Dave T

I try to always ask the client if they are using the same bank account as the previous year for either direct deposit or direct debit. Well I ask the client and yes, same as last year so i go ahead and e-file. Several days later after return has been submitted and accepted client calls to tell me that account had been closed due to fraudulent activity last year. Client calls the bank to see if account can be reopened to accept deposits only but no luck. I am assuming that refunds will then bounce back to IRS and state and they will eventually get a check in the mail. Client has called twice wanting to know what else if anything she can do? I think it is just wait for the check to show up. Thank you

Clients. both husband and wife, had very large medical expenses in 2023. In addition their other Sch. A expenses put them right on the threshold of being able to itemize. They participate in , but did not include in the medical expenses, Direct Primary Care membership. Client didn't think that this could be included and in the brief reading I have done that is the case but also that legislation had been proposed to allow it. Does anyone have any kind of update on this? I have to admit that I was not familiar with this. Thank you

Quick update. The Lifetime Credit did calculate correctly. Had just forgotten to check one box. Bigger issue still remains is degree or no degree?

I will obviously need to get clarification from my client but wanted to run something by the board as I have great respect for the knowledge as well as the willingness to help. A couple weeks ago I posted about my client that had a 1098T with 26K in tuition and 34K in scholarships. I asked about this and she said it was for off campus housing and food. Check box as at least half time student and so it seems 8K of income. I did specifically ask her about her studies and she said it was toward a degree. Well her parents are also clients and when they were over the other day we got talking about the daughter and how well she is doing etc. and the Dad says she is there earning a certificate as she has already earned her undergraduate as well as graduate degrees and she is there because this is an athletic scholarship and still had a year of eligibility left. So I go into ATX and uncheck 'Candidate for a Degree' and now the whole 34k shows as taxable ( and of course big tax liability ) but for whatever reason it won't let me at least calculate the Lifetime Learning Credit. Any advice would be appreciated. Thank you

New client emails me her tax docs. a couple of small W-2's and a 1098T from a major Texas university. She is on a running scholarship and the 1098 shows 26K in box 1 and 34K in box 5 Scholarships. I call her to get more info and she says the difference is for off campus housing versus room and board on campus as well as for books. She says she has had this situation in prior years and preparer didn't include anything as income. Seems to me, and as I read Pub 970, that this excess, apart from the books, she has about 8K of additional income and no Education Credits. Am I correct in this? As an aside, she said she just got picked up by one of the major shoe brands which will take effect in 2024. Thanks in advance for your help Dave T

Marie, What is the error you detected? I have just been working on a MO return. Rather simple, just w2's and unemployment. Thank you Dave T

Taxpayer was appointed to the board of a nonprofit in 2023. It is a 3 year term and they meet quarterly. He received a 1099_NEC from them and I know it is taxable but is it subject to S/E tax as well? Thank you

This was a new one for me. I had an e-file rejected because the primary taxpayer didn't have an IP PIN. I haven't been putting that on any of the returns and haven't had any rejections. The only reason I can think that this occurred is that they wanted to pay their balance due with a credit card. Could that be what triggered the rejection or would it be something else? I guess I need the t/p to contact the IRS to obtain the PIN Thank you.

Thank you. Yes, this was filed a couple of weeks ago.

Client just texted wanting to know if direct debit date can be changed? Return was submitted and accepted with a scheduled payment date of 4/14/23. She would like to change the date to 4/18 but I believe that once the return is accepted that's it. Any thoughts? Thank you

Had a similar situation only it was 28 trips in total to 10 different organizations. Weill try and remember the 12/31 trick next year.

Thank you Margaret

T/P normally takes auto expense on line 9 of Schedule C but this year he purchased depreciable asset and needs to file form 4562. I believe I now need to show standard mileage on the form as well. but when I go to part V of 4562 , line 24 I don't see where the input screen is. What am I missing besides my brain at this stage of the game? Thank you

Should have read instructions more closely. If he meets other requirements, he must file it regardless of dependency or not.

Full time undergrad student, non-dependent, age 22 has unearned income over $2,300. Does he have to file form 8615? Thank you

Yes, I was working through it but it doesn't seem to calculate a carryover yet it seems as if it should.

New client in 2021, full time student with nominal earned income ($230) in 2021 and clamed as a dependent. In 2021 he was in the market and generated a short term loss of $2k. Perhaps I am overthinking this or more likely not thinking correctly but his 2021 standard deduction of $ 1100 was greater than his earned income so shouldn't his loss be carried forward to 2022 ? In 2022 he is still a full time student but instead earns $ 8K in short term gains and I am wondering if these should be offset from the prior year loss? Not sure how this is going to play out as he is going to have file form 8615 and Mom made quite a bit in 2022. This is a new one on me so appreciate the help Dave T

T/P and wife are both 54. They liquidated their Roth in 2022. They began making contributions in 2015 and continued to do so part way into 2022 before liquidating. Obviously under 59 1/2 but am wondering about the 5 year rule. Are the entire proceeds, less basis, subject to tax and penalty? Not sure if it is relevant but they received four separate 1099R's in various amounts all coded J, early distribution of Roth IRA, no known exceptions. Thanks for assistance with this. Dave T

Newer (2021) client gets married in 2022 and wife begins working as a nanny in latter part of 2022. She earns $ 2,000 and does not receive a W2 I know I can record the income on line 1b as Household Employee but am wondering about the tax component. Since no taxes were withheld ( paid in cash) does she need to record the income on Sch C and pay S/E tax? Thank you Dave T

I hope this is a simple question regarding e-filed amended returns. I copied the original return and prepared the 1040X within that. I need to add two supporting schedules EIC and form 8867. How do I do that? Thank you

Hi Christian I have the same issue. I looked at my credit card statement last night and there were two charges from ATX. One I know about and that was due to having to purchase an extra state. ( I use the 1040 pkg. which allows for 3 ). At any rate, there was another charge which I cannot identify and I too called the A/R department only to get the same message, " we will get back to you in 48 to 72 hours"

I live in Rochester NY. No snow but cold and damp. My nephew says the late arrival of spring is a supply chain issue.

Yes, in 2022 for 2021 and I was thinking the same thing.

Self Employed t/p hasn't yet filed for 2021 but when calculating her self employment income, I realize her SEP contribution exceeds amount allowed. Her financial advisor had given her the maximum you can contribute but apparently didn't mention that amount is limited to 25% of s/e income. At any rate, is there anything she can do to avoid penalty for 2021? I've never encountered this before. Thank you.

Also, if the student is under 24 years old they wouldn't get the refundable credit component I believe.