jklcpa

About that networking...

You're welcome. I was lucky enough to have spent my early years in a small CPA firm having a diverse client base where I worked on a wide variety of projects. The owner was a perfectionist when it came to the work product, and he gave me the guidance and leeway to learn. He's gone now and I miss him, but his training and expectations still resonate. And... Google.

You must also include a second 1045 and all related schedules and calculations using the AMT methods and rules even if AMT didn't apply because of being under threshold. I've seen these NOL carryback returns kicked back for that very reason. I hope you aren't doing this by hand.

With the exception of Sch A, line 1, everything you've listed will be entered as a positive number. Some of this is in the instructions, some of it printed on the form itself within the lines' descriptions. Sch A Line 1 Net Operating Loss This is the amount from the 1040, line 41. Enter it exactly as it appears on that line of the 1040. If it's negative on the 1040, enter it as negative on this line. Sch A Line 3 Nonbusiness Capital Gains - positive Sch A Line 6 Nonbusiness deductions - positive Sch A Line 7 Nonbusiness income other than capital gains - positive Sch A Line 12 Business capital gains without regard to §1202 - positive Sch A Line 16 Sch D, line 16, loss - Positive, if there is a loss on that line of Sch D.umber.If you don’t have a loss on that line (and don't have a sec 1202 exclusion, skip lines 16 through 21 and enter the amount from line 15 on line 22 Sch A Line 23 DPAD Deduction. Positive. Sch B Line 3 Net Capital Loss Deduction. Positive Sch B Line 5 DPAD again. Positive Sch B Line 6 Adjustments to AGI. Positive Sch B Line 7 Adjustments to Itemized Deductions. positive Sch B Line 8 Personal Exemptions. (I believe positive on this one)  Yes, positive Correct, the purpose of the 1045 Sch A is to actually calculate the NOL, using the 1040, line 41 as its starting point and adjust for all of the items that aren't considered NOL. If line 25 is positive, then there isn't an NOL.

Links to illustrated 1045 for an individual, plus see additional information with links that may be accessed at the left of that page: http://irszilla.com/net-operating-losses-nols-individuals-estates-trusts/illustrated-form-1045.htm If using Drake, this KB also has some information and how to input depending on the years involved: https://kb.drakesoftware.com/Site/Browse/10863/1040-Net-Operating-Loss-FAQs

Naveen, the mid-quarter convention could also possibly be the cause. If this is a prior year asset that was already in service and subject to the mid-quarter rule, you can use the drop down or enter "MQ" in the "Force Convention" box:

Concerning the changes pertaining to alimony - The new law will NOT affect those already paying or receiving alimony under existing agreements. The new rules generally apply to divorce and separation agreements executed after December 31, 2018 and prior agreements modified on January 1, 2019 and thereafter IF those modifications expressly state that the new rules apply to those modifications. Below is the actual text from the relevant section of the Act itself:

Perhaps. I personally haven't found that to be much of an issue and don't remember seeing complaints about it either. Don't most preparers know the lives of common items that we deal with on a regular basis anyway, and if there's an oddball addition or we are unsure, shouldn't we be checking on the life anyway and not relying on a program to do our thinking for us? I rarely used the full ATX depreciation and don't recall the level of hand holding it provided. Instead I chose to use the depreciation module from what was Creative Solutions that is now part of Ultra Tax, mainly for it's features for financial reporting, ease of handling bulk sales, and for creating a variety reports. Again, even with that program, I am not relying on it to come up with the proper useful lives. It does have drop down selections that will lead a user to a value, but even with that, any user that doesn't know the law may make an incorrect selection.

This is the entry screen that Drake uses for all types of entities. The minimum you'll need to enter is: Choose the entity type at top in the box labeled "For": My example is showing 1120, COGS, F because I had an 1120 open. On indiv returns it should show the schedules that the 4562 could relate to (A, C, E, F, 2106, 8829) Multi-form code - may be blank if you have only one form that all of the assets relate to. Examples of where this field is used is where there are multiple properties on 1040 Sch E, or where H and W each have Sch Cs or 2106s. Input where the 1040 has two property on Sch E would be a "1" for the first property and a "2" for the second one, and the properties would be designated in that same manner on the Sch E input screen. Next line pretty straighforward: enter description, date acq, cost. Bus use % is assumed 100% if blank. Chk box if "used" property. Use the drop down to pick the type of listed property if that applies. Method, use the drop down to pick the method. Ex - for a 7 yr property using MACRS GDS, pick MACRS(200DBHY) and the program will display an "M" in that box, or you can enter "M". You'll see that those abbreviations like "M" appear in that drop-down list. I'd suggest using the drop-down until you are more comfortable. You must enter the depreciable life. For the 7-yr asset, enter "7". For residential rental, enter "27", not 27.5, but I think the system is forgiving and will accept both and just use the 27 even if you enter the decimal. Other entries that may or may not be needed: If entering a new client with existing assets, enter salvage, prior deprec and prior 179 taken. For current year 179, bonus, and depreciation, the system will calculate but can be overridden on any field that has a "=" In that same section at left, "Force Convention" is where you can override to force it to use either half year or mid-quarter. The system does pick the appropriate method for current year acquisitions, but you might have to enter this for a new client with existing assets to be entered. The columns for state, AMT, and Book work the same way and will populate some data. You will still have to enter depreciable life in those columns. The system will create a reports, depending on the state and your preference settings and report settings. It will also create a report for future depreciation too. Other sections and drop-down boxes should be self-explanatory. There are other intracacies of where to start the entries so that the 4562 is properly linked and associated with automobiles and mileage that are used for 2106 or Sch C and that also allows the system to determine the best method (mileage vs actual) too. If you enter an acquisition date and then either select a method or life that was/is not available under the law for that year, the system will produce an error message. Similarly, the system will generate an error if you override depreciation that exceeds depreciable basis or excess 179 (either for that individual asset or the year's limitation). I hope that makes sense. If you have other questions, please just ask.

People have differences in how they absorb and retain information, and hopefully we are utilizing those methods that suit each of us best. Most of my CPE now comes from webinars and self-study, and I don't miss the the higher prices, travel, or distractions from other participants for some of the exact same seminars that I take online. This year I purchased an unlimited package that includes both webinars and for self-study, NOT because I need more credits and certainly NOT to buy credits, but because I have access to this company's entire catalog of materials that are excellent reference materials. That's a huge bonus on top of the CPE credits that I EARN and makes the price all the more reasonable.

I had another thought on this too. Are you sure that no 1099-DIV was issued by whatever state paid out the unclaimed funds? I know that here DE does issue 1099s for any divs that are more than $10 and issues other 1099s just like the company or original holder would have. Perhaps that is worth contacting the state to see if there is any additional information it would be willing to provide so that as much of that $100K as is possible can be taxed as qualified dividends using the lower cap gain rate.

For the social security benefits, if you have any back year return or 1099-SSA to use as a starting point, it should be fairly easy to calculate the SSA benefits because the COLA increases each year are known, and one of those years had no COLA increase at all. You should be able to get to the exact amount or within a few dollars and then verify back to bank deposits even if Medicare was being withheld since those premiums are set also. The only variable might be if those benefits are also net of FWT or drug premiums withheld.

I can only tell you that, for me, I wouldn't have needed to run both simultaneously. My switch occurred in Feb of 2013 when I wasn't willing to risk waiting out for ATX to correct all of the problems in its 2012 program. I went to a Drake sales presentation that was mostly an overview of the input process, and I also checked the 2011 returns that Drake converted. Those 2 things gave me a pretty good introduction to what I needed to know, and I jumped into tax season from there. Drake also has some short training videos that qualify for CPE, and also has video presentations on input of specific items in its help section that new users may find helpful. YMMV.

@Terry D I'm sorry to hear about all what you've been going through. Come here to vent any time to offload some of that stress if it will help. After all, who better to share with than a bunch of tax and financial nerds that would totally understand your frustration. Glad you got the answer to your question too.

Don't know if this will help you, I found this for starting in safe mode when running Symantec Endpoint Encryption: https://support.symantec.com/en_US/article.HOWTO63839.html

PSC C corps now pay the same rate of 21%. Some early proposals had the PSC rate at 25% but that didn't make it to the final legislation that was passed. PHC tax and accumulated earnings tax are both still in effect, rate unchanged at 20%.

Sorry, there was a typo in that post above. The input screen I was asking about is the "PNSN"

Mike D, do you also have to use the PSNS screen for this NY subtraction to be automatic, or is the only input on the 1099R screen? Naveen, the evaluation program should be fully functional in all aspects with the exception of items related to e-filing since, and since the payment by any electronic means would require processing through that service, my guess is that is the reason the direct draft is not processing. Once you purchase either the unlimited version or pay-by-return, you'll be able to e-file and process payments. Sometimes the date of payment can cause trouble too, because usually the date of withdrawal for payment can't be the same date it is submitted; dating the withdrawal one day later usually solves the problem.

No, ^ this is incorrect for David's client's situation as he described it. Because incorrect depreciable bases and lives have been reported on 2 or more years tax returns, the proper handling to correct this is by filing Form 3115. They are both considered changes in accounting method. Amended returns are appropriate only if the error is discovered after only one year's return is filed. Please see "Change Your Accounting Method" here for more details: https://taxmap.irs.gov/taxmap/pubs/p946-008.htm

We should start a separate topic on all of the things preparers don't do or don't provide to clients that cause huge messes later on. Basis issues is one that shouldn't be that difficult since the tax programs have input and worksheets for this. Another one that is missed and that is not in the tax programs is calculating accum E&P for C corps.

MeF accepts the current and prior 2 years, so the system is currently accepting 2015 through 2017 returns.

Yes, the Qualified Charitable Distributions (QCD) count toward the RMD, and the QCD also reduces the taxable portion of the distribution too. Up to $100K is allowed, and the person must have reached age 70.5 also.

I think Terry is trying to say the loss is equal to the hauler's fee of 50% of value that's being held back in exchange for removing the items.

The category that the equipment falls into in the heir's hands will determine if the losses are deductible or not. Losses on dispositions of personal property aren't deductible, only those attributable to investment property or income-producing property. If you decide that this is personal property and you are still reporting the transaction that results in a loss, there is a code on Sch D to indicate that it is nondeductible.

Under the TCJA, the MFS brackets are exactly half of the MJF, and Pacun gave a good example of when MFS may be of benefit. With that being said, we must still consider factors such as the composition of income and anything on the returns that may be affected by AGI or taxable income limits, and possibly run scenarios using each filing status because there are still items that aren't treated the same under the two filing statuses. A couple of examples I can think of off the top of my head: MFS may result in more of the social security benefits that are taxable if the couple lives together anyone wanting to contribute to an IRA for a nonworking spouse under the spousal IRA rules must file MFJ and I have some wealthy older couples with huge investment portfolios, yet the returns are fairly straightforward with only SSA benefits and investment earnings for income. I've prep'd returns for them where one of the spouses will make a huge charitable gift annuity that would have definitely exceeded 50% of AGI if they'd filed MFS and ended up with a carryover. In fact one year, the gift exceeded 50% of AGI on a MFJ basis so they still ended up with a carryover.