JohnH

From an accounting perspective, this is simple. But I'm confused a bit about the 1120S instructions and recent developments. The client's S-Corp did not participate in PPP1, but obtained a $90k PPP2 loan in March 2021. They spent all the funds as appropriate within the required time in 2021, so fully forgivable. Full loan forgiveness was obtained in May 2022. Seems to me the $90K is simply a "Loan Payable" on the 2021 return with no other entries on the 1120S. Then the loan forgiveness, along with appropriate entries on the K, K-1, and M-1 will be reported on the 2022 Form 1120S. Am I right, or do I need to make any entries on the 2021 return other than the "Loan Payable" entry?

I like the Ellis Island thought. I'm with you on the "freeing" aspect of being able to use the phone. I don't like to return from a vacation or any kind of trip with a stack of snakes & alligators on my desk - often little menial items that distract from the important things that REALLY need attention. Being able to handle simple tasks while traveling has always been a more relaxing way for me to be away. When using the phone to access the computer, have you ever connected it to a tv to get a larger display?

Another quick question about Splashtop, since I've bought it and am already deploying it in ways I hadn't imagined. Are the default security settings adequate, or are there selections I should make to enhance its security? Keep in mind I'm using it to access a client's offsite computer to look at Quickbooks files and some Excel files. I've also discovered how easy it is to access my own office computers from my Mac (and even from my cell phone, which I wouldn't have even thought to try if you hadn't mentioned that). All in all, Splashtop has become one of the most interesting & useful things I've run into in a very long time.

Thank you for that reply. I was hoping you were familiar with it. And knowing you use it is probably the best recommendation I could imagine. I appreciate the background as well.

A client and I want to set up remote access for me to access their computer from time-to-time (not continuously). Their computer and mine are stand-alone devices (not networked, etc). Neither of us knows how to make a good decision, although we are looking at Splashtop Business Access at the moment. Is anyone familiar with this provider, or are there other providers we should consider? (I like to save money, but at the same time I don't want to sacrifice security, features, or convenience for price. So part of my hesitation is that this service only costs $100/year).

Wouldn't your Certified Mail/Return Receipt number be helpful in replying to the rejection notices?

Reminds me of the story about when the textile mills used to pay everyone weekly, in cash. One week John opened his envelope, then turned to the paymaster and complained his envelope was $2 short. The paymaster responded, "Yes, last week I overpaid you by $2, so I just deducted it this week." John nodded and walked away. The paymaster then called John back and said, "I could tell by your reaction you knew about the $2 overpayment. Why didn't you mention it last week?" John replied, "Well, I'm a reasonable man. I'm inclined to let it pass if a fellow makes a mistake. But when he messes up two times in a row, it needs to be called to somebody's attention."

Many years ago I had a few clients who owned multiple rental properties. Most were constantly complaining they weren't getting enough tax deductions and at the same time complaining they had to pay too much for the services they obtained from their vendors. Eventually the conversation came around to the fact that I was one of their vendors and maybe I could help out by reducing my fees. Their sense of entitlement was boring and took up a lot of my time in unproductive conversation about tax-avoidance schemes. Eventually I got rid of most of them and stopped taking landlords as clients. I found most of them too cheap to keep.

Around here we call it “Hillbilly Estate Planning”. Why pay a lawyer $1,000 to do it right when all you need to do is follow the recommendations of some random stranger on the internet? (But then, from time-to-time we’ve also seen lawyers some up with some pretty quirky arrangements as well, often involving trusts)

Hi Katherine: Just to be clear on what you are saying. I assume you are pointing out that the ONLY exceptions to the 10% penalty for a taxpayer who is under 59 would be either 1) disability as defined; or 2) a qualifying SEPP. Any other use would be subject to the 10% penalty. Right?

This thread brings back fond memories of a client from the early 1980's. He was partially disabled, but a very proud, independent type. He owned a large truck from his working days and to earn a little extra money he would haul livestock to market for local farmers. Never earned very much profit but he wanted to "pay his fair share" because he was receiving a small disability payment. I admired his integrity. Each year he brought me his records - a calendar kept in his truck for writing down his mileage and hauling fees. Needless to say, after a year of being carried in the cab as he loaded, hauled, and unloaded animals, the calendar was something that needed to be handled "with care". Especially since it might have occasionally fallen on the floor. (Don't ask me how I know that)

Thanks to both of you for the replies. Guess I'm just trying to "torture the text" to get a desired outcome.. This helps me to go ahead and wrap this one up. I appreciate the confirmation.

Still researching this, but I'm unable to find anything that definitely says "yes", therefore I'm leaning toward "no" as I have been since the outset. I had the client pay the full amount of the penalty tax with their extension, explaining that we could claim a refund of the education-related portion of the penalty if we found that it was excludable. But looks like I'm not going to be able to deliver good news on this.

Client is under 59-1/2 and cashed in a whole life policy. Insurer said it's a Modified Endowment Contract and issued a 1099-R with Code 1. Early withdrawal penalty tax applies. Taxpayer also paid education expenses for their dependent child. The penalty exception would apply for the amount of education expense paid if this were an IRA, but I'm uncertain whether this exception works with the MEC withdrawal. Can anyone offer any guidance on this?

I tell clients to drop off their info or mail it to me and I'll get back to them if I need anything else. But years ago when I would have a sit-down with them to go over everything in my office, I always enjoyed stuffing the boilerplate and the mailing envelopes into the shredder as we were talking. Sometimes, while that thing was grinding away, the expression on their faces would be priceless.

I found the 2802C to be the most humorous. After all, how can they know there's a withholding problem if they haven't processed a return? Seems to me the only time this notice would go out is after a return has been processed and the under withholding is known, so why suspend it?

Another interesting twist to this issue of 2020 returns still being processed. Within the past 3 days, 2 clients who filed by paper have given me CP80 letters from IRS. Each letter cites a payment that was made for 2020 (balance due on the return and a check processed), but no return filed. The letter warns of potentially losing the credit and has an instruction to send a newly-signed copy of the return to Kansas City. So naturally that scares the client and they want to do something. It's clear to me that the ACS system is working fine, but nobody has bothered to interrupt the process in light of the fact that IRS is still sitting on millions of unprocessed returns. While they tell us to be patient and not file another return, the boiler plate on the CP80 gives exactly opposite instructions. I know IRS has a huge task on their hands, but they're creating another level of confusion by allowing the automated process to grind away without regard for the realities.

Congratulations to Andrew, and also to you.

Looks like an invitation to send paper W3/W2 Copy A via Certified Mail with Return Receipt. If SSA wants to complicate things, let them be responsible for working it out.

I would not send back. I would tell the client that IRS also makes mistakes, and Congress handed them an impossible task with the restrictions and exceptions on the stimulus payments. And it may take IRS months or even years to sort this all out. So they should be prepared to repay the “excess” payment, with interest, at some unknown point in the future. if that happens, they have been forewarned. If it doesn’t happen, then they won’t remember.

Sorry, I wasn’t clear about that. It was Max W who posed the question. I was making a loose connection between the two having the same name.

My high school football coach was a survivor of the Bataan Death March. Ironically, his name was Max Beam. Coach Beam didn’t have any patience with slackers, and he always said we were too soft & had no idea what hardship was. Wonder what he’d say about today’s generation?

Old accountants never retire. They just become unbalanced.

I did not know, but I'm sure Drake will know when they send out 2021 s/w.

You could also set up a personal EFTPS account. I think it’s an excellent way to handle tax payments, estimated tax, extension payments, etc.