Kea

It might have all the markings of sounding suspicious, but there are, in fact, many honest, hard-working people from the Middle East, who come here for school and then get good jobs here. I have several clients who fall into this category. I have no reason not to answer his question as fully as I can. I just don't have experience in this area, which is why I posted the question. My guess is they probably just figured it was easier to send money to an existing account. His question to me was only related to tax consequences. I, for one, don't know how to go about setting up a bank account in another country. It doesn't sound easy and I'm sure there are hoops to jump through. I have no idea if they considered that their plan could be considered suspicious. If they had, I doubt he would have asked me about it. I did tell him that I didn't have a ready answer for him and I would be posting the question to a tax bulletin board. He thought that was a good idea. It doesn't sound like he is trying to hide anything. Thanks.

I had asked my client if they considered setting up an account before the brother left and they weren't sure if they could do that. But, I do agree that would help my client. I don't know how they go about setting up an account from oversees. If they can get the account set up and the money is just transferred from Dad to Son, there would be no reporting issues at all. Right? The form I referred to earlier was 3520, but that probably won't be needed. Thanks so much.

My client's brother is coming to the US to go to college. The family lives in Pakistan or India (I don't remember which). Their father wants to transfer the tuition (and money to cover other expenses) to my client's bank account. They thought that would be safer than having the brother carry the money (or check) with him. By client wanted to know if he would be responsible for any taxes for receiving this much money. He never told me the amount, but if you are talking college tuition and expenses, it could easily be 10s of thousands. My client receiving a gift would not generate any taxes. And since the father is in another country, he would not be required to file a gift tax return. I know there is a form my client would fill out if he receives a large sum from another country, but I don't remember the form number or the amount (maybe $100K?) Note, this money isn't really for my client - he's just going to hold it for his brother until he moves here. When he transfers to the money to his brother, would that be considered a gift and require a gift tax return? Could his brother set up an account at a US bank before he gets here? What is the best way to handle this transfer? Thanks.

I'm seldom afraid or intimidated about learning new things. I'm just trying to find a good way to do it. For updates, I'm OK with books and newsletters. For the "new stuff" I learn better in a classroom. I also have to keep in mind that my business is fairly small, so keeping costs down is especially important to me (important to all, but "affordable" for me is lower than for many). Over the next couple of years, I will also have to learn about non-profits and expatriots. I'm hoping I get some of the non-profit info in some of the other classes (maybe). But for expatriot, I guess I'll stick to IRS publications. My clients are always moving into new areas. This is good - it makes me learn new things! Thanks

All I've done at this point is explain that I know what the entities are, but not much else. I did share a chart out of Quickfinders that has the summaries.

Thanks Jainen & Taxbilly. I did take the H&R tax classs when I first started. I worked for them for 1 tax season, then took almost all the other classes they offered the next summer. Then I started my own business. I don't remember their offering classes in partnerships or other business entities (except, sole prop of course). Also they seemed to only be interested in teaching to H&R employees since a couple of the textbooks contained a lot of typos. But, I agree, that they gave me a good foundation. I have had a few accounting classes, but the refreshers would be a good idea. I've been wanting to expand, and now I have a 2 sole proprietors that want to become partnerships or are looking at changing to another business entity. They already trust me and want to keep me. I want to make sure I can do right by them. Thanks so much.

I am considering expanding my tax preparation business to include business returns. I would prefer to learn in a classroom setting, but books, DVDs are OK, too. Any recommendations? Thanks.

All 7 returns were originally filed in June 2005, and other than the 2006 refund held back, the taxes have not been paid. I amended them 4/24/07. If possible, I would like to give my clients a citation for them to pass on to the IRS agent. The amendments will reduce the amount of tax they owe. But, per jainen, there is no specific cite. I guess I'll just have to leave them with the 1040X insturctions.

Client filed 1999 - 2005 taxes in June 2006 after receiving several notices from IRS for taxes due. That tax preparer filed him as single with his common law wife (no income) as dependent. Client lives in TX which recognizes commonlaw marriage. I filed his 2006 taxes as MFJ ($7K refund). He and his wife have been working with someone at IRS to handle prior balance due. I have amended 1999 -2005 to file as MFJ. I have always understood that you could amend a return within 3 years after filed or after due date whichever is later. These amendments did not create a refund, only a reduction in tax due. The 1040X instructions also include the later of above or 2 years after tax was paid. Only the $7K from the 2006 refund has been paid toward the over $50K assessed. The IRS agent they are working with has now told them that they can only amend within 3 years of due date of original return and references (according to client): 2007 US Master Tax Guide Paragraph 154 Publication CCH 6013 code Paragraph B Paragraph 2 I admit I work off publications and Quickfinders. The searching I tried to do with the above information led nowhere. I'm sure I'm not entering something correctly. Could someone help me find the above cite or one that states that the taxpayer does have 3 years from date filed (besides IRS instructions or publications)? Thanks.