imjulier

I have this same case for a client. Since ATX allowed the loss, I went ahead and let it pass through to the 1040. The 150K limit does apply to Sch E rental properties and I am guessing would also apply to P-ship losses that are real estate specific on the K-1 (line 2) but ATX does not catch this. I passed the loss through and haven't heard from the IRS yet. It will be interesting to see if anyone knows if real estate losses in a pship or scorp are limited the same way as if reported on the Sch E. Julie

There are ordering rules to how losses are utilized and dispositon of a passive activity does kick in all the previous passive losses. I'd guess that PALs have to be used first and that there is not an option to not take the PAL. It only makes sense that Capital loss carryforward would kick in after the PAL but I don't know enough to give you a cite or even if I'm 100% right. You might try a search in some of your reference materials for "loss ordering rules" as this is how I've heard this stated. Julie

I just haven't seen a form 2439 before. It looks like the taxpayer claims amount in box 1a as long term capital gains and gets credit for the tax paid by the RIC or REIT (which was 35% of the LTCG). Result with so much taxes paid is additional refund to the taxpayer. Does IRS do matching on these? Am I missing anything? Thanks, Julie

Based on what you are describing it sounds like 39 yr depreciation to me. Julie

I use the "Complete" field in the Return manager. I e-file as signature forms are obtained and once accepted through e-file, I mark the retrun as complete in the return manager. I can then browse the return manager as needed (weekly) to see if any aren't marked complete that I think should be. Near the filing deadline, I look for the not completes and follow up with the cleint if I am waitng on signature forms. Also, for mailed in returns or clients that ask just for hardcopy so they can mail, I mark as complete once it is out of my office. I have used this method as long as its been available and haven't had a problem yet. For more people in the office, I think you need to have a really clear procedure to make this work (or maybe only one person who can ever mark a return as complete). My 2 cents. Julie

Yes, you can e-file federal whenever you are ready....even today. In CO, I generally don't send an extension unless funds are due nor do I provide federal extension with the return. Julie

Or show on sch d to account for the income at zero g/l and reduce basis in property. I'm just throwin' it out there....don't know if its right or wrong.

Oops. I just fired another client. Today must be a bad day for clients. Or I need to leave the office while I still have clients left.

Yep, gave him the extension and the address to mail it to.....didn't feel like just abandoning him today.

look at pub 544 starting on pg 4. Personal losses are not reported. Julie

Just a moment to vent- I just had to fire a client since he came clean to me just this morning on having household help to the extent of about $4400 in 2008. He wanted it to be under the table except that he documented it by having a tax-free account for dep. care thru his employer. I suspected he was lying to me since I was trying to get these figures from him for about a week. He came clean and told me how to handle a couple other things on the return....does the tail wag the dog or dog wag the tail? He also asked if he and his wife could still come in and sign off this afternoon. Just frustrated I suppose but I still feel good about letting that one go. OK, I'm done, thanks for letting me vent. Julie

I have a client who lived in MI part year and is now here in CO. I'm claiming part-year resident in both states. I've brought in forms MI 1040, MI Sch NR, and MI Sch W into ATX. I've done all the aprropraite data entry and it all checks out. MI 1040 on line 13 takes a subtraction for the income attributable to CO. Also, Line 19 has a non-refundable credit for the taxes paid to CO. The form has Sch 2 in it and has self populated based on my input. It seems to me that both the subtraction and the credit wouldn't apply. I'm guessing the credit is wrong. Any help? JUlie

How does sch H work in ATX? Line C and Line 9 ask the same question to figure out if you should do Part I or Part II. Shouldn't this be neither parts or both parts? Also, if wages are less than $1,000 in each quarter, for a total of say $3600 then Sch H doesn't apply. The directions for the form on the IRS website says something differently. Last darn tax return before the 15th and this is the only sch H I've had this year. Thanks for any help. Julie

I agree with jasdlm. I don't see any issues here unless you have to respond to a notice.... Julie

Just looking for opinions/knowledge on this. Is pre-school tuition an allowed expense for form 2441? Instructions to form say they are qualifying if the iotems are incidental to the care of the child and can't be seperated from the cost of caring for your child. It goes on to say that schooling for a child in kindergarten or above are not qualifying expenses. Client could have had child in daycare but opted for pre-school instead. Any issues with using this as a form 2441 expense? I'm thinking of using it but just want other opinions. Thanks, Julie

I hope someone knows something about this. I have a client who received a stipend from the United Negro College Fubd and amounts have been reported to her on 1099 Misc. Looking at the Master Tax Guide shows that this amount can be off-set by tuition, books, fees, etc required for attending school. For my client, this will actually leave about $4,000 as taxable. Presumably, this should go on Sch C but is it really subject to SE tax? Thanks for your help on this late-comer. Julie

Can the interest on a 401k loan be used as mortgage interest....if that's what the loan was for? Thabnks for any input. Julie :angry:

Form 2553 should have an effective date that they wanted and S election acceptance from IRS should have date election effective as well. Go by that. Julie

Hey there- Yes, you are right. You are double dipping on the mileage. If form 4562 won't be filed, input info on sch c line 9 by using the bunny. If 4562 required, use asset entry. One or the other, not both. Julie

What he probably meant is that she should elect to treat herself as a s-corp and then put herself on payroll. Not a bad option for many but I always make sure they have at least $50K in income before considering this option. Unless they've already elected to be treated as an s-corp then I don't care how much their income is. But, March 15th deadline to file to be treated as an s-corp has already passed so you can decide if there is a good reason to be filing election late. But again, it doesn't matter if they don't have much income. my 2 cents. Julie

The 2 out of 5 years rule is a "safe harbor provision" that the IRS will look at if the particular return is audited. It is not a hard and fast rule. There needs to be a profit motive though so the business can't be engaged in to specifically create a loss to offset other income. Example might be a photography business when the taxpayer is fully employed by someone else and really doesn't spend much time on the photography business. Marketing expenses can also show profit motive. I'd talk with the client about their profit motive and if they seem to have it, let it go and claim losses for many years if necessary. Julie

Look at Pub 544 on page 4 and/or 5 at the foreclosures and repossessions section. You have to figure out gain or loss first and then worry about how to report. Personal losses are not deductible and not reported. I think gain would go on Sch D but maybe you can re-post if its a gain and see if I'm right. Julie

Hey there- In ATX, I entered all the foreign tax paid info in the input form 1099-Div. When I look at the detail to the form 1116 the information is there. It does not load into the form 1116. I even thried to enter it seperately and still didn't populate. Am I missing something? Julie

Jimmer- I'm not aware of a basis schedule in ATX for the 1040 either. I would have thought form 6198 as well. if not passive or at risk, what is the prior year loss from? That may give us a clue as to the best way to report. Julie

Thanks Margaret for the info and guidance. I've got it now. Julie