Lion EA

I liked the old schedule. I'd send them out. Then get the calls about I Moved, Changed My Name When I Got Married or... But, still had time to correct the government file before sending. But I see their point. And, I hated those teeny, tiny verification codes that are only on one copy, so I miss them or the client didn't even give me the copy with the code. Good riddance.

Student was a paid intern in the legal department of a commercial properties firm in Greenwich, CT. Had to buy dress shoes, belt, pants; and no, I did not deduct those. Very definitely not a not-for-profit. But, hey, he's getting a Yale education and almost $5,000 per summer job for less than $730 in taxes. A great deal. But, he's a great kid of a hardworking single mom violin teacher/yoga teacher. And, he volunteered with VITA, so why he forgot to prepare his own tax return... I like his mom, but I'm charging for this kid's return.

I think a parent can hire his/her child with FICA exemption and age restrictions, including a husband-wife only partnership. But, not an S- or C-corporation, even if parent is only shareholder.

Will it really be 100% biz usage? If not, and corporation owns truck, corp has to add personal use to W-2. Sounds like your client wouldn't be bothered with that, either. How about an accountable expense plan for biz mileage reimbursement?

Thank you. I have it flowing to "wages" with SCH next to it. With the standard deduction, it does wipe out income tax. Unfortunately, the student's summer internship was reported on a 1099-MISC, so SE tax.

Scholarships in excess of tuition are taxable for income tax purposes. Does the excess trigger Social Security & Medicare taxes?

If it is more advantageous to file MFJ, amend his return from MFS to MFJ to include her. You do NOT have to file her MFS first and then amend.

I think you include the basis computation when losses, distributions, &/or sales. Distributions might be distributions in excess of basis, but how would you indicate whether the distribution was not in excess unless you showed the basis computation?

Thank you, all. With that in mind, I stupidly accepted two new trusts that I haven't filed before! They're for family members of current clients. I have to learn to say no! It's not like I don't have a stack of personal returns to prepare, our own included...

Are extended trust returns due 30 September? 15/16 September? Why not the same as PEs. Or, the same as personal returns? I'm sleep-deprived and confused !!

You don't know what could be attached to that LLC, even if inaccurate, especially with missing partners. Person A can ask his colleague to dissolve it with the state -- if in your state that would free up the name. Then Person A can form a brand new LLC, choosing the now open name.

I've lost clients, too. Whole families. But, I gain clients. Whole families. I have more work than I can handle and would prefer to be losing clients by attrition to ease into retirement. I have enough trouble sleeping with an achy knee and those sit-bolt-upright-asking-myself-if-I-remembered-to-do-X-on-a-tax-return moments. I'm not going to add I-wish-I-hadn't-given-in-to-that-client moments. They can trust my expertise or I WANT them to leave.

Does he have prior returns? Prior medical claims when SSNs were used? Working with a lawyer? Anything he can offer her in exchange? Does she need to file MFS, or does she qualify for HOH? Paper is not so horrible!

Send the 1099-K processor a new Form W-9 immediately.

Nope. Very frustrating. How does Congress &/or the IRS expect taxpayers to handle this themselves?! Confirm how many times you have to circle back before you're allowed to stop; it's something like 3. Then, just do that and stop. You'll know when you're stuck in that kind of loop, because you won't be getting closer each step, you'll be bouncing back and forth. So do the required number of loops and then stop and sleep well at night.

That's why you can use the alternate method that lets you stop at three (?) iterations if you're not getting closer. Or continue with the iterations until within a dollar and then stop. Or, depending on your software, tell it which method to use if you don't like its default. If Drake does the calculation for you, that's wonderful. If ATX does not, then complain to ATX. If I had a lot of those cases, I wouldn't have the time or be able to charge enough for my time. With just one or two and not even every year, I would have to relearn each time, spend time looking it up. Someplace in the middle might be cost effective for me to do the calculations myself. However, I don't have the type of clientele that qualifies for Premium Tax Credits very often. If I did and if I used ATX, I would be writing to them about now!

My time is worth money. I'm glad I pay more and get more. I have only a couple clients that would have both SEHI and Premium Tax Credit, so I'd never pick up speed at that calculation.

UPDATE. I think I have it all in place, now. I'll sleep on it and proofread tomorrow. I did have the 1250 gain flowing correctly. It flowed from the K-1 to a "statement" that is numbered sequentially depending on what's on each return, but is clearly labeled as Schedule D Unrecaptured Section 1250 Gain. The number I was afraid I was missing is indeed on Line 5. It gets reduced by a small loss, so by the time it shows up on Schedule D Line 19, it's a lower number than I was looking for. And, I was shaky enough on the flow to really doubt myself, so I really benefited from the detailed explanations you provided. I know I'd probably make some refinements if I had the corporate tax returns, but I think the wife won't deal with that firm any more. (I did find a revision on the redone CT corporate return that changed the taxpayer's PE payment for their joint CT return from what the CPA had on the original CT-K1.) I did track ALL the K-1s from the father's gift/father's basis to the dissolution of the company. Thank you, thank you, thank you.

You helped with all of it. I was overwhelmed and needed your help and guidance. Thank you. And, thank you to this forum and all participants for providing a safety net and my virtual water cooler.

Thank you! You are my new best friend. Your detailed and thorough explanations are a big help, as are you links. (Actually most of my best friends are on this site, including some no longer posting.) The wife does have a great POA in place that specifically discusses tax matters and signing returns and other good stuff and used to have a comfortable relationship with the CPA firm. And, luckily, she did have the K-1s from before my time. Now, the CPA firm seems to be ignoring her questions, requests for copies of the S-corp returns, etc. MIL seems to be having similar problems now that her husband passed away.

Well, THAT was a typo I missed. Yes, Sch 8979/D was where I showed his 2018 distributions (no detail on if it was all in September with the company dissolved) and his basis in his 200 shares. It ends up a loss, which is a help. (The spouse thought the company's CPA told her that the company paid ES payments to both CT and the IRS, so the clients would owe nothing on the building sale passed through on the K-1. What he probably said was that the company paid ES to CT only because it is required for PEs as of 2018.) Thank you for the explanations and the links. I'm not sure I have all the details that would help me report this correctly. The CPA prepared the 2018 final return on 2017 forms due to it being a short year. He gave no 199A information for the business. CT did NOT accept the company return on prior year forms, but CPA would not redo. (CT actually assigned a person to walk the spouse through writing the company return on 2018 forms, including the CT-K1.) My taxpayer/shareholder has early-onset Alzheimer's and his father who gifted him the shares in 2012 and ran the company and dealt with that CPA has since passed away. The CPA went to Bermuda during tax season, but really can't talk to the spouse/non-shareholder, I guess. Spouse worked with her mother-in-law to get me what she could, redo CT, etc. There are two other sibling shareholders, but spouse is not comfortable asking them questions and has not given me permission to talk to anyone except the CPA who does not respond to me. (Nor, to her, apparently.) I don't think the spouse has access to the S-corporation federal return. CT sent her (her husband, actually) the CT return when they rejected it because their address still was listed as the location of the books. I think the CPA was in Bermuda at that time, and no one in his company could talk to spouse/non-shareholder instead of taxpayer/shareholder whose communication skills were lacking by this spring. The K-1s have never included basis, capital account, etc. But the company always had positive rental income, so I postponed tracking basis. This couple became my clients in 2014, so I had the information since then. Spouse worked with MIL to find the gift tax return from 2012 when father gifted 200 shares to son with about a $50,000 basis and $150,000 FMV. Spouse found hubby's K-1s for 2012 and 2013. With only that, I filled out outside basis worksheets starting with 2012 with the ~$50,000 basis and adding rental income and interest and net 1231 gain (please tell me I CAN add that to his basis) and subtracting annual distributions to arrive at a basis about $350,000. 2018 Distribution was about $300,000. He must've had over $300,000 in basis to get a distribution of over $300,000, right? But, I need to deal with the about $50,000 unrecaptured 1250 gain. (I hate following the flow of anything through the new forms, and the IRS is changing them again for next season.) I entered in on the K-1 entry screen. Where would it go next. Schedule D worksheets, right? If I can get this piece to look reasonable, I'll let it go. I think "reasonable" is the best I can do with the information I have. Thank you, Judy.

I have a final K-1 from an S-corporation (that I did not prepare) to enter on a joint 1040. The corporation sold a commercial rental building and then dissolved. The K-1 has its usual Box 2 Net rental real estate income and Box 4 Interest income. Then it has Box 9 Net section 1231 gain which flows to 4797 Part I as a gain, which I think is correct. Only that one number, the net gain on 4797, right? The K-1 also has Box 8c Unrecaptured section 1250 gain. Isn't that the depreciation component of the gain that gets taxed as ordinary income at a maximum 25%? Where should that flow? And, the fact that the company was dissolved: client received a distribution but still had a larger basis. I put the distribution on Form F as his Proceeds from his 200 shares in the company with a Date acquired in 2012 when he was gifted the shares and Date sold in 2018 when the company was dissolved. I put his final basis as the Cost. Is that correct? Thank you for any direction you can give me.

The virtual receptionist companies use real people. They're just not at my client's site.

One of my business clients used a couple of different virtual receptionist companies, both in CT. He liked them both, and only moved back and forth to combat price increases. Eventually, they both raised prices to a level that he no longer found valuable. He now uses RingCentral to take messages, route calls, etc., and finds them worth the price.

https://www.forbes.com/sites/peterjreilly/2019/08/23/what-happens-when-you-are-a-full-year-resident-of-more-than-one-state/#2f83b52b399c