BulldogTom

As usual, Judy hit the most important question... Tom Longview, TX

Moss Adams website says 1MM. Another site said 400K. Both stress that it is the building less the land to come up with those numbers. Tom Longview, TX

Does the company have employee theft insurance? If so, the insurance company may have a relationship with a preferred vendor that they can bring in. Tom Longview, TX

Sorry @jklcpa, I got that backwards. I thought you had it all set up in the outside software and were asking about the depreciation setup in the tax software. Assuming that your client is going to tell you by unit what appliances are replaced, which carpets are replaced by unit, etc. I would have Land and Buildings as my first level categories, then the units as sub-categories under each building (building A, unit 1). Then all the components, F&F and improvements listed under each unit entered as the lowest level sub-categories in such a way that I could sort on MACRS Class and Life to get summary totals. Once you have it set up, it should be pretty easy to maintain. I envy you getting to set up the depreciation schedule. I have had many instances where I had to go into a musty spreadsheet and try and figure out how that came out as something else on the tax return. Tom Longview, TX

If you have an outside depreciation schedule in detail, I think I would suggest keeping the tax return as consolidated as possible. I would not list the F&F by unit on the tax return. I would summarize my tax return by MACRS Class & Life, so any of your F&F that are 5 year would be 1 line item, 7 year 1 line item, etc. Same with buildings if there are more than 1. Just one line item summarizing all buildings. Tom Longview, TX

Did not think of that one. It may or may not be feasible but it is worth exploring the idea. Tom Longview, TX

You said yourself that you are working with incomplete information. That leads me to believe that the bank statements are not the only source documents (I could be wrong, just my hunch). I would hesitate to amend returns that I am not sure I have all the data and documentation for. How would you defend it if the IRS decided to audit the returns? What I would do, if you want to keep the client, is ask the client to give you a letter indicating that I can rely on the work of the prior accountant. Get the prior year financials and returns, make your prior year financials look like the reported financials and returns and move forward with your work in the current and future years. I hate these situations, but I caution you about making it worse unless you are absolutely certain you have all the source documents to make any changes. Tom Longview, TX

I generally inform the client that they have a reporting requirement and offer to prepare the 1099s for them (for a fee, of course). If they decline my offer, then we have the discussion about deductibility and audits and losing audits and paying taxes and paying penalties and paying interest and possibly finding someone else to prepare their returns. I like to educate, and it is not my job to disallow deductions - that happens at audit by the IRS or the tax court. If it is a one off oversight, then we do what we can to make the return correct for filing. Tom Longview, TX

Same here for my CA clients. If they have a mortgage I pretty much can assume they will itemize in the state. The one I have to watch for is older clients who have paid off their mortgage but are giving larger charitable contributions. Tom Longview, TX

@joanmcqYou got a fax number for FTB responses? Thanks

Showed that to FedEx and they said they won't send it that way. They want a physical address. That was when I just about had my head explode. Tom Longview, TX

That is the CDTFA offices. But thanks. Tom Longview, TX

Warning - half venting - half asking for a solution. My client in CA got a notice of balance due. After looking at the notice (which was sent to me a month after they got the letter), I realized that the LLC payment was not applied to the LLC (SMLLC disregarded). The payment was made electronically with the timely filed return and we have proof of the payment came out of the client's checking account. I suspect the payment went to the taxpayer's account and not the LLC account. So I get a POA for CA for the individual and write a letter to the FTB with all the details. Sent the letter Priority Mail. 10 days later, tracking shows it is still not delivered. Go to the post office and they say it looks like it is lost in Sacramento. Sent the letter a second time. Surely they won't lose the letter again. 10 days letter the tracking shows it is still not delivered. Somewhere in Sacramento. Go to the post office and they take it to the manager who is about as useless as tits on a boar! "Nothing we can do - I can't contact anyone in Sacramento to find out where the package is". So I go onto the FTB website and get the address for express delivery. FedEx says they can't deliver to that address! I am at a loss. It seems like sending the letter again via the postal service is the definition of insanity, doing the same thing over and over expecting a different result. Does anyone have a physical address for the FTB? Tom Longview, TX

I was wondering if the client could get the policy attached to a GL policy instead of the Auto policy. Even that may be a stretch because it is still auto insurance covered under the Standard Mileage Rate. I think your client is not going to get the extra deduction for the policy. Tom Longview, TX

Waiting for @DANRVAN to answer because I don't know for sure. He is looking at this post right now. Tom Longview, TX