Abby Normal

What was going to blow up the economy in MD is that fact that they were or are giving EIC credit to people with fake social security numbers. This is how they are getting this EIC from MD, they file as Jose Juarez with social 578133443 who happens to have a W-2 for 12K and claim 3 dependents, MD used to just send refunds. I still believe they are doing it. Of course these returns are paper filed.

I remember before 1990 when the IRS didn't require SS number for dependents. Everybody was claiming 2 dependents who were enjoying the beaches in Central and South America and other nice places.

No. A few fraudulent people have nowhere near the impact of thousands of MD business deducting, millions in depreciation in one year as opposed to spreading it over 5 years. MD was just trying to responsibly smooth out their revenues.

You can split the losses and deductions in any reasonable manner. You may need to make two duplicate data files and have at it!

KC is correct. Add the PA return to the client's return and then you will have to exclude the items that aren't taxable in PA. Assbackwards PA is!

I'm thankful that DE is one of the states that piggybacks the federal laws for depreciation.

I already the PA return added. I was just expecting the state depreciation schedule to say PA and not MD. Even TaxWorks had that right! I'll just edit the PDF to say PA.

PA returns are a pain in the ass! I have a PA CPA contact I can email, thankfully.

MD used to follow federal law exactly until the Bush tax cuts were going to blow up the state budget so they decoupled. With bonus gone (for good I hope) the only diff will be 179 over 25K and that doesn't happen much.

Thanks!

This reminds of the Intuit approach where you make the basic product deliberately flawed but offer you an addon that does things right. Many states have decoupled from the federal over 179 and bonus depreciation. I haven't seen any states lately that accept federal depreciation.

Hmmm. I just did an update and no forms updated.

Let me get this straight. If I have a client with rentals in 4 different states, ATX is going to just give me one state Tax Classification report for the home state? Wow.

OK, let me see if I'm understanding the problem. You are looking at the 4562, the tax classification report, and it shows the t/p resident state,Maryland, right? But you also need to file a NR Pennsylvania return reporting the Pennsylvania rental income. Do I have that right?

Yes. Actually I just need the PA one because all depreciable assets are in PA.

I don't see a place on the Sch E (other than the address) or in fixed assets to designate which state the rental is in. The problem is the tax classification report says Maryland and I need it to say Pennsylvania.

Thanks!

You only have to report the part of the 1099Q that is taxable, if any.

This isn't like a corporate dissolution where items are deemed sold. Just show the items as being distributed to each partner. It's probably at FMV but you should look it up.

Delete 1120S and re-add. Grrr. You may want to check line 7 on all 1120S before you make any entries.

Goes on Sch E pg 1 Ln 22 Loss Limitations I think.

On hold with support now. It's not displaying any blue input fields and can't add any.

Just had my federal estimated letter totally change to some default text. Thankfully I had a prior client with federal estimates so I could re-save it.

But I have sections of my letters move, wording changes, etc. Perhaps I'm making some noob mistakes but I don't know what they are.

Also, why I can't we default the letter options?

Grrrr.

No issues for me either.

Can't take a rental loss under MFS.

Would you mind sharing the problem? It might save the rest of us some grief.

Sorry, JM, but this guy is not self employed, he is an employee, so he's not under that rule. It would work if he was self employed.

Jeez. RTFQ, right?

Using part of the home for storage would give them a home office, true. That wouldn't change the commute miles though - the home office needs to be considered your principal place of business in order to make the transportation expenses deductible. Storing goods would just give you some deductible home office expenses, no miles.

For an employee you also have the for the convenience of the employer test. It's a good idea for the taxpayer to get something in writing from their employer.

You're right that the inventory loophole doesn't make the mileage deductible, but he should advise the client to establish a home office immediately, because it will qualify as a principal place of business under the administrative rules.

From the link you posted:

Your home office will qualify as your principal place of business if you meet the following requirements.

• You use it exclusively and regularly for administrative or management activities of your trade or business.

• You have no other fixed location where you conduct substantial administrative or management activities of your trade or business

I think he would qualify under these rules. Maybe not last year but it can be done for this year.

When I built my last computer, I told them I wanted the fastest processor, hard drive, graphics, network, etc with a shit load of RAM. I spent 1,200 just on the parts. No regrets. That was in 2012.

Tell him to get a home office. Problem solved. He may already have a home office if he stores inventory at home.

Edit: http://www.irs.gov/publications/p587/ar02.html#en_US_2013_publink1000226297

I'd bet he has some inventory or samples at home. Go for it!

That should be the first thing you see when that form opens,

You obviously don't understand the way my mind works.

It comes from up above the form on the first line that says "Tax shown on prior year's tax return"

Thanks! I hate when they do that. My eyes are not drawn up there. And when I click on a field and there's no green arrow, I assume I should just type in that field!

ATX says to efile one 8868, then duplicate the client file and create the second 8868. Then contact the EFC and ask them to unlock the EIN so you can efile a second 8868.

Yes, I agree, it is complicated. And the school district doesnt help because they told the TP that all of their mileage is deductible.

The school district might be right if "visiting clients or customers" means what it appears to mean.