Max W

Since rental's are income producing property, are they eligible for the solar energy credit under IRC section 48?

Other income was a mistake. This wasn't handled properly. There is no debt basis. Question: If the $64K carried fwd, wouldn't the client be faced with the same issues as now if the $50K is completely distributed? The $50K is added to basis but when it is distributed, doesn't that reduce the basis by the same amount, leaving the same $64K to be carried forward. Wouldn't it be better to take the loss as a cap gain and leave the basis with a clean slate?

I just confirmed with Drake that their cutoff date is Nov. 20.

Client is 50% owner of an S-corp that has been losing money for several years. In 2020 basis went to zero and there was a $64K loss that was supposed to be carried forward, but is being taxed as other income. For 2021 client expects he will have about $50K ordinary income. By amending 2020 and using form 6198 At Risk Limitations, the loss can be carried forward to 2021. How will this affect the taxablity of a 2021 distribution? Doesn't the $50K raise the basis to $50K, but distributing all of it leaves the basis at zero, with the same loss CFWD as before?

Yes, it looks at the harea code. I have a friend that uses Skype and even though he is in CA, the skype number that the call goes through is in the Eastern time zone, so he can call at 4 AM, if he wishes.

1040's are usually cut off the Wednesday the week before Thanksgiving. Everything else, Dec 26. The announcement usually comes in October, but .....?

@Catherine The Bataan Death March! What an analogy, but I doubt that anyone will be bayonetted for not showing up for work on Monday. I wonder how many people on this board even knows what it was.

Dang! Just as I got the Fresno address memorized.

If you are referring o the first time penalty abatement, the estimated tax penalty is not subject to abatement.

Oh! This is a state audit! You didn't specify that, so I assumed it was IRS.

I do not see what the fuss is about. I would guess that almost everyone on this board is already regulated by Circular 230. This legislation is aimed at the approx. 50% of the preparers that are not EA's CPA's or Tax Atts. The TPAO has been pushing for this legislation every year. From Forbes https://www.forbes.com/sites/irswatch/2021/05/14/bidens-plan-to-regulate-return-preparers-is-welcome-news/

You are a long way from resolution. When the auditor makes the final report, you will have 30 days to accept or reject it. Do not accept it and let them know you want an appeal. This could take some time to schedule. Appeals is much more generous than the auditor. If you still are not satisfied, the case will be closed and then youwill be notified you have 90 days to file a tax court petition. This will lead to a higher level appeals meeting. Here the IRS will try to resolve the issues so that the case does not have to go to tax court.

Good point, Catherine

At that rate it will take over 4 months to process the rest before a slug of new returns come prior to the Oct deadline.

TILT

Gosh, Oh golly, you mean the IRS made a mistake. What is this world coming to? The clients would be best advised to put the money in a separate bank account, because sometime within the next 3 years they may receive a letter from the IRS. "Dear Taxpayer, In August of2021 we sent you a refund check for $3000.00. We are sorry to inform you that the person who calculated your refund was suffering from apoxia due to prolonged mask wearing. Said person made an error in determining your refund, which we have found in its totality to be unwarranted. Please accept our sincere apologize for this, but we demand that the $3000.00. plus interest of $27.33 be returned to us within 15 days, or interest will continue to accrue. Furthermore, failure to pay could subject you to collection action including levying your bank account and garnishing your wages. Joe Potatohead, Supervisor of Dumbbells"

Amen! Even the IRS is frustrated by divorces. I attended an IRS tax forum and sat in their presentation of OIC's. After the hour was up, a little group gathered around the speaker to ask him questions. One question concerned divorced couples. The reply was, "We wish that people wouldn't get divorced"

I chose Hartford this year. Coverage $25,000 for $150; $1000 deductible. Also, you can pay with a down payment and quarterly or monthly payments.

There are a couple of things here. 1. The IRS is not entitled to the $10K deposit as it is for business operating expenses. However, if your clients is like many SE persons and comingles his personal and business deposits in one account, you should show how that money is being spent buying materials. 2. The IRS can not levy your clients bank account while the offer is being considered and for an additional 30 days after the case is closed. This is supposing that the IRS has already completed the CDP (Collection Due Process) by sending out a series of letters notifying the client of Intent to Levy. BTW, the IRS does not "freeze" bank accounts, unless there is criminal activity involved. When they do levy/garnish, the bank has to hold the money for 21 days before before forwarding it to the IRS. During those 21 days it is possible to negotiate with the IRS to set up an installment agreement and sometimes even have some of the money returned.

Are you saying you calculated his offer based on negative income? It looks like it because there $9k in assets attributed to him, so that would be the minimum that could be offered. Was proof of the assets presented with the offer? That can be presented at appeals, but it better be airtight proof. I suppose it is for financial reasons that you chose the 24 month option. I never use 24 months because it doubles the offer. I try to foresee all the problems that could be involved in a case before taking it for OIC. If I see too many hurdles to jump over I go for CNC, or IA.

This OIC Specialist is way off base. The only time another person's income can be used is in the case of a liable spouse. There is an exception for community property states. "(A) In general. Where a taxpayer is offering to compromise a liability for which the taxpayer's spouse has no liability, the assets and income of the non-liable spouse will not be considered in determining the amount of an adequate offer." from USC 26 CFR 301.7122-1 (c) (ii) (A) Before the final report is issued, it has to be reviewed by a supervisor. That person is sure to catch it, especially if you send a note to be included in the file. Appeals is the last resort, but I don't think it will get that far. Anyhow, appeals is always more generous than the lower echelons.

Has anyone dealt with this issue before? The property is a personal residence and the owner is a foreign person (Vietnamese). The way I read it 15% is withheld from the Selling price. There are some exceptions but requires a Certificate of Exemption which can take 3 or more months to be issued by the IRS. Can the $250,000 ($500,00) Sec 121 be applied as an exemption?

I ran across this website. It might help you, Tom, to get started on your search. https://nomadinternet.com/pages/plans?utm_source=Microsoft Ad&utm_medium=CPC&utm_campaign=Sales&msclkid=8708549b5e3316dd1b9c35917f71569d&utm_source=bing&utm_medium=cpc&utm_campaign=Unlimited Internet Terms - OA&utm_term=[wifi hotspot devices unlimited] data&utm_content=Unlimited Hotspot (E)

The ITS sends out a myriad number of different types of letters. Most of them are not collection letters. At the upper right corner of the IRS letters, there is a box and the first line says Notice. Next to it is a code number, such as CP14, CP52, CP504, LT-11, 1058, etc., etc. What is the Number on the last letter your client received?

C'mon Tom. It's the gub'ment. You know nothing can go wrong.