Catherine

6 hours ago, Lion EA said:

when they return from their trip.

Take a nap until then! Or work on someone else's stuff.

6 hours ago, Patrick Michael said:

For the handful the do make payments, you have to file manually.

Nah. Send 'em a link to Direct Pay and tell 'em to make sure they pick EXTENSION payment. Or (securely) send 'em a coupon to mail in with a check. 

I've generally found external search engines to work FAR better than the IRS search box. Look up "2022 instructions Form 8606" (or anything) and anything 2022-specific will be somewhere on page 15 of the results. If you're lucky. 

On 5/20/2024 at 3:28 PM, jklcpa said:

or it is for some other reasoning

The one way back was a very weird case - but all it takes is one weird case and you end up over-thinking and wondering if the new situation is analogous to the older weird one. 

Thanks to all for responses.

On 5/20/2024 at 3:20 PM, Tax Prep by Deb said:

I was very happy to see the bult extentions and that it worked flawlessly.

I put everyone on extension whose returns are not 100% ready and just waiting for signatures as of the beginning of April. Then, if we finish, no harm no foul. If the clients don't get me the information, no harm no foul - and no racing on the last day to get extensions filed. If later we find someone should send in money, I send them the Direct Pay (& state equivalent) link, or a paper coupon to print and then to mail in with a check. But that's also on the clients getting me enough information. 

14 hours ago, Lion EA said:

Dividing up marital assets in a divorce is NOT buying an asset at FMV from your soon-to-be ex.

This is very true. But I have also seen divorces where there was a specific buy-out clause put in the agreement, as well as money that changed hands in accordance with that clause. I forget why it was done that way, though, as it was some years ago. That does not seem to be the case here.

On 5/18/2024 at 10:21 AM, artp said:

I would be very interested in viewing your presentation. Can you provide a link?

Thanks

You can take the class for credit at the link provided. Since Tax Practice Pro is using this as an online offering, I do not think it would be appropriate for me to giving it out on my own to anyone. 

This year's addition of bulk 1040 extensions was a huge timesaver, too. 

Yes, the macros are a fabulous tool. Highly recommended.

Thank you for all your hard work for us!

On 5/17/2024 at 3:54 PM, BulldogTom said:

I would stay out of questioning the divorce settlement.

Not questioning the settlement per se, but rather if there is something IN the settlement where, for example, his larger share of investments was designated as because she was getting the house. If there is wording specifically stating the house as his reason for getting more investments, that could be a de facto purchase of his part of the house, increasing her basis.  

TIA to all for answers; I'm just going to tell her she gets to exclude $250k, their joint basis from purchase, plus any major upgrades done while they/she owned the house.

Divorced client tells me (in advance - hooray!) of her plans to sell (in 2024) the house she got in the divorce that was final in 2023. She asked about tax repercussions of that plus some other queries. In response I asked if she bought him out, or if there was an agreement to share proceeds of the sale. 

Neither! She got the house and in exchange he got more of their investment assets. Total value of assets was the same. 

My first thought is that she gets 100% of the gain with only $250k exclusion and no step-up for "his" portion of the house. But that's just a first thought. Pub 504 and Code Section 1041 talk about basis in the property being the same as if it was a gift from one spouse to the other, with nothing about any step-up even being possible. Yet that seems to leave her with a bigger tax bill than he'll have from their investments. Making me wonder if I should be asking if there was anything in the divorce agreement that talks about equalizing basis. 

Any advice/references/thoughts for me?

After using ATX for many years, I switched to Drake mid-season during the 2012 filing season debacle. Support is excellent (if not quite as good as it was before Phil Drake retired). Not quite as intuitive but the search box works really well. No bunny-hop endless circles as I ran into in ATX on too many occasions. If you switch, you get (or at least always used to get; ask about current terms) the current-season software free to roll over returns, or re-create them (to learn how the s/w works), plus prior-year programs free. I don't use Portals but use Verifyle instead. Gruntworx - that was once standalone but got bought by Drake and integrated with it years ago - is something I now consider essential but rarely use more than the non-verified (i.e., automated) bookmarked/indexed pdf creator. It makes methodical entries far easier, but the best use is looking for substantiating documents for the tax agency "send us proof of withholding" type letters. Boom, found in an instant, instead of endless searches through vaguely-named pdf's. It also has The Tax Book as an integrated add-in but I prefer the standalone version. 

Pricing has been remarkably stable. This year there is a price break for single-user offices (like mine) which I like. 

TL;DR version:  jumping in the deep end worked and while it's not perfect I would not go back to ATX.

I believe this is it (I've asked the hosting group for confirmation, too).

https://www.bigmarker.com/tax-practice-pro-inc1/When-1040s-Go-Wrong-Navigating-a-Tax-Train-Wreck

Praise God!

On 5/7/2024 at 3:06 PM, DANRVAN said:

 

Maybe a reason why they are changing tax preparers?  By their choice or were they fired?

Self-prepared using some online site for 2022.

I've already told him he needs to find someone else for next year. I've put the return on extension and have asked for a phone conversation. I may ask him to go elsewhere for 2023, too, as I am getting increasingly uncomfortable with this whole mess. Considering for all of 2023 they took in less than $5K (and yes, spent it on PF purposes), that's saying something!

3 hours ago, Lion EA said:

https://www.irs.gov/charities-non-profits/form-8940-for-miscellaneous-determination-requests

Are they dissolving the PF; or do they need an advance approval for a new activity, such as voter registration? Why does your client think they need to file Form 8940? I agree with you that that form says nothing about "activation." Maybe their "advisor" said de-activation, and your client heard activation.

They are under the impression that they cannot accept larger donations until they are "activated." As far as I know, that was the Nov 2022 determination letter! I had been wondering if the guy was told "de-activation" and heard it wrong. But since this is not an area of expertise, I also figured there was a chance I was the one misunderstanding it all, too. 

It's a new entity, and has not yet even begun to serve it's purpose (because he's been holding off for this $%^&* form issue); it's not being disbanded, that's for sure!

Private foundation needs help with its 990-PF, but also says they were told they need to file Form 8940 "to allow us to become 'active' as a foundation" and there is nothing I can find in the Form 8940 instructions that has anything to do with being "active." They got their 501c3 determination letter in November 2022, and did file a 990-PF for 2022 (no activity, so late in the year). 

I've done PF's before and this one isn't hard (only two donations totaling less than $5k, a couple of office expenses, and a prepackaged web site; all expenses are maybe $1k). The stumbling point is this insistence that they "need" this form filed to "activate" the foundation.

Every other bit of advice they got from whoever was talking to them about taxes seems to be highly suspect, and I'm thinking this is again the case with this form. But I'm somewhat out of my league here in PF startups. The one other PF I dealt with had their own issues (meant to set up a charity & did the paperwork wrong; had to file PF for two years while that mess was being fixed) but there was nothing about some form for "activation."

Instructions for the 8940 have nothing that sound like it applies. Other readings online ditto. However, I could well be missing something. Anyone here have any clues, pointers, reference sites?

TIA.

I had an elderly client, gone these many years now. He had interest from a dozen or more different banks every year, chasing interest on 1-year CDs. His great joy and glee in life was calculating (by hand on paper!), and paying, his estimated taxes such that he owed less than $25 in April, each to the state and the IRS. But always he wanted to owe and never overpay into refund. I got a real kick out of him and he (and his wife) were lovely to work with. 

Look at Drake single-user full license. 

Not worth any small price "saving" to me if I'm going to spend dozens of hours learning a new software, converting returns, checking every single bleeping depreciation item (those are most likely to get mucked up in conversions), every single carry-forward amount, etc.

I have easier ways to hurt myself, and easier ways to save a couple hundred bucks. 

YMMV.

46 minutes ago, BulldogTom said:

Stepping down from my soap box now.   I feel better.

I feel better just from saying "YEAH!" to everything you wrote.

On 5/1/2024 at 5:19 PM, Terry D EA said:

One thing I want to know is if there is a way to stop a client from becoming the host once I create their account. I have had clients do this which prevents any signing

Only the one who creates the workspace can control signatures. I had a client do this, and I started a new workspace for her & her husband, saying it was the only way for me to get signatures. It was a mild annoyance only. Next year, I'll start her workspace early, so she does not.

On 5/1/2024 at 5:19 PM, Terry D EA said:

Verifyle gives the option of choosing a digital signature or a handwriting signature so a mark can be made.

The client can type their name and choose the font they want displayed.

I bumped to the single-user and that also kept the price down a bit more. Everything is going up. Time to raise my prices!

And the recording still qualifies for CPE credits.