Pacun

Interest or other income will cause the loss of some EIC. So it will not make any difference if reclassified. I can only imagine how much that person received in child support that year in order to earn 9K in interest.

EIC is not in play here. I need to enter earned income in a way that is not SE taxed and is able to be considered for addition child tax credit. I will try Form 2555 and see what happens. I expect this person to get $1,400 refund.

Title should read: How to report earned income WITHOUT paying SE

US citizen living in SPAIN sin 2018, earned $18K in spain. I want to report HH because she has a child and I want to get additional child tax credit. If I use ex-line 21 and enter 18K, no additional child tax credit. Thank you in advance.

Sometimes I just think like a tax payer. I hear things from my stylist like "the IRS has a lot trailers full with unopened mail" and I don't bother to find out what's happening to the individual return. In my case, the IRS website had nothing listed for 2019 and I kept telling the client that the IRS had not opened her package and I pretended to be savvy by saying that the IRS had a bunch trailers with mail and that her package was in there since there was nothing on the website. It is easy to send the client away when you have not prepared their 2019 return which is the case with this client. One day, reluctantly, I decided to call the practitioners hot line and they told me that the return was on file but they were taking a look at it. Since it has been so long, the representative said that he was going to open an inquiry and that will force the person or group holding the refund to work on it. The inquiry gives them 30 days to look at the return. For the 2020, the lady said that the client needed to wait 45 days before anything could be done. I am about to call about 2020 since the 45 days have passed. I have read that if you used 2019 income for EIC and CTC on the 2020, they are delayed because someone has to look at it. But again, something can be done after the 45 days. After that call with the IRS, the client stopped calling me every week.

Not only that, one of them might even qualify for EIC or extra EIC. 1 HH plus 1 Single standard deduction is much better than 1 MFJ. If one of them file with the two children, they will get also stimulus for the extra one child on the return which $500 plus $600 and since they have not filed yet, maybe they already got stimulus 3 and the parent with the two children will get an extra $1400. Not only that, if next year the parent with no children in 2020 claims the two children next year, that parent will get another $1400. Regarding amendments... I am always busy. In this case, I would tell the clients, I am going to prepare the return you have hired me to do and I will do it the correct way. You don't qualify to file jointly so I will not do it this year. You should amend the previous years filings, but I am busy and I cannot do it. After I prepare your taxes, you can go to HR block or anywhere else to have those amended. I don't like to amend what others preparers have done because I was not there when the tax payers were interviewed. Plus I am busy and I decide what jobs to take depending on my schedule.

I have not done in ATX but I have done it in proseries. You have your data on a shared drive, let's say, on the "server" computer, which in turn is your current computer. You install ATX and use the "server" option to install and point it to the shared drive to get the data and to save the data to. After that, you follow the instruction and install on the other computer using the workstation option. For proseries, once you install the server portion, it creates an installation file for all workstation and you only click on "set up" on the shared drive and installs. As you know, your computer MUST be up and running in order for the workstation computer to have access to the taxpayers information. Also, any updates need to be run on the "server" computer and the updates will be distributed to the work station computer. For QB, you save the data on another folder on the shared drive (on your computer) and you install QB on each computer individually or as network if you have paid for it. In the simplest way... only one person can work on a QB client at a time. Again your computer needs to be on in order for the data to be available. So, no need for extra equipment if you have two computers and a router.

Keep in mind that where the money from the distribution went doesn't matter. If the person, spouse, dependent or household member was affected by covid-19, the distribution can be reported evenly for the next three years. She could potentially, roll over 1/3 before she files for 2021 and another 1/3 before she files for 2022 if her business gives her profits. If her business was shut down at the farmer's market for a couple of months, that's enough reason to be affected by covid 19.

I think the best is to itemize all years and that's the most conservative, legal and ethically. Depending on the documents and circumstances described by the client, I would itemize the first 3 years and use the standard deduction for the next three years. I would put an end to 2015, 2016 and 2017. For the other years, I would use the standard deduction because chances are that the ex also used the standard deduction because of the $12K+ deduction. I hope he has her social security number and remembers her name. I would recommend a divorce as soon as possible so you don't have to deal with this situation next year. Good luck.

Not when they are longer than usual.

I enter the names as they appear on their Social Security cards and I print their return. If the name is too long to efile, I take out the second last name from the spouse. If I still have the issue, I take the second last name from the first person. I have not needed to go any further.

Talking about MD.... I have noticed that each time I efile, I have to check mark that I have verify IDs and address... and who knows what else I am verifying. This is new this year.

I think the license info doesn't roll over because we are supposed to ID everybody every year. I have also noticed that university information must be entered every year by IRS requirements and they don't roll over anymore. For my practice and taste, ATX is the best in the market. Stand alone installation, who opens the program knows what forms and what questions to ask (at least that's what I believe), interface and price look good.

I guess if the amendment is for a filer, then the social security number is freed soon. In my case, mother claimed child and when grandmother claimed the same child it was rejected. I amended mother to free up child's social security number and it has been a month and still grand mother's return gets rejected. In my case, I think I will have to wait until the 1040X is completely processed before I can efile grandmother's. To efile 1040X, the original return MUST have been efiled.

I have a simple return with 16K unemployment that I was checking everyday. Today I opened it and voila, everything was correct and I was able to efile. Prior to opening, ATX updates so... yes it did it by its own because of my setup.

I am happy that ATX has now fixed form 8962 from: Line 29=(smallerOfline28orLine27) to: Line 29=0. That required a lot of programming effort and that's why it took them weeks to fix.

It is only April 19 and Maryland is ready to accept and correctly calculate ATX 1040 with unemployment benefits. I have a lot of MD returns to efile.

I have a couple that fell in a black hole. Both are using 2019 income to calculate EIC and Child tax credit. One filed in Feb and the other at the beginning of March.

I bet you the IRS will be happy to get their money. I efiled one a few years ago and I only had the daughter to sign form 1130??? . She got the refund and no problems.

Thinking about it, it seems to be a contradiction in the way this is reported. A chef asked my client for $50K in exchange for a 10% interest in the restaurant. My client became a silent partner but he has never visited the restaurant which is about a few blocks from where he lives. To make more interesting, my client has never ever visited a restaurant but he invested the money. The contract reads that he is a 10% owner and 10% of the profits and losses belong to him. My client has his regular W2 job. It seems to me that my client should not get money reported as ordinary income on K1s. If the losses are not reported as "ordinary income (loss)", my client should be able to deduct up to $3K every year, correct? If the restaurant were to be very successful and my client would get $100K, my client should not pay SE taxes, correct? Thank you in advance.

Yes, the question is about ordinary income for a passive partner who only contributed money to the partnership. I will wait for income to be available to deduct the suspended loss.

Two partners 80% and 20%. I am preparing 1040 for the 80% partner and his K1 shows guaranteed payments for a total of $140K. The partnership ordinary income is $100K of which my client got $80K on his K1. My client is the one who does all the work for the partnership (active participation). I can deduct 199A from the $80K but not from the $140K, correct?

I guess I associated capital losses as being passive.

Thank you for the answers. It is a restaurant. He has no other passive income. I thought you could deduct 3K losses on passive activities.

I shows the loss on 8582 and the it also shows it as "unallowed loss". Sch E has a check mark on "check if some not at risk". I don't where that check mark comes from but if I override it, it doesn't change anything. All his money is at risk. He should be able to deduct 3K every year until his basis is gone, correct?