kcjenkins

Jack is right. It's no different than if he bought a company car, you set up the car at purchase price plus sales tax, whether you paid cash for it or you financed 100%, or anywhere in between. Same thing with tools and equipment.

I would put it first to child support, myself. But I don't have a cite for it.

25.15.5.9.2 (05-01-2005) Equitable Relief If the requesting spouse (RS) does not qualify for traditional relief under the first sentence of IRC 66©, then the Service will consider equitable relief under the second sentence of IRC 66©. Relief is available for both deficiency cases and underpayment cases. The Service issued a revised guidance on the relief provision in Rev. Proc. 2003-61, 2003-32 IRB 296. Rev. Proc. 2003–61 is effective for relief requests filed on or after November 1, 2003. In addition, this revenue procedure is effective for requests where a preliminary determination letter has not been issued as of November 1, 2003. Rev. Proc. 2000–15 is still effective for all other requests for relief. For information on the factors to consider when determining whether equitable relief should be granted see IRM 25.15.3.8.2 . These guidelines should be applied in a consistent and nondiscriminatory manner. Decisions to grant relief should not be based on the subjective personal and social beliefs of the IRS employee or any other inappropriate grounds. If it is inequitable to hold the RS liable for any unpaid tax or deficiency, the Secretary may grant relief. The equitable relief provision under IRC 66© is available for spouses domiciled in a community property state, who did not file a joint return and who do not qualify for the traditional relief under the first sentence of IRC 66©, and who meet the following threshold requirements: The RS must apply for relief no later than two years after the Service’s first collection activity after July 22, 1998, with respect to the RS The non-requesting spouse (NRS) must not have transferred assets to the RS as part of a fraudulent scheme, and, in addition, if disqualified assets were transferred, relief can only be granted to the extent the income tax liability exceeds the value of those assets The RS did not file or fail to file the return with fraudulent intent If Rev. Proc. 2003–61 applies, then the income tax liability from which the RS seeks relief must be attributable to an item of the NRS, unless an exception applies. See IRM 25.15.3.8.2.1(4) for the exceptions If all the above threshold requirements are met, the guidelines in Rev. Proc. 2003–61 or Rev. Proc. 2000–15 should be followed in determining whether to grant relief. If the decision is made to grant relief, the item of community income is included in the gross income of the NRS and not in the gross income of the RS. However, any additional assessments made against the NRS must be made in accordance with the deficiency procedures of IRC 6212 and IRC 6213. Where IRC 66© is asserted against the other spouse, it must be clearly reflected in the notice of deficiency 25.15.5.10 (03-21-2008) Requesting relief under IRC § 66© A RS seeking relief from the operation of community property law under IRC 66© must request such relief in a statement signed under penalties of perjury or Form 8857, Request for Innocent Spouse Relief. The statement must state why relief is appropriate and include the NRS’s name and taxpayer identification number (TIN).

Just because the MH is a residence does not mean it is Real Estate. The special deduction is only for REAL ESTATE TAX, and since the MH is not taxed as real estate, the tax on it is not deductible. Tell him tax law does not have to be fair, it's just 'what it is'.

The basic problem, which is general to all states, is that no entity choice will protect the doctor from claims arising from his own actions. So if he is accused of malpractice, and found at fault in court, he's going to be personally liable no matter what sort of entity he uses for business reporting. And since insurance is his only defense in such cases, I rather doubt that how he structures the business will have much effect on his premiums. Of course, he can find out by talking to his insurance agent, who probably can give him better advice on that subject than we could. Where you can advise him is about such things as any C corp he forms being a PSC, that sort of thing. Lots of doctors seem to think that incorporating is some kind of panacea against a big tax bite. It's not.

Two other changes that will affect many: Child Tax Credit The refundable portion of the child tax credit will be increased. Previously after reaching a threshold of $8,500 of earned income the refundable portion was 15% (subject to other limits), now the threshold will be lowered to $3,000. Earned Income Credit For 2009 and 2010, families with 3 or more children will have a new rate of 45% on the first $12,570 of earned income. The threshold phase-out amount for joint filers increases to $5,000 above the phase-out amounts for other statuses (an increase of $1,880 over past law).

Education Provisions The Hope Credit will become the American Opportunity Tax Credit. For 2009-2010 this credit will be enhanced as follows: It will cover 4 rather than the previous 2 years of college. The maximum credit has been raised from $1800 to $2500. 40% of the credit will be refundable. Course materials are now considered qualifying expenses. The credit will be 100% of the first $2000 and 25% of the next $2000. Phaseout levels have been raised substantially to $80,000 for single taxpayers ($160,000 for joint).

I edited that just a bit, because I was sure I would not be the only one who wondered about the other two items. Of course, the list I found had the girl friend as number 11 instead of number 1, but was otherwise the same. I also took out the ads between each item. Hope you don't mind.

Way back then, I had a list of most of them, but I've thrown it away a long time ago. I know there were over 15. Bob was actually a good guy, you know, just a bit obsessive about some things.

You enter the carryover loss down near the bottom of the K-1 Input sheet, where it says "PTP Carryovers and At-Rick Limitations"

5 to 6 weeks if e-filed.

Well, we know know this was NOT any sort of WDRO, just him withdrawing funds. Personally, I'd file her HOH, since he 'abandoned' her in the first half of the year, and I'd ignore his income. I'd prepare a MFS return for him, as well, which I would mail to him with postage-paid envelopes to mail them in. Clearly he can not pay, but filing on time will minimize his penalties, and protect the wife as well. I'd ignore the CP issue from the date she filed for divorce.

Not necessarily, if the box 5 amount was used for qualifying expenses it's not taxable. But if it was used for non-qualifying expenses, it would be taxable [on line 21]. Also he should have received a 1099G, box 6, for a taxable grant. I think you need to do some digging on this one, I've seen lots of 1098-Ts that have errors.

Less than half the year, should be OK. In jail before July 1, and still there Dec 31, I would not take him. Same thing if in on 1/1 and not out until after 7/1, then no.

Lots of us transmitting extensions is probably the problem. Try again later.

Sorry, Joel, I forgot who asked the question.

Yes, MA might very well want to take that stand, since it raises questions about whether he did in truth move his residency. He'd really be smart to change those addresses, and anything else that ties him to MA, unless he's happy to pay taxes there.

Cats probably are easier, but I'm allergic to them, although I like them. But I could not stand to have to give up my dogs. They are just too much a part of my heart. I just hope my health never gets to the point I have to live without at least one dog.

I'd be strongly influenced by the way the company handled it, since clearly they understood that if they continued to pay his expenses over a year, it had to be added to his W-2. Since they did that, clearly they understood that it had become an indefinate time assignment. He should just be happy that they still are paying it, IMHO.

Of course, you would not know it was below FMV unless the client told you so, since FMV can vary so much depending on the condition of the property as well as the location. But even if a client says "I'm renting it to XXX for less than normal" you have to ask him some questions to determine if that difference is reasonable, or is actually a true 'below FMV'. For example, if you were renting a normal $600 month house to someone you trust for $550, that would not disqualify it for deductions. Or if you rented the same house to a skilled carpenter for $300 a month, but he's going to do significant work on the house for you in exchange for the lower rent, that would not disqualify it. Although you would in that case recognize income for the work received, but then deduct the repairs as an expense. The TC has allowed up to a 20% discount as reasonable for renting to a family member, on the logic that they will treat the property better, maintaining the value, for example. So I agree that we have to ask questions before we make decisions in such a case.

It's not a fire, Margaret, it's my wheaten Scottish Terrier, hunting for lizards or anything else she can find that moves. Her name is Little Bit, and she's my 'Office Manager'.

You misunderstood what I was saying was dumb. If the state, or for that matter the feds, REQUIRE that data, then that data should have been on the 1099G that the state sends out. THAT was what I meant was dumb, requiring an address but not providing the address.

Terry, clearly this is a BAD CLIENT. While it sounds like you did file timely, if there is a penalty, it is THE CLIENT'S FAULT, because they needed you to wait. It's not your responsibility unless they had the funds, authorized you to deposit them timely, and you just did not get it done on time. In this case, they are trying to make their collection problems into your fault. That is outrageous, and if you do keep the client you should raise your fees to include a PITA fee.

Kerry, if you don't get a freebie from someone in Maine, I'll do it for you. All you need to do is email me your data. In fact I'm a little hurt that you did not ask me first.

David, I think you misunderstood Taxbilly. He does not 'do' those new clients in April, I bet, but merely makes appointments so that he can set up their extensions. Something you can usually do automatically for priors.