Gail in Virginia

I have a client who has cancellation of debt income for their S-Corporation. They have depreciable assets that still have basis left, so I would like to reduce their basis in those tax attributes to eliminate the cancellation of debt income from their reportable income. How do I show this on ATX? I would like to keep the assets listed so that if and when they are sold I know that the basis is zero.

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That one in five would also include those who use a paid preparer that does not sign the return, I would think. We have quite a few of those in the area I live in who either buy TurboTax or use the IRS' FreeFile system to file tax returns for all their friends and neighbors. They don't sign the returns, and won't be affected by the new regulations because they still won't be signing the returns. I wonder if this won't cause some of those who do sign the returns to continue filing returns but to quit signing them rather than paying all of the fees and having to take a competency test and continuing education.

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I have also used e-mail support with sometimes less than satisfactory results. I like to email problems because I feel like it is a more efficient use of my time - I do the email when I have the problem, and move on to something else while waiting for an answer instead of being on hold and keeping the problem in front of me to be ready when they answer. I would think that it would be more efficient for ATX as well, but perhaps I am mistaken. However, there does seem to be a problem with information stated in the email being overlooked, and with turn around time for any followup question. And since the information overlooked is most likely going to lead to a followup question, this situation only gets worse and encourages us to telephone so that we can get our followup/clarification all done at the same time. I have wondered if email support is outsourced. They tried that with phone support, and it was so unpopular that it was discontinued. Email support could be outsourced and we would probably never know. :dunno:

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I am using Windows 7, 64 bit, and I have not had any problem with ATX 2008 or ATX 2007, even though my operating system is not supported. Good luck.

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A belated to you!

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I have a new client, S-corporation. In verifying loan balances, there was an adjustment of $183,000. made to their loan balance at the beginning of this year. According to the finance company, they wrote off 90% of their portfolio of loans when they converted to a new system. Upon advice of their legal counsel they are not issuing any 1099-C's because their is some doubt about the legitimacy of the loans. It appears that there should have been a write off of about $100,000 the year before. However, I don't have any exact numbers for 2008, and the prior accountant apparently did not verify the balance with the finance company at the end of the year. How do I treat this on the tax return? Do I report it as income even though they were not issued a 1099C? If the original amount was reported "in error," should it just be an adjustment to the loan balance and not income? I have never had anything remotely resembling this. And the client needs the return right away for the bankruptcy attorney. Of course. :scratch_head:

Isaac Asimov wrote a short story long ago about the cold war wherein one side rediscovered doing math using paper and pencil rather than a computer. This gave them a tremendous advantage because they could put a man into a rocket rather than an expensive computer. The day when math will be need to be rediscovered seems to draw closer all the time.....

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