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Max W

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About Max W

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    ATXaholics Anonymous

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    Boston Red Sox, Spanish Civil War History. Flamenco Music & Guitar

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  1. Max W

    Sec 199A QBI deduction and the W-2 income

    Here is a much more comprehensive web site. https://www.watsoncpagroup.com/section-199a-deduction/
  2. Max W

    4797 - Capital Gains Portion

    Is this a question from the EA exam? Answer -C. The $5K goes to Sch E.
  3. Max W

    Clergy exempt from SE Tax

    Pub 17 is available in Spanish. There are some forms W-4, W-7 and a few others also available. There are no other languages provided. There is also a Glossary of English to Spanish tax words and phrases -Pub 850. As a side note - I have a friend who had a tax prep service and had 60 clergy as clients. He said they were the biggest tax cheats.
  4. I have run into this a number of times. What I do is to allocate at least a part of the distribution to Officer Compensation, Line 7, 1120S. Then that amount is entered on the 1040, Line 21 as Officer Compensation. Then an SE form is generated for the SE tax. In 2004, the IRS began auditing S-Corps and at that time issued some guidelines which I can't locate again. They guidelines were less than $10,000 income and more than $50K distribution. These may have changed over the years. The good news is that less than 1% of S-Corp returns are audited and I assume that the small ones, such as this, are on the bottom of the pile.
  5. Max W

    Canadian Tax question

    I used to have a client who received pension money from Canada and it was on a NR4 with tax withheld. The IRS used to have a form 8891 that was used up up until 2014 and then it was discontinued. What would concern me here is the $3K. If it came from dividends, or interest, it might need form 8938 as wells an FBAR requirement.
  6. Max W

    Advice please - Collections and IRS Rev Officer

    Federal employees only get 13 days of sick leave a year, which they can use for bereavement. They also get to accumulate the sick leave, so that's most likely what happened. Tom, you can get 20 days for bereavement, if you can get a job at Facebook.
  7. Max W

    Penalty abatment

    Make sure you write "FIRST TIME ABATE" across the top of form 843.
  8. Max W


    That's what sports cars are all about. Your butt scraping the pavement and the adrenaline rush of high speed. Hmm! Only 90 mph? Must of needed a tune up! My college roommate had a Facel-Vega. They stopped making them in 1964, but the sporty coupe model had a 354 Chrysler hemi motor that was rated at 325 HP. That was a lot of HP for a small car. The first time out my friend took it up one of SF's steeper hills, it went up so fast I though we were going to shoot off into space.
  9. Max W


    "Special ´╗┐rules allow an employee to exclude certain achievement awards from their wages if the awards are tangible personal property. An employer also may deduct awards that are tangible personal property, subject to certain deduction limits. " The key is those "certain deduction limits" ? Will 5 carat diamond rings, Rolex watches, Lamborghini's be allowed? Don't think my clients will be so lucky.
  10. Max W


    Fortunately, I don't get too many. One was from a very persistent solar panel company, that kept calling on the home land line, even after it was blocked. So, I answered and played along with the caller and dragged the call out. Finally, I said I didn't own the house (lie). The guy hung up and that was the last call I ever got from them.
  11. Max W

    Expense or capitalize

    you can elect (Sec 266) to deduct or to capitalize carrying charges, such as interest and taxes, that you pay to own property, except carrying charges that must be capitalized under the uniform capitalization rules. Pub 551. It can be done on a year to year basis. Under TCJA , in some cases capitalization may be the only way to get any benefit from these expenses. The lesson here - read the fine print, or better yet, spend a few bucks and take it to a RE lawyer.
  12. Max W

    Children's Surrogate Account - Interest Income

    Whoa! when I Googled "surrogate" all I got were links to surrogate mothers. It must be a hot topic. If it is the mother's natural child, it would be a Custodial acct. (Thanks, Judy). If the mother was appointed guardian of a someone elses child, and the mother was legally appointed guardian, it would usually be a guardian account. However, it seems that in some states, they use "Surrogate" for both custodial and guardian accounts. Maybe PA is one of them. It may be that the child is adopted and the account was opened between the time the mother was appointed guardian and before any adoption was finalized. Yardley, I would simply tell the mother that it does not matter what the account is called, it is the SSN on the account is all that matters and any interest over $0.50 has to be reported.
  13. I have learned over the years, and especially nowadays, NEVER assume anything. It is sometimes hard to do because every once in a while you slip up.
  14. Max W

    Advice please - Collections and IRS Rev Officer

    There are two suggestions, so far, and both might be worth pursuing. RO's do get sick, get transferred, have accidents, go on leave, retire and some even die. However, I suspect that she has a large case load and is jumping from one case to the other and that me why she talked OIC. That would get you out of her hair. John's approach is what I usually use. In this case, where there have been multiple lapses, I would definitely contact the supervisor. You could also request that a different RO be assigned to your case, but you seem to like her, so maybe you don't want to do that. As for closing down the business, that only happens when taxpayers are continually uncooperative, try to hide money, or keep defaulting on installment agreements. If you don't get any results from the supervisor, then, by all means, call TPAS. Be sure to tell them it is URGENT, otherwise you will wait for weeks to hear back from then.
  15. Max W

    Power of Attorney

    They can not be legal fees. because he is not an attorney-at-law. A POA makes someone an Attorney-in-Fact. The payments can be for management fees, consulting fees and fees for other services performed. One possible way to avoid the SE tax would be for the parents set up some sort of trust with the son as trustee. Since he is not a professional trustee, the payments to the son would would be ordinary income, Line 21.