BrewOne

had a (former) client got caught in a similar situation--no mention to me of their buying and selling and possibly no 1099-K, but the IRS knew the amount they sold on eBay. When I told them they would need to know what they paid for every item they sold, they had a hissy fit. Since I had no idea how long this had been going on (possibly for years), I told them I wouldn't handle it and recommended they get a tax attorney. Their new CPA wanted to know why I didn't want to handle such a simple matter and I told him I'd retired.

I've used eFax for years although I'm thinking of dropping them due to sending/receiving maybe 2 faxes a year--at $16.99 a month, those were some expensive faxes.

If no tax would have been due if the beneficiary had been changed to the church, looks like a legal matter. Further thought: As you point out, for a charitable deduction, the charity must be listed in the instrument; however, it also has to be noted that they are receiving the money from income, not corpus. It looks like it will end up as income to the estate... Interesting stuff

if there was business activity (income or expenses), a return is due. And late filing penalties are severe. That's the information a preparer should pass on to the tax-matters partner. I'd leave speculation on the odds of anything happening if they don't file to the partners.

No problem (except for incorrect data appearing)--I would open 2022 and make sure everything is functioning normally there.

Initial opening of my 2023 return in ATX--my Schedule C, to my surprise...had entries under Inventory. I've never had inventory and verified zeroes on the 2022 Schedule C. Crazy.

ever since an HP desktop died on me during tax season (about 10 years ago), I've run my ATX software off of high end Dell laptops.

A few years back, a CPA (whose system was hacked) said at an IRS forum he had $100,000 worth of coverage and ended up with over $300,000 in costs. If you do partnerships and corps, there is a multiplier effect from every SSN in your system. So I'd say ballpark $500k in coverage, more or less depending on your practice. And ask if coverage includes them coming in and de-bugging your system.

I would be interested to hear if the K-1 shows up on the transcript. My experience with hand-written information returns (i.e. 1099's) is that they can take more than a year to show up in IRS records (if at all). So you may not be able to know if it was filed--the questions about the origin of the K-1 seem key to deciding on how to proceed. As well as knowing why they are not willing to go back to the original preparer to amend.

I took another look and can't find any specific rule requiring professional grade software; perhaps, as y'all mentioned, it is the requirement for data security and e-filing that creates the need. I laughed when recently an IRS presenter said that we should try and minimize our collection of personal data--a year and a half ago I had the experience of several of my clients' refunds being held up because I hadn't submitted their driver's license information (I previously only collected it on returns where a State return was present).

I can't find it in a search of Circular 230, but I have a clear memory of being told that we (paid preparers? EA's?, can't recall) had to use professional-grade software, i.e. not off the shelf.

not a fan of hers either.

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.