Corduroy Frog

Why does the IRS need to know if you HAVE BitCoin? If it is treated as property, there should be no tax until BitCoin is sold. We can buy 100 shares of Ford Motor Company, General Mills, or 50 acres of land, and we don't have to report it to the IRS until we SELL it. What is the difference with BitCoin? I didn't have any customers tell me they had any when I asked them.

Mr. Lee, you do a great job of bringing current IRS and other issues to the forefront as soon as they become available. Thanks.

Thanks for all feedback.

No responses after several views and several days. I believe this is probably because I asked for responses if my assumption was incorrect. I believe my assumptions is therefore correct, or I would have heard from someone. I further believe the credit must be substantial before anyone would jump through the hoops on 7200 just to get an advance 60-90 days ahead of fruition.

I hope I have this correct - please advise if not so. From what I can see, Form 7200 is an advance payment for a credit which is not realized until Form 941 is filed and reconciled. If a taxpayer wants to pay his accountant (or people like us) the time necessary to calculate up to 3 months in advance the amount of the credit and get money back from the IRS for various employer credits, it can be done. But all the payments resulting from 7200 must be paid back when calculating the 941 at the end of the quarter. Correct?

Dan, I didn't prepare any of the K-1s in question. Judy, I have enough personal hometown knowledge of the first partnership to confirm this was SE income. And I agree that Drake is handling correctly, after reading all the posts. First I've ever heard of a suspended loss for SE purposes - they generally try to protect Social Security from prior events - witness the recent exemption of Unemployment.

The saga continues with more reflection. To Judy's question, the answer is a resounding "no" - there was nothing in Box 14, and there should have been, as the owner is a general partner, and the creator of the 1065 himself. Like Abby said - Not all K-1s are prepared correctly. I inserted $11,355 in Box 14, and the SE amount increased accordingly. I suppose the honest answer to Dan's question about basic understanding is a perplexing "no" or I wouldn't be asking all these questions. Thanks Dan for responding.

Thanks for this, and for visiting the other board, where I asked the same question. The software I use is Drake, and the numbers in my example are fictitious. I will need to present the real numbers to track what Drake is doing. There are four potential sources: From a proprietorship, Sch C - Profit of $5114 From a first partnership, general partner, Ordinary Income of $11,355 From a second partnership, also general partner, Guaranteed Payments of $120,000. From the second partnership, Ordinary loss of ($180,778). There is insufficient basis to deduct the loss f

What is the amount subject to self-employment tax (before the 93.25%) for the following situation?? Taxpayer has: **A proprietorship which made $12,000. **A partnership with $120,000 in guaranteed payments **A loss from the same partnership of $150,000, but taxpayer has insufficient basis to deduct ANY of this loss for AGI purposes. **The K-1 from the partnership shows Self-employment income of -$30.000. Thank you in advance for your response.

A good seminar instructor (Chris Bird from Champagne IL) this fall stated that the IRS does not have the manpower to chase down the "rush-and-take-the-kids first" abusers. They not only would have to catch them, but they would also be drug into the facts and circumstances to determine whether someone is righteous or not. This is true even if the second filer follows up with a paper return. Not right.

I want to make sure I understand...We calculate on the year 2019 or 2020 with the lower income, even though the calculation may give a higher EITC in a different year because of change in children or other qualifiers. Is this correct? I did read your response above, but could not come away with a clear-cut yes or no. This pretty much means that this is NOT a good year to switch tax software.

Lion, it sounds like the criteria is based on income alone, and not necessarily the EITC formula which may involve different numbers of children....correct?

Thanks folks. Glad you are on top of this better than I am.

Some info floating around, and I want to make sure it is for real: If someone does not qualify for EIC in 2020, but qualified in 2019, they will be deemed as qualifying for 2020. In fact, if their EIC calculates greater in 2019 than in 2020, they will be entitled to the higher amount on 2020 tax return. On a joint return, the "above-the-line" charitable deduction is $600 rather than $300. For stimulus payments, all amounts received are calculated using 2020, even if some of the stimulus was not received until 2021. (For some reason, the automatic stimuli are

I'm very interested to know. The virus is worse than ever, and we should be later than usual getting our appointments scheduled. Especially for deadlines due on March 15th. I have been vaccinated and will be immune (I'm told) by Feb 8th if successful. I am not taking appointments before Feb 12th. The IRS will be under pressure to collect $$ but their worst enemy in this regard is Congress itself. What I foresee: IRS does not want to enforce a deadline, assess penalties, and then go to the administrative hassle of having to waive penalties because so many clients (and preparers too) will