Cathy

Ah...JB is back! Thanks, I needed that!

Jack, Thanks for your comment, but I'm just too tired to fire back at ya! Just read the Codes and regs...that's all I have energy or time for at the moment. Have a good one!

Thanks John, We think a lot alike. Again, my thoughts also. It's almost comical now especially as while trying to protect your client's deduction, you might think the church would be....I'm looking for the right word here...pleased, happy...no, not quite the wording. They have never been asked to include something on their statements such as what IRS is requiring, and it probably doesn't make as much sense to them now as it did to me at first.....especially for a church! I'm just still in awe at the church who gave us the most lip was the one who received a couple of 500k contributions out of the blue years back....you would think they would want to make sure their patrons' donations would hold up under an audit. Time for an overhaul of the entire system. Take care, Cathy

I really don't mean to be beating a dead horse, however, after mucho info provided to a church in regard to what should appear on their donation statements, the following is what appears: "Pursuant to Internal Revenue Code requirements for substantiation for charitable contributions, no goods or services were provided in return for the Tax Deductible." No where in the actual donation statement where the Tithes, Offerings, Building/Media Fund totals were listed was there any mention of "Tax Deductible".....just the above statement at the bottom of the page. Good Grief, I'm ready to call it a season! Well, at least it was dated! Signatures of the "Pastors" was done beautifully in the "script" font within their word processor.

Yardly, I hate to put it this way, but if that is really you in your picture, I'd pay you too!!!!!! I wouldn't want you to send your guys to my house to collect your money for sure!

Just want to give everyone a heads up on the software calculation of state sales taxes versus the IRS Sales Tax Deduction Calculator not agreeing. I usually verify the total amount of sales taxes to deduct using the IRS Sales Tax Deduction Calculator after I run the figures through the software a couple of times each year just to be sure the program is giving the correct deduction. Before the tax year of 2013, the two figures agreed. Not so this year. The ATX softwear is giving more "Local Tax" than IRS's calculator is providing. Just tested two separate returns, and I have different figures in total sales taxes to deduct when comparing the ATX softwear calculation and the IRS's calculator. Will let ATX know, but wanted y'all to know in the interim. Cathy

I used to hold certain clients checks until the refunds clear their account as a courtesy, but it quickly became expected of me even with clients with six figure income. The year I started charging an extra $25 for this service, the clients who really needed the service didn't mind a bit and it was still cheaper than getting a rapid refund or"payday" loan. Then there were those clients who while once needed the service, their income has increased over the years to where they could easily afford to pay their fee without my holding their checks. However, once I started charging the fee, they would tell me to go ahead and deposit their checks by all means! My fee is going up to $35 next year as it is a lot of work and stress thinking I might deposit their checks too soon. I tried fee collect last year but it's not worth the extra work plus record keeping....then it costs me rather than my getting paid for my time and trouble. Then there are those few that seem to think it's their right to mail me a check "as soon as they get home." They are the ones who forget to bring their checkbook, debit card and/or credit card each year, and, without fail until I mail them a second notice, I don't get paid. Won't happen this hear because when I e-file a return I sign the return based on being the PAID preparer, and cannot do so until I have been paid,.....and will cite being reminded of such at an IRS seminar this past year......sounds logical anyway! I've had a sign posted in my office for years that states in an effort to keep my fees at a minimum, no returns will be released until my fees are paid. Guess I need to hold a reading comprehension class prior to tax season.

Don't know what's up. But when you are given less than 24 hours to perform an update on the program, it makes one wonder!

Thanks, John. My thoughts also...good to have them confirmed though!

After some arm twisting, client was able to obtain a donation statement from his church with the "No goods or services, other than intangible religious....." with a listing of the donations and a signature. However, the only date of the statement was at the bottom: "Printed on: xx/xx/xxxx" (actual date, of course rather than x's). The "date printed" will be prior to the date the tax return is filed. Guess I'm slightly paranoid with the ridiculous court case, so what say you about the "date of the statement"? Will the "Printed On" date suffice this stipulation? Thanks! Side note: Years ago, a gentlemen was driving through this sleepy community and was impressed when he saw this same small country church struggling to maintain parking spots for the Sunday services. A $500,000 donation was sent with a note about his visit that day....and if I'm not mistaken, another 500k followed years later. Needless to say, surrounding land was purchased and many, many improvements were made with the gracious donation. Thank goodness that (possibly those) donation(s) were made years prior to the 2012 court case. I'm sure this is not the first time a donation of such nature was given, nor will it be the last time. I'm just glad the word is now spreading to the organizations in regard to the Tax Codes and Regs regarding the statement needed for a deduction for the taxpayer.

Refer to Publication 525 under "Repayments"....."Method 1 or Method 2". It lists the two options you have, depending on the amount of the repayment.

Rita, Sorry to be chiming in so late but the link below will probably help answer your questions: http://www.irs.gov/pub/irs-pdf/i1099ac_13.pdf

A long time client of mine decided he was using Turbo Tax to prepare his own return several years ago. He had just graduated from the seventh ranked accounting college in the country and surely he could do his own return. Well, my client called me two weeks later after trying to get Turbo Tax to give him the refund I had estimated the year before that he should receive. "Didn't you tell me I was silly letting Uncle Sam hold $7,000 for me until I file my tax return?" "Yep", I replied. "Can you fit me in?", he asked. I should have made him crawl on his belly like a reptile, but since he was my son, I had to squeeze him in to my schedule of "paying" clients, and, yes, he received his $7,000+ refund and Mama got yada, nada! But don't worry, he's not using his degree in the tax world...he decided he hates accounting work and is working in the law enforcement field. I told him I know of a couple of local tax services that could really use his lack of knowledge if he needed part time work.....it would be a cold day (you know where) before I'd let him work in my office!

What was even more surprising to me, KC, is the fact that I told them I had opened the package and stripped off the orange security tabs and they still are letting me return it! Amazing!

If you have one of the HP LaserJet printers below, I have a high yield ink cartridge someone can have with my blessings. The number is 64X. My printer takes a 64A which is the 10,000 copies cartridge....and I thought I was doing something great by ordering the high yield version this time that prints up to 24,000 copies. I could swear that Office Depot's website showed this high yield cartridge would fit my printer, but it doesn't. Just don't want to see $310 sit in my storage room and rot! LaserJet: P4015, P4015dn, P4015n, P4015tn, P4015x, P4045, P4515, P4515n, P4515tn, P4515x, P4515xm CALLED OFFICE DEPOT AND THEY ARE LETTING ME RETURN IT...THEY ARE EVEN PAYING THE SHIPPING!

Thanks everyone! Your replies are my feelings as well. It seems we have a treasurer who has taken the approach that he/she will do it her/his way....which is not what the very detailed IRS Regulations state. And my feelings, exactly, Jack, as who is to say the writer knows what the Regulations state, much less how to state it properly on the donation statements. This is the same church that I sent detailed information to last year in an effort to protect my client as well as their other members. Evidently someone didn't appreciate my time and effort. One more time....and if the church still refuses to write a proper statement, then I'll just have to tell my client we'll have to overlook his contributions in excess of $250 for his single donations. JohnH, Thanks for the ECFA article! Hopefully, it will get someone's attention and will encourage them to review all of the information I'll send. Thanks, everyone! Take care, Cathy

Client gave donations to his church, several of which were over $250. On the year-end statement, the church listed dates and amounts. Then the following: Total Tax Deductible Amount: $5,000.00 Total Non Tax Deductible Amount: 0 Total Offering: $5,000.00 Am I correct in assuming that this will NOT satisfy IRS's Regulations?

No HOH as her daughter claims herself. Mother can claim EIC as it doesn't matter where they live, as long as the child lives with her mother....even a homeless shelter will qualify mother for the EIC...as long as the daughter lived there also with her mother. And the EIC for the daughter is based upon the fact that the daughter is a full time student for at least 5 months of the year (because of her age). IRS has an "EIC Assistant" that can be very helpful in a case such as Bart has.

Ringers, Thanks you, thank you, thank you!!!!!! If I can ever return the favor, please give me a holler! Take care, Cathy

Terry, I certainly wouldn't bang my head against the wall on this no brainer. Plain and simple....NO, NO, NO. There's no possible way you can put off your good clients for one who is perpetually slow and seems to only think about having his return prepared when he's pushed up against the wall. Your client certainly has payroll records the auditor can view plus the fact that an auditor usually tells the client he is to audit to have those payroll records ready in addition to his check register for the policy year so he/she can see if any "sub contract" labor exists without Certificates of Insurance. Trust me, it is not necessary for an auditor to have a completed income tax return as normally the policy year doesn't run from January through December as does the tax year for most. As long as you pacify your client and abide by their absurd requests this time of year, the longer they will keep on doing it to you. Take care, Cathy

I have a Louisiana client who paid Illinois income taxes during the time he worked in Illinois in 2012 as well as 2013. He will again receive a refund of Illinois income taxes this year as well as last year. In order to report the Illinois refund he received last year on his 2013 1040, I need the EIN for the Illinois Department of Revenue to insert on the 1099-G. The client either lost the 1099-G or didn't receive one. Anyway, I need the number to enter on the 1099-G in order to get all of my ducks in a row on his returns (Federal, Illinois and Louisiana). For some reason, I was able to slide by without having the number for the 2012 return, but the error check on the 2013 return is insisting I must have the "Payer ID number". If you have it, PLEASE pass it on to me. Thanking you in advance, Cathy

Lynn, Thanks so much! That's exactly how I've handled it over the years...just wanted to make sure! Take care (and thanks again), Cathy

Husband and Wife lived in a community property state and had purchased home together years ago. Husband died and his wife got usufruct over the kids 1/2 interest (no will) with wife's 1/2 and kids 1/2 inerest all getting the stepped up basis as FMV at the time of husband's/father's death was greater than the actual cost basis. Mother died a couple of years ago while still living in the home. Question: Do the children once again get the benefit of the stepped up basis of their original 1/2 interest (after father died) as the fair market value of the home is now larger than when father died....or do they use their 1/2 stepped up basis when their dad died and their stepped up basis of their mother's 1/2 interest at the time of her death? Or perhaps to make it clearer, if the home was valued at $100,000 when the father died and had grown in value to $150,000 when their mother died, what is the kids' cost basis: ($50,000 -1/2 of stepped up basis when their dad died + $75,000 1/2 stepped up basis when their mother died) = $125,000 OR $150,000 which would be a double-double stepped up basis? All comments appreciated as long as you don't make me cry because I'm almost nuts at the moment! Take care Cathy

For at least 20 years, every IRS seminar I've ever attended, we were always told that the Earned Income Credit was the single largest source of taxpayer related fraud in the entire tax system, however, the EIC continues to grow by leaps and bounds each year. If we ran our businesses whereby we would increase yearly the weakest link in our revenue source, I doubt if there would be many of our businesses profitable today, if any of us would still be in business without having gone belly up under the circumstances. It's no secret that people buy social security numbers to use on their tax returns. Year ago, people sold their "extra kids' numbers for $50 each. Today's going rate is $650 per number. I purposely stay away from Wal-mart this time of year because I'd hate to be arrested for clawing a few eyes out when I see these sales taking place. I think it's time for IRS to take ownership of the fraud occurring with the EIC rather than trying to make it sound like it's due to uneducated preparers. They have been told over the years about the real problems behind the fraud and have chosen to do nothing about it for many, many years. And now, after we preparers have done our part in the "Mandatory" e-filing target dates, we are left out in the cold with "seeds of doubt" planted in taxpayers heads about preparers who shouldn't be preparing tax returns because our court system ruled their testing rules unconstitutional. The next time I find myself training an IRS auditor about the tax code in relationship to one of my clients tax returns, I'll continue to keep my cool and pray I am able to do so until I retire.

JB, Your first post was correct as unmarried parents living together all year with the child is different than separated/divorced parents. In the unmarried parents living together situation, the benefits (providing that both parents agree) all or whatever one parent can legally claim go to the one parent.....the other parent gets no benefits. If the parents don't agree, then the parent with the highest AGI gets all benefits (providing he is legally entitled to them). In other words, the parents can't pick and chose which benefit each gets. It's all or nothing.....if the mother is entitled to the EIC and both parents agree that she will claim the child as her qualifying child for the EIC, but she didn't provide more than half of the support for her child, then the exemption is lost for both parents unless the parents decide to let Dad claim the dependency credit....at which time he would be able to claim every benefit for the child providing he so qualifies for each benefit. In this case, then the mother would no longer qualify to claim the EIC. It's best to sit down with both parents and see which scenario provides them with the biggest savings in tax dollars assuming they are both your clients. I have two such clients coming in the morning. These rules differ from divorced parents or unmarried parents living apart....