neilbrink

Client brought in a W2 with an address of Vancouver, BC. The income was earned in the U.S. It does not have a zip code, so I am getting a warning that this W2 cannot be efiled. Does anyone know of a way around this? Thanks.

Anyone from Illinois, or anyone else from a state that has a Use Tax?

For those of you who are preparing Illinois Returns, how are you handling the Use Tax on Line 22 for those who have not purchased anything out of state? Are you just putting a zero on line 22, since instructions say to not leave Line 22 blank? Do you ask each client if they have purchased items out of state and whether they have kept their purchase receipts, or do you just routinely use the amount from the table? Thanks.

For those of you who are processing the returns of those that have received the 1099-C's because their qualified residence was sold for less than the mortgage (or forclosed on), are you simply completing the Form 982 with the information from the 1099-C, or is there more that needs to be done. Is part 1 on the Form 982 the only thing we need to complete in this instance? This is my first 1099-C, so I appreciate the feedback. Neil

I believe that when the federal and state were piggy-backed, they had the same number. Now that they are not piggy-backed, they have different numbers.

Schedule A Only.

If they come back the third year, after having missed the second year, you should reverse the order of the pin numbers from what they were the first year so nobody catches what you are doing.

You are correct.

Write your Congressman and your Senators. They caused this fiasco.

I would write to my Congressman, but he is not around anymore. I would write to my Senators, but one of them is not around anymore.

Under the EGTRRA, however, the basis of property acquired from a decedent who died in 2010 is the lesser of the decedent’s basis in the property, or the fair market value of the property at the time of the decedent’s death.

However, EGTRRA allows an executor to increase the basis of property acquired from a decedent who dies after December 31, 2009 by $1.3 million ($60,000 in the case of a decedent nonresident not a United States citizen). The executor cannot, however, increase the basis in any property above its fair market value at the time of death.

Also, EGTRRA allows the executor to increase the basis of property acquired from a decedent who died in 2010 and that passes to the decedent’s surviving spouse by an additional amount of $3 million. The executor cannot, however, increase the basis in any property above its fair market value at the time of death.

Not all property acquired from a decedent is eligible for the new increase in basis allowance. There are some important rules for determining which property is allowed to receive an increase in basis; especially for jointly owned property, property held in trust, property subject to a power of appointment, community property, and property acquired by the decedent by gift within 3 years of death. You can find more information about property that is eligible for basis increase under Property Eligible for Basis Increase.

There should be a form 8606 pop up. The front needs a check mark at the top, and the back should fill in with the correct information from the 1099R, which should then transfer correctly to the 1040. Hope that helps.

Thanks.

My client was in the middle of a 20 year contract sale for farmland that she sold when she died this year. The buyer will pay off the remaining amount of the contract to the estate. Can someone tell me if the basis in the property is still the basis listed in the contract, or will the estate (and ultimately the beneficiaries) receive the modified stepped up basis of the remaining value of the farmland not yet paid off? Thanks. Neil

I just had the same thing happen a while ago. After it had errored out, I resent it and although it took awhile, it eventually went through. There has to be a lot of congestion there right now.

Atx's website is down and apparently the servers are down, also.

Not a good time to go down!!

Thank you.

Neil,

Line 14F on the K-1 isn't income that would flow to the 1040. It's an "information" figure instead.

Cathy

Thank you, Cathy

That is my understanding also. So if this was income that WAS supposed to flow to the 1040 Return, should it not have also been entered on Line 6 of the K-1? This "information" was based on income that I assume should have shown up on the K-1 somewhere.

Client's Return went in with the request for her refund to be deposited into an bank account that was closed at an old bank. She called that bank and they had already returned the funds to the IRS. Has anyone had any experience going through the Practitioner's Hotline to request that the refund be deposited now into the current new account?

Thanks. Neil

I would like to run this by again to see if anyone has a response.

Thanks

Neil

I have a client with a Trust K-1 that shows an amount at line 14-F as the only income on the form. This line indicates that the income is coming from Farming, and that amount is transferred to the correct line on Schedule E, line 42, but it does not show that income on the 1040 itself. Shouldn't that amount of income also be showing on line 6 (Ordinary Income)of the K-1? A member of the family completed this trust, and I am not sure he knew exactly what he was doing. Thanks. Neil

The HOH rules apply to where the child lives, not who has the dependency.

I noticed earlier this week after an ATX update, that a change had occurred with Returns that were being held for efiling. When those return files were opened when in the "created" state previously, they then showed up as "rejected" when the file was closed and stayed that way until the efile process was performed again. Now, when the return is opened, and saved, the efile status does not change. It still stays at the "created" category. The purpose of the previous "rejected" category was to alert us to the fact that when the return file was opened, we needed to check the return to determine whether any changes had been made before we efiled. Has anyone else noticed this change? Or has anyone seen any notice from ATX that this was going to happen?

Thanks.

Neil

This is an interesting video on what the IRS is doing these days.

http://articles.moneycentral.msn.com/video/default.aspx?vid=37de1050-f422-4aca-b014-8980f47c1d8a&t=v&from=en-us_msnhp

I have a TP who has a child attending college in Canada. I am reading the instructions for taking the Education credits, and the information given for an eligible educational institution is "any accredited public, nonprofit, or proprietary (private) college, university, vocational school, or other postsecondary institution. Also, the institution must be eligible to participate in a student aid program administered by the Department of Education. Virtually all accredited postsecondary institutions meet this definition." Are any colleges that are not in the United States eligible educational institutions for the purpose of this credit? Thanks. Neil

Try page 2 of form 8853. Most likely, the cost of the nursing home was more than this amount and it will not be taxable but this form should answer that question.

Thank you, Form 8853 is correct, and I found it on Line 21, Other Income. In this particular case, since payments were made as "reimbursment", I did not have to complete the form.

TP is in a nursing home dementia unit and receiving Long-term care benefits from an Insurance Company. She received a 1099-LTC form showing Box 1, $44,107, and Box 3, Reimbursed Amount, "Y". I do not know if this amount is required to be declared on the Form 1040, and if so, where. I also cannot find a worksheet for the 1099-LTC. Can anyone help me on this one?

Thanks.

Neil