kathyc2

IL resident received the $300 property tax rebate.  Do I need to need to reduce the amount that was paid through escrow by $300 for the Sch ICR?

Thanks.

18 minutes ago, Lion EA said:

Oh, my gosh, we're more expensive than New York City!

But not if you limit NYC to Manhattan!  

It's pretty amazing how granular it gets.  I don't live in any city limits and if I put in my township rather than nearest town is has my transportation costs as higher.  Guess it realizes that I need to drive more to get to necessities like a grocery store than people who live in town!  

I ran across this site years ago and find it quite interesting.  I put in my town and Lion's Fairfield, CT.  Her cost of living is close to double mine, so it make sense she should be charging double.  

https://www.bestplaces.net/cost-of-living/

4 hours ago, Slippery Pencil said:

There's no sarcasm to the my first comment.  Her two comments are contradictory.

While I wouldn't phrase it that way to the client, she needs to educate the client that the fee he is complaining about is already half of market value and she even discounted it further from that, so no, he can't do anything to lower her fee.  He's looking a gift horse in the mouth and that will end bad for both of them if she doesn't educate him.

Not at all contradictory.  Who says H&R is market rate?  My fees are almost always higher than non licensed preparers.  Among one person CPA offices such as myself and EA's, sometime my rates are higher and sometimes lower.  Like I said, I charge what I feel is fair.

Your comment of I think so little of myself and saying I'm stupid in the post Judy deleted says more about you than about me.  Peace out.

20 minutes ago, mcb39 said:

I don't have many high-class clients. 

I have some low income clients with a lot more class than high income clients. 

Per form has always worked well for me.  A lot of circumstances I'll give a discount off the set fee, and a handful get surcharge above the per form charge. 

It's based on annual income. 

45 minutes ago, Lion EA said:

I have a vague memory of something about -- if you honestly thought you qualified when you applied, there's some exception to the payback. In these two cases, the taxpayer actually did qualify when they applied.

If AGI is below 400% FPL there is a flat dollar limit on amount that needs to be paid back. 

I've always charged what I feel is fair to both client and myself.  My fees are generally well below the national average, definitely less than the H&R's.   I don't aim to be the lowest cost, just what I think is fair. 

The per form fee ended up at $322 which I felt was high so I discounted it by $50.  Their kids are aging out, so I spent several minutes with them explaining what credits they will be losing over the next few years.  After all that he wanted to know what to do to lower my fee!

It happens very infrequently, but it is does, it really throws me for a loop.

MFJ- 1 state

3 w-2's, 2 1099R's, K1 from trust with capital loss so Sch D, small and simple Sch C, child tax credit, tuition credit (had to ask for 1098T even though it's on checklist), standard deduction. 

Would you charge:

a) less than $250

b) between $250-300

c) more than 300

Curious minds want to know.....

If the house was jointly owned, she would have received at step up upon his death.

2 hours ago, Jim Oh Bkkr said:

Maybe the original account was from a NONqualified plan.

That is what the code D in OP would indicate.  Non qualified annuities have their own rollover rules.  

See if Pub 575 answers your question:  https://www.irs.gov/publications/p575#en_US_2021_publink1000226849

So... after being on hold forever with SSA the agent sent me in the right direction.  In certain circumstances, adult children can make a claim for last month SS benefit of parent via Form 1724  Claim For Amounts Due In The Case Of Deceased Beneficiary.  This article describes the circumstance: https://maximizemysocialsecurity.com/when-will-social-security-pay-deceased-persons-last-payment

Not sure how your client received the payment without supplying his SSN.   Since the money was after death, it would be income in respect of decedent same as if it were interest earned on a bank account after death. 

Since post 1997 new claims are not paid on the first of the month, I think this will become more common. 

23 minutes ago, TAXMAN said:

Yes box 8 is dad's SS# followed by UI. still the problem. Where do I report it? Box 2 not having any SS# in it I wonder if IRS will be able to trace it?

Mine had the daughter (my client) SSN in box 2 so I put it on her return. I've found lists of the codes that can be in box 8, but none list U1.

I also had one this year paid to adult daughter.  Never seen this before.  Is box 8 the Dad's SSN followed by U1?  I can't find what that code means, but I'm wondering if it means underpaid?

8 minutes ago, RitaB said:

Well, I never got to Zero, and I thought I had looked at it all the ways.  

 

Zero because she gave him the money to buy it, then gave him an additional 7K to boot!  

Basis could be 0, 3K, 5K or 10K depending on how you look at it.

None of the special situations apply to her. Also, the 255 is only paid if there is a surviving spouse, not adult children. 

I just thought it strange since I've never seen it before. 

I've always thought it's not fair that when someone signs up benefits are delayed a month, but upon their demise that month is not made up.  I looked a little to see if it might have changed but didn't find anything. 

Middle aged client received what looks like 1/2 father's SS benefit for one month.  Her sister received the other 1/2. Her SS is listed as beneficiary so obviously she filled out some kind of paperwork, but doesn't know detail.

I'm not disputing that it's taxable to her.  I've never seen this before and just curious if anyone knows what kind of situation would have benefit paid to adult children.

If he's married, check if this might be a situation where MFS has better results. 

Couldn't you send an e-mail to all and tell them that they need to all agree who will be the Rep?  

I personally would disengage from this account as quickly as possible. If two of the partners can't be civil enough with each other to handle business, they will likely try to put you in the middle of things.  Not worth it IMO.

15 hours ago, BulldogTom said:

Congress makes tax law, and Congress said all income is taxable unless Congress says it isn't. 

Has it ever been that a state tax refund was taxable unless a federal benefit was received from over-paying?  Less than 9.5% of returns itemize deductions after the higher standard amount.  I'm guessing a good chuck of the 9.5% was limited by 10K total.  So, the only ones that it would be taxable to are the middle class that itemize but don't have 10K in state taxes. 

As long as each parent could have claimed child (their biological child) if they filed MFS the CTC can be allocated any way they want.  IMO it's the clients call, not yours.  Vast majority of time they will choose option to get most cash rather than pay debt.  Do not allocate EIC, IRS will calculate that. 

Sounds to me like they contributed to Roth in 2021 then realized they could not due to AGI.  Since most markets were down in 2022, it's reasonable that if they had less than the 7K to withdraw.

Entering codes JP does not make anything show as taxable, does it?  

8 hours ago, DANRVAN said:

So if a volunteer/client came in and said they received $xxx.xx from charity as reimbursement for travel under accountable plan, I would offer the position that it is not taxable income over the standard rate for the charitable deduction.  

Just remember that the only actual costs that can be used for charitable driving are gas and oil. 

28 minutes ago, cbslee said:

1. What about taxpayers that didn't pay any state taxes due to credits etc?

2.  The IRS general rule is all income is taxable unless specifically exempted from taxation.

The state payments are a refund of taxes paid.   So, unless they took a deduction for it off of their federal return, not taxable. Even if TP does not pay state income tax, they are paying sales tax. If TP income was so low they have no state income or sales tax, they aren't going to be having federal tax either. 

Same general concept as credit card rebates.  If the rebate was for personal purchases, not taxable as it is deemed a reduction of payment.  If the charges are for business purposes, then taxable because the full (pre rebate) amount was deducted.