Jump to content
ATX Community


  • Content Count

  • Joined

  • Last visited

  • Days Won


About Christian

  • Rank
    ATXaholics Anonymous

Profile Information

  • State
  • Gender

Recent Profile Visitors

4,680 profile views
  1. Also thanks. I'll remember to watch for the individual one.
  2. The cousin's wife had a regular IRA and neither she nor the attorney she used evidently had an understanding of the beneficiary designation. She went to an attorney and did not advise her husband who after her death was presented with this surprise. The fiduciary as stated simply placed the assets into his account. They lived in Florida. These IRA assets were a settlement from her first husband. She had signed a divorce settlement stipulating that if he outlived her the remaining IRA assets in her account would revert to him. It was quite an interesting mess to say the least. As far as my client is now concerned he is going to sit down with the respective fiduciaries and do what's best and I'll get on the phone and get my own in order as well. Thanks again.
  3. That was my understanding of how things went Sara but after reading Judy's post and referencing the provided website I changed my understanding of the issue. In point of fact my financial guy was of the same opinion that the entire balance was cashed out and fell into the estate as a taxable distribution. In my client's case the fiduciary will simply have to divide the account balance into three accounts with the heirs having to take distributions as indicated by the fiduciary. This looks to me to be a much simpler process than going the extra cumbersome step of moving the assets through his estate. In my cousin's case referred to above the fiduciary simply ignored his wife's expressed wishes as stated in her will and placed the entire account balance into his account. He had provided no waiver and the attorney she used evidently was not up on the law.
  4. Many thanks. This clears this up. It's clear an individual is better served by indicating a beneficiary with the fiduciary organization which is a much simpler process. A cousin's wife died some time back and unknown to him had gone to an attorney and directed by her will that her IRA be placed in a trust for one of her grand children. The fiduciary had no beneficiary so listed and simply transferred the account into the cousin's existing account since he was of course her husband which made quite a mess of her wishes. My client is recovering and hopefully will have adequate time to addrss this himself. Making his estate the beneficiary is an extra step he can avoid as well as yours truly.
  5. The client I spoke with who has this arrangement has now gone to a local hospital in not good condition. I decided to ask this question to the PPS as I may now have to confront this problem. The individual with whom I spoke said she did not know in fact stating " I don't know what you are talking about" and further advised she would transfer me to another area. Shortly thereafter the phone connection ended. So much for IRS assistance.
  6. A client came by yesterday and in our discussion mentioned his 401K plan and IRA proceeds after his passing will be paid into his estate. I have never seen this as most have a named beneficiary who gets the account. I suspect it is not a great idea as it would seem to expose the full account proceeds to tax on a Form 1041 unlesss there are special provisions for these accounts. I myself have a similiar provision and plan to address it shortly myself. Information on this is appreciated.
  7. He can in fact provide school resident records for two of the children. I am going to make a last ditch effort by calling the examiner myself as his number is listed. I have all clients check the third partry check box on their returns. Oddly I have found IRS folks reluctant to discuss much of anything in regard to this even though the Form 1040 instructions provide clear indications they would be expected to. He has now lost his job and their chance of recovery is at best not great. What are they going to do sell the guy's double wide or pickup and make him destitute? I think not.
  8. I think the certificate would indicate who the parents are and would tie him in that way. I may call the division of vital records but am just about shot on this one. I really love my little tax business but I simply now lack the ooomph to deal with these compllicated situations as I once did when I was spry and willing.
  9. Thanks for your input. I have a sneeking suspicion he listened to the former wife. The same grand wizard who got him into a tax problem years back ! This time he is really going to pay big time as I feel almost certain they are going to want $8,000 plus back. They may write some off as his reported income is less than $15,000.
  10. I checked out obtaining the records from the DMV and examined their required form. I found it inline with what Max stated in his comment. Unless I am greatly mistaken the relatives have to be kin to the grand children genetically. However if you will check their form DMV Virginia Birth Certificate Application and find you agree I would greatly value your opinion. I thought to add it to this comment but find I lack the tech skill to accomplish it. ETA - Link to vital records at VA DMV - https://www.dmv.virginia.gov/general/#vital.html And the form itself with page 2 listing required i.d. and documents acceptable:
  11. Exactly so Max. I ran into this stone wall when I reviewed the requirements of the audit. Without the birth certificates I see no way to tie these children to the step grandfather. The step daughter was such a complete ingrate she refused any assistance after having lived in the guys house for nothing for about a full year ! Well what is to be expected of a mother having three minor children all by different fathers. He should have known better.
  12. I appreciate all of your replies. I have retained Rita's reference for future possible use. I informed him today I can do him no good (regrettably). He is a good man and was truly attempting to help that family but the audit indicated birth records for those kids. He had a misunderstanding with their mother when she moved and neither she nor the former wife will raise a finger to help. He himself cannot get the records so I can see no way to keep his filing status or credits intact. I did WARN him of the real possibility this very thing might happen. Now he will learn a difficult lesson.
  13. In some 37 years of helping folks with their taxes this is the creme de la creme of tax messes. A male client 59 yoa and single came in this year stating he had taken in his former wife's daughter and her three young children providing them with a home since June of 2018. He insisted on claiming them as dependents despite my objections. I took a pass as a result and some family member filed his taxes claiming the three kids as dependents allowing him the HOH filing status along with receiving the EIC and Child Credits which resulted in some $9,100 in refunds. A very happy camper until he received a mail audit notice requiring proof of his connection to the kids all of whom are by a different father with resulting different last names. As best as I can determine he will need birth certificates for all three as well as the mother's birth certificate tying her to her mother his former wife. These along with his marriage certificate and divorce decree might do it but I doubt it. Are step children and step grandchildren allowed as such after you have been divorced from your wife for several years ? I have no clue. So much for having a kind heart for a family in need. Now his former wife has refused any of the birth certificates he probably needs. Whether he can obtain them from the State of Virginia I really don't know. Even so there remains the question of whether the Service will recognize these people as relatives since he is no longer married to their grandmother and has not been for several years. Anyone have any suggestions?
  14. I don't routinely include this form in my client copies. I have done so this year for a couple of folks who came to me this year and had them in their former practitioner's copy. I find the one provided by ATX really lacking when compared to the competition. The state comparison is not provided. I suspect ATX tech support has been appraised of this and likely with no result.
  • Create New...