Christian

I usually renew in May. The software is my largest cost but comes in at a reasonable cost when broken down per return. I raised my fees this year and received few complaints in no small part because everything else is exploding. My business is slowly being impacted by all the FREE tax stuff supported by no less than our local banks and just about everyone else. I have been able to keep my annual fee income fairly stable for a number of years and this year introduced a new lower fee for all these younger folks who have found free file a problem. I note that many of our local tax preps have folded and we face competition from all those cheating filers out there. I got one from a guy I knew thirty years ago since he had covid. He did not file any efiles and I soon found out why. No signature on the client return. He was cheating back then and still is.

You really have to love a tax forum where even the best educated flop over into arcane disagreements. LOL This one reminds me of a question I submitted years back and got some 35 or so contradicting replies ! I feel some comfort in the knowledge that I am far from being alone in my understanding of our tax code. In this client's case she being in the 10% bracket she may totally avoid any tax at all. This sale is reported on Form 4797 right with any result carried to the Schedule D ? This instead of using the Form 8949.

Sorry guys I got it from the 2017 edition of the U S Master Tax Guide sent to me by CCH. On page 1785 it reads in the second paragraph the following "Residential rental property and nonresidential real property that is placed in service after 1986 and is subject to MACRS must be depreciated under the straight-line MACRS method. Thus, there is no recapture of depreciation upon disposition of such property because no depreciation in excess of straight-line depreciation could have been taken." As noted in my submission this house was set up in 1998 well after 1986. In checking my setup for it it reads SL/GDS for 27.5 years.

I got my info from the Taxbook as well and since I earmarked the applicable page I will retrieve it and send y'all a direct quote.

A client has placed a rental house she owns on the market. Concerned the sale would fall under the recapture rules I checked the date the house was set up for depreciation and see it was in 1998. After reading the rules earlier today it looks to me that it will not. Assuming it is sold this year I expect I will use it's depreciated basis which will surely produce a hefty capital gain and since I have not needed to handle one of these in years want to check to see if my assumption is correct.

Well forty seasons now done. Some of these clients showed up as young adults, had children whose children now have children. Not in my wildest dreams when I accepted my Uncle August's suggestion to take over his small tax business when he quit it would go on this long. It has been a challenging and rewarding time. I have had countless laughs with clients and sad times when as with this year three of them passed on after more than thirty years. I have been much appreciated and sometimes less so. I have not been perfect but I rather doubt the perfect taxman has yet to walk this earth. And now you are doubtless thinking I am going to hang it up and bring in my rocking chair. Well I ain't ! I'll be back again next year.

Needless to say I took the SAGE advice of my fellow forum members and contacted the minister who is supposedly getting this fixed. Until she does she will be on extension. I can only imagine what Margaret's wall would look like if she had not restrained herself.

Has WK put out any information on Windows 11 use in 2023? Like everyone I am bombarded by Microsoft to upgrade but I am going to wait to see if ATX will be compatible before moving forward or not after tax season.

I have just awakened from a two hour nap while sitting in front of my computer doing taxes having dozed off it seems.

A client retired and failed to advise me of her change of address. The former address a post office box is where her refund check will go. As the box is now assigned to someone else simply getting it redirected will be a problem. Is there any way of getting this addressed as her efile was sent prior to her calling and telling me. Am wondering if ATX tech support can address this.

Normally I add the W-2 wage AND the housing allowance together minus allowable expense and place it on Form SE thus insuring the payment of required Social Security tax. This year I have excluded the W-2 wage since they evidently withheld these taxes already which is a new wrinkle. It is a small amount and likely would cause no problem. I simply have never seen this handled in this manner and really wonder if the new outfit was up to snuff on this but I am not going to call at this late date and inquire.

A minister for whom I work received her W-2 from the church's new accountant. Their former accountant now deceased did not indicate any Social Security or Medicare tax withheld from her W-2 but the new outfit does indicating amounts in boxes 3.4,5 and 6 of the form. I have calculated Earned Income Credits for all my over 65 clients who have jobs and qualify for the credit this year. I can find no reason not to compute one for this client as the church has evidently paid Social Security and Medicare tax on this wage income. What do you think. The resulting credit is some $248 dollars.

I cannot imagine being fatigued at the end of tax season being myself full of energy and pep.

Well she decided to take her chances on being checked which I adjudge as very small indeed explaining that if checked she could discuss the basis with them.

This has also occurred to me. I'll have to call his wife as he has since died and try and determine what part of the loan was paid and what part dropped. As about half the credit is already used I may simply drop the portion allocable to this year. This is one of those "can of worms" I alluded to awhile back.

A client installed solar panels on his home in 2020. The resulting energy credit totaled in excess of $11,000 dollars. The panels did not perform as advertised so he sued in 2021 and won a settlement in which he was absolved of paying the loan he contracted with the company to pay and the company removed and absorbed his legal costs. There remains a carryover energy credit in excess of $4,000 for use in 2021. Is he still entitled to use this in light of the fact the panels are now gone and he received legal redress ? My thinking is he was not responsible for the defective equipment and he gets to use the credit. Any input is appreciated.

A client who is a railroad employee had some disabling health issues in 2021 and has been unable to return to active employment. The company has awarded him a disability pension paying both Tier 1 and Tier 2 benefits. His wife informs me that he is not retired and expects to return to work in time. Apparently he is not considered retired by the company. Ordinarily when an employee begins drawing a pension I prepare the Simplified Employee Worksheet to calculate the tax free portion of his Tier 2 benefit but since he has not been adjudged retired I expect to show the full Tier 2 benefit as federally taxable. I believe this to be the correct way to handle this until he is given a formal date of retirement.

Oops I should have said line 4. As stated I entered 2 on the exception line. I see my error. You enter the exception in one screen and then need to toggle to a second one to enter the excepted amount. Like you I usually see the number 2 in the code field on the 1099-R but this particular company simply will not do that and invariably puts 1 in box 7.

I have entered exception 2 on line 2 of Form 5329 on a client's return. On Form 1040 no additional tax is shown but oddly the penalty is still shown on line 5 of the Form 5329. Has anyone else encountered this or is this correct. You would think the penalty amount would disappear from the Form 5329.

A client had an epiphany and now believes he did not receive the second $600 stimulus payment. On review of the rules for claiming it as a refund I find it should have been entered on his 2020 return. That would require the filing of an amended return for 2020? I am unable to find a provision allowing it on the current 2021 filing.

I am preparing the 2021 return. Basically the daughter entered university in September 2020 and after Christmas leave did not return. For years I have had as a client an account who worked at a local university. Some time back I had a question about the college year. He explained that even though a student entered in September the college year would be the following year for the 1098-Ts. With regard to this particular situation I expect I will need the Bursar's statement as noted above. Gail you are spot on as I too have run into this. Many times the students are unaware of this fact. I sometimes wonder if they are even advised of the fact it is online. Many thanks to all who have replied.

I have a grandmother age 77 whose husband died in 2020. A grandson who is 18 years of age last year and graduates this year lives with her. I believe she qualifies for the QW status but find the wording in the description a bit confusing. What do y'all think and ,of course, she has not remarried.

I asked if the university furnished a 1098-T but the mother advised no. How would the parents prove the costs and the half year student requirement other than through personal checks ?

A client's daughter who completed her first year of college in 2020 entered for her second year in fall 2020. She dropped out in late December. In speaking with her mother she advised the university did not send any tuition info. They evidently spent a not inconsiderable amount on her but I know of no way they qualify for any education credit. She plans on reenrolling this fall but this will only create the possibility of getting a credit if she completes the full year. If anyone knows anything different from what my understanding is on this please advise.

I sent in an efile this AM and have not got an acknowledgement back. Any problems in the system ? I have had no problems until now.