Gail in Virginia

Or maybe everything in the ACA forum should automatically be considered a vulgarity unless it is off-topic.

ProSeries also has a tax planner, and I have used it more this year than ever. I was not surprised that most people come off better under the new law - that had been my understanding from the media all along that the immediate benefit was for everyone. I am waiting to see if the changes that benefit the lower income and middle class taxpayers remain in effect when they are set to expire. Congress has a way of making changes like this continue rather than being known for raising taxes. The only people I am noticing a negative or no impact for are those who itemize, and especially if they have large employee business expense deductions. But I am not sure how accurate this planner is this year, and I know it tells me nothing about the state. Does anyone make a planner that includes state income tax effects?

You can't put the 1099's on the personal return, but if the income was earned by the person and not the corporation, then the income can go on the personal return. You can either have your client contact the people who issued the 1099s and explain that the corporation was out of business and they were dealing with him/her personally and ask that they correct the 1099s accordingly; file a corporate return and back out the income that was never theirs; or wait to see if the corporation gets a letter regarding their failure to file on these 1099s and answer the letter explaining where the income was actually earned and reported. I personally might take a chance on the wait and see approach, especially if the corporation was accrual. IRS might assume these are already reported in the accrued income and not question the 1099s. BUT it might also depend on how nervous your client gets if they receive letters from the IRS.

If I could, I would nominate my husband for a tax star. He knows nothing about doing taxes. If it doesn't come in an envelope labeled "Important Tax Information" he doesn't even know that it goes with the stuff for our taxes. BUT - he has dinner ready and serves it to me whatever time I come home. He has been trying to do my laundry for me for the last month and a half. He doesn't nag me to come home early, or expect me to have energy left over to do what he wants to do when I do get home. He cleans the house and mows the yard now that he is retired and I am not. If I decided tomorrow that I have had enough of this and wanted to retire, he would be all in favor of that. But if I decide to keep working, he is fine with that too. This has been the hardest tax season for me personally that I have ever had, and he has made it possible for me to get up and face it. I am so lucky!

Tell 'em how you feel Abby - don't hold back!

As long as he never depreciated the property, I think I would just go with Sch D

Interestingly, today's Checkpoint email was about an LLC that filed 1065's late in 2010 and 2011, and then claimed it was a disregarded single-member LLC and did not owe the penalties. NOT the same situation as your client, but close enough to be an amazing coincidence. If you are curious you can look at TC Memo 2018-35.

Maybe James Earl Jones backed up by the Mormon Tabernacle Choir?

I don't think so. It is isn't really non-taxable income; it is a non-deductible personal loss. The basis in the personal property sold is the date of death value plus the commission paid on the sale, and the income is the sale price. Since the sale price is the same as the date of death value (or generally pretty close, if they are close in time and the items were valued properly), this almost always results in a loss equal to approximately the commission on the sale. Since this is personal property, the loss is not deductible. At least, that is my reasoning for how this works.

In our area, the deer cross wherever they want to and just ignore the signs. I don't think they understand the pictogram.

Were the returns all self-prepared? is there any possibility of getting the depreciation records from a prior preparer? I would at least try the transcript route if you can't get the returns faster locally. But no matter what you do it sounds like the client is not going to be happy. Or maybe he will - he might be expecting to owe 80,000 without the sale of the rental and 70,000 sounds good.

I am not sure what the transcript shows as far as the sch. E. But if you calculate the depreciation that SHOULD have been taken each year, are you anywhere close to what was taken for the year's that you have information about? After all, it is deprecation allowed or allowable that you are looking for - so unless you think they might have taken too much depreciation, you could just use the calculation for what they should have taken. If they took the right amount, you are spot on. If they took too little, you are correct in taking allowable. You only have a possible issue if they have taken too much.

That could be similar to my husband's reaction when I get home before dark anytime from January through April.

The good kind of hugs, not the kind Rita sometimes give PITA clients.

I was hoping someone else would answer you, because I don't use ATX anymore and I am not sure what you are asking by line numbers. The only difference I am aware of is that Virginia is sticking to the 10% threshold instead of the 7.5%, and they allow LTC premiums even if you don't itemize so that sometimes there is an adjustment for that. Without knowing what lines 10 and 11 are, that is all I have. Maybe this will bump it up where someone with ATX can help you.

I could do two or three times as many tax returns if all the information was present when I pick up the folder to work on the return, and if people would quit calling to ask if their return is ready. Some days I want to scream at them that I told them I would call when it was ready, and I don't get paid until it is ready so I will call them as soon as I can. By the end of tax season I want everyone to just go away and leave me alone.

Why would he be MFS? He was single when he received the payment in 2017 (unless he was a qualifying widow/widower) and MFJ in 2016 - at no point was he MFS. Unless the executor of the estate decided not to file the final return for the wife as MFJ.

It sounds like it was paid to him from her account, so yes.

I went home last Monday feeling great - I completed 10 returns start to finish, and 5 of those were face to face. But that is a VERY unusual day, and when I say completed I don't mean that they were ready to hand back. Someone else in the office double checks them, scans the paper that came in with the return and makes the copies for the client. Most days, I don't get that many done all the way. Maybe 5 complete, 2 or three finished when they bring in the last piece of information , and a couple more started that need more information. If only they would bring me everything I need at once. I do feel better seeing that most of you aren't finishing 16 returns a day.

I haven't ordered yet - trying to find a spare 5 minutes. I just hope I don't lose track of this thread in the meantime!

Actually, it has been my experience that most certificates of insurance are requested by other contractors or customers who have employees because anyone they give a 1099 for non-employee compensation will be added to their workers' comp policy unless they can show they have insurance. That certainly would not be the case with E&O insurance. I would be suspicious that they are checking to see if you have deep enough pockets to be worth suing. But maybe I am overly suspicious.

Did your client get a 1099-C and/or 1099-A for the year of foreclosure? You might want to have him request IRS transcripts for those years to see if anything was reported to them as cancelled debt or foreclosure on mortgage if he doesn't have the paperwork.

Was a gift tax return filed in 2012? It should have been, and the basis should have been established at that time as the basis the mother had in the lot, assuming that it was less than the FMV in 2012. If so, the lesser of the mother's basis on the gift tax return or the FMV on the gift tax return should be the daughter's basis upon sale. Perhaps that is why the appraisal was done.

Our tax system was not designed or ever intended to be "fair." It is a progressive tax intended to tax the wealthy at higher rates (although with more loopholes) than the poor, and to accomplish certain social and economic goals that have nothing to do with taxation.

Judy, you are a super duper moderator EVERY week! You should have a permanent star!