jklcpa

No, and yes. If you mention it, then some may want to go back to look more. Let it go because if the church members are close and have come of referrals within the group, chances are they all know you handle each others work anyway. I have a bunch of unrelated older clients that are friends, coworkers, or neighbors that bring me each others tax data. Depending on which one comes earliest, they might bring two or three other clients' papers with them, and sometimes the envelopes or folders aren't sealed. Am I supposed to pretend that those folders being handed to me don't exist or are invisible?

I'd like to see a thief put my micro shredded chips back together to steal information because they aren't small enough according to the IRS directive.

Agree with FDNY on adding in basis of land. They'll have the recapture of depreciation, and that recapture is not eligible for exclusion. There are additional rules that apply to rentals converted to personal residence to determine the periods of unqualified and qualified use to determine the amount of sec 121 exclusion allowed, but unfortunately for your client, the recapture of depreciation already exceeds the entire gain on the property so there won't be any gain that is able to be excluded. If you want to see how the calc for unqualified/qualified use is applied to the sec 121 exclusion, here is a pretty good explanation with an example: https://www.merriman.com/wealth-preservation/planning-on-moving-back-into-your-rental-in-the-future-read-this-first/

The constant timing out and logging back in is so d@mned annoying, and like Roberts said, a short phone call is all it takes to be logged out. In the past I've used the software's timer feature to tally the total time on the return including while I may have been working in Excel, so I would leave the return open at the same time. Now I have to make sure that I wasn't logged out at some point.

Is he an SMLLC? Delaware piggybacks Federal law where he'd be a disregarded entity if that is the case and would file any DE activity on a DE nonresident individual return. If an SMLLC with no DE activity, I think no income tax filing is neded, and if DE ever questioned why no tax return was filed, it could be answered simply with a letter. If he has partners, then file a DE partnership return, Form 300. It a simple 2-page form that has a column for Fed and a second for the activity within the state. There's a box to check indicating if are any nonresident partners. There's also the typical apportionment methods if allocating within and without the state based on property, compensation, revenues. The filing would also include the form 300 K-1, with columns for federal and within DE that correspond back to the Form 300. Domestic and foreign LLCs file an Annual Report for the franchise tax due each June 1st to the Del Sec of State to keep the corporation active and in good standing. The State sends a letter each year to the address of record of the registered agent (he probably listed himself) containing the file & case numbers, and informing that this filing must be filed online. It's fairly straightforward and usually isn't part of our tax prep services unless the person needs help with it. It's a questionnaire type form with demographics of the corporation, who the officers are, when their term begins and ends, etc. He'llprobably pay the minimum fee of $300, but tell him not to miss this deadline unless he wants to pay the penalty that is $200 plus interest at 1.5% per month on the tax and penalty. He may need a business license in DE if there is activity here, and the type and cost depend on what his activity is. Obtaining a business license here would trigger a gross receipts tax too, filed either monthly or quarterly. The first year of filing is always monthly and then the state does a lookback and those with smaller revenues are switched to quarterly. Each industry has it's own dollar exemption threshold before incurring tax but filing is still required. No penalty for late filing if no tax is due. This is also filed online, done through the Division of Revenue's site but can still be filed on paper and mailed in. Let me know if you need links or web addresses for more info.

Estep was licensed as an EA and public accountant here in DE, and he also lives close by in my small town. He was ordered to cease and desist by court order that he flagrantly ignored and ended up with fines for nine violations totalling of over $35,000. He was also brought before the State Board of Accountancy on 3 separate times resulting in cease & desist, lost his license to practice for 2 years the first time which he ignored and it was finally permanently revoked. His fines in these instances totalled over $582,000 that was based on revenues that ultimately went back to aggrieved former clients. He was writing wills, trust and estate documents, giving legal advice related to those, and other legal work too that the DE Bar Association had been watching for a while before all of this transpired. He also wanted to issue financial statements like you have been doing. He used to come to the CPE breakfast seminars and was pretty much lobbying our state representatives to give him a CPA license because he wanted to issue financial statements beyond compilations. He'd sit at my table and once asked me if I'd speak to my state rep on his behalf. My response was that we'd each tested and worked hard for those hours of experience to qualify, that we each had hurdles that we overcame, and that we'd EARNED the certificate and he should do the same. If you want to read about all that he did, his case is always included in my DE ethics course. Estep case.pdf

As I said, you probably have an ethical violation unless you are a CPA or PA licensed and recognized as such by the state of TN. You would also be required to participate in appropriate CPE in those areas and subject your work to periodic peer review. If you are performing this work without being a CPA or PA, and you are an EA, you are violating your state law, and I think that is where additional ethical violations occur. You never know who's watching, and if you don't believe me that this can happen and put you out of business, just read up on the Ralph V Estep case that was brought against him here in the State of DE. It was brought to the attention of our State Board of Accountancy by the DE State Bar Association, and he had fines of over $600K, had cease & desist orders that he ignored, and his license was finally permanently revoked. I'll post a link to the case in the next post.

Maybe I wasn't totally clear. DE has its own form, but the only way to get info to flow to the new DE Sch A is to enter the Federal Sch A input. The software does automatically choose the best method for Federal and State (standard v. itemizing), but it does NOT automatically transmit the Fed Sch A to DE. @BulldogTom, does ATX transmit the Fed Sch A if using standard deduction for Federal and itemizing for state purposes?

By doing it that way, I don't believe the Sch A is actually transmitted with the Federal return because that return is using the standard deduction so the Sch A isn't required. You'll have to check the e-file for the actual forms transmitted. CA may not require the Fed Sch A. Prior to this year, did CA have its own version of Sch A. Prior to the 2019 tax year DE never had its own Sch A, and the Federal A definitely was NOT included in the transmission and the client would get a notice unless it was sent separately via mail, email or fax. The way I do it is the only way to actually have the Fed Sch A transmitted in the e-file to the DE when the federal claims standard. I can't answer what CA does or requires.

You can do that so that client doesn't receive a notice for "missing" information. I usually send the federal e-file first if it is claiming the standard deduction, and then after acceptance which is usually within a few minutes, then I go back into the file to force the federal to use Sch A and send only the DE return. Nothing really changes as far as IRS is concerned because that return is already filed, but it allows the Fed Sch A to transmit with the DE return. DE is one of the states that developed its own version of Sch A this year, probably to help eliminate errors related to the SALT limitation, but DE still wants all of the Federal forms, so this is the only way to actually have it transmitted without faxing or emailing the Fed Sch A separately.

No one here will be able to answer how the IRS assesses one's qualifications or what other information on your application may trigger a delay or denial by IRS, but you are beyond the 10-year look back for answering the question about felony convictions within the suitability check. You'll have to submit your application to find out.

Your question, like those you posed last year regarding GAAP reporting, very clearly exemplifies why non-CPAs should not be involved with the complexities of GAAP-based financial reporting. If anyone has discouraged you, it is because some of us feel you are neither qualified nor well-versed enough to prepare or advise on GAAP basis financial statements, and may even be bordering on an eithical violation by doing so.

Yes, I realize that and it goes along with your statement that not many early returns are itemizing as before because of the higher standard deduction. Sorry if my post was lacking in clarity or completeness.

That error code IND-162 is related to the name control or the name being too long. This error can occur when the combination of the Taxpayer First Name, Taxpayer Last Name, Spouse First Name, and Spouse Last Name is too long. Try shortening the name fields. The total number of allowable characters, including spaces and the & (ampersand), is 35 characters. The IRS validates SSN/Name Control based on the first four letters of the last name.

You realize Cathy's post is almost a year old and Cathy may not answer quickly or at all, right?

I've had one over-65 client that is itemizing for state purposes with some medical .

No, the IL wages of $100K would be correct because the TP is a full year resident and all wages will be taxable in the state of residence. None of the other states listed have reciprocity with IL. In order to claim a credit for taxes paid to any other states, the TP is required to file a return in any of those other states and have a tax liability for which the credit may be claimed. The credit for taxes paid to other states is only on the income that is taxed in both that other state and that is also taxed by the State of IL, and that is how the TP offsets some of the IL tax liability.

From an older ATX blog, it sounds like you need to make sure that your own "client" information is up to date within the ATX system, meaning your information as the tax preparer. Here is the snippet that I found:

That was a feature I liked with ATX too, and I used to print the lists for the Fed & State. With Drake there is the assumption that the required forms and statements are being sent, but it would be nice to see the actual items transmitted. I also still greatly miss the ATX planner that was on one page with the ability to increase items by %.

There may be more, here are some from the beginning of this year that may have something helpful: https://www.atxcommunity.com/topic/22819-publication-15-circular-e/?tab=comments#comment-165385 https://www.atxcommunity.com/topic/22846-filling-out-the-new-w-4/?tab=comments#comment-165518 https://www.atxcommunity.com/topic/22862-new-withholding-tables-the-new-w4/?tab=comments#comment-165951 From last year when the draft of W-4 came out: ehttps://www.h.com/topic/22117-irs-issues-draft-of-revised-form-w-4-for-2020/?tab=comments#comment-162213

I allow the software to generate printed signatures where possible and sign everywhere else a signature is required. This is mostly on my state's returns and e-file authorizations and any local returns that can't be e-filed.

Your wife is a lucky woman.

Your client should take this up with his or her employer if its felt that the W-2 is inflated. I wouldn't necessarily assume that it is or try to argue the point with the IRS. Are you sure the W-2 is wrong or that the employer doesn't know the % that is shared to the bussers and runners so that the correct amount is included in compensation? This seems unlikely if, as you say, most of the payments are via plastic as opposed to cash. Also, what proof does your client have to document the shared tips? Is there a tip pooling or sharing arrangement that the servers have agreed to participate in? You might want to check state regulations on tip pooling or sharing and read up on the amendments to the FLSA for this that occurred back in 2018. https://www.touchbistro.com/blog/tip-pooling-laws-in-restaurants/

If you look at the instructions for those boxes, the amounts in those boxes are for contracts/straddles that are reported on form 6781 and then ultimately flow onto 8949/D.

That detail for box 18, code C has never been provided for the individual K-1s because it isn't required for the partner to file his or her return. If you want to provide that detail, I think the only other place would be to use box 20, code AH as supplemental date, but that spot isn't really appropriate either because the nondeductibles are not required for the personal return. Other than that, you'd have to add a statement outside the program. The instructions for K-1, box 20, the final item for using code AH says this: "Any other information you may need to file your return not shown elsewhere on Schedule K-1. The partnership should give you a description and the amount of your share for each of these items.