TaxmannEA

Dear Client, Words cannot express the joy that I felt when I entered my office yesterday and discovered the large box of documents that you so thoughtfully dropped off for me. I was especially impressed with the fact that you arranged the 50 or so receipt books in chrono;ogical order to help me separate the 3 different years that are needed to be filed. I only wish that you had so arranged the other invoices. check statements, etc. in the same manner. Be assured that I will treat your account with the same regard that you show for my time and effort. Since you told my assistant that you could not afford to hire a bookkeeper I will be happy to give you a reason when calculate my fees for this project. You also might want to spend some time looking for a good proctologist in the next few months as you will need one to remove any further packages that you send my way in the future. I LOVE THIS BUSINESS!!!!!!!!

Pacun, I think that you need to re-read the regs regarding MFS. If one spouse itemizes deductions, the other spouse is forced to use only those itemized deductions that they have. The only exception to this is if a spouse qualifies for HOH under the abandonrd spouse rules. As long as they are married and filing MFS, this rule applies.

Thanks Terry. The client is dropping off the documents. I guess that I just get frustrared by banks, ets. who don't seem to know or care about processing these forms in a correct manner.

A client just presented me with a 1099C showing around $18K of cancelled debt. This was a loan that was discharged in a Chapter 7 bankruptcy. The date of cancellation is shown as 0/00/0000 and the bankruptcy box is not checked. I'm trying to show this as non-taxable, but I seem to be too fried to get it thought out. Any ideas?

I believe that spouses can gift any amount to each other that they desire. There is no $13K limit to gifts between spouses. Mom and Dad can then gift $13K to son and son's wife. They can also gift the same amounts to the grandkids(if there are any) and the grandkids can then make gifts to son and son's wife. Just remember that in this case it's form over substance in regards to the transactions.

Check with the state rules. Many states do not have the capability for E-filing 1065s.

SE income (from Sch F) of about $10K and Social Security along with about $750 interest were the only income. SSA verified that he received $250 payment. As I said, there is no explanation of the adjustment on the notice. I'm assuming some type of IRS database error at this point.

Just went over a new Sch M Problem. TP had around $10K in SE income. He also gets Social Security. The preparer showed the $250 payment which reduuced the Sch M credit to $150. The return was E-Filed and accepted. Now the TP gets a CP notice reducing the $150 by $119.20. There is no further explaination or calculation shown on the notice. Any thoughts on what might have happened?

Are we clear that this is not a Roth IRA?

As a part-time gravedigger, I have helped many people move in to their "permanent residence" after their demise. The posibility of them moving overseas is very small after that point in time.

The Child Tax Credit is lost in the year that the child turns 17. Therefore, no CTC for this dependant in 2009.

I just discovered the 3rd. method. File the return showing $250 received, it rejects. Change to $0 received, it rejects. Call SSA, they have no clue. File on paper.

There is a message on the general chat forum with the same problem. Sounds like it might be a problem with an update. You probably need to call support or wait for a fix.

Thanks KC. Thankfully this is a client that won't freak out over having to mail the return.

I'm getting a reject on a return because the FEIN for the employer "deos not match the master file". This employer is a municipal library that has not changed it's number. Anyone else having this problem.

No. They must be married either officially or by common law to file MFJ or MFS.

Is this a Chapter 7 or 11 filing, or is it a Chapter 13 ? If it's a Chap 7 or 11, the estate reduces the tax attributes. If it's a chap 13, then the individual does so. That's been my understanding up to now. (Anyone PLEESE feel free to correct me if I'm off track here.)

I was referring to the assets disposed of in the bankruptcy. If the TP paid to retain some assets, then a new basis would need to be computed for those assets. The reduction in tax attributes would only apply for debt cancelled outside of the bankruptcy. Any debt cancelled or reduced in the bankruptcy is considered to occur with a separate entity, not the TP. I would think that the form and\or substance of the transaction with the estate would determine your client's treatment.

It's my understanding that the bankruptcy trustee is supposed to prepare a return for the bankruptcy estate. In practice, many of these are never filed as there are no funds left at the termination of the proceedings. The estate is a separate taxpayer from the individual. I have always simply deleted the assets disposed of from the records and kept notes as to their disposition in my file.

If the assets were sold in the bankruptcy, then there is no tax effect on the TP. The bankruptcy estate deals with all that. TP will only have gain on discharge of indebedness for assets disposed of outside the bankruptcy.

Did you enter the information on the Ln3 tab of the SE form?

I always tell my clients that they may have a delay due to system problems. I NEVER give anyone a firm date to expect a refund or action on anything. (They still blame me, but at least I know that I warned them.)

I just tried again and got in. Guess I'm just nervous today!

I've been trying to log on to ATX Support for the last 2 hours. I can't even get on the home page now. Just hoping that it's not my computer.

I just got a call from a pair of clients asking if it was too late do their 2 returns (business, 2 farms, trucking company, and rentals) before the deadline. The phone handset is still smoking from my reply! They decided to drop it off Monday. I LOVE this business! :spaz: