Abby Normal

My question is, if you use the "Other" section, is the pdf sent to both the feds and the states or just the feds.

I wanted to attach some K1s with nonresident withholding to the state because the state always sends a letter asking for them but it's totally unclear what using Other does.

I'm not sending the IRS any broker statements this year as a test to see if they ask for them. I don't think they have the time or the inclination to check all those PDFs or paper copies. As long as the taxpayer's total sales proceeds equal or exceed the total in the IRS' computer, they don't flag that return. Eventually they'll be able to check basis too and they've already tipped their hand that they just want totals on Sch D for box A & D transactions.

I put totals on Sch D for years before I learned that you're supposed to send the IRS detail sheets and I never heard a peep from them, so I doubt I'll hear a peep now. And if I do, I'll just say, Oh, did my office manager forget to send those to you? I'm sorry, she's new. Here you go.

This year the Sch D has line 1a and 8a to put the totals for "covered" transactions report to IRS, (short and long term respectfully).

I'm not using those boxes because I use the totals on the Detail page to tie to the 1099B(s), so I find those boxes inconvenient.

I charge $25 more for paper filed returns. Sometimes it changes their minds. Sometimes not.

When I try to e-file Form 4868 for a partially completed tax return, I get an error message saying locked amount must be checked. The client is not making a payment as the return is not complete and the amount with the extension is incorrect.

ATX will only allow one box to be checked so I cannot have all zeros on the 4868 and Lock Amount checked at the same time. How do I e-file the 4868?

The answer is to override box 5 "Total 2013 payments" so it's more than the amount on line 4 "Estimate of liability" so box 7 "Amount you are paying" is zero. Box 4 is the only box that matters if the IRS is going to challenge an extension and that only happens in rare cases. It shouldn't happen at all. It's bullshit, but it is the law.

I just want to go on the record as saying I hate the extension process and the whole concept of having to file for an "automatic" extension with a reasonable estimate of the tax liability, or the IRS can (and has) reject it.

No tax software I've ever used has made the process automated or easy.

My idea: if you don't file by the 15th you automatically have until 10/15. No "request" made to the IRS is necessary. That's why I think when I hear the word "automatic".

As for ATX, we used the batch process to create (and print - we turned our printer off then killed the print queue) zero amount extensions. Then we're going into each unfinished return and overriding the tax amount and the amount paid payments so no amount is owed. Check the lock box, put in our PIN and create the efile.

Then we'll just have to remember to delete the amount paid on the 4868 when checking the final return. Nothing flows to the 1040 if no balance due on 4868. My employee who's doing them all says it's great compared to what we did last year in TaxWorks.

Don't put in anything but the tax & it will flow to the 1040 under the exception to filing a 1116, if under $300 for single or $600 for MFJ. If you put in anything else (and ATX will default to putting all the div as foreign as mentioned above) then it goes to the 1116 & the rest of the data has to be complete, including date.

Thanks! I'll try that on the next one. I was getting red errors unless I entered dates, country, etc. so I was just feeding the beast what it was asking for.

The Fixed Assets form appears when you add the 4562. Delete and re-add the 4562.

Prior preparer was wrong. Amend those returns and depreciate the house (and take all the expenses) on the day care Sch C directly.

Anyone else notice a speed improvement?

It's just called "paperless"? I've not heard of it.

Well that's good news! The letters have been driving me crazy.

Try running a Check on the return. I had ghost assets appear after doing this once. Then I deleted all the ghost assets.

Oh please. Have them draft a loan letter up with some small amount of interest. You can't live your life scared of the IRS. Are we tax advocates or just a conduits of funds to the federal imperial government?

And then they never repay it and what do you do? Plus you're stuck with imputed interest which creates phantom interest income on the S Corp. No thanks!

The most important thing you do on a computer is SAVE, SAVE, SAVE! If your computer "takes too long to save", get a new computer.

I was entering 5 W2s yesterday and I saved after each one. I save after entering each asset. I was saving less in ATX early on until it crashed and I had to reenter a K1 and Basis worksheet. I would rather spend a 1/10 of a second pressing Ctrl-S than 3 or 4 minutes reentering a K1, not to mention the frustration. Ain't nobody got time for that!

Why in the hell would you make someone pick up capital gains? Think people make it an advance or loan.

On audit, the IRS would move it to distributions anyway. Might as well do it right to begin with. The shareholder clearly did not intend this to be a loan. "penalties of perjury, blah, blah, blah.

Haven't used that line and it's filled with N/A on mine too. Not sure what I would ever want to put there. If it's a biz exp, I'd put it on Sch C. Just leave it alone. You might have to delete/re-add form.

Jack was telling me just the other day that I shouldn't save as often as I do. I save early and often. I do this in ANY program I use (spreadsheet, text editor, email, etc.) I've lost data in ATX on crashes several times in the past few weeks, but it is always just one form because I save before switching forms almost without fail.

I hit Ctrl-S about every minute or so. Whenever I'm ready to hit Ctrl-B, I always hit Ctrl-S first. You don't even have to release the Ctrl key.

The retained earnings balance will differ from the AAA in this case since distributions can't reduce the AAA below zero.

It's amazing how many people get this wrong. Most of my S corps' AAA does not equal retained earnings. But then again, I have no idea why we track AAA. I've never used it in any calculations, even on liquidations.

Then in that case, and it happens a lot, is you then tell the client that you get to pick up Capital Gains taxes on all those distributions.

And oh yeah, NEXT year when you have to pay off the loans and have no distributions? Yes, you get to pay tax then on that phantom income....

So, tread carefully here.

Rich

I would rather have capital gains distributions than W2 wages. It's all money coming form the business to the individual. I used to dread it when there were distributions in excess of basis but then I realized it's not a problem. The losses get suspended to be used against future income.

I have QB back to version 11 running under Win8. I'm going to tell all my clients that have to upgrade to at least 2012 this summer because all my computers are going to be Win8.

I have XP installed in a VMWare virtual machine in case I really need to run any old software. I actually have one client still using an old DOS accounting system! I almost had him convinced to switch to QB but he got cold feet at the last minute. <sigh>

I've never issued a 1099 and I don't think you should because it's already reported on the K1. Excess distributions are capital gains so if you were going to issue a 1099 it would be a 1099B.

I would not treat it as a loan to shareholder because it's not evidenced by a note and the loan will never be repaid.

Can you post pictures of your setup? I recently bought a setup for two monitors from dell and a dell XPS 8700

I don't know if that stand gives me enough height or swivel. Here's my setup: http://imgur.com/a/3MxMp

I always had this problem and some of my clients told me that it only took X amount of time and I was charging them a lot. A few years, out of the blue, Mark came to my rescue. Now, I check all the information that the client brings and I ask about his address and then I say, I need to concentrate on the computer so if I have a question I will ask you. I do this because I don't like to lie to my clients. So I deeply concentrate on the computer and start checking my facebook. As a matter of fact I have been on facebook for 20 minutes... oops, my concentration time is over, let me print this guy's return now.

I just tell them I'm very efficient and it's less than H&R Block would charge you. Followed by a rant about how much rent, insurance, health insurance, computers, software, CPE, etc. etc. are.