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Yes, I agree that the taxable gain is $15. That is what your client ended up with in cash from the intermediary after purchasing the replacement property. The way I see it - here's what I think should be on these lines. You said it's acreage so these #s assume nothing else on this property and the transaction that would have any ordinary income recapture on line 21. Sorry, I can't help with ATX input. line 15 - $15 16 - $175 17 - $190 18 - $100 19 - $90 20, 22 & 23 - $15 24 - $75 25 - $100 Basically since the full gain is $90 and client is paying tax on the $15 the $75 is deferred. Basis in the new is $100 and if sold tomorrow for its $175 FMV, the remaining gain (now deferred) of $75 would be taxable. Hope that makes more sense of it.

This is not correct because you are missing part of the formula for calculating the limitation on the credit that is allowed in the current year. The actual wording from pub 514 regarding calculation of the FTC allowed in the current year reads as follows (bold shows the part you are missing): You already said that the return showed no taxable income, so there should be no FTC allowed for the current year to offset any of the APTC.

Edsel, did you know about Drake's enhancement where a right-click on many of the line items in a calculated return will bring up a box that shows the source entries that feed into that line? It's one of the tools that the support people use, and it was made available to the preparers. I called a couple of times, mostly about state issues early on in the season where I alerted them to something that needed to be corrected. Overall, from that survey it shows that Drake's customers are happier in almost all areas that any other software out there. Good for them.

CCH will give you that exceptional tech support as "concierge customer care" with their Advantage package, all for the low, low price of $3,759. But wait, there's more...call in the next 10 minutes and we'll throw in...

For anyone that hasn't yet seen this warning from IRS or your software vendor, the link cbslee provided is safe and goes to a page at the IRS. For anyone that is still hesitant to click on it, here is the contents of that IRS page:

I have always included these in the return, and I, or the firm I worked for at the time, have always coordinated with the other party's tax preparer to make sure the forms match and match up to allocations in the the sale documents.

Yes @Abby Normal, could you perhaps provide the list of enhancements you are reading about? Others that use this forum and that aren't current ATX users can't access the official forum, and someone may find that information helpful when considering ATX for the next upcoming season. I tried to find a list of the enhancements on CCH's ATX products page or blog and couldn't find anything about new features.

You're out of luck on this one. Once the election is made it is irreversible unless there is some change in the tax law that specifically allows its reversal under very exact circumstances.

Yes, ^ that is the answer! In your client case, the contribution of the property didn't trigger gain recognition so the partner's basis in the partnership is equal to his adjusted basis in the property contributed. The partnership's basis in contributed property equal to the FMV though.

David, Old Jack gave you the answer in his very first post. I used hypotheticals for the historical cost of $250K and accumulated depreciation of $150K that you didn't supply, but that arrives at the $100K NBV you mention. In this case the entry would be: Debit of $250K to the Fixed Asset account for the original depreciable basis from the Sch C Debit of $300K to the Fixed Asset account for the excess of FMV $400K over the $100K of current NBV transferred in. This is a nondepreciable cost on the fixed asset schedule. Credit of $150K to the Accumulated Depreciation account for the amount already taken by the Sch C Credit of $400K to Partner Capital You might find this article interesting and helpful so you know how to handle the allocations to the partners in the future: Contributions of Appreciated Property to a Partnership: More Than Just a Nice Credit to the Capital Account

But, but would this not result in the cookie itself being chocolate cookie, not a chocolate chip cookie? Either way, I wouldn't turn some down and would pair them with some bovine water-based butter fat liquid.

Did you try the IRS website? It is the best place to find the forms and instructions. I'd suggest that you print out the EZ form and its instructions from there. The 5500-EZ must be paper-filed, as long as e-filing its substitute isn't mandatory. The instructions to the EZ form describes those that are required to e-file using Form 5500-SF instead and must file directly online using the DOL's EFAST2 system.

I'm here between projects, procrastinating on whichever job to tackle next.

With this being a sale at a bargain price, I don't think we are concerned with the child(ren) picking up basis from the parents. However, that being said, even if it was a 100% gift I still don't think the child's basis would necessarily be the FMV. It would depend on the parent's basis in the lot is, and we weren't told what that was in this hypothetical case. If their basis was $40K, then child would step into that, but it could also be that the parent's basis was $110K with a decline in value to the $100K at the time of the gift. We don't know the parent's basis, but I think in this case with it being a sale at a bargain price, we aren't concerned with that. I could be all wrong, but here's what I think happens: On the parent's side of the transaction, What they did was sell 100% of the interest in the property and the gift is reported only because of the bargain price aspect, so I think the parents will report their entire basis against the sale, whatever that basis is, and they will either have a taxable gain or will have a nondeductible loss under the related party rules. In this hypothetical, it seems that they didn't sell 20% of the interest in the property and gift 80%, so I don't think there is any of their basis that transfers to the child(ren). This is an undeveloped lot, so the 1021 exclusion wouldn't come into play, but it would if it involved the parent's residence, for example, which isn't that unusual. Regarding the gift, the annual gift exclusion will take care of some, or maybe all, of the gift depending on the timing and number of donors and donees involved, as we've already touched on above. If there is still a taxable gift after that, next is the application of the the unified credit, so perhaps there would be no taxable gift, but again, we don't know the extent of the parent's estate or prior gifts in this hypothetical, but let's assume that it doesn't create a taxable gift. What this transaction does is it shifts any future appreciation on this property out of the parent's estate and to the child(ren), which could create taxable income to them in future. From the donee/child's perspective related to their basis, I think that the child's basis will be the amount paid of $20K plus the typical basis additions if they pay anything related to the lot, either POC or at settlement. Basis would also be increased by any gift tax paid that is attributable to the appreciation in the hands of the parents under sec 1015.

This really should have it's own topic so that those that might be interested won't miss it since this thread has the title indicating it is about CT moving to regulate unenrolled preparers and Easytax used his opening post to express his feelings on the regulations of CPAs and attorneys vs those of EAs.

The TaxBook comes with some CPE for no added cost, if you use that product and haven't taken advantage of it. I've been purchasing an unlimited package from Surgent, but that isn't much help for you. Thanks for the alert about the PRIMA site. My y/e for the next review is 8/31/17 and I haven't been contacted by the state society overseeing it yet. The PRIMA site was down when I tried to check it out last night.

I think your due date and extended dates are ok, however the fiscal year beginning date should be the DOD, not the 1st of the month. Sorry, I don't know about Oklahoma. ETA - missed one of your questions, sorry! There is a penalty that can be assessed for failing to timely provide the K-1, even if the overall late filing penalty is -0- for the 1041 because of having no tax due.

I wish that 'spaz' smiley was a little larger. My suggestion was meant as a humorous followup to Elrod's gif.

EAs are required to have 2 hrs of ethics every year. My requirement is a 4-hour course every two years.

...or, if the parents make part of those 4 gifts this year and the remainder in the following year, none subject to gift tax!

Haha, it does fit for a cat for a variety of reasons. Cats rule their world, and they decide on who will be their person or people, so naming one 'Borg' does seem appropriate.

I believe that happens when a Facebook group is set to "secret".

It would be easier for the masses if you would post a link here to the group. Is this group officially related to CCH? I ask because I checked out CCH's official page for their products of ATX and Taxwise, and those pages on the CCH website (not FB) do not have any link to Facebook at all but do have twitter and a couple of others.

Hmm, I searched Facebook for that exact name "CCH Axcess User Forum" and nothing matched, and no match using "CCH Axcess" either.