Sara EA

We find that you can't beat ATX for price and ease of use for 1099s, W2s, etc. For our practice of maybe 1500+ returns, including lots of partnerships, S and C corps, trusts, estates, some nonprofits, and many complex but some simpler individual returns, ATX does not meet our needs. We use UltraTax, which is expensive but very powerful and does almost everything we need. It isn't perfect on states, but close. A weakness is the tax projection module, which doesn't consider increases or decreases in credits depending on projected income. Of course, they sell a separate projection piece, which I'm sure does a better job for a higher fee. That brings me to an issue we are all seeing more and more. Things that used to be included are now part of a separate package for a separate fee. Even Quickfinders, which used to tell us all we needed to know, now has frequent references to "see our XXX book," sold separately of course. You can't buy Adobe any way but subscription now (with constant reminders to upgrade to the next level). Heck, Mahjong and solitaire used to come with your initial software but no more. I used to get a printed offering from Comcast showing what stations were included in which packages. Now I can't even find it on the website, so I'm afraid to downgrade in the event we lose one of our few must-have stations. Businesses are just too clever.

The eastern panhandle of WV is beautiful and has a vibrant economy, certainly other areas of the state do too. There is much to praise about residents being independent. You won't find a million fast-food restaurants but lots of mom-and-pop places with great, affordable food. Not many big box stores, but you will get to shop at local hardware , appliance, and furniture stores and niche sporting good, auto, plant, you name it places. I once bought a bag of mulch at a local ACE hardware store (family owned), and it was bagged in nearby Virginia. No matter where you go in WV, you'll feel like you're in a neighborhood.

We had an incident when the person doing the efiling filed parents' return instead of son's (same first name as dad). We hadn't started the parents yet, so the filed return was blank. Imagine how many lines of "explanation for changes" that took. The culprit no longer works for us (not her only mistake).... I'm impressed that people are filing amendments already. We have so many on extension that it will be months before we get to amendments. Almost all of our state returns with unemployment that were filed before the law changed will have to be amended. We will have to triage here: Extensions where people will owe money first, then regular extensions if we have the info, then amendments for unemployment, and last amendments where people found another form or just thought up some deductions. I guess the principle is initial filings get priority, then amendments not the fault of the taxpayer, then amends for those who already had their chance to do it right the first time. I'm starting to worry about clients who had lowered income in 2020 but are back to work. That advance child tax credit is going to be sent automatically starting in July. Many will not be eligible based on their 2021 income and, unlike the stimulus payments, my understanding is that overpayments will have to be returned--making for a very unhappy 2021 tax season. Ideally we can warn these clients to opt out of the auto deposits, but I don't know how to begin to identify them. What are others doing?

No loss allowed if sold to a related party. I believe the unallowed loss is added to the new owner's basis provided she holds on to the house for a specified period of time. You can research that in your spare time since it won't affect anyone's taxes in 2021. (Spare time--what a concept!)

A little south of Winchester. I would love to connect with more tax pros here. I cannot imagine how you solo practitioners do it. I've always worked for a firm with other tax pros to bounce thing off of and help or get help when needed. I belong to both NAEA and NATP, and over the years in CT I got to know lots of people from attending seminars together. I am working remotely for the tax firm in CT where I've been for 18 years or so and interact with my colleagues there, but here in VA I don't know a single person in this crazy business.

I could be wrong, but I seem to remember from an update course that unlike the stimulus payments, the advance child tax credit will have to be paid back if 2021 income is not what the IRS calculated the credit on. This year I had a few clients who could not come up with how much stimulus they got, but when I looked at their 2020 income and realized they were not going to get any more anyway, I just plugged in the standard amounts or entered zeros. (Say they really got $1k instead of $1200, but their 2020 income was too high to get anything, it made no difference what I put in there because they were definitely not going to get a recovery credit.) We won't be able to do that with the advance child tax credit in 2021 and will have many clients moaning when we present their tax bill. Right now we don't know enough about it to warn them. The IRS may do that, but how many people won't read it because they are thrilled by the thought of getting extra income?

Get ready for the phone calls!

We have been in VA about a year a half and love it. The people are genuinely kind, real southern hospitality, and it is beautiful here in the Shenandoah Valley. Real estate taxes are less than a quarter of what we paid in CT, gas is cheaper, utilities and insurance are less, roads are in great condition, state budget is healthy. Housing is expensive though, and we aren't in the beltway. Our son lives 40 miles away in WV. It too is a beautiful state with low housing and property tax costs. You can get any environment you want there--mountains, plains, rivers and lakes. I don't know why it hasn't been discovered by the masses yet. What is neat about both states is they have history everywhere--castles, plantations, revolutionary and civil war battlefields, underground railroad sites, canals that existed before the rails dominated. Take some vacations this year to explore potential new home sites. Looking at the zillions of returns we have on extension, and all those state returns that will have to be amended after the late federal changes, it looks to me like another tax season that will never end. This one will hurt more because last year we couldn't go anywhere even if we had time; this year we sort of can....

I had to learn about VC several years ago when one of the boss's clients started mining. He's my client now and still mines. He has the magic software and this year gave me a 29-page 8949, all filled out. Put the totals on the return, attached the pdf, done! He did all the work (well, his software did), but I still charge him a lot because of my "specialized knowledge." As of now, VC is not subject to FINCEN reporting. Proposed rules may change that. If held in a foreign exchange and greater than $50k, it should be reported on Form 8938.

If the house is mortgaged, the bank has the title so your client can't gift something she doesn't own.

Does ATX have a more powerful (expensive) version that will do the 8615? In UT, you simply mark one return as the parents. Then you go to the utility, choose the parents and each sibling, and run it. Done! Last year it even told if it was better for the child to use the trust or parent tax rates. I too used to set up each family member on different computers and run back and forth. It was work and doubtless less accurate. Can you save or print each child's return before the kiddie tax calcs and the parent's return to somewhere and work from there (hopefully you use two monitors)?

CT just announced that returns with unemployment filed before the software updates will have to be amended even if the IRS auto-corrects the federal. CT starts with federal AGI and does not have a separate line for unemployment benefits, so there is no way for the state to know what went into that AGI number. If MD and other states do the same, there's a whole lot of amending going to be happening. And we thought that this year we might actually get some time off before extension season hits! Our software also will update the minute we open the return, so the "originally reported" numbers will all have to be entered by hand (and double checked of course). We are planning to charge $75-100 per amendment. If federal amendments have to be done because the client is now eligible for a credit or deduction that wasn't there before, we'll charge for those too.

Just finished a client who worked in the UK all year and all earned income was excluded on 2555. (He did have a few k US investment income.) He got the first but not the second EIP, and the program was calculating a recovery for the second. Based on his foreign income, he made too much to get either. I looked it up and believe it or not, his reduced US income made him eligible. My point is that every credit has its own quirks, and in our job we learn something new every day (or hour).

Fifteen returns in a day! You are superhuman! The only times I can do that is when they were all done and checked and finally that last bit of missing info came in. Even then, I don't think I'd make 15. Missing info is the worst. Email a client with three questions, and you get two answered. Heck, tonight I emailed a client with two questions and got an answer to one. Really? Most of my returns are fairly complex--even the "easy" ones turn into hours of work when they leave a note that they sold some land or hunting cabin they've had for years and the stock their grandfather gave them when they were born. Tonight I picked up a normally straightforward return and found that she had her daughter's and boyfriend's in there too. Will it ever end???

Same thing is happening in Ultratax. The IRS is telling people not to amend, that they will automatically correct and issue refunds starting in May or so. The exception is when a taxpayer was not eligible for a credit or tax break so never filed the relevant form. If excluding unemployment now lowers their income enough to make them eligible, amendments will be needed. I have a hunch most state returns will need to be amended. I admire you for getting to amendments now. I have so many original returns to do I'm a month behind. Those amends are going to have to wait.

Lion, CT doesn't require a driver license. If you have one in there that expired, you do get a diagnostic in UltraTax and can't efile unless you update it or put "none provided." School info rolls over in our program. Why would anyone have to verify ID every year if they already have it? It's the same person, no? Just making work for us. I had friends who were adopting a child and the process took so long their blood tests expired. Did their blood types change in six months? Another friend was albino and legally blind but kept having to be recertified. Like her genes changed? I think a lot of this constant verification is because the regulators either don't think or do it just because they can.

If the child's 1040X was paper filed, you should wait until it shows up on the "where's my amended return" link at irs.gov. That can take months. I'm glad to hear that efiled amendments are going through quickly and allowing parents to efile sooner. We must have a dozen of these scenarios every year in our office.

That reasoning always makes me laugh. If they are getting a refund or a stimulus check, they are more than willing to let the IRS "know" their bank info. Do they really think the IRS can't get their bank info any time they want? (The easiest way is with Form 1099-INT, which the agency gets every year.) If the IRS wants to seize your bank account, they will seize your bank account whether or not you gave them the specifics. The majority of my clients pay balance dues and ES with direct debit, and it has always worked smoothly. Last year when the IRS was partially closed I was getting calls from clients frantic because their paper checks had not been cashed, although eventually they were.

Before the court appointment, the daughter can act as a personal representative and sign the 8879. It's trickier when there is a refund, but with a balance due I agree that the IRS will gladly take the money from anyone. She should write "personal representative" after her signature.

If no tax is due, file when you get the time. No extension needed. Penalties and late filing charges are based on the amount due ($0 X $0 = $0) IRS uses the 709 just to keep track of lifetime gift amounts. I rarely do gift tax returns during tax season but put them off until summer. States may have different rules, so do check there.

I have never been this far behind. Most clients are understanding--I tell them to blame congress for the whole thing, changing the laws midstream as they did. Last year IRS gave us a three-month extension due to covid, but no laws had changed. This year we get one month while covid is still a factor and laws that affect many taxpayers have changed, meaning forms and software have to be updated, states legislators have to meet, tax pros have to learn about the changes and how to address them. Plus estimates, trusts and estates did not have an extended due date. What's up with that?

Next season how many will remember the 2021 EIP they received nearly a year ago? Those with children will start receiving some CTC as an advance sometime this summer. My understanding is that those payments will have to be repaid if income or the child's status change, so they will HAVE to know how much they got. If we think this season is unbearable.... Our two-page client questionnaire includes blanks for both 2020 EIPs. Some fill them in, a few even include the IRS letters, some ignore it, and some put in amounts you know are wrong. I either connect with them or put in the right amount. I've had very few who actually didn't receive anything, mostly clients where one spouse had died. Then there are those whose income went down and are entitled to the recovery credit but don't know how much they already received.... Why didn't the IRS website give amounts instead of the fact that a payment was made? And why did they take it down for 2020 before filing season was over? I hate this tax season!

As if congress didn't create enough extra work for us by changing the rules midstream, now we have to calculate estimates due now from returns due in a month. This week I filed extensions for people who likely won't need an extension just to make a payment that hopefully will cover their first ES. I prefer that route to making a 2021 estimate outright in the event they do owe some for 2020 the penalty will be lower.

When I started working at the CPA firm where I am now, I was assigned most of the mail-in clients (mostly people who used to live in the area but moved before I got there). I still do most of them and have never met a single one. Most have become friends by now; they call or email with tax issues and I respond, yet I wouldn't recognize any of them if they rang my doorbell. Those clients number a couple dozen probably, but I have met most of my other couple of hundred (and many of the thousand or so other clients I've chatted with in the waiting area or worked on pieces of their returns). It has always puzzled me why someone would move hundreds of miles away and stick with the same accounting firm. Are there no accountants in WI or TX or FL or AZ or MA or NY? I came to realize that once you trust someone with your financial files, that trust is lasting. Now I'm kind of enjoying not seeing clients in person because of covid, and not seeing photos/videos of their kids, grandkids, vacations etc. Of course the emails and phone calls probably take up just as much time. My entire morning today was spent with client contacts instead of with all the returns I hoped to finish up before lunch.

It is up to the CLIENT to keep track of purchase and sales prices. These change by the second, not by the day. Client is welcome to invest in software, or if s/he uses an exchange, that data may be provided to them. We tax pros cannot do this for them. It is possible. I have a client who mines crypto and actually keeps track of electric usage. This year he mined/bought/exchanged/sold so much he was ready to throw in the towel and just pay tax on the whole thing. When I reminded him that his income would soar by millions, he decided to invest the time.