Janitor Bob Posted April 14, 2012 Report Share Posted April 14, 2012 Elderly client with only Social Security....none of it taxable. She does not really need to file, but insists on doing so. since all zeros, the 1040 is not eligible to e-file....should I just enter $1 other income so I can e-file this return for her? Quote Link to comment Share on other sites More sharing options...
Lion EA Posted April 14, 2012 Report Share Posted April 14, 2012 I've put $1 of interest in similar situations to enable efiling. Remember when we had the telephone tax rebate or some such where people wanted to file to get their rebates? Quote Link to comment Share on other sites More sharing options...
Janitor Bob Posted April 14, 2012 Author Report Share Posted April 14, 2012 Ahhhh....The old telephone rebate....I knew I remembered this issue from somewhere! Thanks! Quote Link to comment Share on other sites More sharing options...
jainen Posted April 14, 2012 Report Share Posted April 14, 2012 >>Remember when we had the telephone tax rebate<< How can we forget, since the procedure for filing is STILL in litigation? Just this week a district court threw the whole thing out! http://www.fedregsadvisor.com/tag/notice-2006-50/ But that was not really a similar situation, because there was a special form for it, Form 1040EZ-T. Quote Link to comment Share on other sites More sharing options...
OldJack Posted April 14, 2012 Report Share Posted April 14, 2012 What's wrong with paper filing? Quote Link to comment Share on other sites More sharing options...
frazzled Posted April 14, 2012 Report Share Posted April 14, 2012 I have successfully electronically filed a $0 AGI tax return this season. Past seasons it would not work, but BINGO - this year it worked! Maybe because of MeF? Quote Link to comment Share on other sites More sharing options...
Jack from Ohio Posted April 14, 2012 Report Share Posted April 14, 2012 What's wrong with paper filing? 20% error rate on mailed in returns due to crappy scanners. We have had the IRS convert many of our old "hold out to paper file" clients to e-file by messing up their mailed in returns. When they pay me to fix the IRS goof, e-file seems pretty sweet. And it is 2012! Not 1968 Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted April 14, 2012 Report Share Posted April 14, 2012 I have this problem with Foreign Income Exclusion. If you exclude all of the income, you can't efile. So we exclude all but $1. Tom Lodi, CA Quote Link to comment Share on other sites More sharing options...
joanmcq Posted April 14, 2012 Report Share Posted April 14, 2012 One of my ex-pats luckily has a bit of interest and dividends. Except she has too many 'types of income' from two different jobs to efile. I love the June 15 date right now. Quote Link to comment Share on other sites More sharing options...
OldJack Posted April 15, 2012 Report Share Posted April 15, 2012 And it is 2012! Not 1968 So it's alright to submit and swearer it's correct just because its only incorrect by $1 dollar? Would you do the same if it was just $1 million? If not what is the difference? It's alright to lie in 2012? Quote Link to comment Share on other sites More sharing options...
jklcpa Posted April 15, 2012 Report Share Posted April 15, 2012 So it's alright to submit and swearer it's correct just because its only incorrect by $1 dollar? Would you do the same if it was just $1 million? If not what is the difference? It's alright to lie in 2012? Jack, that $1 could be chalked up to rounding. The difference in reporting $1 and your hypothetical $1 million is that the $1 will not affect the amount of the tax liability calculated on the return, but you already know that. When we complete a Schedule D, I hope that we all tie in the total proceeds reported back to the 1099-B, but in order to get to that number, sometimes it is necessary to adjust one or two of the sales by $1 to make the total work out. Does that make it a lie? I don't think so. What about the cost and net gain or loss? Rounding on entering each individual cost basis sometimes yields a difference of several dollars in the totals of the cost and gain or loss as compared to those totals reported by the brokers on their summaries when not rounded. 1 Quote Link to comment Share on other sites More sharing options...
OldJack Posted April 15, 2012 Report Share Posted April 15, 2012 >>Does that make it a lie? I don't think so.<< @jklcpa: Rounding is allowed and if thats what it is no problem. Adding or subtracting a made-up dollar or more is in violation of your ethics. Is it still ok to add more than $1, say $2, if that is what will make it efile? >> Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.<< Quote Link to comment Share on other sites More sharing options...
Lion EA Posted April 15, 2012 Report Share Posted April 15, 2012 I'm sitting here with Forms 1099-INT for $0.42 and $0.18 for one client. My software would round those amounts down to zero. And, I know that many of my clients had up to $9.99 in interest that was not reported to them from one or more banks. Some even tell me they called their bank and had $7.56 interest, for example, which I report. The IRS wants me to e-file and the client wants to e-file and it's April, so NO I do not feel dishonest if I report interest that the client agrees to but is not reported to the IRS. 2 Quote Link to comment Share on other sites More sharing options...
Hahn1040 Posted April 15, 2012 Report Share Posted April 15, 2012 Put the $1 on line 21 they found the dollar on the street- that makes it report-able income truly almost everyone has at least .01 interest- so round it to $1 Quote Link to comment Share on other sites More sharing options...
OldJack Posted April 15, 2012 Report Share Posted April 15, 2012 they found the dollar on the street- that makes it report-able income And you and the client will both stick to that story in the federal tax audit! Martha Stewart went to prison for lying to a federal agent. Quote Link to comment Share on other sites More sharing options...
Jack from Ohio Posted April 16, 2012 Report Share Posted April 16, 2012 And you and the client will both stick to that story in the federal tax audit! Martha Stewart went to prison for lying to a federal agent. And we are all very painfully aware of how closely the IRS checks, cross-checks and scrutinizes interest income on tax returns. Be AFRAID!! Be VERY AFRAID!!! Quote Link to comment Share on other sites More sharing options...
OldJack Posted April 16, 2012 Report Share Posted April 16, 2012 Be AFRAID!! Be VERY AFRAID!!! You don't have to be afraid if you prepare a correct tax return. Is your license worth only a dollar? Quote Link to comment Share on other sites More sharing options...
jainen Posted April 16, 2012 Report Share Posted April 16, 2012 >>Be AFRAID!! Be VERY AFRAID!!!<< Yes, I am afraid. I am afraid of the cavalier attitude that has discredited professional tax and accounting work. I am afraid of low standards of quality that has caused the IRS to rewrite its ethics guide. I am afraid that some of my colleagues care more about their workflow procedures than about the accuracy of their data. Quote Link to comment Share on other sites More sharing options...
Jack from Ohio Posted April 16, 2012 Report Share Posted April 16, 2012 >>Be AFRAID!! Be VERY AFRAID!!!<< Yes, I am afraid. I am afraid of the cavalier attitude that has discredited professional tax and accounting work. I am afraid of low standards of quality that has caused the IRS to rewrite its ethics guide. I am afraid that some of my colleagues care more about their workflow procedures than about the accuracy of their data. Seriously?? All this over $1.00? Quote Link to comment Share on other sites More sharing options...
michaelmars Posted April 16, 2012 Report Share Posted April 16, 2012 HMM since this whole conversation, along with others here don't directly benefit the posters practice, are they charging this to personal use on their logs? Quote Link to comment Share on other sites More sharing options...
OldJack Posted April 16, 2012 Report Share Posted April 16, 2012 >>are they charging this to personal use on their logs?<< Some of us don't have to keep a log. Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted May 6, 2012 Report Share Posted May 6, 2012 I love you, Jack, but I still think your position on this one is silly. It benefits not only the client and the preparer, it also benefits the IRS when we efile a return, and I do not consider it a lie at all, since everybody has normally had, over a year's time, some 'unreported income' of at least a dollar. Like the quarter I found on the ground next the the gas pump last time I filled up, the nickle I found in the change slot of the vending machine at the hospital last week, along with my own quarter in change, etc. And yes, there is a big difference in $1 and $100, because one makes no difference to the taxes and the other probably does. But I don't see it as any difference than the issue of amending a return for a late arriving 1099. The IRS says clearly that you should NOT file a 1040X that makes no change to the amount owed or refunded, unless it involves some other significant item. And when doing an audit, they will write up as a 'no-change' any audit where the changes they did find did not change the bottom line more than $50, where there are no other issues that might affect a past or future return. 4 Quote Link to comment Share on other sites More sharing options...
Don in Upstate NY Posted May 6, 2012 Report Share Posted May 6, 2012 ... The IRS says clearly that you should NOT file a 1040X that makes no change to the amount owed or refunded, unless it involves some other significant item. ... Cite please? Quote Link to comment Share on other sites More sharing options...
Jack from Ohio Posted May 7, 2012 Report Share Posted May 7, 2012 I guess that some preparers think that the IRS closely scrutinizes ALL tax returns. I however, live and work in a world where REALITY is much different. Please share with me where an auditor has make ANY remark, or made ANY change concerning a $1 entry of any kind?? We have dealt with an auditor that did not know that when you claim standard deduction the prior year, that state tax refund is NOT taxable in this tax year. (true story) Quote Link to comment Share on other sites More sharing options...
MAMalody Posted May 7, 2012 Report Share Posted May 7, 2012 Cite please? I am not sure about today, however, when I was an IRS auditor in the 80s we were told specifically not to make any adjustments for under $25. We would write it up as a no change. Quote Link to comment Share on other sites More sharing options...
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