BulldogTom

Hey Eli,

I was wondering if you have heard from our friend up north? I cannot remember her name right now, but she was hispanic and had a big practice up around Chicago I think? Wasn't her name Rachel? Have you heard from her at all?

Tom

Lodi, CA

I think the license allows you to use the software on 3 computers, but not with different EIN's. Each license is for 1 practice. If they allowed you to use 3 EIN's, you could run 3 separate tax practices on one license, and I don't think that is what they have in mind when they say 3 users. At least that is how I interpreted the license agreement.

Tom

Lodi, CA

>>He donated a building<

No he didn't.

Maybe he did. I took "He donated a building" to mean he transferred title in a completed gift. You seem to believe he did not. Who is right? Only the poster knows, but I think that is the crux of the question. If he transferred title, I stand by my answer above. If no transfer, I will side with you.

Tom

Lodi, CA

Well... just for the heck of it I will take the opposite view and say it is deductible. The taxpayer/owner of the house did not donate any land or use of land, rather they donated a building to a qualified organization. The fact is that the fire department took possession of the building and it is irrelevant that instead of removing the building they burned it. The gift with FMV of $12,000 was completed in full when the fire department accepted the building and took possession.

I am with OldJack too. He donated a building. The fact that it was consumed is irrelevant.

I am not sure about the cleanup, because he did not give that to the fire department. He merely cleaned up his Investment(?) property after it was used by someone burning a house (with his permission). On an aggressive day I might take that position, but I think I would be more conservative on the clean up costs and add them to basis.

Not sure about the cleanup, but confident about the building.

But if the fire dept used it for 2 years, the deduction should have been taken when title transfered. I don't know that you can get the deduction this year?

Tom

Lodi, CA

Spouse needs to immediately get a general power of attorney for everything. Hopefully he can consent and sign on one of his good days. If you can do this, spouse signs and you attach power of attorney to return.

If he can't sign, or even if he can, she should follow up with courts and have herself appointed over all his affairs (not just tax).

Just my 2 cents.

Tom

Lodi, CA

You're not thinking about a tax write-off are you? (grin)

Can you say "annual shareholder meeting"?

Aloha

Tom

Lodi, CA

That is funny, now lets clog his message board and overwhelm his servers. Maybe we can get some other press about how the ATX user base is revolting against CCH?

I just added my comment. Only took a minute.

Tom

Lodi, CA

However, of the $10.00 charge supposedly $6 goes to CCH and $4 is put towards an account for me to upgrade software. Interesting....

So, if I were only to renew for MAX next year, since I did not upgrade, I could not use the $4.

That sounds like the CCH I am expecting. It is not a $4 rebate for us, and we cannot use it except to purchase more software from them.

They can take their $4 and shove it up there server! They are theives. I wish nothing but pain on CCH this year.

Tom

Lodi, CA

I got the same e-mail.

Tom

Lodi, Ca

OK, here is my fuzzy math thinking about this last night.

Form a corp. Authorize 1,000,000 common shares. Highly speculative risk capital. Issue 200,000 shares first time out @ $5. 1 Million for start up and infrastructure costs. That should buy servers, phone systems, operating software, and programming help. When the software is ready to roll into BETA, do a stock split 2 for 1. Then offer another 200,000 at $5 for 1 million for advertising and support start up cost. Sell 5,000 copies first year at average of $500 (assuming a 3 level platform: basic 1040 1 state @$299 + efile fees extra, complete 1040 all states with ulimited efile @ $699 and Business + 1040 + efile @ $999.) That gets you another 2.5 million to get through the 15 weeks of tax season. Hire us for beta and overflow support (we will work very cheap the first year). If you are successful (and you will know by the end of the first year), split the stock again 2 for 1 and issue another 200K shares for $5 for another 1 million of infrastructure upgrades and advertising. Get 2000 repeat customers on early renewal for another 1 million of operating cash.

18 months from now you have a corp with 4 million shares authorized, 1.4 million issued, a client base of 5K users, and hopefully you are on your way. Investors on the early issues got stock dividends so they are happy and well positioned for future dividends and returns. No one has to invest more than they are comfortable with investing, and those on the cutting edge get the bigger reward. We can all help out a little on beta testing and support, and the Corp can pay us a little bit for that help (can you say web chat support, any of us can log on as support techs to make that work).

Simple, huh? What a business plan! (OK, rip me if you want - I am just musing on possibilities)

Mel, I am sure you could whip this out just like I layed out for you. You are all ready to go now.

Tom

Lodi, CA

The real question is not how much it would cost to produce, but how many customers it would take to sustain it.

There is one truth that all businesses must remember - CASH IS KING!.

The question comes down to how much cash it takes to run the company, what sacrafices have to be made when cash is lean, and what the priorities for cash are when it starts coming in (for example advertising to attract more customers versus programming to enhance the product for the current customer base). Figuring out how much it would cost to program and engineer the product is the easy part. Determining how much it would cost to support is the harder part, because it requires the knowledge of how many customers will purchase and then need support on the product.

If you don't put enough resources in the right place (remember the server problem a few years ago when they took on e-file?, or how about the lack of phone line capacity in GA right now?) you could have the best product in the world and no one would want it because the perception is that you can't support it.

I am sure Mel could put a program together for us in no time, but he is asking the right question - Can he put the infrastructure together to make it successful?

My 2 Cents.

Tom

Lodi, CA

Off the top of my head, I would say on the NOL worksheet, in the area where business expenses are calculated, there is a problem. I don't have the form or program in front of me, but I remember going through all the business versus non-business deductions for an NOL a couple of times before. If you don't do it correctly, you end up with a funny number.

Sorry I can't be of more help.

Tom

Lodi, CA

Client was in a partnership (Event Planning business) for a few years....partners went their seperate ways this past June 2007 and former partner sent her a K-1 (which I will use in preparing her return). When partnership dissolved in June, she formed her own small business (one-person LLC...still event planning).

So I, at first glance, I assume I need to do a 1065 for her current single-owner LLC, then a k-1...with that info used to do her personal 1040...which will include two Sch E (one for partnership and one for single-owner LLC.

Then of course, she has rental income/expenses unrelated to the above business, so a Sch E for that....Am I missing anything big here?

1. Schedule E for the partnership K-1

2. Check the box and put the new LLC on a Schedule C, unless she wants to be a corporation.

3. Rental info on the Sch E like you said.

It is how I would do it.

Tom

Lodi, CA

I would love to stay with ATX, but I don't think it is going to happen. My understanding is (and the ATX staff can confirm or deny) the management of CCH Small Business is mostly from the TaxWise side. That is why we have Taxwise support people in Georgia instead of ATX in Maine.

Your goals are admirable, but from what I have read in my tea leaves, this is not going to get better, and I am preparing to bail immediately when this season is over.

And I will not promote their product for them until they treat me with a bit of respect. The last minute gotcha fees, the pulling of the support board, the support layoffs... none of it is something I would tell a friend to sign up for.

Just my 2 cents.

Tom

Lodi, CA

Beth,

Even if you decide that you have not started a business, all is not lost. First, those items that have a useful business life of more than 1 year will be depreciated begining the day they are placed in service. That deduction will not be lost, just postponed.

Other costs, what we call start up costs, can be recouped with a §195 election. From your post, it seems like you might be able to get all of it through the first year expensing related to that section. If I remember, up to 5000 of start up costs can be expensed the first year of the business. The rest is capitalized and amortized over 15(?) years.

Throw in a §179 election on the assets that are purchased, and you may be able to get a deduction for all of the costs associated with starting the business in the first year.

Just a few more thoughts to consider.

Tom

Lodi, CA

I just did too. Wonder what will happen?

Tom

Lodi, CA

Beth,

When a company is open for business is a facts and circumstances situation. Jainen has given you a lot of the factors that could be used to make that call. JB has done so also. Being open for business is one of those things that you know, but are not always easy to prove. Remember, you have to prove it to the IRS.

Personally, I would ask - "On what day could I have walked up to your hubby and got him out to my party the next night?". If he could not have done that in 2007, he probably was not in business yet. If I can't call him today and have him at my party tomorrow (unless he is booked somewhere else), he probably is not in business yet.

You are responsible for your own tax return. This is a place where you will have to work with your preparer (or make the call yourself if you are going to do this on your own) to make the best possible decision for you in light of your facts and circumstances.

Keep posting here, we all owe you for your help and will do our best.

If you are not comfortable with putting your tax situation in the public view, pick a couple of us whom you trust and send a personal message through this wonderful web site Eric provided. I can't speak for everyone on this board, but I would guess that we would line up to help you (or any of you ex-ATX techs helping us out).

Tom

Lodi, CA

We ought to all email the tech gap and tell them the truth. But then, we are not corporate america and would not be believed.

If we were enron, they would believe us.

Tom

Lodi, CA

Awesome Dude! Congratulations.

My best to you and your family.

Tom

Lodi, CA

I am not sure that it works that way in CA. We routinely accept a post dated check (the refund cycle chart date that they expect their refund). I have never heard that it was unenforceable. In fact, we have prosecuted a bad check and been paid by the county after the district attorney collected. That was a post dated check. I don't remember any language like you mention. Perhaps it is a local law for you.

Tom

Lodi, CA

But I'm more likely to go to a different company, if they cheat us with bad service, after keeping us with false promises that nothing significant was going to change. The drop in support is already a violation of that promise, IMHO. I will continue to hope it improves. But I'm suspicious now.

Wow, KC. I have never heard you talk like this. I am one of the "hotheads", not you. I am supposed to be the one who claims the "sky is falling". If you are voicing the possibility that you might leave, ATX is history.

The queen has dropped her pom-poms.

Let me know where you go if you leave after this year. I am still looking at Drake, but have not been able to pull the trigger.

Tom

Lodi, CA

If I remember correctly, I would remove letters from the first name from right to left. If this didn't work I would do the same for the last name.

Eli

I have not run into this in a couple of years, but I remember like Eli. It was one field and the first - initial - last name all went into that field. If it was too long, you took out the initial, then all the letters but one in the first name, and then started pulling letters out of the last name. It may have changed.

Tom

Lodi, CA

Rita,

How much of the content does CCH update for you, and how much do you update yourself.

BTW, that is a pretty cool site.

Tom

Lodi, CA

Wait and buy it on Wednesday.

Eli

Eli is the MAN!!!! LMAO. Elegant and to the point.

Tom

Lodi, CA

www.trctax.com

Not very fancy. I need to update it. I have it just to say I have one. Nothing more than a vanity plate right now. It might turn into something later.

Tom

Lodi, CA