jklcpa

I successfully efiled a return that had 2 forms 8606 in it. TP & SP both have basis in trad IRAs and are receiving RMDs.

The threshold for filing is gross income of $600 or more.

My cutoff's been around 1 or 2 am, but then I have to read for relaxation to fall asleep. Sometimes sleep doesn't come until about 3, so I've been on about 4-5 hrs sleep for the past couple of weeks. I don't see anyone before 10am, and all I can say is that's it's a good thing that my computer doesn't have that camera/video thing on it. Lots of work done in sweat pants & t-shirt when there's no appts before lunch!

From Pub 334, Ch 10 under the heading Who Must Pay SE Taxes: Fishing crew member. If you are a member of the crew on a boat that catches fish or other water life, your earnings are subject to SE tax if all the following conditions apply. You do not get any pay for the work except your share of the catch or a share of the proceeds from the sale of the catch, unless the pay meets all the following conditions. The pay is not more than $100 per trip. The pay is received only if there is a minimum catch. The pay is solely for additional duties (such as mate, engineer, or cook) for which additional cash pay is traditional in the fishing industry. You get a share of the catch or a share of the proceeds from the sale of the catch. Your share depends on the amount of the catch. The boat's operating crew normally numbers fewer than 10 individuals. (An operating crew is considered as normally made up of fewer than 10 if the average size of the crew on trips made during the last four calendar quarters is fewer than 10.) You are not subject to SE tax if you are under age 18 and you are working for your father or mother.

Hey Ray, we're having it at your house, right? Should I bring a dish? Maybe JB will bring some of his famous frikkin' bananas.

For CPAs I think requirement is 10 yrs if client is still a client, and it's 3 yrs for those no longer current clients. Just be aware that you have to maintain the proper software/hardware to be able to access those CDs. A couple years ago I still had some stuff on 3.5" floppies that I burned to CD, even though my current computer still has a 3.5" drive.

It's asking for the pin because the return still requires a signature on both lines if it's a joint return. The surviving spouse would sign on both lines of the 8879 just like he or she'd have to do on the 1040.

Thanks Ed. Actually, when I tried to e-file mine & was rejected it may have saved my client and the wife's employer a lot of future correspondence. The employer was trying to use a defunct EIN that has been reassigned to another company. Employer is filing Sch H, so it saved him some headaches too. Both parties will be able to fix this before the returns are filed. I do intend to paper file for my client once I get a corrected W-2 later this year. For now the return is on extension.

https://www.feinsearch.com/index.aspx signup uses your email, so 3 free searches per email address. I think at left of the page is "Search EIN database" and on the next page it gives choices to search, reverse search, narrow the choices by state.

Deb, you're right, no mileage deduction because it's all commuting.

Yep, IRS is wrong on this one. Refer your IRS person to the instructions for 2006 Form 1120. On page 5 under the headings "Specific Instructions, Period Covered" it's spelled out very clearly.

You might want to check with that state's dept of labor. Here in Delaware I think that taking that money back might be illegal for the employer to do. Example: employer must pay the full wages, and even if the 'ee owes 'er back for things broken, stolen, uniforms, etc, the 'er cannot take it out of wages under Delaware law. Was there some agreement that says that the relocationi expenses were to be paid back it the employment didn't last beyond a certain time frame? Sorry I don't have any tax advice for you - the brain hasn't turned on yet. I'm just entertaining myself with this forum & cup of coffee. I'm waiting for a client right now.

Here's a link that explains it: http://www.sec.gov/answers/shortsale.htm (easier than typing & thinking right now).

Bob, I'm assuming these were transmitted to ATX timely? If so, what's CCH's explanation why IRS is assessing late penalties? Is there any chance of abatement? Are you renewing ATX or leaving?

Sounds like the 1/2 of the taxes is just part of the settling of assets between them. You are in the middle because you're prep'g both t/rs. They will be both looking to you to come up with the $$ he's responsible for paying. What I'd do is complete her returns that will actually will be filed. Then make a dup of the returns & prep another set of returns for her without the distrib. Do fed & state. Don't look at the bottom line bal due or refund. Compare the total combined fed & state total tax liability with and without the distribution. The diff between the 2 should be the total taxes on the distrib. Then you calc his 1/2.

Moses or Heston? :P

I hate extensions too. I worked for a firm where > 1/2 the returns were extended. We were a very busy office during the off season anyway & we all ended up working tax season hrs from Jan - Oct to get it all done. I worked that way for almost 15 years & won't/can't work that way any more. I have one extension. The return is complete, but needed the extension because the guy is in the middle of a 1031 exchange. The extension was needed to allow him the full 180 days for replacement of the properties. Without the extension, the 180 would have been cut short. I have other nice accounting work in the summer & fall, but at a more relaxed pace.

Correct, employee leaves the funds in the SIMPLE IRA for 2 yrs after first beginning to participate, there's no 25% penalty. If the realloc of plan assets to the money mkt was all within the SIMPLE, that has no effect. The employee just chose an investment that he felt was better for him at the time. My research didn't find any answers for you except NEVER COMINGLE THE FUNDS. Can your client provide documentation of the rollover from the first employer? In my mind he shouldn't pay any penalty on that portion, but like I said in the wee hrs this a.m. I haven't experienced this myself.

Now that you have the QDRO, the answer to your original question: She steps into the place of the account holder. What does the sep agrmnt say? Does she get the full pension & the 1/2 is just a settlement, or was the distribution screwed up? If she got the whole check, then the 1099 is correct. Because of the QDRO, she did have the ability to do a direct roll over an IRA or she could have retitled with the same custodian if she wanted those specific investments.

Is any of this formalized with a promissory note, or is the only documentation the spreadsheet and verbal agreement between the parties? Have they filed a claim in court to recoup? Your first problem is that you need to establish that the loan and the back pay are now worthless. If you have a Master Tax Guide, you can start by reading about business bad debts at para 1145 and then also within that section under the heading "Employee Loans." That talks about employee rendering of services for pay is considered for trade or business purposes in applying the bad debt provisions. It goes on to discuss employee loans. Also read the section Dominant Motivation Test.

yes, I see your problem. The client muddied the waters by comingling the orig SIMPLE from his employer with his own more current contributions. So the custodian thinks the whole thing is within the 2 years. And that's why the code "S" is causing the problem. The custodian should know that the orig amounts were a roll over (was it a direct rollover) and not a contribution, but then also the new custodian has no way of knowing whether those amounts are beyond the 2 years. That's prob why the whole thing was coded "S" on that 1099 issued. It seems that you should be able to exclude that portion of the distribution that's attributable to the 1st employer's IRA that was rolled over & exclude that portion from the 25% penalty. However, tax laws aren't always logical & I don't have any reference to give you. Perhaps another forum user has run into this and will offer advice. It's sure to cause a notice or other inquiry by IRS too.

If you have a CCH 2008 Master Tax Guide, it's at para 2170 under Active Participant Defined. It's found in code sec 219(g). Basically, whether it's a MPP or prof sharing plan, an employer contribution or a forfeiture allocated to the employee's account causes that employee to be actively participating. The employee's W-2 should be marked as such. Your question should be not whether she can contribution (because she can), but how much is deductible if she does. Just follow the rules for your client's age and AGI limits for an individual participating in an employer plan to determine the deductible portion of any amount contributed to the IRA.

One offer by mail and one by email received here. I just received an email survey from the CCH Small Firm Services section. Do they really think I have time to fill out a frikkin' survey on 4/8???????????????

Any yr that taxpayer was subject to AMT, the deductions are computed using regular tax rules and then again using AMT rules. It's possible that the IRA deduction in a prior year is different using AMT than for reg tax. In that case, the taxpayer could have basis in the IRA for AMT that differs from basis, if any, for reg tax. Then, when the taxpayer receives a distribution, the taxable portion of the IRA distribution for AMT will not be the same as the taxable portion for reg tax. The difference would be entered on 6251, line 26. Same goes for other items affected by income limitations.

I would have zero confidence in this to have a QDRO if the document says MFJ after the divorce.