mcbreck

If the trust has its own EIN and is getting tax forms, it should be filing a tax return. How it's handling that income is written into the trust documents.

Yes you should include a copy of the statement showing the money going into the account. If it's a 60 day non-direct rollover, the 1099 isn't going to show a correct code. I upload a copy of the statement because the IRS will request it later (and may not even notice it was uploaded).

The Roth IRA conversion has NOT been stopped.

I have a brother MFC and it's been fine for over 5 years (I only paid maybe $150?). During the offseason it's nice for printing in color which for client presentations is a very nice option.

11 hours ago, TexTaxToo said:

Dividends are only qualified if the underlying security is held for 61 days during the 121-day period surrounding the dividend date.  Preparers of Form 1099-DIV are allowed to include dividends as qualified in Box 1b for which it is impractical to determine if the holding period has been met.  The instructions for Form 1040 say that you must exclude any dividends reported in Box 1b if the security was not held for 61 days (see here).

I suspect that very few people are diligent about doing so.

My mind is blown. Thank you for the information. This would explain why I've had corrected 1099's on this exact matter.

2 hours ago, cbslee said:

Wash Sales ?

That's what the client thinks but why 60 days and why dividend paying stocks? The 1099 should account for that anyway. I'm sure the planner is coming from their software (it has tax items printed).

Previous tax preparer wanted to know if any client sold any dividend generating stocks during the first 2 months of the next year (2023 for this year's taxes). If yes, they wanted copies of their month end statements for January and February before they would do the taxes. Any clue why? It specifically mentioned dividend paying stocks and it's a different question if they sold ANY stocks the previous year. I have no clue why they'd want that.

19 hours ago, Abby Normal said:

I wouldn't amend anything that doesn't get a refund. I'd go back and redo each year properly, to determine the current passive loss carryover, then just do 2022 based on that.

The IRS doesn't keep track of carryovers so they won't complain when one just shows up.

We forgot a loss carryforward on an 1120S and you can't efile an amended return that only has a carryforward correction. We added it to the next year's return with a note and it was never questioned by the IRS. I'm pretty sure we did mail in an amended return but I'm pretty sure we were told it wasn't required. I like the idea of amending if at all possible just to show the trail.

2 hours ago, Randall said:

I don't bother unless there is state tax withheld.

I'm just wondering how they determine to add a state distribution figure at all if no taxes are withheld. About 40% of the time there is a number in there. I've read online it depends upon your state - all but about 3 of my returns are in one state so I'm not seeing that as a factor.

Is there a rule for when a 1099r includes an amount on the STATE Distribution versus when it's left blank? It seems exceptionally arbitrary but maybe I'm missing something.

That's the correct form but why is the 1099r showing up with the wrong payout code?

If you have a date of death, it would seem maybe code 4 on the waiver is correct IF they died. Include a copy of the death certificate.

I've mentioned this guy before. In his 50's, runs a company with over 100 employees, Ivy League MBA and he's monitoring his father's tax prep. I've known the father for 30 years and he's physically incapacitated / nursing home and not all there mentally.

Son wants to know why his father's w2 shows $50k in income, but there were only deposits for $33k. He wants me to provide an accounting of the difference. Literally attached a copy of the W2 to the email making this request.

Son wants me to explain to him why his father is still subject to SS and MEDA on earned income (they are commissions).

His family flew to Florida to visit a University for his daughter's decision making process. While on the trip they attended a concert for University concert orchestra. He wonders why he can't deduct the entire trip as a charitable donation. He's adamant the tickets MUST be deductible.

Son now thinks I've improperly included in the W2 income his father's IRA Required Minimum Distribution (I gave him a copy of the 1099R).

I'm not sure if the son is punking me or he's really this clueless. When I mentioned it to the father last year (son declared I'd done the return all wrong) - he insisted his son has never done a tax return in his entire life and has no clue.

17 hours ago, Lion EA said:

Show him the Form 8949 instructions, especially pages 3-4 with exceptions to listing everything on Form 8949 and the sentence, "If you choose to report these transactions directly on Schedule D, you don't need to include them on Form 8949 and don't need to attach a statement. For more information, see the Schedule D instructions." If he doesn't agree, he's a lawyer, ask him to show you the code section.

I've seen where some claim if you put it on the 8949 and not on the Schedule D itself and have summary totals of non-basis given trades, you should include it. I don't agree but that's what they are saying. I can't remember the last time I didn't itemize out the non-basis trades as there are rarely more than 2-3 in a year for clients.

1 hour ago, BulldogTom said:

I assume it is a partnership return like most law firms.  

This is 1040's for clients. He's just being a jerk.

Working with a law firm and their tax attorney is insisting that all returns with a Schedule D MUST have a copy of the 1099 attached. Does anyone on here still do that? He's insisting it's an IRS requirement and trying to draw red flags against me with other partners and I haven't attached 1099s in 15 years probably.

The withdrawal is for excess contributions. The earnings are taxable. Is that what's showing up on the 1099r? box 2?

14 hours ago, Lynn EA USTCP in Louisiana said:

See if the client qualifies for self reporting and penalty waiver 

see https://www.cpa-wfy.com/did-you-miss-the-60-day-deadline-for-your-ira-rollover/

We would have gone this route but the bank has told them 2x that they will NOT move the money into an IRA at this point. I was the one who asked him 2x to ask them and that was their response both times. Can't get a waiver if the money is still sitting outside an IRA. The bank will charge them a fee for early withdrawal of a CD and in their minds it is better to pay the tax than the fee. Not my problem anymore as he doesn't seem interested in me calling the bank for them.

(Bank keeps says they'll only move their allowed contribution and the clients aren't even interested in that.)

Bank says NOPE. I swore I had a client years ago where the bank allowed them to do it after the fact and risk the 60 day rollover question by the IRS and qualifying for a waiver. Maybe the difference was that time it was the bank's error and this time it was the client's error. Senior citizens need help on this stuff (like taxes).

Personally I'd claim the $396 as interest earned.

Client took money out of their IRA bank account and moved it to a CD at another bank. Upon arrival today and talking about it we realize the new bank didn't move the money into an IRA account. Anyone ever have a bank recharacterize such a mistake as having been put into an IRA as it should have been?

Many states issued checks to people whether they paid taxes in 2022 or not because they called it inflation relief payments. The state of California issued 1099-misc forms - not 1099-G. Spidell initially said to expect it to be federal taxable but backtracked and said to wait for the IRS to rule which they haven't yet. Illinois called it a rebate but they literally have no money so how they can afford to rebate taxes is beyond me. Most of the states paid out amounts less than the 1099 limit so they aren't required to issue forms - will the IRS pursue it if they decide it's taxable?

Talked to a guy who received his Minnesota frontline worker payment of $487. How many people do you think are going to claim that on their return since they didn't issue a tax form?

Thanks, I only use one computer.

That wasn't it. Not a big deal and I'm not going to work on it but it's weird. I think I'll hide completed just so I know to look elsewhere.

I'll check that, THANKS

Just noticed an 1120S that I've completed and efiled isn't showing up in the PCM on the front page of the software. Shows up on the recent returns list and it shows up if I look them up with the Client Status Manager. Fed and State were both accepted so I'm done but wondering why it isn't showing up. The only other 1120S I have started so far is still on the list but not finished.

I've done a "repair index files"