JohnH

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.

Sad to hear this. Harlan was a great guy.

2 Weeks seems about right in this office as well. But I've already prepared one extension and plan to file several more the first of next week. March 13 is going to be my drop dead date for extensions this year. After that date, everything goes on extension as it comes in the door. (The only exceptions are the very simple ones). Keeps life manageable...

There is absolutely no limit to the creative ways people can mess up their lives. Not much we can or should do about it unless we want to get drawn into the craziness.

Drake just now sent this same warning to all its users. Looks like it's creating lots of concern.

I've been fiddling this morning, and I don't even play a musical instrument.

Say, can you send me the link to that form? I don' do any PA work, but one never knows when it might come up some time and I want to be ready.

Personally, I wouldn't buddge on refusing to handle his work after he goes to Costa Rica. Trying to bone up on somehting like this for a single client is a losing propostion. I'd tell him he has to find someone else and he can expect to pay them a lot of money to prepare his returns. If he can't afford it, then he can't afford to go to Costa Rica.

My response: