Terry D EA

He can't file single. He is married regardless of his wife's status

Thanks Margaret and you are correct, the change does make it easier. I can tell you this much, I am using TRX this year and it does not handle this kind of return very well. All the input comes from the 1041 and the 1041-A. For a split interest trust, I can see why but it is still cumbersome. It was especially fun preparing the K-1. On the other hand, it really makes you use your head and not the software.

I too was glad when this board started. The amount of kindness and willingess of others to help is sometimes overwhelming. This is one research tool and can't be replaced by any other. Thanks Eric for creating this board. :bday:

Congratulations!! I thought I only had to get to 500 well I guess I better get busy as I am lagging way behind

Hey it's me again Margaret!! I want to see if you read the requirements for filing CRUTS they way I am. Form 1041-A is no longer required and form 5227 replaces it correct? Have a great day Terry D.

Jainen the reasons for talking with the IRS is to obtain the prior years accounts. These folks probably don't know for sure what documents they need or should have kept. The other reason is to find out if the husband has some enormous tax liability, collections or anything else that caused the other CPA to recommend filing separate. I don't know if the other CPA will talk to me or not. The client's claim they will not return their phone calls. Thanks for the help

Last minute new client. I know how to ammend a tax return. Let's get that out of the way first. Another CPA, and for the life of me I don't know why, filed 2009 for a MFS for a couple who are married with no quarrels; etc, that should have been filed MFJ. They missed a few entries and included entries for the husband on the spouse's MFS that were identifed soley as the husbands. The spouse has already mailed the return and paid the tax due. My question with this is, this return should be amended but the taxpayer has not filed his MFS return. What are the right steps to take? The only thing that makes me wonder is the taxpayer said this CPA no longer wanted to file his taxes because there was too many receipts and they didn't have time for it. (Makes no sense billable hours). With that said, the CPA has filed 2005, 2006, 2007 & 2008 MFS. Now, if this guy owes the IRS big time, or his tax situation is really stinky, then I can understand the CPA's recommendation for the spouse to file MFS. If not, then I am still lost. I did get the POA signed and will be talkinh with the IRS before I proceed. I may want to toss it to the wind as well based on what I find. If he is clean, then the crunch will be on to get the 2006 amended by 4-15.

If you are e-fiing the return, then I would enter the grand total and attach a copy of the statement to form 8453 and send it to the IRS.

I agree with KC. You have too many unanswered questions and certainly not enough information to make a comparison. Alot of different items can trigger the AMT which is a horse of a different color to deal with. I would never assume any package is right or wrong without all of the information surrounding the client's income and expenses.

This is why I love spreadsheets. I am tired of pulling my hair out trying to keep all of the calculations straight. Remember book depreciation is separate from tax depreciation. A spreadsheet side by side works extremely well. Keep in mind though spreadsheets are tough for a company with a lot of assets. JIMHO

I don't know for sure if I can help with this or not but here goes. The ALT, in my opinion, is the Alternative Depreciation Systems also known as ADS which you have identified. The alternative depreciation system has some fairly strict usage and once elected is irrevocable and usually gives a slower rate of recovery. Also, the ADS must be used which figuring the AMT. I have tried to come up with the figures you presented and am having trouble backing into it as well. Given more time, and that is not a luxury right now, I think this can be figured out. Here is a suggestion, see if your client is open for an extention that will allow you the extra time to work on the math. In the mean time,check out the depreciation tables in the my link below and see if they might be of any help. I tried only one of the tables that I thought were appropriate and still the numbers are off. The worse case scenario here is having to correct the depreciation from the previous year which will require amending that return. My link

Assuming the home that was sold was "their" primary residence then no taxable gain on the sale so I would report the sale on his return. Also, because it was "his" business then I would take the recapture on "his" return. Hope this helps.

Don is right, I just completed one of these yesterday using TRX. But, ATX has the box as well. I always thought ATX had programmed in some gremlins that eat at random things in the software. Too many times, I experienced the incredible disappearing information. Remember the year when client's names; etc would disappear from the return? Might be some of the same gremlins left behind. :-)

Dear Client, Thank you for calling and insisting that I file an extension and include a payment amount with the extension that you do not owe. I encourage you to give your bookkeeper a raise for being far more knowedgable then I who worked hideous hours unraveling the messiness of your financial statements. Don't bother to recognize the 23K loss titled Net Income/Loss from operations from my certified finacial statements as it us not relevent because your efficient bookkeeper entered transactions in a closed period. Again, I point you to giving her a raise due to her ability to find, override, and bring my errors to your attention. I am sure you have noticed the reduction in the fee I charged this year in an attmept to be sensitive to harsh economic times. However, be adivsed the discount is not available when it comes to filing extensions of this nature. See the portion in your contract regarding the additional charges for dumb looks and responses to stupid requests. P.S. YOUR FIRED! Go find another "frickin", "friggin" (JB's words) accountant.

1.) 2006 Van, in service 10/06, set up as 5 year 200DB/MQ. On the ATX "Asset Entry" form, Item 4 Asset Category I used "V - Vehicles" and I am unsure on what to put in for Item 5 - Asset Subcategory. Do I use "2" - 5 yr. Qual non personal use vehicle or "7" -Truck, Van on truck chassis or some other category? You would use the 5yr Qualified non personal use vehicle. You need to determine if this vehicle is a personal vehicle and if so, what the percentage of business use is. You will need to see what the amount of the accumulated depreciation is so the program will calculate the depreciation for 09 correctly. Also, Since the method is 200DB should this years depreciation be less than last years depreciation? Typically, yes if MACRS is used. MACRS depreciation is based on a percentage and the tables can be found in the publications. I think it is Pub 945 on How to depreciate property. Again, I suggest getting the previous depreciation documents to see what methods were used. Also, Since the van is being depreciated he cant deduct the loan payments, correct? Only the interest on the loan, correct? You cannot deduct the payments for the van, only the interest if the van was purchased and owned soley by and for the business. If this is a personal vehicle, then only the percentage of business use would be used to deduct the business portion of the interest. Remember, the cost of the vehicle is being recovered through depreciation and deducting the payments would be double dipping. .) Form 8829 - Part III - Depr of Home. Since the home was sold on 6/29/09 whats the proper way of calcualting only the 1/2 years worth of Depr? The yearly depreciation total divided by the number of periods the asset was used in your case it is 6 months or simply divide by 2. Example: 1200.00 annual deprecation for six months = 600.00. They are filing a joint return and the recapture will be calculated on Schedule D and flow to both of them.

I have to follow GraceNY on this one. Your client must be able to substantiate the business related calls and only the charges for the business related calls are deductible. One other option is a cell phone purchased or added to a plan strictly for business use. The additional fees to add the phone, the monthly charge for the phone, and any added minutes would be deductible. I did this with my own business as it is ridiculous to pay 150.00 per month for a phone to take up space on my desk. I added a line, ported the company number and added minutes to cover the business use. Here is the key, my wife is to never and under no circumstances call me on this phone. Non-business calls are easily identified on the phone bills. This is an area to be extremely careful with.

Thanks for the replies. You have confirmed my intial take on this. I guess the idea of building the building on your own property that is not zoned commercial is what put the question in my mind. Over thinking it I guess. Pacun I cerntainly knew this was non-residential real estate but thanks anyway.

Client has built a building on his primary residential property to run and operate his automotive repair buisness. I understand using the uniform capitalization rules to determine the final building cost. Question is what asset class is this? 1250? and how many years and what method of depreciation would you use? I can't see this as commercial property because of it's location. My thoughts are 25 year property SL. Any suggestions on this?

Normally, the tuition deduction follows the exemption so the parents can take the deduction. They may not have paid the tuition but they definitely provided the housing, meals;etc as the daughter lived at home.

i think you answered your own question. As Jainen stated, the CPA did all of the work for you. Income minus the expenses should go on line 21 other income of each beneficiaries individual tax return.

I think that would go under the furniture & fixtures as 7 year property.

I gotta agree. That was awesome. Too bad we couldn't see him come back down.

I found this from the Smart Pros Accounting and News Insight. While I know HRB cannot control the nature or character of the people they hire, you would certainly think something like this would definitely impact their business, especially in the area this occurred. I know it would deter me from ever going to their office(s) again. My link

Don, I took the plunge and purchase the TRX product this year which is Tax Works. At the beginning I questioned whether this was a good move or not. The price was attractive and naturally there was a learning curve. The program is input driven and not forms driven like ATX. Overall, I have had a good experience. The depreciation calculations threw me a little because the input screens don't show the current depreciation which is something I was told they were working on to correct. One other problem I had was finding the input to override a unallowed loss from the previous year that was allowed. The program picked the loss up from the K-1 line 1 which I was told they are also going to be working on. Other than that, no significant problems. The time it took to learn the program took a little while but did come fairly easy. One of the major pluses over ATX for me is the client profile screen. You can synchronize with the e-file center and the status of the return is displayed. Numerous reports from the e-filing center can be printed that allows you to verify the progression of the return including bank information. This is something I personally asked ATX for the last 3 to 4 years. One more thing, the returns print in order from the cover (slip) sheet right thru the end. The only sorting is separating the Fed client letter from the State which can be avoided by combining the letters. It is worth a try and as a new customer, you will get an offer that is hard to refuse.

I'm going to go out on a limb here. I think it would be to your best interest to try to obtain the documentation surrounding the trust. Those documents may very well outline the taxation of the trust as well as what happens upon death. I agree with the previous response, the executor is the one who can initiate this and it ultimately responsible for filing any and all tax and legal documents on behalf of the estate. You might consider filing an extension of the deceased's final return to allow for some additonal time to obtain the documents and research this. Good Luck!