Lion EA

Who are they going to blame when they owe more/smaller refund next year? Send them to the IRS's Eligibility Assistant to make their own decisions: https://www.irs.gov/credits-deductions/advance-child-tax-credit-eligibility-assistant And, if you're worried about blame, document your interaction with them.

Can he deposit the check into his own account? Mobile app, ATM, etc. Then he'll have access to the funds. Depending on the amount, it could be worth opening a no-fee account if he has no bank account at all. Can they open a joint account at Bank of America, HBSC, or another large bank with branches in her country? She should be able to do the ID verification from a branch near her while he does his at his local branch where he's opening the account.

"The IRS is now the largest social services agency in the US, with respect to transfer of payments." -- Frank Agostino, Esq.

Yes, both parents must opt out if receiving no advance is their choice.

IR-2021-130 does NOT say they will answer their phone! My elderly clients use the computers at the library, the town's senior center, or in their retirement communities, if they do not have a smartphone or tablet. But they're not the ones dealing with the ACTC (except for a few with custody of their grandchildren). Parents/grandparents with children have access to computers at their child's school or the Chromebook their child brings home for his education, as well as the public library.

A quote from IR-2021-130: Anyone who lacks internet access or otherwise cannot use the online tool may unenroll by contacting the IRS at the phone number included in your outreach letter. https://www.irs.gov/newsroom/irs-announces-two-new-online-tools-to-help-families-manage-child-tax-credit-payments

I tried this year, and hubby tried just a couple weeks ago. I had the OLD e-Services since it opened, have lived in and owned and have a mortgage on this house since 1978, been an EA since the late 1990s with PTIN, CAF, and ERO, have had the same AT&T cellphone contract and same cell number since the late 1980s or early 1990s, and have a mortgage and a couple of credit cards in my name only. Anything prior to 1994 would have had my previous last name, but all were updated to my current name in 1994. The IRS says that AT&T told them my cell is NOT in my name; but AT&T tells me that it IS in my current name, and the bills come in my current name. The gal on the e-Help desk told me to unfreeze my Experian account, which I did each time I tried to work through this. They say I will get a code in the mail, but they've said that each time I call for years and years and years, and nothing comes in the mail. They tell me to make an appointment at an IRS Service Center, but none are open around here. Two more TAC offices open tomorrow, one of which is not too long a drive. However, the services they provide do NOT include help with Secure Access or any services to tax professionals. I may try again after 15 October.

Thanks so much. I like that quote.

You can unfreeze your credit temporarily so the IRS can verify your identity. The IRS uses Experian, at least they did when I had to do this. Anyone know for sure if that's still current? By the way, neither I nor my husband can set up secure accounts. "There is something in your file that prevents..." No IRS employee has been able to get me in since the very, very old eService days prior to their redo a few years ago. And, the code they say they mail me, over and over again, never arrives. Someday I'll make an appointment at an IRS Service Center. I read somewhere that the IRS thinks 30% of taxpayers will be able to use their secure access. Not a very high number.

cbslee: where's your quote from?

My client (subject of another thread) received his first CP2000 and responded via fax (has a record of it) with his Partial Agreement stating the cost basis needed to be accounted for, including the broker copy of the formerly missing account with the cost basis shown, and asked for more time to contact me/his preparer/EA. He's a lawyer for a major bank, so his verbiage was perfect, thorough, common language. The IRS did stop sending him notices for two months. This week, his second CP2000 arrived. Cost basis still NOT taken into account. He wants to fax his own cover letter, so I sent him instructions, talking points, and 11 pages of documentation (2 pages from CP2000, 2 pages from broker, 5 pages re Schedule D, and 2 pages of 1040, all appropriately marked up and read for his signature and cover page.

I was putting the cart before the horse. First I need to respond to their tax calculation. The new Fidelity account had a dividends amount plus two amounts for capital gains. Even though the transactions were "covered," the IRS did NOT calculate capital gain but simply used the proceeds to compute tax, interest, and penalty. Is my documentation for our "disagreement" with their CP2000 to prepare a new Schedule D with all the transactions and include the Fidelity statement with proceeds, basis, and capital gains? The letter says "Do not file an amended return." But would you include the first two pages of the 1040 to show that the new dividends are included as well as the new capital gain? The "new" capital gain drops from $105,000 down to just over $63,000.

I think reasonable cause would take the client telling his own story re thinking all the investments from his trust (set up by grandparents) went into his existing Fidelity account and not knowing he now had a second Fidelity account part-way through 2019. He was away at college with mail going to his parents' home in another state. (Client was neither the grantor nor the trustee but only the beneficiary until the age stated in the trust document. Trustee wrote checks from the trust account to the college for tuition.) Are you saying not possible penalty abatement at all? The penalty is call the Substantial Tax Understatement Penalty. Are you saying it's NOT the same as an accuracy penalty? How do I find out if it is or is not an accuracy penalty? If it's NOT an accuracy penalty but is a Substantial tax Understatement Penalty, can we ask for FTA?

I remember someone pointing out this answer, probably with a cite, but I can't find it searching on FTA, First Time Abatement, Substantial Tax Understatement Penalty, and various similar phrases. I have a client who didn't give me a large 2019 Form 1099-B (had another from the same brokerage -- as he had in prior years -- but the second account was new to 2019 due to the trustee dissolving the client's trust and moving investments to his name personally) and now owes tax in the five figures, ~$1,000 in interest, and a substantial tax understatement penalty of well over $5,000. Can the FTA be used for an understatement penalty? Would you try reasonable cause? I'm open to any advice. (Client notified me in April. I told him I'd take care of it after tax season ended, put a post-it on his file, and forgot until last night when his father emailed me the latest CP2000. It just got buried in my queue of folders during this 1.5 year tax season. So, I have some contributory negligence in this case (son & father are both lawyers) and want to take care of this in the most efficient way.) What would you do &/or what would you have client do re waiting on the phone?

Wait until they receive a penalty letter and then try this: ABC qualifies for an exception to the penalty you charged under IRC Section 6698(a)(1), because all two (2) partners, XZ, 222-22-2222, and YZ, 333-33-3333, reported all their shares of income and deductions timely on their joint 2019 income tax return Form 1040. Therefore, the partnership meets the criteria specified in Rev. Proc. 84-35, which says in part: “A domestic partnership composed of 10 or fewer partners and coming within the exception outlined in section 6231(a)(1)(B) of the Code will be considered to have met the reasonable cause test and will not be subject to the penalty imposed by section 6698 for the failure to file a complete or timely partnership return, provided that the partnership, or any of the partners, establishes, if so required by the Internal Revenue Service, that all partners have fully reported their shares of the income, deductions, and credits of the partnership on their timely filed income tax returns.” We trust that you will remove the penalty due to reasonable cause for small companies.

Did they have unemployment taxed on original returns?

Here's a good instructor: https://www.bigmarker.com/tax-practice-pro-inc1/Cryptocurrency-Update-The-IRS-is-Closing-In?utm_bmcr_source=email&utm_source=Tax+Practice+Pro%2C+Inc&utm_campaign=6a8b861f03-EMAIL_CAMPAIGN_2020_10_26_12_54_COPY_01&utm_medium=email&utm_term=0_e8d6f6fd06-6a8b861f03-30289501&mc_cid=6a8b861f03&mc_eid=fa3d1fe03e If you see any Crypto courses by Knox Wimberly/Knox Taxes, Knox is really good.

And, all those 'earned' bits go on Other Income (what is it now?) Schedule 1 line 8 or something. Can we really do one-line summaries on Sch D with non-covered stuff like Crypto? Just wait until Congress/IRS/whoever decides that wash sales apply to Crypto!

Yes, as I said, if you use Crypto, you have to report it. You have a Schedule D sale proceeds, in your scenario $160,000. You have the $10,000 basis, that I think you meant. But depending on how/when you bought the coins and how/when you "sold" them, you might have several lines to report instead of just one on Form 8949. If you didn't go on your buying spree until January, you wouldn't have anything to report on the current year return.

If your client does anything else other than purchasing cryptocurrency with real currency, then you're filing Schedule D for "spending" of any kind, including one type of coin for another type of coin, buying things, etc. &/or, your client has Other Income for earning cryptocurrency by any means other than purchasing with real currency, including mining, earning rewards for watching videos or tying up their crypto for a time period, or awards for just being on a particular platform at a particular time. I have one young client who purchased crypto with US$ during 2020, but she "earned" partial coins in her account during 2021. She hasn't spent or transferred or...any coins yet. I had "the talk" with her about tracking her coins or using a software program to track for her. So far, her coins are on Coinbase which does offer a free tracking service up to a certain amount and then charges.

Sorry, I don't have any NY returns with EIC and read your post too quickly, I guess. Did you report this to ATX?

Form IT 558 adjustment code A-011 https://content.govdelivery.com/accounts/NYTAX/bulletins/2ca9827 https://www.tax.ny.gov/pdf/current_forms/it/it558i.pdf https://www.tax.ny.gov/pit/ads/efile_addit558-2d.htm

So they qualify for a higher mortgage?

I have two who called me last week that they finally received their refunds. Filed about 20 February. Single, retired, over 65, SS, small pension w/withholding, standard deduction, received EIP1 & 2 so nothing on line 30 (IIRC), no unemployment. States sent refunds immediately. Luckily they were both pretty patient. One contacted me once and then waited. The other contacted me via email multiple times, but understood that I couldn't do anything; he just wanted reassurance.

The IRS is not accepting e-filed extensions after 17 May, but you can paper file extensions for TX and the other states with later extension dates. (Check with your software for the latest information.) https://www.irs.gov/forms-pubs/extension-of-time-to-file-your-tax-return "Victims in FEMA Disaster Areas: Mail Your Request for an Extension of Time to File To request an extension to file your federal taxes after May 17, 2021, print and mail Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return. We can’t process extension requests filed electronically after May 17, 2021. Find out where to mail your form."