JohnH

Borrowed from a post I liked over on another forum: "The Time has come," the Tax pro said, "To talk of many things: Of Wages, Tips, and Interest, Of Donations of Rings, And why the business profits not, And whither taxes' stings." (With apologies to Lewis Carroll)

I can't vouch for the reliability of the source, but here's something I found by googling your inquiry. It appears to have an example that's on target for your question. Of course, yo'd want to verify the information before actually following their advice: http://www.farm-equipment.com/pages/From-the-September-2013-Issue-Special-Report-How-Special-Depreciation-Rules-Impact-Farm-Equipment-Purchases.php

I find that I don't gain much insight from people with whom i agree, It's the exchange with those with whom I disagree that informs me. I will miss her, but there are plenty of others on this forum to take up the slack.

best thing that happened to him at that trip to the casino was the tax withholding.

I'm sorry to hear this.

These aren't related parties, are they?

Apparently the closed captioning software doesn't have "Polar Vortex" programmed into its dictionary...

I agree. It's Jan 6 - time to get down to business on this part of the forum. All the personal jabs and innuendo should be saved for the "Politics" section, which is still going strong for those of us who want to indulge the urge to lob a few grenades at one another from time-to-time.

My initial reaction would be to let sleeping dogs lie. Report the transaction as it stands - a sale in the current year, with basis reduced in the amount of depreciation claimed during the rental period, etc. The prior years are the responsibility of the client and the previous tax preparer. If you try to unwind the rental and amend prior years' returns, you are taking on responsibility you don't need to accept. Even in an audit, I don't think IRS would likely reclassify the transaction because the net tax is about the same no matter how it's handled. The fact that the selling price was substantially renegotiated is pretty strong evidence that a valid sale never took place to begin with. They had an agreement of some sort, but once it was breached the seller also had the option to walk away and look for another buyer. But you should advise the client that things are a bit fuzzy here, IRS might take a different view, and let them know that you are not accepting responsibility for anything that happened in the past. If they aren't comfortable with that, maybe they need to go back to the other preparer (or anybody other than you).

FedEx gets it there overnight for about $15.00. Fully trackable and no passwords needed.

Still trying to make the list available. Drake_2012_DataEntryRef.pdf

I mentioned the Selector Box in an earlier post (after Taxed was kind enough to remind me of its name). As I'm getting oriented with Drake this morning, I must re-emphasize the importance of that box - it really is the secret to navigating around in the Drake program. Understanding how it works is a major part of the secret to breaking the dependence upon forms-based data entry. You use this box as a "Pivot Point" for getting to any part of the return quickly. Attached is a pdf of the 2012 list. (As Judy pointed out, my attempted attachment didn't work) I expect 2013 will be the same (or similar). If you look closely, you'll see that the first column is the tax return line number, the second column is the description, and the third column is the "magic entry" which jumps you to the appropriate data input screen. In come cases there are multiple ways to accomplish this. (Note the E, K1P, KiS, K1F, and 4835 choices for line 17, for example. Very logical and concise) The "magic entry" is never more than 4 keystrokes. Anyhow, this actually duplicates the jump you get by double-clicking on an ATX form to navigate around the return.

Presently, ATX is my backup software. I don't purchase the backup software due to my low volume of returns, but I do have a selection. That's one of the reasons I continue to participate on the Unofficial ATX Community, although the greater reason it that I enjoy the comraderie and the quality of the tax-related discussion is superb. Because I'm transitioning into retirement, the number of returns I prepare is decreasing each year, but if I prepared a significant number of returns I would buy the backup software on a PPR basis and would actually use it on a few in order to be up to speed on it, as I've stated in other posts. I have tested TaxSlayer and could use it in a pinch, although I agree with you it's a little clunky. My ultoimate backup is Form 4868, which I use extensively even when all is going well with my software. As for the Drake training, it's very easy to get real-time Drake training if you have two monitors, or two computers side-by-side. (I have both - my main computer has dual monitors and then I have a second computer beside it using a single monitor). A third alternative is to have a smart phone or tablet device beside your computer - the only requirement is that it must be able to run flash player. II can't get my iPad to run flash player, so I think the device has to be something other than an iPad. You open the Drake software on one monitor to begin preparing the return. You open the Drake tutorial on the other monitor (or other device), and run it while you are preparing the return. You can stop the tutorial, back up, or skip ahead as your needs require. There are several very good tutorials on the Drake web site suitable for doing this.

It's interesting to see all the hoops everyone is having to jump through to get started this year. I know they have all their very good reasons for sticking with ATX, but I just don't get it. On Dec 31 I renewed Drake for the upcoming tax season. Downloaded the program on the same computer I've been using the last 3 years, which took about 15 minutes altogether. Then I set & updated a couple of preferences and I was done. While preparing payroll reports for a couple of accounting clients, I switched over to Drake and entered their W2 info just to get a snapshot of where the clients will stand this year. No fancy "rollover" required - I just entered their SocSec number, it asked a question about a couple of forms, and the return opened. A few numeric entries later I was looking at their 2013 return - still marked "Draft" of course, but basically done except for tweaking non-W2 info. Sure is a less-stressful process than agonizing over whether the software is going to perform up to expectations this year. And no need to spend a bunch of money buying computers with the capabilities of running a nuclear power plant.

Good topic. This year I'm going to get up to speed on non-profits organizations and Form 990. I've dodged this thing for years, but I've finally decided I'd better learn more about the whole subject. Therefore, most of my CPE and personal study in 2014 is going to focus on this area. If anybody has any good recommendations for study, please let me know. I'm also going to get busy having that standing desk installed in my office. Been talking about this for years, but never took the first step. So come February, that project gets under way. Once the one in the office is done, it will be the prototype and trial run for the one I plan to install in my bonus room at home.

Send everything to the client, password protected, etc. Let them forward it on to the bank, broker, whomever. If the third party can't trust that process, they're probably not going to approve the loan, grant, etc anyhow. If you NEVER send anything to a third party, you don't need to protect yourself with disclosures & permissions.

Several years back I looked over a return (gratis) for a new employee of a client. The guy had previously worked as an independent contractor driving a taxi provided by a cab company. He paid for fuel and split the fares with the owner. The previous preparer had deducted the standard mileage allowance and had also taken a FUEL TAX CREDIT on the return. When I advised the he should amend and how much he would owe, he decided to get another opinion. Never saw him again, and nver heard if the return was ever audited.

Either way, you're better off. If they agree to amend, you helped your client. If they refuse to amend and go somewhere else, you helped yourself.

In cases of this type, It isn't a matter of IRS paying you to be a detective. It's a matter of the IRS charging you a pretty hefty fine if you refuse to be their detective. You've just illustrated one of the many reasons I simply don't prepare returns eligible for EIC.

Selector box - yes, that's it. Thanks...

Right now I can't remember the name of the box at the lower part of most data entry screens (maybe I'll come back and edit this later when I'm in the office). Anyhow, learning how to springboard from that box directly to the desired data entry screen is really essential in Drake. (The closest thing I can think of in terms of usefulness is to compare it to the time I first learned the power of the "Fill Handle" in Excel). In exactly the same way, your speed increases exponentially when you master that little feature. You use it virtually every time you do anything significant in the software. As Taxed pointed out, sometimes it's simply the form number you enter, but in many cases you have to memorize an abbreviation (or keep a cheat sheet handy).

I do the same as Judy. I only use the data entry screens to push the data into the computer. Then I click on "View" to see the information on the form (the form recalculates automatically when you click on "view" so you never actually use the "calculate" button as far as I can tell). It's very simple to toggle between "View" and "Date Entry", and the program is so fast that you have the desired screen in front of you at the blink of the eye. It isn't as though you need to go through any steps to toggle back & forth in Drake. One of the reasons I say that Forms Data entry is overrated is because even in ATX, there are numerous times when you must use a data entry screen anyhow. You either have to jump to a sub-screen or jump to a different form, then back to the 1040. With a few exceptions, about the only time you truly enter info directly onto the form is when you have a small, relatively insignificant entry or when you want to force an override. And the data entry screens in ATX are varied, whereas the data entry screens in Drake generally follow a similar pattern in their layout and how you get into & out of them. So navigating the data entry screens is much easier in Drake since you are so often in familiar territory. I keep coming back to the old issue of speed. Drake is fast. This is mainly due to the simplicity & efficiency of its design and layout. There aren't many bells & whistles, so you have a program doing what it is supposed to do - produce an accurate tax return as fast as possible.

My EIC checklist is pretty short. 1) Does client qualify for EIC? 2) If yes, give them the phone number for HRB.

Forms based data entry is vastly overrated. It's more of a crutch than an efficient means of tax preparation. There are rare occasions when I miss it, but on the whole I'm very glad that Drake helped me break that dependence and utilize data entry screens efficiently.

The TaxBook is a great investment. Well worth the price. And their Forum is very good as well.