kcjenkins

"This form transfers the burden of responsibility from the taxpayer to the paid preparer.''  That's the real problem.  While the IRS should certainly go after those preparers who make a business out of preparing bogus returns, there have always been laws to do that.  Shifting the responsibility, on every return, from the taxpayer to the preparer, is IMHO not only morally wrong but also totally counter-productive.  Preparers are not and should not be unpaid IRS employees.  Yes, you have to be alert to the occasional bogus TP, but this "solution" is just plain wrong.  

IT'S JUST SO EASY TO STAPLE YOUR TAPE TO A PILE OF RECEIPTS, AND IN AN AUDIT, THERE IT IS, IF YOU HAND THE AUDITOR A BOX WITH 15 PILES WITH THE TAPE ATTACHED, ALMOST ALWAYS THEY CHECK THREE PILES AND IF THEY ALL MATCH, THEY ACCEPT THEM ALL.  

That said, I gave up mine around 05.  Went to Judy's 10 Key and never regretted it.  http://www.judysapps.com/TenKey.htm

Easy to print out the tapes, if you wish, or save as pdf in the client's file.  

And the recipient needs to understand that, as a gift, the tax basis is the basis from the giver.  Best that this information is in writing, and signed by both.  This is for the recipient's protection, not the giver's.  And remind your client that, while there is no tax effect on the business, there might, if the value of the building is significant, be a gift tax issue.   

47 minutes ago, Abby Normal said:

The struggle then becomes the allocation of the sales price, because they buyer wants more allocated to equipment so he can 179 it or depreciate it over a few years instead of 15 years for goodwill, but the seller wants less allocated to equipment and more to goodwill because goodwill sale is capital gains and equipment is probably mostly ordinary income.

Both buyer and seller must attach form 8594 to their returns with the agreed upon allocation.

Absolutely drum in to client that they MUST insist that the Form 8594 be part of the deal.  And strongly suggest that for any significant equipment they get a reputable appraisal in writing.  But help them understand that the 8594 is how they establish that the price they agree on is the result of  an arms-length transaction between buyer and seller, and thus, a "fair market price".   

The absolute WORST way to get any sort of financial planning advice is by watching a TV show !!!  And that's not to blame the show, really, because they almost all do warn people at the end to talk to their tax advisor before following this advice.  But the tax code is so complex that even if 5 clients have exactly the same amount of income, from the same sources, the odds are high that at least 3 of them [and probably all 5] are going to end up with different tax outcomes.   

Mildred, the church gossip, and self-appointed monitor of the church's morals, kept sticking her nose into other people's business.
Several members did not approve of her extra curricular activities, but feared her enough to maintain their silence.
She made a mistake, however, when she accused George, a new member, of being an alcoholic after she saw his old pickup parked in front of the town's only bar one afternoon.
She emphatically told George (and several others) that everyone seeing it there would know what he was doing.
George, a man of few words, stared at her for a moment and just turned and walked away.
He didn't explain, defend, or deny.
He said nothing.
Later that evening, George quietly parked his pickup in front of Mildred's house... walked home... and left it there all night.
You gotta love George.

The client creates the situation, we can not ignore the facts because she does not like the result.   

On 6/2/2016 at 11:54 AM, Gail in Virginia said:

I have never read the Divine Comedy entirely, in English or Italian, but Larry Niven and Jerry Pournelle did an excellent fantasy version of the story entitled Inferno.  Nominated for both Hugo and Nebula awards in 1976, it is highly entertaining and borrows the geography of Dante's Hell.  If you want something a bit lighter than the original, I highly recommend this book.   i know we have some science fiction aficionados on this board.

B&N has a free sample of this book available.  

\I love my Nook.  It's so great to be able to carry a 1000+ books in my purse!   And since no one has mentioned it, I will bring up a wonderful site, https://www.bookbub.com/home/    Many totally free books, plus many discounted eBooks, for all platforms.  You can pick the categories you want to see, 

Why we shouldn't lie
We were dressed and ready to go out for a dinner and theater evening. We turned on a 'night light', turned on the answering machine, covered our pet parrot, and put the cat in the backyard.
We phoned the local taxi company and requested a cab. The taxi arrived, and we opened the front door to leave the house.
As we walked out the door, the cat we had put out in the yard scooted back into the house. We didn't want the cat shut in the house because she always tries to get at the parrot.
My wife walked on out to the taxi, while I went back inside to get the cat.
The cat ran upstairs, with me in hot pursuit.
Waiting in the cab, my wife didn't want the driver to know that the house would be empty for the night, so she explained to the taxi driver that I would be out soon. "He's just going upstairs to say good-bye to my mother."
A few minutes later, I got into the cab. "Sorry I took so long,” I said, as we drove away. "That stupid bitch was hiding under the bed and I had to poke her ass with a coat hanger to get her to come out. She tried to take off, so I grabbed her by the neck. Then, I had to wrap her in a blanket to keep her from scratching me. But it worked, so I hauled her downstairs and threw her out into the backyard. She'd better not shit in the vegetable garden again!"
The silence in the taxi was deafening.

Suggest you click on it and chose "Pin to Start Menu" for both it and the Snipping tool.  Then it's always there with one click.  Or pin to your task bar, if you use it all the time.  

Might want to check out all those 'accessories' as they are things that many asked for over the years, so MS added as 'value-added' extras.  

And you just know a few people will try to hire them !!!!

Probably will blow over, as BHoffman wisely stated, but never hurts to talk to your E&O anyway, just to get their take on what, if anything, you should say and/or do, as to contacts with the former clients.  And as to your responsibility related to record retention.   

I'd take it.  IRS rules do not require that you use the cheapest mover, cheapest motel, etc.  Same thing here.  

Was there any insurance  recovery?

The sad thing is that in many families the only time they all make the effort to come together is for their parent's funeral. 

"And typed words have no inflection. Inflection can totally change the meaning of a sentence like:

I never said he embezzled money from his business."

I never said he embezzled money from his business.

I never said he embezzled money from his business.

I never said he embezzled money from his business.

I never said he embezzled money from his business.

I never said he embezzled money from his business.

I never said he embezzled money from his business.

I never said he embezzled money from his business.

Yep, 7 ways.

That should not invalidate the claim.  You included the A, right?   They will normally just ask for proof of the entry, if you did not include it.  Slows it down, but that's all.  May not even do that, since they already should have the 1098 in their system.

Sounds about right.  Did you check the nol carryover worksheet?

Yes, it's a bad date for sure.  But this year had dinner with all three of my sons, so it was a wonderful day to me.  

Hi, friends !  Makes me feel good to know I am valued enough to be missed.  Just been a bit busy, but I'll stay here as long as I'm wanted.  Guess taxes are 'in my blood', can't stop.  

i had a great Birthday, with all three of my boys.   Best gift of all !!!

I'll be 72 in just a few days, Terry.  

My boys favorite movie, the third time they watched it, Don and I watched it with them, I laughed so much I hurt!  I've watched it multiple times since, but I still love it.  Rita, you must watch it.  The famous line, often used in various memes today, repeated multiple times in the movie  "I don't think _______ means what you think it means."   

Clear up a few details, please.  Did they operate the business jointly?  Did the business have a name?  Did 'the business' have a bank account?  Did the business buy the supplies, or the individuals buy them?  When they got paid, where was the money deposited?  If the answer to most of these questions is "yes" then they did have a partnership.  How long did it operate?  Were tax returns filed?