling the corporate attorney which I've permission to do and the attorney has permission to speak. I'm 'back to work' tomorrow and think my new client got cheated in this settlement but, hey, did she ask any tax person's advice ahead of time? No. Does her attorney know anything about tax laws let alone 1244 stock. I sincerely doubt it. To boot, she has to pay her ex $12,000 per year as she 'makes' more money with her pension and Social Security so she has to sell stock every year. Sigh, it won't be her happiest year. I hope she can find some way to take this back to court. Thanks again!

What a timely discussion! I have a new client who received stock in a divorce settlement recently. I am now trying to determine whether 1244 (most likely) and then what to do when the ex states that most stock was purchased from joint funds but in his name and later stock was purchased for a higher basis. Much reading to do and soon! The tax ramifications are significant.

Free software is, of course, good. You might also check cmifixedassets.com. I've been using it for years. While free (what I use), there is an update fee annually when things change - as it seems they always do.

Thanks, SaraEA, for your thorough and thoughtful reply. I will ask about a possible revocation of 8332. I think that there are currently strained relations between the parents so this is possible. I would like to think IRS would mention this. I tried multiple times to speak with the examiner's supervisor - all those messages that were presumably passed along including hours and days I could be reached. No calls ever came. You are correct that I don't know fully both sides of the story. I do know that client and daughter have good relations as he has brought her here several times when she has stayed with him and family. But there may be other things going on, true. I do tend to believe him as the mother has repeatedly claimed the child every single year which is why we've mailed in 8332 in the even years. Yes, he is a long time client and has always paid, eventually. He's had some tough years with rentals and his real estate business but always made good on the bill. I will still likely make an adjustment because this was all post season so I had the time and it was a learning experience - I had never heard of 12203, for example. The decision about calling Taxpayer Advocate or pursuing Tax Court will be his. I have, as stated, recommended that he just forget trying to claim her as it is a challenge every time and this one was over the top. It is unpleasant every year and he would have only 2 more to go (unless she has revoked the 8332 and it now goes back to odd years - sigh, I don't even want to know). In my opinion, it isn't worth it as it continues to facilitate bad feelings and may affect his relationship with the child. The child at 18 will choose her sides, if needed. Thanks again, I will pass this along.

Client had child with girlfriend in 2003. They split up, court order states child support paid and dependent alternates with client in odd years for tax purposes. Client came to me in 2006, mother of child agreed to sign Form 8332 and wrote in relinquishing EVEN years, listing out 2006, 2008, etc. In 2006, '08, '10, and '12 we filed mailing in 8332. In 2014, efile rejected so paper filed WITH 8332 (not sent as before with 8453) attached. Return was pulled for audit. Client had married in 2006 and he and wife had sons in 2007 and 2010. Examiner denied all dependents and required proof for all such as birth certificate, school records, etc. Client mailed in all required docs and another 8332. Examiner still denied first child and added accuracy penalty of $1162. Examiner also stated that 8332 was not timely filed which I vigorously deny having collated the return myself. In any event, another was sent as sometimes original paper forms are misplaced, etc. I've never had a resubmitted form denied. I got involved with POA and multiple phone calls but never got through to the examiner. Agents noted comments but could do nothing except pass along my requests for consultation. One finally suggested filing Form 12203 to appeal. We did and it crossed in the mail with a letter accepting the 2 sons but still refusing the daughter. Then another letter arrived now removing the penalty but assessing the additional tax ($1592 with the loss of a dependent exemption and child tax credits return went from refund of $3304 to balance due) plus interest or suggestion that we can go to tax court. At no time, despite POA on file have I received any copies of documents. Grrr. There is no statement as to exactly WHY this exemption was denied after acceptance for 4 years. One agent speculated that the court document said odd years although signed 8332 states even years (I thought IRS regs and forms superseded court documents), another agent revealed a note in the file that the examiner questioned the legitimacy of the signature on the 8332. Duh! It's the same one on the court documents! The client cannot pay what I've billed to date and I will adjust. I've suggested that he consider to just not exercise his right to claim his daughter to avoid further issues. Which year should he use if he does want to claim her until she is of age? If odd years, do we file amended 2013 and 2015 although the mother will not sign a new 8332? If even years, does he get skunked again in 2016 and 2018 (the last year)? The letter says to call the Taxpayer Advocate which I did a few months ago without any help at all. Any suggestions would be very welcome!

Hmmm, I thought I didn't need to do this then read more then saw that I had logged into e-services with a new password after May 2016 so, theoretically, was already validated. Then I saw Get Transcript wasn't part of e-services so tried to set up a new account for that. I got all the way to entering my cell phone number (with Verizon in my name for over 10 years) and got a message that it couldn't be verified with that name, number and carrier. Now what? Maybe I will just wait for the letter.....

I received a disk yesterday but had already downloaded the programs.

I still haven't received the contract and won't really get into this until end of November but did you take the deposit into income at the time the tenant gave up? From what I know of the current tenants with several late payments, it wouldn't surprise me that the same thing happens here.

Thanks so much, Max! Once I get the contract, I will do more in depth research, especially for this state - thanks for that tip. My CPA license gets renewed end of this year for 3 more so I've definitely decided on just 3 more tax seasons with NO extensions for tax year 2018. The trusts on which I am trustee will be fully distributed that fall, yippee! I'll be 73 then so enough but it's not too late to learn new things as long as it isn't too hard and I have this great group here.

Client has informed me that the LLC formed recently has a rented property that they want to sell to tenant. I don't yet have a copy of the contract but info sent shows $3000 as down payment on lease option and it appears as though an additional $380 monthly over the previous rent will be payments. I looked up basic info on accounting for this, seems fairly straightforward but is there anything I should look out for? Maybe specific questions will bubble up when I get the contract and I'm in no real hurry. I'm leaving for Australia and Papua New Guinea next week for a month of scuba diving. They didn't get their final data for 2015 to me until last Wednesday. It seems they are ahead already this year!

Methinks this end of (thank goodness) tax season is making us all a little blithering uh accountants.

Thanks for asking! Yes, they all survived albeit with dirty water and very messy cages. My sister said they were quite traumatized but settled down quickly. The trees in the yard lost some branches but seemingly there was no damage to the house itself - thankfully. I am encouraging her to think about moving more inland but doubt that will happen.

Oh my, prayers for your sister and for you, too. Take care of your return, the clients have had 6 months. And without your license, you couldn't help them.

I was so grateful that my sister, husband, daughter and family and son and family were able to evacuate from St. Simon's Island in time. They had to go to Montgomery AL to find a place, over 500 miles. They are back in Brunswick GA now but can't get to the island for another day or more. My sister could take her 2 dogs but not the several finches that she raises. She is so worried that the extra food and water she left may not have been enough or there may be damage to the house. At least they are all safe though it has been very costly for them. Scary....

My sister and family are in St. Simons Island GA. No one answers there now so I am hoping they have evacuated. Someone on the radio said she doesn't expect her home to still be there on return. Scary!

This was from 'Limited Liability Company & Partnership Answer Book,' third Edition, Alson R. Martin, Wolters Kluwer pub. I forgot I had it and, even then, had no clear idea of the search terms so began paging through. It was under Property of the LLC. Although it is in a 2012 supplement (why I forgot about it), I am counting on it to still be valid and am going with it. Makes life easier and the client will be much happier, too! Thanks again for the point in the right direction!

Thanks again for the new direction, Ron. I went back to an old book I have on LLC and found just what you said. "Property is presumed to be owned by the LLC if purchased with the LLC's funds, even if acquired in the name of a member, manager, or other person." I have to amend the 2014 return for another reason (new data arrived this year - surprise!) so will remove that member loan. Everyone will be much happier now!

That is exactly the case. Any cites? That would make my life ever so much easier! Their's, too! I can't even think of search terms to find this sort of thing, though. Ideas? And thanks! I just do want to be sure about this and document it with something.

LLC formed by mother and daughter for flipping properties jumped the gun, so to speak. A property was found at end of 2014 and bought in daughter's name with LLC funds. Remodeling began with LLC funds and continued until rented (not flipped) in March 2015. I booked a member loan to daughter at end of 2014. Property was rented through July with all funds going into and out of (insurance, maintenance, etc.) LLC account. In early August deed was finally transferred to satisfy the loan to the LLC. I have all the crazy calculations and allocations AARRRGGGGGHHH as to what daughter reports for income and deductions but do have a question about depreciation on daughter's personal return. As it was placed in service then ownership was transferred in the same year, I'm not certain whether that is a short tax year or nothing is taken as both things happened the same year. Then I begin depreciation under LLC ownership in August. Oh, I am charging plenty for this and have duly chastised them but they did what they did. Brain straightening thoughts appreciated. I so do not want to do this but we've all been here in a way, right?

Got one like that now and it's making me crazy. I just want to be finished!

I haven't called back yet, no time, but the number I have is 216.539.0790. That's a Cleveland area code. The message left in my voice mail was pretty dire. It went to my 'zero' box though, not box 1, CPA, box 2, spouse and I or box 3, diving and music business. Someday I may return the call to, you know, yank some chains.

Thanks, Gail. Our committee meeting is Aug. 17. The person who raised this possibility for participation will be bringing criteria. He just emailed members asking if the church had one. I was trying to be proactive and explained how it wasn't needed, etc. even sent links showing that churches were exempt and the incorporation document on the state website. We shall see what next to do, if anything. If only our EIN letter is really needed, we do have that. But I doubt, from 1867, we have a determination letter or that it was ever applied for not being needed.

Ummm, the fundraising 'group' is Kroger. I suspect Kroger has at least one qualified, knowledgeable tax professional on staff. But I will pass along the suggestion. Thanks!