BrewOne

Form 5329 provides for the calculation of additional taxes on excess accumulation; I recommend you request a waiver of those taxes when you file (it is compatible with e-filing) rather than paying and then asking for the money back. As Catherine points out, penalties cannot be waived before assessment.

I agree; probably the same thing that is happening with BOI and the draconian $500 a day penalty. I did acquire a client who had to pay some of the penalty on an inherited IRA. They had taken an initial distribution, then nothing for five years. After requesting a waiver on every year, the IRS waived the penalty on years 1 and 5, but enforced it on years 2-4.

in years past, I had two versions to send out, depending on how much room I had (I don't want to go over one page) and if there are new tax laws to consider--one for clients with businesses and others, or one for retirees and one for others. This year I composed one letter to all clients--I don't bother to use what ATX has to offer. I sent this year's out in October and it is already obsolete because of the IRS decision to delay implementation of 1099-K changes and the extension of BOI to 90 days for new businesses.

By royal fiat? Anyway, doing what Congress should have, IRS has announced for 2023, filing requirements of 3rd party payers will be the same as 2022. And 2024 will have a $5,000 threshold for issuing a 1099-K (as reported in NY Times)

always. Every year I face an expired password and hold my breath while I try to get in. But I'm in no rush, going to give them some time to get things sorted.

they sent me a code for payroll, which I don't believe is part of my packet. But I've also had them haranguing me to renew in January after I renewed in May (and have already downloaded the software).

I have 8821's on about 70% of my clients. I don't require it, but have toyed with the idea of requiring it of all clients. I push it every year in my annual letter. Anyway, I just finished my review of their 2022 IRS accounts. Two biggies and one take away. 1) Client's name and SSN being used in California for DoorDash payments. Impersonation has to be the worst form of identity theft, what a nightmare. Client had no idea and would not have found out until getting a nastygram from the IRS (1099-NEC, so self-employment taxes as well). 2) Client's professional association was reporting all their income under her social (large $$$--can't believe she hadn't heard from IRS). Square is cooperating with reissuing 1099-K's, so kudos to them. Once again, client had no idea this was happening. 3) Client's 5498's--seeing how much client's have in their IRA's may seem intrusive, but I was able to match up the accounts with 1099R's, make notes for those approaching RMD age, and verify that everyone was receiving distributions who were supposed to. The slow response of the IRS to discrepancies means that you can get out ahead of problems--I highly recommend collecting the authority.

sorry, I didn't see this posted elsewhere. But I will say that if the e-file deadline is missed, I'd go ahead and paper file rather than wait for next year. I know that your mileage may vary, but I've had good results with the few I've done recently; it is no longer a death sentence. And it beats having penalties and interest go up in the meantime.

IRS announced that November 18th will be the last day for e-filing individual returns (for any year) until they (hopefully) re-open in January. Business shutdown has not been announced.

This is one of those cases that, as Sara relates, you do the best you can. Under normal circumstances, I won't consider claiming withholding unless I have a tax document in hand.

Because of the legal implications of the 2848, I do not get one unless needed (think about a former client who has moved and you're the only one getting their IRS notices). I am a big advocate for collecting 8821's from clients and checking their accounts in late October. I do not charge for the service, I just want to know that if there is a problem with an account, we can fix it before the IRS takes action. I'm currently going through 2022 returns and unfortunately, Transcript Delivery is acting funky--it's working but everything is in plain text. I believe with the Tax Pro Account, there is a new method for cleaning up your POA's. When I left H&R Block in 2011, I had to use the Freedom of Information Act to clean mine up. I might add, I do know preparers who require the 8821 of all clients; I don't, but I try and point out all the advantages.

I had a similar situation that went on for several years--elderly client with dementia had moved several times and son could not get Social Security information. I did the same as Kathy, adding a few bucks extra every year just in case. We finally received the SSA-1099 for 2022 and I was pleased to see we were only about $3 off after four years. Fortunately, there was no withholding.

and registered mail is for items of tangible value in excess of what can be covered by insurance. So certified if using USPS.

you are correct. Tell her to look down at the bottom of the front page of Pub 547 Limitation on personal and casualty theft losses

Folks who aren't well-positioned for retirement don't tend to listen to advice...they've already made up their mind to sign up ASAP.

Seems to me to be anomalous--the IRS records are "reasonably complete" by August. But I recheck all of my clients (who've given me authority) in October to make sure something hasn't popped up. You cannot be absolutely certain until Jan 01 of the following year. BTW, if you see Code 922 on a transcript, it means they are going to get a CP2000 within 5 months.

no 1065's ever filed? I guess I don't understand, what is the discrepancy? 75% of the basis = $600k and then report 75% of the proceeds (minus cost of sale)? Also, this is a good example that a client with investment property should be looking at capitalizing property taxes along the way--annual election, Section 1.266-1(c)(2)(i). Most software has it built in to the elections/statements worksheet.

part of the irony of being a Circular 230 practitioner--Office of Professional Regulation can throw the book at us.

up to five years in prison? Not nearly enough, grrr.

A good start for simplification would be to end Head of Household as a filing status. It confuses taxpayers and is needlessly complicated. Increase the standard deduction and the 10% tax bracket (main benefits of HoH) and no one gets hammered and one less thing to worry about. Of course this will never happen.

I've used Track1099 and now tell any clients who need 1099's to use it. Good to have an email address on file for recipients and Track 1099 will take care of everything.

even before the decline of the USPS, I'd get 30 day letters from the IRS that were dated 3 weeks prior to receiving them, leaving little time to respond. The postmark on our correspondence is the official record of the date received--maybe their correspondence should have a postmark as well?

Maybe it's an attempt to encourage employees to pay workers on an hourly basis, rather than call practically everyone "managers" with a paltry salary (and no OT)? There was an attempt at legislation a few years back to end Walmart et al from paying someone a salary circa $20-25k a year and working them 60 hours a week.

the gory details are in Sec.1.1.1031(a)-1 of the IRC. This situation doesn't appear to involve an acquisition of real property, so I'd agree with Dan.

the first time a couple files jointly, they may find out something unpleasant about the other's past. However, with no withholding, then there's not much chance of losing a refund. But as a rule of thumb, I'd probably want an 8821 for the new client to check their account.