Christian

Just received a call reportedly from the IRS saying my PTIN is incorrect. does anyone have a contact number in the Service to check . Say I have been using an incorrect PTIN since 2014.

I finally located the answer.The wife continues to use the tax free basis until exhausted. Alas a moot point as this spouse cannot provide the needed info as to retirement date of her former husband. Good grief !

A new client has come in bringing a pension 1099-R from the Office of Personnel Management showing a pension which she gets based on her deceased husband's record. As with so many of these the taxable amount is not indicated. I have forgotten if a widow is allowed recovery of her deceased spouse's remaing basis in his pension or if it is simply lost. Can anyone address this ?

I filled it in and divided the income as indicated but I saw no calculator and assumed the service would do anything further.

That will be my solution as he as no itemizable deductions and their combined standard deduction of $27,000 is greater than any itemized deductions. I would expect the Service will simply deduct his $252 in tax withheld and send them the remaining refund balance.

I have two clients both over 65 yoa who have married. He owes an outstanding and ongoing tax liability for which he is paying $100 a month. His refund is taken every year until this is paid off. In reviewing the MFS filing status I find she has $20,000 of useable itemized deductions and he gets the standard deduction. The ATX software indicates if I assign her $20,000 to her I must reduce his deduction to $7,000 on his return. The IRS instructions advise each can use their own deductions which would indicate she uses itemized and he gets the $13,500 standard for his return. Which is it ?

In point of fact I finally determined that the former practitioner in reading this used this method even though there was no other parent to claim the daughter. Another incidence in which the IRS instructions can lead a person astray unless combed over again and again.

Is there a toggle in the forum that allows you to see your individual prior posts?

The daughter's concern is that being shown on her dad's return as his dependent would cause problems with her drug benefits through Medicare. Unless I am completely mistaken he HAS to have a dependent to use the HOH status. Under his previous filings he did not indicate she was his dependent and I suppose the Service never cross checked it so no problem arose. I am simply going to delete her from his filings going foreward.

Well shucks ! She is a domiciliary resident and there goes my noble idea.

I questioned the daughter who was the one who raised the medicare concern stating she files an annual form with them stating that no one claims her as a dependent. She advised me that doing so would negatively effect her drug benefits. Apparently the Service never looked into her being shown on the father's return as a non-dependent assuming I suppose he gave that status to her mother but retaining the HOH status for himself. Her mother has never claimed the dependent status for her. In truth it would likely go forward with no problems just as it is but with all the new paperwork (Form 8867) I don't feel it is a good idea to not strictly follow the law.

A client of mine in her 90's went to Florida in November 2018 to live with her son until spring. Ounce there her health deteriorated and she was unable to return home and so lived all of 2019 in Florida. Her home here has just recently been sold. I really see no reason to file a Virginia return for her but knowing those greedy souls at the Department of Taxation they likely would send her a where are you letter of some type. A cousin of mine ran into that problem when he moved there years ago but they finally just gave up and left him alone. What do y'all think ? Her bank in Florida is the same one she had here so her income directly deposited would seem to me to be Florida income.

I am certain he pays over half her support. My question involves not carrying her as a dependent and whether it can be done. Doing so as a dependent will interfere with her medicare benefits which I suppose is why the former preparer showed her as not a dependent. Even so I can see no way of leaving her on the return unless he would show her as his dependent as I suspect the former reporting is incorrect.

An Uncle who was an IRS field agent would simply add the SE form to the return and let them pay the tax. Of course, the amounts were not large. I read something recently which indicated amounts on form 1099-MISC up to $1,899 were exempted from SE tax and have found when lesser amounts were included the Other income line of the 1040 this proved no problem with the Service. I routinely use his method for amounts over $1,900 unless the client has identifiable expenses which can be deducted.

A new client came in bringing his return from his retiring former taxman. He is just over 80 yoa and has a daughter in her early 50's who draws Social Security disability who lives with him all year. On reading his 2018 return his daughter is indicated as not being his dependent but qualifies him for the HOH filing status. No one else claims her as a dependent and she files no tax returns. My reading of the HOH status indicates he must carry her as a dependent. Of course, this will mean removing her from his return and showing him as a single filer. Am I missing something here ?

In attempting to add this form to a client return I find ATX does not show this form. Do I simply note the form 1099-C Cancellation of Debt on line 8 Schedule 1 or what ? What if they qualify for an exception ?

Thanks to all. Likely I have simply lucked out as I have never been informed any of those who sold homes ever received any followup from the Service but then again I do not process many returns with home sales either.

A client sold her home last year. How is this reported on Schedule D or exactly how? Lawyers here rarely send clients the federal reporting form and I have not had to fill in this info in years.

OIC ATX has a handy dandy toggle to compare this. I have not dealt with this in ages as almost all of my clients never ever use it. It looks as if the wife can keep her itemized deductions but her husband will loose any deduction even the standard deduction and the the tax treatment of their social security and railroad tier retirement 1 benefits changes materially. Initially it looks like not a good idea.

An older couple got married last year. Oweing to large mortgage payments, contributions, etc she has been able to itemize even under the new rules. As he has an outstanding tax bill she wants to file mfs. Under former rules those itemized deductions would by law be split evenly between husband and wife. Is this still the law or did the new rules effected in Decmber 2018 change this?

I finally decided to do nothing. At her income level dad surely can no longer consider her as a dependent. If she wants to pursue it she can I do not feel comfortable handling it. The courses are all online no room and board . All costs are tuition and supplies. Last thing I need is a kickback from the Service over an iffy issue.

Let me clarify. Box 8 of her 1098-T indicates " Check if at least a half time student". Clearly a full time employee cannot be a full time student. I'll check into the reference you provided. I think I can locate it in Pub 970.

A single woman who was 23 yoa last year continues living at home with her parents. She earns some $30,000 or so working in law enforcement at a local town and continues her education by pursuing a masters degree. Her tuition expenses are covered by a payment from a 529 plan set up by her father years back. Due to her income I would be reluctant to have her file as a dependent of her dad even though living at home. She wants to know if she can file for the Lifetime Learning Credit even though her tuition is covered by the payment from the still existing 529 plan. She is shown on the 1098-T as a graduate student with the halftime box checked. I really do not see how she qualifies but it would not be the first time being wrong. Does she qualify?

A client died on May 3rd last year. Her final return will have prior to death info. Her post death inome will fall on her Form 1041. Her daughter bought a cd some time just prior to her passing on. The cds were redemed at cost in August of last year. The bank sent a check for interest showing her social security number instead of her estate ein basically stating the interest accrued prior to her death with the check coming in November of last year. On the reporting statement it indicates she is deceased. Having run ino this many years back I believe I showed the interest on her final Schedule B but somehow indicated it as being subtracted out stating it was reported on her Form 1041. Of course, I have since forgotten just how this was done. Can anyone provide any information on this?

Ok I finally found it although I've not used it in quite a while.