Lee B

At the end of October there were 1.9 Million unprocessed amended tax returns

You could paper file a Form 8809 for each client requesting an extension or you could use a third party to file your W 2s and 1099s

I filed all of my clients W 2s today using Login.gov to access the SSA. 

1 hour ago, WITAXLADY said:

Mind is froze..

In order to contribute to an IRA - must have $7,500 in wages in box 1 -

For a 2% S corp shareholder - whose health insurance is $4,000 can their wage only be $3,500 to equal $7,500 or does it need to be $7,500 + $4,000 = $11,500?

 

Thank you,

D WI

Technically, I agree with Dennis. However if your client depends on distributions of profit for their month to month living expenses then you have a reasonable compensation problem which would cause me to terminate the client unless they actively increased their wages!

Copied from the website of The IRS Mind:

"Appealing adjustments to the IRS Independent Office of Appeals:   Some audits end up in disagreements with !he IRS auditor.  The first step is to request a conference with the auditor’s manager.  If agreement cannot be reached with the IRS auditor, then the taxpayer can appeal to the IRS Independent Office of Appeals.   If an agreement cannot be reached in Appeals, the taxpayer can also timely request a review by the courts."

Your auditor is playing hardball to see who blinks first.  As long as your client doesn't get nervous, hang in there, but don't over promise to your client.

3 hours ago, mcbreck said:

How much are they paying? I checked into it last year for my sister-in-law and Intuit paid $30 per hour and TaxAct paid $35 per hour plus a bonus that could easily get you up to $45 per hour. Not a bad supplement wage if you starting a practice. My sister-in-law is working on her EA to snag that in retirement. Her attitude is that $10k makes a massive difference.

 

$30 to $45 per hour wouldn't inspire me to sign up.

I would rather spend my time reading a good book

I would consider it to be a reduction in basis of the related assets.

 Given the way the contract is written and the payment is structured, I agree with DANRVAN's analysis.

It will be interesting to see how the seller and their accountant react.

Wow you have a lot going on.  I know you are concerned about your clients and that you don't want to leave them in the lurch.

Why don't you send out a letter to your clients explaining everything that's going on in your life and retire now?

I am sure most of them would understand. Your health and your husband's health is way more important.

This is one of the times that need to put yourself and your family first.

I wish you the best.

So you are saying that the seller received the $115,000 down payment, $42,000 in principal plus interest payments in the first year.

The seller did not receive any additional consulting related payments in the first year?

I don't have any clients filing HOH. But I don't understand the race to file issue,

because you can file HOH while the other parent claims the child as a dependent.

It's not like both unmarried parents are claiming the same dependent with the dependents SSN popping up twice,

so what' to prevent both unmarried parents from filing HOH?

https://www.irs.gov/newsroom/recovery-rebate-credit

Over the years I have learned that helping clients with quasi related legal issues is that they avoid retaining  competent legal help,

which in the long run shoots themselves in the foot and gives us big headaches.

The IRS is in the middle of a total redesign of all of the notice letters.

In my experience, not all brokers are knowledgeable. A few years ago I had a client whose broker advised her incorrectly about her RMD.

She didn't really understand so I had to email the broker with a copy of the rules that applied to her situation.

Yeah I received one too. You have to commit to 5 - 4 hour shifts per week, 4 weekdays plus Saturday.

If you don't respond then there is a good chance your client will receive the same notice next year.

That's a confidence builder

Copied from the website of Current Federal Tax Developments:

"Tax Relief for Working Families

This title encompasses provisions aimed at expanding the refundable portion of the Child Tax Credit, as specified in IRC §24.  The following changes would be made to the Child Tax Credit under the bill.

Per-Child Basis Calculation of Maximum Child Tax Credit.  The maximum amount of the child tax credit that can be refunded would be determined by multiplying the earned income of the taxpayer exceeding $2,500 by 15% and then multiplying that result by the number of qualifying children. At present, the number of qualifying children does not affect the calculation of the maximum refundable child tax credit. This provision would be in effect from 2023 to 2025. [Act Section 101]

Aggregate Restriction for Refundable Child Tax Credit: In addition to the aforementioned cap, the maximum reimbursable child tax credit is further bounded by a fixed monetary sum per child, which is currently set at $1,600 per child, as per the existing law. The bill proposes to elevate the maximum reimbursable amount per child to $1,800 for 2023, $1,900 for 2024, and $2,000 in 2025, along with an inflation modification for 2024 and 2025. [Act Section 102]

Inflation Adjustment.  The amount of the child tax credit, which is currently set at $2,000, would be indexed to inflation for the years 2024 and 2025, with the result rounded down to the nearest $100. [Act Section 103]

Election to Use Prior Year’s Earned Income. Taxpayers will have the opportunity to participate in an election in 2024 and 2025 to utilize the earned income from the preceding year when calculating the child tax credit. This election is available if the taxpayer’s earned income in the current year is lower than the earned income in the previous year. [Act Section 104]

IRS to Attempt to Automatically Issue Refunds to Early 2023 Filers. The implementation of these proposed legislative amendments, should they be enacted, would occur, at best, several weeks into the year 2024. Consequently, a substantial number of taxpayers, particularly those anticipating a tax refund, will likely file their tax returns before the Internal Revenue Service (IRS) is prepared to process returns claiming the revised Child Tax Credit. In order to address this issue, Section 105 of the Act stipulates that, to the greatest extent feasible, the IRS must recalculate the Child Tax Credit based on the aforementioned amendments and any information provided by the taxpayer. In the event that this recalculation results in a refund, the agency is obligated to issue said refund or credit as expeditiously as possible."

If this bill becomes law, hopefully the IRS will handle it like they handled the early filers with Unemployment Compensation in their returns several years ago.

The IRS did not require amendments and the IRS handled the tax recalculations internally and refunded the tax overpayments

in the late summer and early fall of that year.

Does the name address and EIN of the Fiduciaries that you entered in the return match the 1099 Rs?

Sometimes the fiduciaries' names, addresses and EIN change from year to year.

https://www.wolterskluwer.com/en/expert-insights/tax-relief-for-american-families-and-workers-act-of-2024

On 1/16/2024 at 12:30 PM, Lee B said:

"WASHINGTON — Senior lawmakers in Congress announced a bipartisan deal Tuesday to expand the child tax credit and provide a series of tax breaks for businesses."

"The deal, would enhance refundable child tax credits in an attempt to provide relief to families that are struggling financially and those with multiple children. It would also lift the tax credit's $1,600 refundable cap and adjust it for inflation."

"The deal includes expensing for research and experimental costs, restoration of an earlier interest deduction, an expansion of small-business expensing and an extension of bonus depreciation, according to a section-by-section summary released by the two tax-writing committees."

Today this bill was passed by the House Ways and Means Committee by a vote of 40 - 3.

I have a similar situation with a tax payment that I scheduled with the Oregon Dept of Revenue to be paid on Thursday December 28th ( confirmation saved ).

However it didn't clear my checking account until Tuesday January 2nd.

I am going to treat just like an outstanding check.

 I rarely get my screen blocked with pop ups.

Having your screen blocked like that is a sign that you may have unknowingly downloaded some malware.

One of the key reasons that I left ATX for Drake was that it took too long for ATX to make state forms available.