Julie

I believe the solution can be found on the ATX knowledge base....I had a related problem last week, and I had to go find the return in the main ATX folder and delete the corrupted form from the return there. In my experience, perfectly good spreadsheets are often "corrupted forms."

Thank you all. It's a work in progress. I restarted my pc after updating and it helped . My AVG detected a trojan virus and I'm defragmenting. In between all of these things I'm doing I was able to open the files I couldn't before but now another one is acting up. I'm working on it. Thanks to all!

A B followed by a ) =

PS: For some reason I'm getting a smiley face in my post where it should be a B

My laser printer came with a warning NOT to put it on battery backup. I have the computers and monitors on backup, but neither of my printers. I can't think what circumstances I would need to use them on battery anyway. If the power goes out, I'm shutting down until it comes back on. The UPS is so the computers can be shut down cleanly, not so I can continue to do tax returns.

And yes, thanks for the warning.

I would never put a copier on a battery back-up, just me. They draw way too much current.

How big are the printers? You need both on battery back-up?

Just my thoughts for what they are worth.

By the way thanks for the warning. Much appreciated.

Pacun and lbbwest are right. Without the sarcasm, just put it on the C. That's what the interest belongs to, so that's where it should go.

Gee, Publication 535 Chapter 4, says you have to allocate expenses according to the flow of funds, not the security; but if you prefer you can deduct it on the Schedule E rental property and say that jainen and Booger said it was okay. lbb

Depends. Does he owe money? Is he getting refunds? Is he being hassled by state/federal authorities?

I don't know a hard-and-fast rule for this. Talk to your client and use some judgment. There are various relevant statutes of limitations. He won't get refunds that are out of statute (three years for IRS), but the three-year SOL for audit and the ten-year SOL for collections do not even begin until the returns are filed. Because of that, if he owes money, you should file all of them, or he'll owe it forever. Look up your state SOLs too, don't just rely on the federal ones. They're probably posted on the state's web site.

California has a 20-year SOL for collections, so I just filed ten for a client. FTB was sending him tax bills (on imaginary income). Since he did not owe taxes, otherwise I would probably have stopped at four years, just to collect his refunds.

I had a new client walk in today with a box of papers says he hasn't filed since 1987

I've never had this happen before, how far back should I file him

I would assume it's because she had no taxable income, hence no benefit from an IRA deduction.

in 2005 client contributed to ira eventhough she had no taxable income, i told her to convert it to a roth."

Why would you suggest to convert it to a Roth IRA to begin with?

Read circular 230. I believe it's VERY clear that the client is entitled to a complete copy of his tax return for his own records.

You are not allowed to efile a return without having signatures on file.

I have been under the impression all these years that my clients had to sign all the forms,8879,1040 etc. and I keep these on file.and I give them a copy of all the forms. client just came in and stated her friend went to anoter tax person and he did not sign anything nor did she give him a copy of the forms. Is this legal. I know we use pin for e-filing but should he have signed the copies.This sounds like the tax person did not want him to know what she had filed on him.

You mean a worksheet to help determine whether a potential dependent is a "qualifying child," "qualifying relative," etc? No. TaxTools has a flowchart that helps in tricky cases.

Does ATX have a dependant worksheet?

You can link to an itemized list, which can have as many rows as you want. Then only the total goes on the 2106, which is the way it should be.

in doing truckers, can we have a mis. row, I don't have enough lines, the add/row feature doesn't work on this worksheet any idea on how to add to my list of expenses? thanks

It's been a long time now since I quit HRB, but the company policy (not always uniformly enforced) was that HRB will amend HRB returns for free. Have her call the phone number on the inside of her HRB folder. The one that came printed on the folder, not the one for the office she went to.

We even amended returns from franchise offices, if they were prepared under the Block brand.

The POM guarantee was in addition to the standard free amendments and p&i payments. (If client owed penalties and interest, HRB paid them with only the district manager's approval. POM had to be approved by someone in Kansas City.)

>>Client was furious about her case<<

If you don't like what Block offers, you shouldn't go there in the first place. As far as I can see they are very open about their guarantee--excessively so. The standard guarantee is that they will pay any penalty and interest from their error, so at least you are no worse off. They will only refund tax prep fees if your tax liability was actually lower than they said, but that's not a forever guarantee. It only runs until the end of the year. The Peace of Mind -- which supposedly wasn't offered but she couldn't have missed it in a Block office -- extends the time limit to three years, which may not even cover all the time it is subject to audit.

Where do they ever say they will fix errors that the IRS hasn't even challenged? No where. They say if they pay a claim it will be straight cash (reported on a 1099 no less!). The only free service they guarantee is audit assistance. Your client wasn't audited so it's entirely fair to charge for an amendment. If she doesn't like their guarantee, she is perfectly free to go some place else.

You'll need to amend the 540 to bring in the new federal AGI, probably not for the D/3885A. You use that only when there's a basis difference, and I can't think how there would be one. (Of course thinking is difficult anyway, with the IRS blasting classical music into my head!)

I received a CP2501 from a client who lives in CA in which IRS is asking him to report the proceeds from exercising some Non-Qualified Stock Options in 2006. He forgot to give me the transaction info last year (I know, I should have noticed the "Code V" entry on the W-2 & asked him, but I didn't).

The Schedule D washes out the income on the 1040, but I noticed ATX opened a CA SchD/3885A when I made the entries. It appears that this is only a formality, but I thought I'd ask you CA preparers if NQ options are treated any differently by CA? Also, if there's no difference is there any reason to amend the CA return to add the CA SchD/3885A?

I don't mind reading up on it but thought I'd first appeal to the wisdom on this forum. Thanks for any advice on this.

1099B is not supposed to show the cost basis. His employer gave him a lot more information at the time. You need it. If he did not pay for the stock, or got a discount on the stock, the value of the "gift" should have been added to his W2, and that amount would be his basis, whether or not it's separately reported on the W2. It may be buried in a pay stub or somewhere else. I expect he will come up with the paperwork, or B&N can give you some help. If all else fails, the value (from finance.yahoo.com or another site with similar information) of that stock on the day of the grant will do.

Client recieved stock thru his job. He says they were Granted to him. He states there were a total of 100 shares of Barnes & Noble stock. He says the company sold 43 of the shares to cover his taxes. The 1099B shows a sale of 57 shares for a total of $2281.00. The 1099B shows date of sale, name of stock, per share price & total sale, but does not show cost basis. Being that this was a grant, would he need to pay taxes on the full amount (2281) or do we need to contact the company to get cost basis?

Thank you!!

Eli

P.S. there is nothing listed in Box 12 on his W2

The bottom part is simply false, as you'd notice if you had studied that list of taxes which "did not exist" 100 years ago.

Many of these taxes are local taxes, which existed then as well as now.

Some of these were taxed by the federal government then, like alcohol and tobacco.

Others are taxes on things that were rare then, like vehicles and telephones. (Remember the telephone tax rebate last year? That was for the Spanish American War.)

Some are for services that we might not wish to abolish, like worker's compensation insurance and paved roads. Now, call me a liberal if you like, but I don't really want to live in the 19th century. I heard enough from my grandparents to know that some things are better now.

And it doesn't even mention the federal government's other big source of income, which has mostly been abolished only recently: Tariffs. The first taxes passed by Congress in the 18th century were tariffs.

Instructions for 5329, page 3.

Distributions due to "total and permanent" disability are nontaxable, exception #3.

My client lost his job due to his disability. He was also unable to draw unemployment due to the fact they considered him unemployable. He did draw from his retirement funds in order to pay his living expenses. He was awarded Social Security Disability toward the end of last year. He did not inform the company of his disability status when he drew the first two times, but did the last time....so.....his 1099R's for the first two times are showing the income as subject to early withdraway penalties. Should the 1099's be changed or is there another way to still file his taxes without the penalties and still efile? Thanks for your suggestions and knowledge.....

This is for anyone who does not remember the original Saber logo. ATX97.ico

I don't have a better graphic of it, but the icon is pretty clear.

I like the Caribou Idea... besides here in Michigan the Tiger is already taken!

Okay, thanks. I think that's the bit of information I didn't have....payments made in the last year, then, for an out-of-statute return, would be potentially refundable? I wasn't looking for an exception, just wasn't sure how it applied to those additional payments, some of which are quite recent.

All ten returns showed no tax liability to California in the first place. If done timely, all withholding would have been returned. IRS apparently was able to figure out that he didn't owe them anything...they've never asked for a tax return. (Most would have had EIC.)

quote name='jainen' date='Feb 14 2008, 03:19 PM' post='10268']

>>getting a refund of the more recent payments<<

You'll need to ask FTB for a record of those payments to see where and when they were applied. There are no exceptions to the California statute of limitations, which is the later of four years from the original due date or timely filing, or one year from the date of overpayment.

Must be someone else then. It was a feature on the election, with pictures and thoughts by a half-dozen people on voting in general. You'd have known if they took your picture.

I don't know if it was me. I wrote a letter to the Lodi News Sentinal that was published a couple weeks back. Had to do with the FEMA flood map designations. Did the Sac Bee pick up my letter?

I don't read the Bee.

Tom

Lodi, CA

Client came in last week with ten years of tax returns. They're all done, and they all would have had refunds. Of course he won't get the refunds that are out of statute, and I've already explained that to him. He has lost at least $12K by not filing.

However....as recently as a few months ago he was making payments on a bill from the Franchise Tax Board for taxes he did not owe. The tax bill was a typical FTB invention, with no connection to his actual income. Any chance of getting a refund of the more recent payments? I'm not making promises, just want to know if anyone has ever succeeded at this.

Thanks for the reassurance, Tom. I had already given up on the HOH.

BTW, that wasn't you featured in the Bee's Forum section a couple weeks ago, was it?

Let me change the facts and see how you would answer.

Instead of the 3k getting him a tax benefit (eic), it puts 2,999 into the 25% bracket, and the 4% bracket in CA, along with the 15.3% SE tax on 93.5% of this cash. The taxpayer is now looking at an additional tax bill of $1,299 for telling you about the 3K. Would you still file the schedule c and put it on the return?

For the record, I think you need only worry about HOH and can he survive a cash t analysis of providing the support. If he can't, file him as single with the dependent.

The 3K is a non-issue in my book. You know what the law says about income from any source, regardless of the tax benefits or detriments that result.

My 2 cents.

Tom

Lodi, CA

Depends on the circumstances. There are times when it is not supposed to be sch C. Example: Furniture salesman is employed by a retailer, but gets additional commissions from the manufacturer. This may generate a 1099-misc with the amount either in line 3 or line 7. In this case, the salesman is not self-employed, and the income goes on line 21 (and unreimbursed employee expenses on Sch A). IRS has a brochure on this subject aimed at car salesmen. I don't remember the pub number.

Use Sch C if the salesman is self-employed.

The taxpayer brought 1099 Line 3 Other Income not Line 7 Nonemployee Compensation. As I know, since he was the salesman for the commission, she should have received 1099 line 7 income and pay the self employment tax on the net profit.

Would any of you comment on the difference between other income and nonemployee compensation? If I decide to go with as is 1099, can I claim the unreimbursed employee expenses on Schedule A? Or Do I have to report income on Schedule C and deduct business expenses there?

Any comment is appreciated.

I agree...bring back the Saber-toothed Tiger.

Remember the packages that used to arrive covered with paw prints?

BRING THE TIGER BACK WITH ITS MIGHTY ROAR AND PAW PRINTS AND LOSE ALL THE PARENT COMPANIES THAT HAVE BOUGHT IN SINCE.

Given the new rules:

Client normally files HOH and claims his daughter as dependent. This year he came in with much less income than normal, most of it unemployment. So I started asking nosy questions, trying to determine whether HOH was appropriate. He was not anxious to tell me, but it comes out that he worked "under the table" for a couple of months, which would add over $3000 to his income. If declared on his tax return, it would add about $1000 to his refund, via EIC, even after SE tax is added. (He was not actually self-employed, but also does not want to challenge the employer, whom he may wish to work for again.)

Now, I know I'm required by law to report all the income I know about, but in this case, the EIC issue might force him to prove that he earned said income, which I'm sure he cannot do if he was paid cash. There may also be a case of UI benefits being received illegally while he was working.

http://www.mkappcpa.com/www.sailortax.com/

This guy is in serious trouble with the IRS. The disclaimer at the top of his website is just a hint.

The article below might be well worth printing out and given to firefighters. Tell them to note one of the now recognized tax schemes is regarding the Mariner's Deduction (or other meal type deductions). Several of the preparers in Louisiana used the "Mariner's Deduction" to apply to firemen....just not true....plus the so called "Mariner's Deduction" handed down in a court decision only rendered a very minimal "incidental" allowance ($1 to $2 per day) to mariners....but the company who put out the propaganda about the court case tries to woooo new clients by making them think they won a large meal deduction for employees working away from home...even though mariners normally eat 100% of their meals provided by the employer while on the ships......just not true.

http://www.irs.gov/newsroom/article/0,,id=177519,00.html

Send them a copy of pub 926.

See what form they give her. We already know she's a household employee. A 1099 is a blatant attempt to avoid paying employment taxes. The child care credit depends on their doing this correctly. She needs a W2. If they give her a 1099, challenge it with IRS and any relevant state agencies.

Topic 756 - Employment Taxes for Household Employees

Household employees include housekeepers, maids, baby-sitters, gardeners, and others who work in or around your private residence as your employees. Repairmen, plumbers, contractors, and other business people who work for you as independent contractors, are not your employees. Household workers are your employees if you can control not only the work they do but how they do it.

If you pay a household employee cash wages of more than the amount specified by law in a tax year, you generally must withhold social security and Medicare taxes from all cash wages you pay to that employee. (Cash wages include wages you pay by check or money order.) Unless you prefer to pay your employe's share of social security and Medicare taxes from your own funds, you should withhold a certain percentage set by law from each payment of cash wages. The specified dollar amount and percentages can be found under the topic "Do You Need To Pay Employment Taxes?" in Publication 926 (PDF). Instead of paying this amount to your employee, pay it to the IRS with a matching amount for your share of the taxes. If you pay your employe's share of social security and Medicare taxes from your own funds, these amounts must be included in the employe's wage for income tax purposes. However, they are not counted as social security and Medicare wages or as Federal unemployment wages. However, do not withhold or pay these taxes from wages you pay to:

your spouse,

your child who is under age 21,

your parent, unless an exception is met; or

an employee who is under age 18 at any time during the year unless performing household work is the employe's principal occupation. If the employee is a student, providing household work is not considered to be his or her principal occupation.

I have not successfully gotten them to efile, but I haven't had an MFS this year yet. Let me know if you succeed.

I believe you're supposed to include all the W2s and do the split on the line 7 worksheet (the one you get when you 'bunny hop' from line 7 of the 1040). I do not use overrides; that little worksheet is perfect for that.

I use the blank input lines, a line for each w2, followed by "community property adjustment" and a negative amount equalling half that W2. Same for all other community income.

Have either of you e-filed a married filing separate return using the community property worksheet tab on the 1040 e-file worksheet?

If so can you explain to me how to do the return. Do I include all the w-2's and then split everything in half? Do I overide to do that?

I know we are suppose to be able to e-file it but I can't for the life of me figure out what I'm doing wrong.

Any help would be greatly appreciated!

Deb!