ILLMAS

Have these folks been your client for a while? I have a suspicious someone advised them to make the improvements to reduce their loses, I would ask for prove of payments for the improvements, I once had someone tell me I bought a 20K kitchen for 6K but I would like to the 20K of improvements.

Would it be a good idea to review publication 544?

Have you tried shutting down computer first? Don't just restart it. MAS

Every time is see this thread I see 1098 Tissue

New client today, their return was prepared in way to get more money back, it's very obvious and they have been informed that their return was prepared incorrectly bla bla bla, have the prior preparer correct it or I could amended for a fee. I have not seen this before in my years of preparing tax returns, married couple, prior preparer prepared the wife return as HOH and with two dependents (children), husband tax return was prepared as HOH and the name of one of children appears (If the qualifying person is a child but not your dependent, enter this child's name here), that child is being claimed by the mother, is this correct? Unfortunately, they were going to think about my fee and would get back to me, but I don't have the return in front of me investigate it further.

Edit to the above: TP attempted to collect rent from the brother.

TP and brother were to maintain the property (repairs, improvements, insurance, property taxes) and split the bills, no rent was being charged/collect. <- TP paid 100% and the brother lived there for free. No depreciation, property has always been treated as a single family home. Many years ago TP took out a rehab loan and fixed both apartments, TP and brother had agreed to split the mortage. <- TP paid 100% and the brother still lives there for free. No depreciation, property has always been treated as a single family home. I will assume one of these scenarios could occur besides any tax consequences if the property is sold, the brother will either buy the house for himself, be homeless or pay someone rent.

Darn autocorrect, I hate when that happens.

Learned this today from a client, TP's father quick claimed property to TP and property was to be divided between siblings many years ago, siblings did not want to do anything with the property with exception of one brother and the arrangement was that the TP and brother would go 50/50 on all expenses of the house. Apparently, TP has assumed 100% of the responsibility of maintaining the house since day one and now would like to sell the property. The 2 flat house has been used as the primary home for the TP and brother, I am aware that her basis would be the original cost to the father or FMV at the time of the transfer, but would there be a gain if the house estimated value was 15-20K at the time of transfer and is now worth 240K? No gift tax was ever paid as far as I know. Thanks

I was thinking of the affidavit atop of collecting as much documents they can provide, not just the affidavit and that's it.

Would be okay to request an affidavit from TP acknowledging their children lived with them the whole year or more then six months? I am collecting school records, medical, birth certificates, SS# cards and none prove that the child lived with the parents.

All I know is that I don't charge enough, if big box companies can charge XXX and people don't complain, makes me think I don't know how to run a business.

Last minute client called and gave me the amounts for the 1099 yesterday afternoon, today client called to let me know he gave me the wrong amount for one contractor and forgot to include another one. Is there a way to efile the corrected information, or will it have to be paper filed, the efile from yesterday has not been accepted yet, is there a way to cancel it? MAS

TP borrowed a good sum of money during the year from his business, TP goal was to repay it back before the year ended, that didn't happened and I wanted to see if I can convert the loan into payroll, accrue it as of 12/31/2016 and have the payroll company calculate the payroll taxes and pay it this year?

I don't know if you are being serious, but why did the student take the $5000 if their not in the business of looking for aliens?

I should of mention that this is as of a result of a large bonus, not salary.

Does anyone know at what point the federal withholding tables do not work and the employee ends up owning money because there was not enough withholdings even if they claim zero dependents? Or if someone knows of any article that would be useful to show to clients why this happens to high income earners more often. Thanks and happy Friday to all.

See last paragraph/question IRA FAQs - Distributions (Withdrawals) Distributions while still working Can I take money from my traditional IRA, or my SEP or SIMPLE IRA, while I am still working? You can take distributions from your IRA (including your SEP-IRA or SIMPLE-IRA) at any time. There is no need to show a hardship to take a distribution. However, your distribution will be includible in your taxable income and it may be subject to a 10% additional tax if you're under age 59 1/2. The additional tax is 25% if you take a distribution from your SIMPLE-IRA in the first 2 years you participate in the SIMPLE IRA plan. There is no exception to the 10% additional tax specifically for hardships. See chart of exceptions to the 10% additional tax. Do I request the distribution check directly from my employer or from the financial institution where contributions to my SEP or SIMPLE IRA are invested? You will need to contact the financial institution holding your IRA assets. If I withdraw money from my IRA before I am age 59 1/2, which forms do I need to fill out? Regardless of your age, you will need to file a Form 1040 and show the amount of the IRA withdrawal. Since you took the withdrawal before you reached age 59 1/2, unless you met one of the exceptions listed in Publication 590-B, you will need to pay an additional 10% tax on early distributions on your Form 1040. You may need to complete and attach a Form 5329 Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts, to the tax return. Certain distributions from Roth IRAs are not taxable. Can I deduct the 10% additional early withdrawal tax as a penalty on early withdrawal of savings? No, the additional 10% tax on early distributions from qualified retirement plans does not qualify as a penalty for withdrawal of savings. Will I have to pay the 10% additional tax on early distributions if I am 47 years old and ordered by a divorce court to take money out of my traditional IRA to pay my former spouse? Yes. Unless you qualify for an exception, you must still pay the 10% additional tax for taking an early distribution from your traditional IRA even if you take it to satisfy a divorce court order (Internal Revenue Code section 72(t)). The 10% additional tax is charged on the early distribution amount you must include in your income and is in addition to any regular income tax from including this amount in income. Unlike distributions made to a former spouse from a qualified retirement plan under a Qualified Domestic Relations Order, there is no “divorce” exception to the 10% additional tax on early distributions from IRAs. The only divorce-related exception for IRAs is if you transfer your interest in the IRA to a spouse or former spouse, and the transfer is under a divorce or separation instrument (see IRC section 408(d)(6)). However, the transfer must be done by: changing the name on the IRA from your name to that of your former spouse (if transferring your entire interest in that IRA), or a trustee-to-trustee transfer from your IRA to one established by your former spouse. Note: an indirect rollover doesn't qualify as a transfer to your former spouse even if the distributed amount is deposited into your former spouse’s IRA within 60-days. See Retirement Topics - Divorce Required minimum distributions How much must I take out of my IRA at age 70 1/2? Required minimum distributions (RMDs) must be taken each year beginning with the year you turn age 70 1/2. The RMD for each year is calculated by dividing the IRA account balance as of December 31 of the prior year by the applicable distribution period or life expectancy. This rule does not apply to your Roth IRAs. You can determine your distribution period or life expectancy by using the Tables in Appendix B of Publication 590-B Distributions from Individual Retirement Arrangements (IRAs). Table I - for beneficiaries. Table II - for owners whose spouse is 10 years younger and the IRA's sole beneficiary Table III - for all other owners (most IRA owners will use this table) See the discussion of required minimum distributions and worksheets to calculate the required amount. I am over age 70 ½. Must I receive required minimum distributions from a SEP-IRA or SIMPLE-IRA if I am still working? Both business owners and employees over age 70 1/2 must take required minimum distributions from a SEP-IRA or SIMPLE-IRA. There is no exception for non-owners who have not retired. Qualified charitable distributions What is a qualified charitable distribution? Generally, a qualified charitable distribution is an otherwise taxable distribution from an IRA (other than an ongoing SEP or SIMPLE IRA) owned by an individual who is age 70½ or over that is paid directly from the IRA to a qualified charity. See Pub. 590-B, Distributions from Individual Retirement Arrangements (IRAs)) for additional information. Can a qualified charitable distribution satisfy my required minimum distribution from an IRA? Yes, your qualified charitable distributions can satisfy all or part the amount of your required minimum distribution from your IRA. For example, if your 2014 required minimum distribution was $10,000, and you made a $5,000 qualified charitable distribution for 2014, you would have had to withdraw another $5,000 to satisfy your 2014 required minimum distribution. How are qualified charitable distributions reported on Form 1099-R? Charitable distributions are reported on Form 1099-R for the calendar year the distribution is made. How do I report a qualified charitable distribution on my income tax return? To report a qualified charitable distribution on your Form 1040 tax return, you generally report the full amount of the charitable distribution on the line for IRA distributions. On the line for the taxable amount, enter zero if the full amount was a qualified charitable distribution. Enter "QCD" next to this line. See the Form 1040 instructions for additional information. You must also file Form 8606, Nondeductible IRAs, if: you made the qualified charitable distribution from a traditional IRA in which you had basis and received a distribution from the IRA during the same year, other than the qualified charitable distribution; or the qualified charitable distribution was made from a Roth IRA.

Please read this when you cannot sleep: http://www.worldwideerc.org/Blogs/MobilityLawBlog/Lists/Posts/Post.aspx?List=c020aee5-48ad-47b2-8295-a4cf71ba9e34&ID=94

I have a client that needs 2011 and 2012 prepared, I have that software in a different computer and I would like to charge a fee for the inconvenience of either bringing the computer from storage or having it to install the tax software on my current computer, what would you call this fee and what would you charge?

Here is how to disable it:

How does now disable it?

Sometimes this is good, I personally waste so much time checking my facebook tax related profile responding to people tax question and don't focus 100% on my work. I've been thinking the same.

I have a client that needs to issue out a 1099 to a payee for some consulting work, the payee requested for the payments to be made out to her name, now her W-9 shows her name, business name however it's show her type of business is a non-profit. My concern was why did she request the payments be made out to her name and for the 1099 to be reported non-profit entity, does this look fishy? MAS