JohnH

Speaking of Tennessee girls, guns, and getting married up reminds me of a story. A Tennessee girl comes home one day to find her husband sitting on the front porch weeping. She says: "That's so sweet. You remembered today is our 25th anniversary." Her husband replied: "That's exactly right. I still remember the day your daddy burst into our house, stuck that shotgun in my belly, and said 'Either you're marryin' my daughter or somebody's gonna die right now!'. I've been thnking that if I'd managed to wrestle the gun out of his hands and kill him, then allowing for time off good behavior, today I'd most likely be getting out of prison a free man."

Yep, I have a few of those every year. I take their info, and sometimes I even enter it into the software if I find time. (Of course I can't do that with the ones who are "getting their stuff together", but I think they believe I can.) Then when the drop dead date arrives I tell them we need an extension. Funny how people will try to dictate our operating procedures if we allow them to do so. They will even apologize profusely, but their actions reveal they couldn't care less if we ever have any time with our families. It's up to us to manage this stuff - the client should have no influence over it. Personally, I have no interest in martyrdom.

Ah yes, extension drop dead date is looming. For me, it is next Monday. (Actuallly it is this upcoming Friday Mar 7, since I don't plan to work over the weekend) The client should know that an extension has no effect on an installment agreement. She/He/They can even file an extension showing an estimated amount due but with no payment or with a partial payment. Even that will not afffect the installment agreement. The only time filing a return affects an installment agreement is when a return is filed with a balance due and no payment made.

Off the top of my head, I think I'd email him immediately and say I'm sorry but I can't prepare his return. No explanation, no excuses. I'd encourage him to find someone else as soon as possible in order to avoid his having to file an extension or settling for a rush job from a new preparer. He deserves an answer if he's pushing for an appointment and is really ready, so if you aren't willing to prepare the return he has a right to know. If he gives you any push-back, asking for reasons, etc you can then stall as long as you wish because you're busy and you've already done him the courtesy of trelling him where he stands with respect needing to find someone else. He isn't entitled to an explanation, but if he does ask for one, chances are he will admit to some of his shortcomings as a client and you cant turn those back on him if you are inclined to respond. Plus you can add others he omitted. Or you can just tell him his situation doesn't fit your client profile, etc, etc, etc.

Like so many other things in this business, it's a matter of making distinctions. There is no cookie cutter rule to apply in every situation. It's clear that divorces take many twists & turns, and what starts out amicably winds up with everybody at one another's throats. Once it goes there, the tax preparer is in the middle with no easy way out. If I were inclined to work with both, I'd probably also tell them that if they wind up putting me in the middle at some point in the future, I'm PROBABLY going to resign from preparing either of their returns. That leave me free to do what I said at the outset, or anything else I choose to do.

Don't come back here telling us you had to do some "internet research" to better acquaint yourself with what constitutes ordinary and necessary business expenses for this client.

I usually use 7% as guesstimate of the actual extra cost, because half of the S/E tax is an adjustment to income. So depending upon the client's tax rate, the true after-tax cost of the S/E tax is something less that 7.65%. If I were inclined to suggest the 8919, I'd be sure to ask the client how they would feel if they lost their job over this. Some people wouldn't care, while for others it might be devastating. They need to know the risks, no matter how small.

Not sure I'd want to tell the client about this, but I suspect he will find out soon enough that it's possible to "roll your own" when it comes to guns. http://www.theverge.com/2015/2/26/8113047/fedex-ups-wont-ship-ghost-gunner-mill

The employee could complain, and they might get some results. . Depending upon the total amount of additional tax involved (which is really only 7%). it may or may not be what they had in mind. They should weigh the potential results against how much they like working there. One result of saving that extra 7% of whatever the amount is on the 1099's could cost them their job.

I'm nominating your guy for craziest. Nothing I've encountered so far this year tops him, and I'm hoping to God that it stays that way.

Back in 1970-74 I was fresh out of the Air Force, my wife and I were attending college, and I was working a part time job to help support us and our newborn baby. Between the GI bill, my part-time work, and lots college loans we scraped by. My brother-in-law who worked for Social Services kept telling me we qualified for food stamps, and that "everybody was doing it". I kept refusing to apply because our financial difficulties were a result of lifestyle decisions we made to get an education in anticipation of a better future. I felt that food stamps and other welfare programs should go to the truly needy. It took us 15 years to pay off some of the college loans - just in time to go another round of loans when our daughter went to college. If I had it to do all over, I wouldn't do anything differently, but I realize we were (and still are) chumps in terms of what our culture embraces today.

Or they could invest in a low-cost, tax-efficient mutual fund such as Vanguard's Total Stock Market Index. They get a 100% guarantee that they will do as well as the entire US stock market - no better and no worse. They also get the benefit of keeping their investment earnings rather than paying outrageous commissions to a financial advisor who is exposing them to unknown risks while raking off 1.5% to 3.0% of their principal, and in some cases additional commissions on the transactions, even in years when he fails miserably. They could also invest some money in Berkshire Hathaway B shares, which reinvests all profits and never pays dividends. That way, their entire investment increases tax free (assuming BH does well), and they get to control when they receive a distribution by selling shares. They also get the benefit of capital gains treatment on all their gains this way, while controlling the timing of the tax liability. The only reason people get surprised by taxes on Dividends and CGD's is because they are too lazy to pay attention to what's happening with their hard-earned money.

Oh, I like that idea. Give the coupon to a PIA and say "We've arranged to get you a discount."

No, I use the USPS. I also mail everything important via Certified Mail with Return Receipt. It isn't a matter of faith - it's a matter of accountability. I tell clients to do the same when there's something really important at stake. Some do, some don't. Either way it isn't my concern, and most importantly, it isn't my responsibility.

I stumbled across a possible answer to this question. Seems outlandish, but just might be true. The rules prohibit any advertising ON the W-2 form itself. They also prohibit putting a business card or coupon in the ENVELOPE containing the W-2. All the ones I've seen have been the tear-apart forms with serrated edges all around that you burst open to get at the W-2. In the process of doing all that folding & tearing, this coupon is the inside part of one of the outer protective "pages". It was suggested that this isn't an envelope in the traditional meaning of the word. So it technically complies with the rules because it isn't in an envelope. If that really is the explanation, then I have to hand it to some slick lawyer somewhere for the most creative reading of a rule I've seen in a long time.

Yep, that's right. He isn't a retiree, but he is a veteran. He just shows up at the VA hospital if he has a medical need. They treat him, he says he can't pay, signs a few papers, and he's on his way. There is a program with the VA which he could have enrolled in, but he never bothered to do it. Guess it's a moot point now that he's almost 65.

Another weird result with ACA. (One of my "freebie" returns). Single guy, age 64 earns about $15K plus another $12K in Social Security Benefits. He's a veteran, so he just goes to the VA for medical issues/prescriptions and doesn't see any need to have health insurance. Our state didn't go for the expanded Medicaid, so based on his W-2 earnings he gets to use exception "G" for the penalty. But wait. When we add his Social Security income on Line 20a, none of which is taxable, his exemption goes away and now he has to pay the $95 penalty. I'm sure glad he is eligible for Medicare next month. Also glad for the person who will be preparing his tax return next year.

What did I say that makes you think I have any faith in the USPS? :)

I know. But this is not a fly-by-night operation. It is a large company with plenty of legal advice, and so is the tax preparation firm. Doesn't really matter to me insofar as my business is concerned, but it arouses my curiosity that they have figured out a way around the rules that everyone else must follow. As a matter of fact, I'm surprised that if they can get away with it, there aren't other large companies doing the same.

Every year I see this & every year it puzzles me. A client comes in with a fancy W-2, computer generated in one of those fancy & expensive sealed sets that open sort of like the SSA-1099 form. When you open it up, one part of the page is a discount coupon for a national tax preparation chain. I assume they either pay for the advertising or maybe the pay for preparing the W-2 forms. Anyhow, I've always thought this was against the rules. Yet, this is a very large grocery chain with enough lawyers on staff and retainer to prevent them from breaking the law or doing anything to get on the wrong side of IRS. As I'm shredding the coupon, it always puzzles me how they are getting away with this.

I'm having a similar conversation with my clients. Several of them have mentioned the TT issue - it has been interesting to note how many of them are aware of the issue. And I can assure them with 100% certainty that none of them are affected, especially since I'm still paper filing (using my current waiver number, of course)

Guess they are proving the point that the only bad publicity is "no publicity".

The state of NC raised the standard deduction considerably and lowered the marginal rate. They also eliminated personal exemptions, the basic retirement exclusion, and several credits. They claim that this was pretty much a wash for most taxpayers, but I think the jury is still out on that issue. The first couple of retirees I prepared had modest increases in their total NC tax liability. I'm sure there's some social engineering going on here, coupled with typical political smoke & mirrors. But the politicians gets to brag about how they "lowered tax rates". Technically it's true, but more like the thief who robs you with only a knife rather than his knife and gun. There is one group who got hit very hard. Self-employed people have enjoyed an exclusion of the first $50K of income on their NC return for the past couple of years. That was also taken away, but IMO it was a bit extreme when it was first enacted anyhow.

Yes, NC removed the routine $2,000 income exclusion for retirement income ($4,000 for Federal retirees) in 2014. The only retirees who now get to exclude income are those covered under the "Bailey" settlement, and of course taxable Social Security benefits are excludable. One does have to be careful about those covered under "Bailey". Qualified NC retirees have a notation on their 1099R - not so with qualified Federal retirees.

Try it. I'll bet you'll like it. Once you transmit, it's essentially the same as a teller deposit without having to leave your office. You hold onto the check for 5 days, so if anything goes wrong you can take the paper check to the bank and they will handle it the normal way. But feeding the ATM is also handy when you have more than 4 or 5 to deposit at one time.