rfassett

With his 12/31/15 basis of $120,000 plus taxed 2016 income of $1,302,000 less cash withdrawal of $1,200,000, he has a remaining basis in the stock at time of liquidation of $222,000. That $222,000 would be reflected on Form 8949 with zero proceeds, $222,000 basis, long term F category. Yes, this would show as a $222,000 loss which would offset some of the capital gain coming out on the K-1 or other capital gains that the client might have. You are on the right path, in my opinion.

This is complicated by the fact that it was NOT a Corp Sale. This was an asset sale followed by dissolution of the corporation. So in simple terms, you will take the 2016 basis, add those items to which he will pay tax on, deduct any withdrawals and that will be the basis in the stock for dissolution purposes. But before I go too far in trying to help you with a basis number, I need you to check the 1231 gain. On a 1.2m sale, is it possible to have a 632m 1231 gain? Also, what happened to the cash from the sale? You could very well end up with a zero basis.

I have 20 returns yet to do. 9 of them are corporations, 1 a decent size 990, and the other 10 moderately complicated 1040s. My extension list is at 66 and growing. Everything that comes in from here on out will be extended. We should be done completing returns and working on extensions by Tuesday. We are well positioned for the four day weekend I have been so looking forward to since January 2nd. The office will close at 6:00 p.m. on Thursday and re-open at 8:00 a.m. on Tuesday the 18th. And it will be blow and go for two weeks when we return to get the quarterly payroll reports done.

I always mark the box "lived in home for 12 months" in these situations and it solves the problem. Another issue may be one of phase out. Is that an issue?

I agree with Gail. But I only do about 50 schedule F's - so I am no expert.

The one thing you need to keep at the fore-front of your mind is that you have no ownership is this problem. You neither created it nor own the rights to solve it. If he insists on blaming you and ranting, tell him to give you whatever money is causing the issue and you will pay the tax yourself. (Notice I did not say give you the tax money, but rather the money that is causing the tax). I have done that when the need arises and it always has quieted the person. The other thing that works well for us - we tell all of our clients the results on their tax returns via a telephone call. That helps them maintain their dignity and the shock has worn off by the time they arrive at our office.

I would have probably ten lines. Line one: year xxxx additions - see schedule in file. And so on and so forth. And then after tax season, just for grins, have your farmer client review those 65 items and have him tell you which ones he still has. My guess is that you will be deleting a bunch of those from next year's return. Of course, that comment assumes that you do not want to extend this return and make it right this year.

My office is always closed on Good Friday. Since that happens to fall on the 14th, it just seemed appropriate to call the season on the 13th. We will be back in the office on the 18th working on payroll quarterlies so we will be accessible for client inquiries but I do not anticipate even one call. We have been telling our clients from the get go that this is our plan. It is all about three things: 1. Communication. 2. Training the client base. 3. Me running the business and not letting the business run me.

I have 32 to get done that came in on or before March 20th - our guaranteed completion date cutoff. Another 20 that have come in since - which are more than likely to get completed (5 of those are my own entities and personal). And I anticipate another 50 coming in this week, only about half of which will get done. We will be done preparing on the 12th, do extensions on the 13th, and then close the office until the 18th. We are in good shape here.

I have had the problem while printing. I do as Rita, close the dialog box - by clicking on the x, not the OK. I then save and close my return. I then close out of the program and immediately re-open the program. This seems to happen when I have been printing a large number of returns or a few large returns. I have reasoned that it is a resource issue and move on until the next episode. Minor-ly inconvenient - but nothing more.

These calls and/or emails always represent teaching moments for me. "You came to me expecting a professional service. Professional services require a requisite amount of uninterrupted time to complete the task. I will contact you if and when I have any questions or when the return is complete. Please know that my commitment is to complete returns within a two to three week period." We have had two calls this year wondering when the return would be complete. Both were new clients this year. They will not make the mistake of calling again. They just needed to understand the rules of the game.

Good things come to those that wait?

Don't become too discouraged too quick. I have seen some of those do-it-yourself printouts and some folks think they need to print out a page or schedule for every block on the return. Two W-2s and two rentals just can not generate that much paper. I will be interested in hearing "the rest of the story". Good luck!

The filing of extensions, for the past couple of years, has required a pro-active statement from the client requesting such an extension be filed. Based on that, I think your only recourse is to file an extension for him. The extension, per my recollection, does not designate filing status. And if there would be a refund coming, I am not sure you have a high level of risk of leaving her off the extension. Just my thoughts!

I am with you on that - there are not many things that stop me either, but I HAVE been stopped speechless a couple of times. Stick around this business long enough and it happens. Glad you were able to recover well enough. We had a young adult client do the suicide thing last year. We do the whole family's returns and fortunately my first contact was with grandpa. Grandpas usually are more forgiving when we put our foot in it.

My office will be preparing returns through April 12th. We will do extensions on the 13th. And then take a 4 day holiday weekend before coming back on the 18th and starting quarterly payroll reports. So we will be done on April 13th. That is just 17 short days away. I have just completed number 352 and think I can get another 125 done before we take our break. I am ready for a break!

Think engagement letter. You are correct - there is a separation between preparation and representation. Just as you should have an engagement letter spelling out the details of the engagement for preparation work - so should you have one for representation work.

Click on the cell named "Name" and it will sort for you. You can then apply that sort to the form by clicking on "Apply Sort to Form". I believe that will accomplish what you are after. The "apply sort to form" button will un-gray when you highlight the column.

Yes - with the switch over to the MeF system a couple of years ago, I believe you can file 2 years back and the current year via e-file. My office, however, has made it a policy to paper file ALL prior year returns. Every time we have attempted to e-file prior year returns, we have experienced some sort of problem - whether at the Federal or State level. So as to eliminate those issues - we just paper file prior year returns - and up-charge for the inconvenience.

A couple of weeks ago a client brought a large pizza from his shop when he picked up his payroll. The timing could not have been better. That one little act of kindness will carry me through to the end. Did I mention this guy makes the best pizza for miles and miles around?

Those are very good questions. We all need to be aware of the escheatment rules for our particular State. And they are different from state to state.

Unless he put restrictions on the cashing of the checks, it is not his concern whether they were cashed. If the recipient had the right to cash the check, then your client is entitled to the deduction. Whether there are discussions about selling the property is not pertinent to whether your client is permitted a deduction for the land rent.

As in most all things tax, it depends. Was an appraisal done for the estate (inheritance) tax return? Is the house located in an area of rapid inflation or deflation of real estate prices - and yes, there are still pockets of areas where this goes on? If real estate prices have been stable and no appraisal was done, then your approach sounds solid. Be sure, however, that it is a true inheritance. Clients like to throw that term around even when the house was actually gifted to the children. Just sayin'

The trust became irrevocable on the father's death is what I am hearing here. That being the case, there would be no step up at time of mother's death. The stock, at mother's death, was actually owned by the irrevocable trust thereby not allowing a step up in basis on her death.

Yes - well kinda - PA is following the federal dates this year (not always, but this year for sure) and the filing dead line is April 18th. And that is true for both the PA 65 and the PA 20S. The reason you see all of those forms on the 276 is that they are all individual or pass through entities. In PA, those are all handled by the individual tax department. If you had a C Corp, you would use Form 853.