Lion EA

I love extensions. I can make more money in 10.5 months than I can in 3.5 months. I've already put two returns on extension, both new clients: one is a family that moved to Singapore last fall that we don't want to file until they've been out of the US for 330 days (it's a three-year assignment from Yale to Singapore U. for a professor) and the other is a retired doctor with lots of investments that include a statement or two that always arrive late (maybe K-1s) who's coming to me because his last preparer made an error in 2011 and because his preparer lives a distance away across state lines and I live in the same town, so I want to have lots of time to go over his 2011 and 2012 returns and proofread 2013 without a deadline hanging over my head and most of my other returns staring at me from stacks on my desk! I expect to spend a fair amount of time on both of these returns; I don't do a lot of international situations but have this and another one this year involving Japan, and I know the doctor's return will be complex and I really need to understand what went wrong and cost him a lot of P&I for 2011 as it wasn't discovered until recently so doesn't sound like matching but like an interpretation of the law re one of his investments. I want to research this summer and not now.

I go over the returns with the client when they come in to discuss, sign, pay, and pick-up. So, sometimes I catch something then or client does; but I really try NOT to have mistakes discovered with the client sitting here. My proofreading takes place before they come to pick-up.

31 January 2014

I always try to sleep on it and proofread the next day or another day. My software has great diagnostics as well as worksheets, statements, white papers, etc. So, I double check all source documents and client info against the white papers as well as the return/schedules. I use the two-year comparison feature to note any differences and explore those, or check when I was expecting a difference (child turned 17 or spouse stopped working or...). I've called my husband in to help me proofread. Once in a while I run a tape or export to Excel where I can add subtotals or rearrange or whatever helps me follow the flow from original documents to return. My software helps me match to original documents by its whitepapers and also options, such as as-entered order good for multiple statements, 1099-Bs or whatever, or another choice such as alphabetical if that was the order the gain/loss statement used, for instance. I missed one a few years ago when a big investor had less interest than the prior year (only $11,000 instead of $60,000). She was clueless as she had managed accounts. The account assistants insisted on three dates that they sold many bonds that year -- which did match her 1099-B -- and they'd sent me all her interest. I'd prepared her return from paperwork and spreadsheets provider by those assistants. I didn't print until client came in with her original paperwork, still in their mailing envelopes. Still just a small amount of interest. Signed and efiled. A few months later an IRS letter for $45,000 missing interest. Back to the broker who found another bond account that was never sent to me or our mutual client. Some investments had been rearranged and accounts renumbered after she started drawing on her IRA. I now have all her account numbers listed in her folder and the nicknames the brokerage uses to refer to them. At least I'm good until they merge and change computer systems and reorganize my client's investments!

I love that Mike specializes in clergy and strippers!

Filing Requirements for Ohio CAT and FIT Returns Dear CCH Customer: The Ohio Department of Taxation released the following updates based on Ohio revenue code (R.C.5751.07). Individual, Fiduciary, Corporation, S Corporation, Partnership Under the authority of Ohio revenue code (R.C. 5751.07): The department now requires annual CAT taxpayers to file and pay electronically for returns filed on or after Wednesday, January 1, 2014. Taxpayers may file and pay electronically through the Ohio Business Gateway at business.ohio.gov. Alternatively, annual taxpayers may utilize Telefile as a means for electronically filing and paying the annual CAT return beginning in April 2014. Due to this new treatment specified by the Ohio Department of Taxation, CCH no longer has access to updated versions of these forms and will not be able to update them for any future changes made by Ohio. We will, therefore, label the CAT 12 (Commercial Activity Tax Annual Return and 2014 Minimum Tax Payment Return) and associated schedules as “Informational.” Filing instructions and transmittal letters have been updated with Ohio Web site information. These changes will be effective with Release 2013.02030, scheduled for Sunday, January 26, 2014. Again, if Ohio revises these forms, our forms will be out of date. Corporation Corporation Franchise Tax Reports FT 1120 and FT 1120 FI are obsolete and no longer supported by ProSystem fx Tax. A new form, FIT (2014 Financial Institutions Tax Report), has been added for Release 2013.02030 as “Informational” only. Pursuant to Ohio revenue code (R.C. 5726.03©(1)), taxpayers are required to file and pay electronically through the Ohio Business Gateway at business.ohio.gov. Find answers to your CCH questions in our Knowledge Base at http://support.cch.com/answers/. Please feel free to contact Support online at Contact Us if you have any questions. Sincerely, CCH, a part of Wolters Kluwer

I use ProSystem fx and know they have a program, but I don't use it. If you are trying to get away from TR, then try CCH, but upgrade to the modules in the ProSystem fx suite. Sorry I can't be more specific, but I haven't added anything like that for my small practice.

Does your tax software have what you need?

Read Pubs 54 and 4732.

Can't your client fund a traditional, even if nondeductible, IRA by 15 April and then convert to a Roth at any time?

tongue in cheek/sarcasm? big grin/humor?

If HE had any suspended losses, he could now use them with a fully taxable disposition of his shares. But, HE doesn't have any suspended losses. And, S-corps don't have any suspended losses as they pass them through to the shareholders; that's what pass-through entities do. If the guy down the street has suspended losses, that has no effect on my tax return.

I wouldn't take that waitress as a client. But, I would eat at her restaurant all the time, because I wouldn't have to tip her!

Thank you, Margaret.

If you're asking if you have to take section 179, the answer is NO. Section 179 is an election; you choose to take it on all or part of eligible property; if you make no election, you do not use 179 at all. If your question is the ordering rules, then YES you start with your 179 election (or no election) and move on to Bonus in whatever flavor is available and finally to regular depreciation. In other words, you don't start with regular depreciation and then apply 179 to the remainder. Although, when you work out the options for your client, you can work with any or all of your available depreciation options to meet his needs. Sometimes a new business will have higher income as the years go along and benefit more from regular depreciation alone. Some with expected tech purchases each year may benefit from high 179 usage or benefit in a high income year. And, if you're working with a state that does not go along with federal 179 or bonus, you may or may not want to make the federal depreciation match what's available in your state. Depreciation options are a legal way to raise or lower business income to suit your client's cash flow/profit/tax needs.

I still have every HP printer I have ever owned going back to a 4L from the early 90s. I get newer ones only because they get faster. My most current model is HP Laserjet 2055dn. Fast, small footprint, quieter than my older models.

Bummer.

My experience is similar to Catherine's. I keep thinking I'll let my practice dwindle through attrition, but I have a small net gain every year. I also have shed some PITA clients through price increases. Those that drop off their tax information close to 15 October don't get prepared on time, some this month! So, I've sent some on their way over the years. But, referrals keep coming.

I also agree with Joan's interpretation that amending is optional and a year-by-year decision. I think my method is similar to Joan's if neither client is in my system. Create the return the way it should be as MFJ, as if your amendment is really an original return (depending on what was done, you may not be able to match one of the originals, if there were DIY-type errors, for instance). Then, call up your 1040X, but do NOT allow your numbers to move to column A, you want them to remain in column C. Then type in the numbers from the original return of the taxpayer that will appear first into column A. At this point, your software should do the math and the spouse's numbers from the original return will be in column B; if not, adjust where necessary. Add the explanation, and you're ready to review and print. Don't spend a lot of time trying to duplicate the original return, because you don't need all the detail.

Also, CFS Tax Tools probably has what you want if you already own Tax Tools.

My son gave both my husband and me Dryguy GripOns a couple of winters ago. We've used them to walk out to the mailbox in icy weather. He'd been using them around The Inn at Starlight Lake, PA, for some time. Just stretch them on over shoes or boots. We may drive out to our mailbox today!

I check with my sister in our old family home outside Chicago and feel better. Although, her streets are flat and straight and get plowed fast while I drive on narrow, windy, hilly roads that get plowed if the school buses are running! I think I'll start checking Catherine's link instead.

We lose power often and have flashlights in several sizes and in all rooms. Just replaced a couple that broke. But, now we have a generator! Yeah!

No. Read the instructions to Form 2553.

Yep, warm and rainy and foggy and all the snow melted down to grass. Back to single digits tonight will freeze all this water into sheets of ice.