kathyc2

2 hours ago, GLJEANNE said:

So frustrating to have this come up at the last minute, since the folks the child tax credit will help are the the ones who like to file right away, because they need the refunds.

Even if passed, it won't affect the majority of returns with CTC.  Only those that have the refundable part limited due to income or maxing out the 1,400

https://gop-waysandmeans.house.gov/wp-content/uploads/2024/01/BILLS-118hr7024ih.pdf

Like any kind of insurance, some people will get more than they paid, but most will pay and not receive benefit.  I certainly hope people that want to sign up for this have read the small print of the exclusions.  

19 minutes ago, Lee B said:

 Having your screen blocked like that is a sign that you may have unknowingly downloaded some malware.

More likely, "don't allow sites to send pop-ups" is not turned on.

Q11: Do I have to use the IP PIN I received this year if filing prior year returns this year?

A11: Yes. You must use this IP PIN to confirm your identity on your current tax return and any prior year returns filed during the calendar year.

https://www.irs.gov/identity-theft-fraud-scams/frequently-asked-questions-about-the-identity-protection-personal-identification-number-ip-pin

2 hours ago, mcbreck said:

I've seen threads on other boards where people have outsourced their data entry, they are outsourcing their problem solving and they refuse any client meetings during tax season and want everything handled remotely. I'm not sure what service they are providing clients but I'm guessing clients will soon be demanding a significant discount for such non-personalized service.

I agree.  TT seems to be going more in the assisted returns area.  If you don't have a relationship with client there will be some who don't see the value of us rather than going that route.  

I had always met in person with clients.  During COVID I refused to let clients in my home office, although I would have phone consults. I had a drop slot for them to drop off info, and then we would meet briefly in the garage to sign.  I lost a few clients during that and have a few that continue (mostly younger) to use that method.  It's what works best for client.  

I don't remember ever charging a client extra to deal with a notice.  I've never had a full audit and most notices can be dealt with without much effort.  Other than the clients who had to file in 15+ states, I only remember one client notice for 2022 due to the fact that they messed up their estimated payments.  

I'm way too much of a control freak to outsource.  First off, I'd want to make sure that the notice wasn't in any way because of an error on my part.  Most notices are from matching.  If it affects federal AGI, I need to amend state or get a notice from state when that do an AGI match 2 years later.  Doubtful the PP company would handle the state amendment.  

I know if I was the client I would appreciate the preparer handling the issue.  If I was told I need to contact someone else to handle it, I wouldn't return the next year. 

5 minutes ago, mcb39 said:

I have at least one major client who has not received his e-filed 2022 refund yet.  Notation on website says "Pending"  Telephone calls say "Pending".  Neither the client nor I have been able to speak with an actual live person as of up to yesterday.  Please advise.

I had one like that a couple years ago.  He contacted the office of his Senator and had the refund in a couple weeks.  I don't know if it was just coincidence or if her office actually did something to get it moving. 

2 hours ago, Randall said:

The sale will be in 2024 so not urgent although they may have to make a 1stQ es payment.

They may have a balance due when 2024 is filed, but if they have paid in 100% (110%) of 2023 liability they won't have a penalty. 

Are they in the same state or different states?

If different, the state they file tax as a resident, where cars are plated, voter registration, etc. should tell you which is main home.

Also, many states offer some kind of RE tax exemption for primary or main residence which would indicate which is the main home. 

22 minutes ago, BTS said:

But of course the cost will be passed on to the client.

LOL!  Would you have confidence in a restaurant that charges you extra to cover the cost of pumping your stomach in the case you get food poisoning?  

It looks like they charge you $10 for every return you prepare, including any you may prepare at no charge.  That's $1,000 for every 100 returns.  How many notices per 100 returns do you receive? One?  Possibly two?  If it's more than 2 I'd say people need to look into their procedures.  

Is it worth $500- $1000 to you to have someone else write a correspondence, or to ascertain if the notice is correct? 

51 minutes ago, Lee B said:

The property can be both section 1231 and section 1250

1231 property is used in a trade or business. 

Why would this be 1231 property instead of 1250?  I would think it would be reported on Part III and then carry to line 6 of Part I.

Any passive loss released shouldn't show on 4797, but on Line 5 of Sch 1.

Thanks.  I was afraid it was something like that.  

I should have come here first rather than spending time on hold and then talking with a person who was impossible to understand. 

Non resident had small CA source income from 1065 K1.  LLC reported withholding on 592B.  I input the info from it including FEIN number before e-filing.  

I prepared 3 1040 returns for members of LLC and so far 2 have received a balance due notice which is the amount of withholding not being recognized.  

I told 1st client to send/fax them a copy of the 592B.  Second client e-mailed their notice this morning.  After thinking about it, I realized that they already have the info from 592B and sending a copy probably won't fix the matter.

I called the number on notice this morning and after she verified my info as 3rd party designee, she said she couldn't help and transferred me to another department.  Recording said about 10 minute hold time.  After being on hold over 30 minutes I found the PPL number.  This person had a very strong accent that I could barely understand, but I think she said they can't get to the information and that I should call back after 1.4.24.

Any suggestion from CA people how I should proceed to clear up the notices?

1 hour ago, Sage said:

How about if mortgage is involve. Mortgage with old property and mortgage with new property. Should the be included on any of the line? 

Yes.  Read the instructions for 8824 and follow the examples they lay out.  Be aware that may cause only a portion of the gain to be deferred and a portion to be included in current income.

2 hours ago, Sage said:

Would that be the number showing on line 25 of 8824? 

Yes.  Remember you need to add the additional cash given of 80 (410 - 330) to the basis of old property on line 18.

Line 16 & 17 410,000

Line 18         330,000

Lines 19 & 24  80,000

Line 25         330,000

Basis of new property is 330 (410 - 80), not 250.

Depends on what you are looking for.  I'm sure there are a number of free websites that will calculate a schedule to print out.

If you want something to account for early/late payment, payment different that exact amount you might want to look at Excel or a program such as TimeValue. 

59 minutes ago, BulldogTom said:

I use Excel, but you can't buy the office program anymore, you have to subscribe and I am looking for an alternative.

I have the subscription, but it appears you can still make a one time license purchase.  https://www.microsoftkeys.net/microsoft-office-2021/microsoft-office-2021-home-and-student-for-windows-pc

I don't know if this would be backward compatible if sheet was created in newer version or not.   

1 hour ago, Terry D EA said:

Just wondering what folks prefer here. I am currently looking at reducing costs everywhere I can. I have used MS Office 365 for several years. Also, I pay for google suites. I have used both but sometimes question the depth of google sheets. I am an old excel guy and have used if for years. Personally, google seems to easy to share and I question the security. What are your opinions?

I absolutely love Excel!  Not a day goes by when I don't use it for something.  I have some templates set up the significantly reduce time for longer term tax planning.

You can use google sheets for free.  I don't use them much as I find it frustrating that the command layout is different, but they are great if you need to collaborate with others. 

For anyone that wants to up their Excel game, I highly recommend Jeff Lenning.  I've done webinars that he has led. He also has youtube videos and several no charge blogs on his website.  

22 hours ago, DANRVAN said:

But that does not understate the tax return as signed by the preparer; 1120-S.  Therefore section 6694(b) does not apply.

1120S is not exempt from 6694 penalties.  You may want to review Rev Proc 2009-11

5 hours ago, DANRVAN said:

Same thing, there is no understatement on the 1120-S.

 

QBI income is calculated at the corporate level and reported on K1.

58 minutes ago, DANRVAN said:

First of all, the unreasonable wage issue does not result in an understatement  of tax on the return.

It understates payroll tax matching.  Also, if QBI is involved it may cause an understatement of FIT.

On 12/11/2023 at 12:03 PM, Terry D EA said:

But... what course do you take if your client says okay let's get it right? Recharacterize the distribution, advise of the payroll penalties and related issues, then prepare the return? I don't see any other way to do so.

If you go that route, remember that you will need to gross up pay to account for FICA withholding at a minimum. 

IRS has on demand video of webinar:  https://www.irsvideos.gov/Webinars/BeneficialOwnershipInformationpresentedbyFinancialCrimesEnforcementNetworkFinCEN