BulldogTom

I am worried. I just sent a return and it says it was transmitted, but then it says it cannot process acks. This is why we love this job. Tom Lodi, CA

NO. "Frikkin" is the adjective that describes the word "Unreal". You are from California - haven't you studied your ebonics? I know you are a young man and surely you were in school when that wonderful program came to be. "Frikkin" can be inserted into any word or phrase at any time to show emphasis or extreme emotion. Examples- Stupid Frikkin Client, Incomprehensible Frikkin Publication, Idiodic Frikkin Politicians, etc. You get the idea. However, it is the highest measure of acheivement when you can insert "Frikkin" inside a word. Example - In-Frikkin-Sane, Un-Frikkin-believable, etc. Try it - it is a good Frikkin stress reliever. Tom Lodi, CA

Client has a basic return with Sch A and Sch E with 3 rentals. Not a big deal most years. Had a loan modification on both residence and rentals. Spent 30 minutes on the insolvency worksheet in our first meeting, and then another 45 when they came back tonight. They owe for the first time in their married life. Pissed about it. Hey - you just got income releif of 200K, and you have withholding of 1600 on 95K AGI with another 30K of non-taxable income. But here is where it gets unreal. "Since we have to pay so much, can you cut our bill down some"? I only charged him $249. He asks if I will take $200 cash or I can wait for the money. I was about to lose it. His wife was mortified. So I very sweetly said, the return doesn't get filed until I get paid. Now the best part, he says "you know our checks bounce" My reply - "I will just call the IRS and tell them that I am not your paid preparer, and I don't know what they will do" His wife wrote the check. Can I go on vacation now. Tom Lodi, CA

I know it considered professional courtesy to tell the new preparer what you did and why, with client's permission of course. But it is also professional courtesy to not bother the previous preparer in the last week of tax season. If you know the CPA, personally or professionally, it might be ok to give him a quick call to discuss, but if you called me this week about a PITA client that you were taking from me, I would ask you to call me after tax season and explain my rates for consultation. To me, it sounds like the client is not telling you everything. They may just be intentionally uniformed about their tax situation or hiding something. But this doesn't pass the smell test. Why didn't they just ask the CPA when they picked up the returns? Why are they coming to you at this late date? Get a retainer. Tom Lodi, CA

Can't take it. Look at the questions on the EIC tab. "Does the taxpayer (and spouse if filing jointly) have a SS# that allows them to work in the US?" If the answer is no, you do not qualify for EITC. Tom Lodi, CA

wait for the 1099 to come in. Ask the lender for one. They should provide it. Tom Lodi, CA

KC, Could you please update this post when that scam is scheduled for the Lodi Lowes? Thanks in advance. Will be checking the price of wallets at WalMart. Could stand to lose a few pounds as well. Tom Lodi, CA

<<I think that would be very improper. In my opinion, the trust can NOT receive the refund.>> Thanks Jainen. But just out of curiosity, why would it be improper for the trust to take the refund, as it is going to go to that account anyway for distribution to the beneficiaries? Inquiring minds want to know. Tom Lodi, CA

Sorry, he is also the personal representative. If the trust has a bank account, can I just send the refund electronically into the account? Tom Lodi, CA

Taxpayer had a revokable living trust. He passed in Oct. Brother is successor trustee for the trust. Final return has a refund. Shouldn't the refund be made out to the trust? Form 1310 does not seem to have this option. Should I have the check sent in the name of the brother under his social security number? That doesn't seem right when the trust has a tax id#. The trust will also have to file a return based on income earned by the assets of the trust reported on the trusts Tax ID #. Thanks Tom Lodi, CA

Welcome to our nightmare Sam. The Republic of Kalifornia appreciates your input. Tom Lodi, CA

Wow, I missed that part of the bill. Job Security. Tom Lodi, CA

Now that the ANNOINTED ONE has ensured that no American will die from lack of health care, it only seems logical that he should move on to saving the rest of the world. I understand that in 2012 he will be running for President, UN Secretary General, and head of the European Union all at the same time. Tom Lodi, CA

Dear Client, In response to you inquiry on why you must pay this year, I would like to point out that your spouse's business she started the year before made over 25K in profits this year. She did very well, and I am sure that extra money helped out. I would also like to remind you of the conversation we had last year about checking in with me at mid year to see if there might be a need for estimated tax payments. I still have not recieved that call, but you will notice I have included the vouchers for your estimated tax payments for the upcoming year, the first of which is due on April 15th. In response to your second inquiry of whether I could just ignore the 6,800 that you included on your organizer but did not recieve a 1099 Misc for, I am sorry, the IRS does not look kindly upon tax preparers who assist their clients in committing fraud. My license is too valuable to me to risk it on a client who's check for my services bounced last year. As to your third inquiry about offers in compromise, I would appreciate the opportunity to assist you in filing the required documents, however, I will need a retainer of $2,000 up front, payable in cash if you please. Please note that my services in this area will not guarantee any settlement from the IRS, I will merely present your case for you. You will need to list all of your assets, including the value of the Mercedes you pulled up in for your appointment, and the jewlery you were so proud of that your wife was wearing. How much did you say that rock on her finger cost? As a final word of advice, before you begin the offer in compromise process, you should check with your employer, the State of California Franchise Tax Board, about any possible negative impacts to your employment if you proceed with this course of action. Thank you.

I would have deducted them on his Schedule C. Tom Lodi, CA

Taxpayer has COD income. The COD came from the forclosure on real estate used in his business. He has PP Loan Fees on the balance sheet from the financing of the property in 2003. Now the loan is gone. Normally, you would take the remaining balance of the PP Loan Fees in the year the loan goes away. Do I have to reduce the basis in this asset before disposing of it? I think so, but my research is not giving me a clear answer. It says to reduce the basis in depreciable assets. This asset is amortizable. Am I splitting hairs? It is about 5K that I can use on his Sch. C if I can write them off without reducing their basis. Thanks Tom Lodi, CA

The 1099A will tell you. Look for the box that is checked for "borrower is personally liable for this loan" or "borrower is not personally liable for this loan". Tom Lodi, CA

Linda, Client won't get a 1099C. There is no COD income on the foreclosure of a non-recourse loan. Tom Lodi, CA

All Debts included in Bankruptcy. I guess my real question is do I reduce the basis in the assets by the amount of cancelled debt prior to "selling" them on the 4797? I know what the final answer is, I just don't know for certain how to get to it on the tax return. The lack of 1099C's is throwing me for a little loop. The taxpayer qualifies under 2 separate rules for exclusion (business property & bankruptcy) and I don't know the order to apply them. So I don't know for sure if I should reduce basis and then sell or not reduce basis, sell, and exclude debt. I do know that cancelled debt is to flow to the activity that generated it. So all the business debt cancelled should go on the C. Do I show it, and then cancel it on the same form with an explanation refering to the 982 form? I keep coming up with too many ways to do this and not enough certainty on if I am on the right track. Thanks. Tom Lodi, CA

Here is how I am thinking of proceeding: All 6 properties on business balance sheet "sold" back to bank as of date of BK (same as foreclosure date). Recourse loans "sold" for FMV listed on the 1099A, non recourse "sold" for outstanding loan amount listed on 1099A. Cancelled debt included on Sch. C. Gain or loss on 4797. Cancelled debt excluded under BK exception less amount of tax attributes decreased (small NOL) included on Sch. C. Explanation of each calculation attached to return. Personal residence listed on Sch. D. Does this treatment sound correct? Tom Lodi, CA

Thanks KEA Tom Lodi, Ca

Sorry - Having a brain cramp. Does surviving spouse have to sign for deceased spouse? Thanks Tom Lodi, CA

Sam, Do I need to sign up to efile in GA? Thanks Tom Lodi, CA

Yes. The client will love you. They probably need the money if they lost that much. Tom Lodi, CA

New client. Travels with film crews. Worked in GA for less than 2 weeks total over 3 trips to the state. Has just over 1K in w2 wages from GA source. I pulled up the GA 500. Is she a PY resident? Non-Resident? Any things that I should watch for? How does ATX handle GA returns? Thanks in Advance. Tom Lodi, CA