Mr. Pencil

She sounds like a gossip. People do gossip about themselves. Sometimes it's a cry for help, if (in a different scenario) you needed to rationalize ratting out your friend. Since right now you just want to protect your own professional sensibilities, etiquette allows you to interrupt with a lame joke about charging her for tax consultation. You might have to do that several times before she gets it. Handing her a business card is a nice touch. Anybody got a suggestion for the lame joke??

I would decline to prepare the mother's return claiming high "medical expenses" paid to a daughter who is not a medical practitioner with an established business.

I don't think this is true, except in the sense of work-related expenses. Also, there is a case for a blind student using an attendant. But not for ordinary tasks. So, in this matter, Jack from Ohio agrees with both me and Taxed.

Naw, it's usually my own fault anyway. I take a broad view of my fault. Missing a 1099? I should have caught it in the interview. That's if they are audited--if they catch it in time, I charge for amending the return. It sounds inconsistent, but it generates the most revenue with the least hassle. Clients get so weird about an IRS letter, I just want them out of my office no matter what I have to do..

Not for me. I don't offer "rush" services.

Of course there is planning. Changes in the tax law are the most common REASONS for planning. Maybe they need to go back to court or make new arrangements. So tell them about it right away, not when they come to pick up the return.

No. The time should be during the regular annual tax update process, so they can plan properly. End of year letter, organizer cover, or office interview as appropriate. If your practice doesn't include such service, then it should be of no concern to you one way or another. But what is so hard about it? The issue fits exactly into the issues we already have with releasing an exemption. Some benefits transfer. Some don't.

Seriously, I am going to claim reasonable cause because I am not able to get a transcript for one elderly client..

I suppose that's right, assuming he was not insolvent. I don't quite get the numbers. Was the outstanding loan $270,000?

It doesn't have to be Anything Goes. This is a tax board, so the political forum could focus on taxation policies--a bit more on point than just whether tax dollars should be spent in such-and-such a way. One technical rule I am suggesting is to limit or even prohibit Internet links and copy. I think they are best used for reference, not as the whole or principal argument of a post. I enjoy the personal opinions.

The only thing I objected to was a topic that some members reasonably did not recognize as offensive, but unreasonably continued to pursue after several members explained why it was offensive.

Intuit never merged Lacerte and ProSeries. The two products are very different in style so they have different user bases. ProSeries used to be called TurboTax Professional, so that's a clue. In the next year or two, I'm sure IRS is going to get its preparer registration rules. After that, the field is going to get even more technical. I don't see how either ATX or Taxwise can survive another five years unless they stop trying to be MAX and pick their niche. There is plenty of opportunity competing with Tax Tools, research databases, LLC payroll, and whatever.

And banks require an EIN for a business checking account. But a sole proprietor can get an EIN too. And nobody looking at it can tell if it is for an LLC or what. It's free and takes ten minutes, so it's a smart way to protect one's Social Security Number from getting spread around.

Usually the request is just for an EIN, not necessarily incorporation. It's an important (but not conclusive) step in determining that a worker is not an employee. Although the difference is often explained in terms of FICA, it is also important for Unemployment Insurance Benefits, Worker's Comp, liability insurance, tax status of fringe benefits and other compensation, withholding requirements, non-competition or even patents, identity theft and illegal immigration--all sorts of things!

Thanks. That's very interesting and helpful. It sounds like the existing individual policy can be maintained (assuming the insurance company allows it), but the corporation's deduction for reimbursement will end (or be taken as taxable compensation). Section 105 is one of the main reasons some people form a corporation, so there we are going to have some new tax planning engagements for sure!

Please don't thank me if you aren't going to follow my advice. And by the way, a medical reimbursement plan IS a tax question, not an insurance question.

Even on a professional site like this, there is tons of misinformation. ACA is a major shift in social policy, so we are going to see different variations and different rulings for a long time. Unless you want to do some serious study, at least comparable to an insurance license, you do your clients no service and bring liability on yourself by trying to figure it out. Especially this early in the plan. Refer such questions to the official published information and help lines. For example, this link https://www.healthcare.gov/what-if-someone-doesnt-have-health-coverage-in-2014/ says, "any individual insurance plan you already have" qualifies as minimum essential coverage. That seems to answer your question pretty clearly. I would guess you won't find a better answer at this time.

16th Amendment? Oh, but it could have been so much worse! After the 15th Amendment gave blacks the right to vote, there was quite a push for the 16th Amendment to let women vote.

The interesting thing is that it's almost impossible to find anybody who DOES admit they voted for Wilson! So how did he manage to win?

Are you talking about the election to use the 50% limit instead of 30% limit for capital gain property? That's the only way I know that calls for adjusted basis instead of FMV. But you are describing property with a capital LOSS, not a gain. Quickfinder strategy is "Sell the asset and donate the proceeds," which is the only way to benefit from the loss (reporting on Schedule D). Since that was not done, the Schedule A deduction is limited to the lower of cost or FMV. Sorry.

This is another example of how IRS could save everyone a lot of trouble by providing a way to report the non-taxable amount up front. On the other hand, that would probably be considered unnecessary paperwork for something that isn't even taxable. People complain about the IRS no matter what they do. Anyway, you should treat this as an audit. Because it is. Follow instructions in the letter EXACTLY, including using the official reply form. If you need more time, send in the reply with ONE sentence stating when you expect to respond. You don't need to give a reason, just don't take more than 30 days. You probably assumed some things or accepted the client's words when you prepared the return. Lay out ALL the math details now, according to Pub 970. Adjust qualified education expenses and co-ordinate with American Opportunity Credit and so on. Keep it all on a single page, but attach full documentation. That means invoices as well as receipts. If you need to count supplies that can't be proved, have the taxpayer sign a short summary.

I finally rolled my independent practice into a larger firm. My fees were still barely half of the rest of the office, but one client complained about the price increase. I replied: That’s a real good question! ,One of the reasons I brought my clients into XX’s office is that my own low rates were no longer sustainable. Although my office overhead was minimal, the cost of software and continuing professional education can not support a small practice any more. The Enron scandal, mortgage collapse, and other accounting industry problems over the last decade led to new standards for handling financial records and other IRS compliance issues. These are much better managed with supervision and a clerical staff, but that has to be paid for. Although your income numbers aren’t high, we must charge according to the complexity of the return. Your family has several tax matters that increase the cost of tax preparation. The most obvious is accounting for a small business. (About half your fee is deductible for that purpose.) You also have a partnership with a passive activity loss carryover. There was a technical sale of less than one share of XXX in a merger, but that generates a three-page form on your tax return. So that’s what’s going on. XX has allowed me to raise rates slowly. Standard pricing in this office for work listed on your invoice would be $xxx, although I would expect the actual price to be $xx dollars lower because you provide complete records and some of your items are relatively simple. We haven’t done any systematic market research recently, so I can’t say if that is high or low. It’s just what it costs for this office. You should take your invoice or the return to a few other accountants for comparison.

>>I wanted to make sure there wasn't something I was missing. Outside of my client being a criminal, not much, I guess.<< That's the kind of gentle sarcasm I enjoy, Rich, and so much the better when it is wasted. Still, I don't think they are saying your client is a criminal. I think they mean she is a sinner. of which non-sinners seem to have a particular understanding. Forget about the OIC. The corporation is in non-collectible status, and it has nothing to offer in compromise anyway. You'll get another chance to deal with it next year. Meanwhile, set up the payment plan. Ask your client how much she can safely commit to. Then cut that in half, and scream and swear at the agent until it is accepted.

You don't suppose opponents have turned on robo-call machines to make sure the system overloads? Naw, only liberals use dirty tricks.

The IRS does have specific standards for processing an Offer in Compromise involving the Trust Fund Recovery Penalty, but they are not related to the reasons for non-payment (which at any rate we do not know in this thread). What worries me is the proposal to begin a personal payment plan on the TFRP while trying to settle the corporate debt which includes the same money. It kind of makes sense, and OICs must always be creative. And since you have already submitted financial statements, you are pretty far along. So, go for it--I guess you are going to anyway. Just remember that you have to get the client to agree as well as the IRS. Make sure she knows that if she doesn't follow through, it might cost her a lot of money.