JoeFreitag

2 minutes ago, jklcpa said:

Why, when I gave the correct response and the cite that contains the rules that you agreed when you signed up to be an ERO?  As EROs, we are governed by the rules in pub 3112 and pub 1345 that I referenced in my first post, and before you argue that an IRS pub isn't authoritative, Pub 1345 references back to the actual underlying law.  Maybe you should read it sometime.

I was an IRS agent for over 20 years. I've read it. I also know the court cases involved. Bye.

19 minutes ago, Slippery Pencil said:

No that's not her opinion.  It's fact of law.

The response to this is interesting and informs me I shouldn't be coming to this board wanting information. Thanks for the heads up.

2 hours ago, jklcpa said:

That would be considered stockpiling and is against the rules of being an ERO. Transmission of the returns is supposed to occur within a reasonable time after the ERO has all the required information and signed documents in order to process the return, and any more than 3 days delay is stockpiling. The exception to this rule is for returns prepared and ready to e-file prior to the IRS' MeF opening date for the filing season.  See pub. 1345. 

So in your opinion I am stockpiling returns by following the instructions of the client solely for their benefit?

If they want to delay filing, do the tax return / extension and have it all completed including a signature. When they are ready you can efile it. Doesn't really add to your workload.

Investment company scammed them? That's a pretty big accusation. Just like with doing their taxes, many people are not educated in, interested in, competent in or comfortable with managing their financial affairs.

I'm trying to figure out the logistics of getting the tax return into my software for it to be efiled if I haven't prepared it.

You have legal obligations once you accept the authority to efile a return. You do not have the authority to waive your IRS imposed obligations.

On the only return I do like this, the real estate tax isn't added back on that line unless you took it as a deduction to income somewhere else on the Missouri return.

Did you deduct the taxes on line Q  / 8a of the 1040?

Was in a meeting in December and a CPA at another firm said their dollar figure to determine support was if the kid earned more than $11k, they likely supported themselves. Personally I would first check to see if the kid has filed already, see what his entire income was for the year and then if I could justify it I would claim as a dependent. Don't make work / arguments for yourself to send guess if the problem has already worked itself out.

Did the kid get a sign-on bonus? They could have gotten one in December making this all a worthless discussion.

19 hours ago, Abby Normal said:

Alternately, you enter 1 for wages on the W2 screen and IRS is cool with the efile. Then you just have to handle the state withholding.

Years ago (don't remember the software company anymore) I was told to do exactly this with the $1 income. On the state, if the software won't allow income less than tax withheld, enter it as a tax payment made on the state return. I did this for several years in the late 2000's and never received a letter from the state or IRS on it.

Last year you could enter your banking information for these payments. My software allows that again this year if you actually file a return, does your software?

When the IRS insists that you include an email address on returns, they are perpetuating these fraudulent activities. They tell you they will never contact you via email, insist on receiving your email address and then act shocked that people think it's reasonable the IRS would contact them via email about tax matters.

I transmitted six 1065s (including my own) yesterday and they were all accepted quickly.

If it's like most years, you can probably start efiling early in the week.

2 minutes ago, Max W said:

I think this is a recipe for a 100% chance of an audit.  You would be changing the the Code from 1 to G and you would be changing the taxable income (not the distribution) to zero.   This would not match the information reported to the IRS.

An adjustment to income as an offset to the 1099R is far more likely to avoid scrutiny.  

That is literally not the case. You don't have to change the code to be an indirect rollover. As I wrote, that's a very common occurance.

It's a tax free repayment. From what I've read and what my software provider has said to do is claim you did an IRA rollover eliminating the distribution. Enter the amount as rolled over that they repaid. The way they distribute IRA rollovers to the client and then they forward it to the custodian -  it's common to have a 1099-R which was actually rolled into another IRA.

Congress ruled that dead people qualify for the stimulus.

I could see them delaying until April 30th. Can't imagine they doing it again like last year.

Just saw this morning that some Senators are writing up a bill to make the first $10k of unemployment insurance to be tax exempt for 2020. Never gonna happen in time. 

This is what I was typing before notified you'd done it. Getting an EIN and not transferring accounts or activity under the EIN is meaningless. If they did transfer the activity to the new EIN, you have a new entity IMO. There was a transfer of assets that changed the liability.

Just now, cbslee said:

The key question is did they legally move and retitle the assets?

The answer to this question will determine what you do

If not, then the LLC is just a shell with nothing in it.

On 1/31/2021 at 10:49 AM, Patrick Michael said:

 

And to add to the confusion, the trustee received a letter from the IRS yesterday looking for 1041's back to 2017, when the trust was created.  So my next question for this very knowledgeable group is why is the IRS looking for returns if there was no income reported?   I'm fairly confident there was no income since the only asset in the trust up to the father's death in 2020,  is non-rental real estate. 

 

If they requested an EIN from the IRS, the IRS will be expecting a tax return for each year until they are notified the EIN is no longer in use. File a 1041 for each year with $0 in income.

17 minutes ago, Patrick Michael said:

I'm waiting on the actual trust documents.  Trustee supplied me with this info.  

Forgot to mention that the lawyer who wrote up the trust told the mother that no 1041 was necessary and the mother should just include the interest on her 1040.

If it is a revocable trust, this is correct. If it is an irrevocable trust it is wrong information. An irrevocable trust must have its own TIN.

I think there is very little chance the season will be delayed and I feel there is zero chance the payment deadlines will be extended. If you haven't figured out how to operate safely in this environment after 10+ months, you probably shouldn't be in business anyway.

But I'm usually wrong so believe what you must.

3 minutes ago, ETax847 said:

Joe, ATX includes the Grantor Letter, so I should be all set! Thanks to everyone for all their help in clearing up my confusion! This forum has been a tremendous help over the years.

Yep - for the trust's portion it really operates very similar to a normal 1041 but looks different.

I don't have ATX software but you'll need to see if the grantor letter rolls into the 1040. My software doesn't and I'm pretty sure it didn't on Drake either. You likely will need to enter everything again for your client's 1040.

As a grantor trust, you generate a 1041 and deliver to the client the grantor letter which shows all of the income. They then report that information on their personal tax return. When you produce the GRANTOR 1041, it will appear to be blank except for the Grantor Letter iirc.

The Grantor Letter sort of acts like a K-1 but it's not the same thing at all.