Abby Normal

K1s don't show basis, they show capital, unless the K1 has supplemental schedules showing the basis calculations. The amount he was paid is a long-term capital gain, to the extent it exceeds basis. The losses allocated to him are his. The capital gain does increase his at-risk amount, but it does not increase his basis, so the losses are probably not deductible. https://www.thetaxadviser.com/issues/2012/mar/clinic-story-04.html If there was any income in the final year, that would increase his basis and you could deduct losses to that extent, assuming there were no other items affecting basis. ATX has a basis worksheet form in the 1040.

Finer points: To get ATX to calculate the partial year depreciation for the final year, assuming they didn't move back in on 1/1, pretend like you're disposing the asset and enter the date it stopped being a rental on the disposition tab. Override the depreciation amounts in the main asset tab to the amount was calculated. Then removed the disposition info. Make a note for next year to change the business use % to zero by entering 0.001 in the business use field in fixed assets, so no more depreciation is calculated. When you delete the Sch E, the assets will become 'Unassigned'.

Heroes.

There are programs to recover deleted files like Recuva. Worth a shot.

I would also explain math to him. You spend 50k to save 20k in taxes, you are 30k poorer. Keep the cash and try to earn money instead. Or just give it to charity for the deduction and do some good in the world!

I'd cash it. The rule is that it's not to be taken back by the government. Maybe donate it to a local food bank. If the estate bank account is closed, I'd have the personal rep endorse the check over to the sister.

I have a policy of never entering 'the' at the beginning of any of my clients' names, both on tax filings and my internal file folders, because I've noticed that is what the IRS does.

Your clients have never heard of online banking and downloading bank statements? And how is payroll being done? Sorry, but we're functioning quite well here, due to using modern technologies for the past two decades, at least.

https://www.irs.gov/businesses/small-businesses-self-employed/single-member-limited-liability-companies A single-member LLC that is classified as a disregarded entity for income tax purposes is treated as a separate entity for purposes of employment tax and certain excise taxes. For wages paid after January 1, 2009, the single-member LLC is required to use its name and employer identification number (EIN) for reporting and payment of employment taxes.

I wonder if Social Security can assign the kids new numbers?

the way to avoid having your rental activity being classified as a bed and breakfast is not to provide substantial services to your guests—don’t provide them breakfasts, clean their rooms each day, or do their laundry. Charge renters a cleaning fee at the end of their visit that is separate from their daily rental charge. https://www.nolo.com/legal-encyclopedia/tax-issues-when-renting-your-home-airbnb-vrbo.html

We don't always follow the IRS' position.

It's a gray area to be sure. You clean and change linens before and after every guest, but it's certainly not like daily maid service with hotel amenities. This article says to report it on Sch E, unless you're providing maid services and changing linens during the stay. https://www.journalofaccountancy.com/issues/2017/apr/reporting-income-from-airbnb.html The breakfast thing is the wild card. I would advise to stop providing breakfast.

I have many Sch C's with 39 year buildings.

Employees in MD had no problem getting unemployment but self-employed are still waiting for the state to figure it out. The simple solution would just be direct payments to individuals from the feds monthly until things get back to normal.

I usually just keep the car in the personal name and have the business pay the owner mileage, assuming it's not a sole prop. Any excess car expenses, including lease payments, are distributions/draws.

It's too bad that not enough tax pros used the eservices POA feature, so the IRS eliminated it. Would be really handy right now. I really, really miss EAR, too.

Wait, I'm confused. The files were transferred from the old drive to the new one, but you can't find them? And, don't you back up your computers in any way, shape or form? ATX data files are in the hidden system folder called ProgramData. Older years are under CCH and newer years are under Wolters Kluwer. ATX automatically backs up each return when you close it. I sometimes close large returns part way thru just to create a backup of work in progress. Backups are also in ProgramData and less you manually moved them elsewhere.

...and both were from wealthier retired clients, whose income stream is secure, wanting to know why they didn't get the full 1,200 per filer. And both called twice. One wanted to know if he had to share it with his spouse, and the other wanted to me check the calculation to make sure it was right. I told him we wouldn't know if it was right until we filed his 2020 tax returns. <sigh>

I always have to efile, wait for the EFC to reject it, then recreate the efile.

I skipped watching that video because I don't want to have to buy a new monitor.

You can print it to PDF and use a converter to convert to Excel. You might want to try different PDF printers if the conversion to excel is less than ideal.

If you choose to have an overpayment of tax credited to your estimated tax, you can’t have any of that amount refunded to you until you file your tax return for the following year. You also can’t use that overpayment in any other way. https://www.irs.gov/publications/p505#en_US_2019_publink1000194714

Could have bonus depreciation of 50k on equipment bought with loans. Seemed like a good idea at the time.

I think social distancing was my family's motto.