BulldogTom

Blaming all of this on Bush is not fair. AMT has been a problem for years, and multiple congress' and the presidents have been including the revenue projections from AMT into their budgets knowing that they were never going to tax the middle class via AMT. It is just getting harder and harder the longer they put it off. This happens to land in GW's lap, but it ain't all him. It is not his tax cuts that caused all of this, even if they were a contributing factor. Mostly, it is politicians lying, then blaming someone else, then lying some more that got us into this fiasco. Tom Lodi, CA

OK, this may not be correct, but if I remember my partnership classes, you may be able to get to that result. I think you need to do a complete close of the book at the time of the split, and get a complete accounting of the capital accounts. Get the hard assets accounted for next. Hopefully, you will be short about 5K (25K X 20%). Value the intangible for the difference. Distribute his capital back to him in the form of the intangible. It is creative accounting, but if you do it correctly, it might work so long as all the income is properly accounted for and included on the K-1s. This is total unresearched. I am not an expert on Partnership taxation. I am just recalling some stuff from some classes I took. Tom Lodi, CA

<<No assets or money will change hands. The 20% partner simply ceases his involvement with the business>> That partnership interest must have had some value (positive or negative). That value was transfered to the remaining partner, which is an acquistion of a partnership interest to him, and a disposition of a partnership interest to the minority partner. In addition, the value of the client list that the minority partner took should also be evaluated. He may have traded the client list (intangible asset) for his partnership interest? Are there any debts in the partnership that the majority partner assumed? or that the minority partner is relieved of? There are many questions that need to be answered before any determination of tax consequences is made. And if I am reading this correctly, the partnership disolution only memorializes what happened LAST YEAR, when the tax consequences would apply. Tom Lodi, CA

Does Tenn have income tax for businesses? If so, ask him if he has a nexus in that state, and if so, you would be happy to prepare the Tenn Non resident tax return and deduct the advertising that he did in that state. See what he wants to do then. Tom Lodi, CA

Merry Christmas to all. Congress just put the AMT present under the tree. GW says he will sign it. Tom Lodi, CA

I don't think L.S. is saying his church is going to Fund Raise in Jamaica, what they are going to do is have some fundraisers in the US to offset the cost of the trip to Jamaica. Tom Lodi, CA

Y'all are crazy. Everyone knows that you forget the peanuts and just put butter and jelly on the bread. JELLY BREAD RULES!!!!! Tom Lodi, CA

I still have not found it anywhere on the ATX websites. It does say on the MAX page that there are no hidden fees. I wonder what CCH considers "hidden"? There is nothing on the bank products page. I am waiting for some info from ATX. Lets see how this comes out. Tom Lodi, CA

<<Why Court of Claims?>> Because he has missed his opportunity in Tax Court. The Notice of Deficiency was issued in 2006, well beyond the time for filing in the Tax Court. Unless I am mistaken, there are only 90 days to file the tax court protest after the Notice of Deficency is mailed. I would very much love to petition the tax court, but I believe he is barred by statute. Also, since this is a credit, the tax is already paid and I can get him in without him having to put up more money. <<you aren't going to get awarded legal fees>> I know this. <<I don't think a taxpayer could represent himself there; he must have an attorney>> He can go to the court of claims pro se <<It is also pretty expensive >> You may file an Application to Proceed In Forma Pauperis which I think means I am a Pauper and can't afford to sue the United States. This is the same taxpayer who has not been able to get any of his child related tax benefits because of the 2003 improperly filed tax return. The taxpayer has been audited every year and had his dependency exemptions for his children (his sperm and his name on the birth certificate) who live with him year round denied, his filing status changed from HOH to Single, and lost his CTC, Additional CTC, and EIC. The prior preparers did a crappy job of representing him, making it easy for the IRS to just ignore him. This is the client who the IRS will not even acknowledge the request for audit reconsideration that I prepared 4 months ago. If you have a better thought on how to proceed to at least get a fair hearing with the IRS, I am all ears. It seems to me that a judge outside the IRS is the only options for a fair hearing. I thought about the Taxpayer advocate, but I am not sure they would not send me back into the same beauracracy that is ignoring the taxpayer right now. Tom Lodi, CA

If any one has an example of a Federal Court of Claims complaint against the IRS commissioner for a denied credit, would you be willing to share it with me? I have a client that I believe this is their only recourse. Of course they are poor, and I don't know an attorney that will take a case with a 50% chance of success pro bono. I have been all over the internet and not finding anything. The Federal Court of Claims website has the basic instructions. I am looking for an example that I can follow. Any help would be appreciated. Tom Lodi, CA

This is interesting, because the HSBC agreement limits the amount that can be charged for a loan. If ATX is causing this limit to be exceded, then the loans are in violation of the new Armed Forces Lending Law. I wonder if HSBC is aware that ATX is screwing up their rate calculations. I am sure that ATX is going to say that it is a transmission fee or e-file fee, but I would guess that if a good lawyer looked at this, it would be a part of the interest calculation regardless what ATX and HSBC call it. Could be interesting if an Armed Forces member comes into a tax shop with ATX software and gets a RAL through HSBC. I would like to see them squirm. Tom Lodi, CA

Sorry, I guess I should have made that clear. The code section 267 says that a 50% or more shareholder accrued wages or bonus may not be deducted until the day paid. The 2 1/2 month rule does not apply. The above rev ruling is deceptive, because it is before the 1984 code changes. It should be obsoleted by the IRS, but since the taxpayer losses because of the 2 1/2 month provision, I think they are keeping it as guidence for non-shareholder bonuses. Thanks Jack. I will try to follow up on my posts in the future. Tom Lodi, CA

When I go to myatx.com and click on "My Product" I only see the MAX product and the $69 Shipping fee. There is nothing about any bank products at all. In the past, Republic and ATX did not play nice in the sandbox together. I am assuming this is the same situation, that ATX is going to get paid for dealing with a vendor that they don't like to work with. Just a guess, not anything I know for sure. Eli, are you seeing anythin else on your order? Tom Lodi, CA

How did you find that out? Is it only Republic? I went with Santa Barbra and don't recall any disclosures about fees for transmitting the application. I certainly don't want to get that suprise, since I don't charge a lot for the bank products. Tom Lodi, CA

Thank you Jainen

Second question Can any of you with great research software tell me if Rev. Ruling 68-114 has been superceded? If not, I have my answer. Thanks Tom Lodi, CA

Is the rule that a corporation with a fiscal year end may accrue year end bonuses and deduct them on the corporate tax return if paid within 2 1/2 months? If the employee is 100% shareholder, does the above rule still apply? Regulation §1.267b seems to take care of the first question, but I think I remember something about the loss of deduction on related parties, even if paid in 2 1/2 months. Thanks for your help. Tom Lodi, CA

I hope they all get hit with AMT. And I hope they have to fill out the forms by hand. And I hope that they have to call into the IRS to get help with their returns. And I hope that no tax professional will allow them into their office, let alone prepare their tax returns. That would teach them. I am not angry with the government! AM NOT AM NOT AM NOTTTTTTTTTTTTTTT! I feel better now. Tom Lodi, CA

Jainen, I did take your advice and wrote a 1 page letter asking for the reconsideration based on IRS misapplication of the 2005 Working Families Tax Relief Act. I assumed they would just deny (which is what I expected) via a form letter. It is possible that the letter "got lost" in the office, but I think you are on the right track about the "round filing" of it. Don't think I will be getting over the hill anytime soon. 2 boys active in sports, a full time job, and a tax practice keep me pretty busy. I may be that way next summer when our church takes the youth group to the boardwalk. Merry Christmas. Tom Lodi, CA

Jainen, I finally was able to talk to someone at the audit reconsideration office in Kansas City about the 2005 return. She told me they never got my letter (I have proof, but oh well) and that even if they got it, they probably would not open a prior year audit on a point of law, only on new evidence. Then she said they take up to 6 months to decide if they are going to open the audit, and about a year to process the second audit if it gets that far. So much for that idea, we will look for a new strategy. As for your warning above about 2006, we have been waiting for 4 months for the return to be transferred to the local office. Practioner priority line operator gave me a number in the local office and I got in touch with them. The return is still not there. No one knows for sure where the tax return is. The Atlanta office sent it out and it is not there anymore. That is the only thing they know for sure. So we wait. Please send me an e-mail with your mailing address. I would like to get something in the mail to you (it won't be a Jeroboam - but I hope you like it). Tom Lodi, CA

Just a follow up, after about an hour of working on it, I found that there was not enough profits on those activities to get a deduction. It is interesting that there are three levels of computations depending on the size of the company. I was unable to use the easiest method because the company was too big. The client was able to use the second method, but it resulted in no deduction. Did not have to go to the most complicated method. Pretty cool to learn something new. Not sure how much I will need this in the future, but I can say I know something about it now. Thanks again to Taxbilly for his help. Tom Lodi, CA

Are you picking on me KC? Saying I can't do something simple? Well, you probably are correct. But that don't make it right. I knew there was an easy way, but I just couldn't remember because it is something that you don't do very often. Tom Lodi, CA

The first time you roll over a return, it will ask you if you want to roll the billing rates, preparer info, etc. Check the box and they will come over. If you forget to do it on the first rollover, there is another way, but I forgot how. Tom Lodi, CA

We were last year. I hope it is the same this year. We have 2 computers in the office and one laptop for traveling. The office computers are networked and the laptop runs ATX stand alone, even though we can access the network from the laptop when in the office. Tom Lodi, CA

Listen to Jainen, Make it simple and easy to follow. Concede on the property settlement portion and fight like a dog for the rest. A paper trail of regular, even payments in accordance with the decree underneath a 1 page summary of the terms of the divorce and the payments made in compliance with those terms might be enough to win. Good luck. Tom Lodi, CA