Lee B

I will get some popcorn and read the responses later this afternoon

At first glance I would agree, but aren't most client's current standard deductions larger than if they were able to itemize including the 2% misc itemized deductions.

I have a client who has a commercial vehicle brake, frame and alignment shop. They require their mechanics to provide their own tools. It's a common industry practice. Unfortunately it falls under the 2% misc itemized deductions category which the TCJA eliminated. Since she probably takes the standard deduction it's probably a moot issue.

I sympathize, when we moved my mother in law in to live with us her dementia was causing problems. She couldn't remember whether she had taken her prescriptions. She had stopped paying her bills and the city was getting ready to turn off her water.

Interesting, since I have efiling OR 41 using Drake

I reread the Journal of Accountancy article again and I still stand by my post. There is also a discussion about catch up distributions and the reduction in excise taxes on late distributions that should help Deb.

ATX has along long history of not providing entity forms to smaller states.

Last year all of my clients except one filled out their tax organizer. Although I did hand back their documents to 2 clients and told them to come back when it was filled out. If you don't have them fill out an organizer, how do you find out when there are changes in their tax situation, which they otherwise might forget?

A classic case of Income in Respect of a Decedent

Here a very good article in the Journal of Accountancy: https://www.journalofaccountancy.com/issues/2023/apr/beneficiary-iras-a-guide-to-the-rmd-maze.html

Yes the Medicaid 5 year look back rules vary from state to state.

My reading now that I have more time says, that, according to SECURE 1.0 an eligible designated beneficiary who is less than ten years younger than the account holder of the 401 k who dies before the required beginning date of their RMD is exempt from the so called "ten year rule" and can use their own life expectancy to calculate their RMDs. You have until 12/31 of the year following the year of their death to begin taking you distributions. Frankly it took me quite a bit of reading to arrive at that conclusion. It shouldn't have to be that complicated !

Why don't you call the fiduciary for your 401 K. They have the experts on hand to answer your questions.

Actually the answer is fairly complicated and can differ depending on state law. Please see the article in The Tax Advisor: https://www.thetaxadviser.com/issues/2022/nov/federal-implications-passthrough-entity-tax-elections.html

I would file MFS using their residences in the 2 different states if that's possible.

Why is it a scam? Discharge of nonbusiness credit card debt is generally taxable income, except when the taxpayer was insolvent immediately prior to the discharge or filed bankruptcy. See Pub 4681

Because they intend to become citizens, this probably needs to be handled correctly. Consulting a knowledgeable immigration attorney may be desirable.

Yes, but since he already has a SIMPLE Plan established, he doesn't qualify for automatic approval using form 5305 - SEP. From Pub 560 - "When not to use Form 5305-SEP. You can't use Form 5305-SEP if any of the following apply . 1. You currently maintain any other qualified retirement plan other than another SEP. "

Well he can't make an employee contribution which would reduce his box 1 - W 2 income. However as Abby points out he could make the 2% non elective contribution assuming that had been elected prior to the end of the year.

Well that would allow him to make a 2 % non elective contribution. "You must deposit employees' salary reduction contributions to their SIMPLE IRAs within 30 days after the end of the month in which the amounts would otherwise have been payable to the employees in cash, according to IRS rules (IRC section 408(p)(5)(A)(i)). For self-employed persons with no common-law employees, the latest date for depositing salary reduction contributions for a calendar year is 30 days after the end of the year, or January 30th" Due to this rule, amending his payroll won't work either.

The way to reconstruct her income would require finding a list of her repeat customers, how much she usually charged them and how often she did housekeeping and when she stopped working.

That would only be helpful if she deposited all of the cash in her bank account before she spent anything. What would you do as far as expenses?

Who would authorize you to prepare the return? Unless the son will help you, there's nothing you can do.

Box 5 already has the amount in box 4 subtracted

I think we have beaten this topic o death. Let's put it to sleep.