Terry D EA

I am sure I know the answer to this question but thought I would throw it out there anyway. Client financed a pontoon boat. Interest is not deductible correct? This is not a RV but maybe considered a house boat maybe. What say ye?

Judy is right you MUST go back the two years which is 2013 and follow her instructions.

I'm right with you. No renewal and I'm not even going to entertain an offer or phone call. Absolutely free for five years wouldn't get my attention. None of it is any good if you can't trust it.

Catherine, I've got nothing to add. Others have given you the best advice with Sch D. One thing I can add is I hope you are feeling better and moving forward.

Here's another one. I had a highly educated individual ask me why the HRB software online was telling him that he used up his education credits and no longer qualified for them. Well, we both know he didn't repeat this exactly or didn't understand what it was telling him. I told him it was probably referring to the AOC credit as his doctorate work doesn't qualify for that particular credit. I also told him that if his income exceeded 130K then no tuition and fees deduction. That he laughed at so is he going to hire me??? Nope, gonna struggle this week to see if he can figure it out on his own. I told him that when he was ready to wave the surrender flag I would prepare his return for him. A doctorial candidate and using HRB free online software. Hmm so much for higher education.

No Rita, I am not smarter than you. This guy's mistakes are so obvious it doesn't take much to spot them. I just finished amending his 2014 where he claimed the wrong education credits and added in the qualified dividends with gross income. I just told him that "you just blew a hole in your foot and wallet by not knowing which education credit to claim". After a few more hints, he had me prepare the amendment. Same with these other folks return, the errors are obvious so the ball is in their court as to what they want me to do. I always tell them that I may find other things as I do prepare the return. Now it is their choice as to what they want me to do.

Rita, you hit it head on! He is going to pay me to do the review which doesn't mean I am preparing the return. I will point out the errors and then offer to prepare the return at my normal fees (well maybe a PITA fee is in order here). Exactly as you said, I am not educating him on how to prepare returns and take business from me.

Thank you for this. Judy can I think it would be a good idea to pin this thread with the others at the top of the forum.

Well by your descriptions it certainly seems she would be actively engaged if she is working in sales for the company she is a partner in. So, you are saying she is a "limited" partner correct? If so, then the statement above from the IRS would indicate that her share of distributive income is not SE income and only payments that are guaranteed payments are subject to SE tax. This would make me believe the K-1 may have been prepared incorrectly.

http://strausslaw.com/do-you-have-an-out-of-state-trust-getting-your-refund-after-the-kimberly-rice-kaestner-case/ Catherine, here is a link for information regarding the Kimberly Rice case. It makes reference to a form to use while the case is under appeal. BHoffman stated form D407 and ittructions which are easy to find on the internet. The fiduciary is required to file the return and using form D407A looks like it would generate a tax due to NC. However, maybe using the general statute form in the article above may give your client some relief. Sorry there isn't any more information than this. I agree the DOR in NC will be clueless with this and is obviously no help to you.

Is this partnership taxed as a disregarded entity and only a SMLLC? Is it possible the income on the K-1 is a guaranteed payment? As stated below, partners in a partnership are not employees but are considered to be self-employed. Does your client receive a W-2 from this company they are a partner in? If so, that is done incorrectly and should cease.The blurb below is from the IRS website. Partners in a partnership (including members of a limited liability company (LLC)) are considered to be self-employed, not employees, when performing services for the partnership. If you are a general partner of a partnership (or treated as a general partner in an LLC) that carries on a trade or business, your net earnings from self-employment include your distributive share of the income or loss from that trade or business. General partners must also include guaranteed payments for services rendered to, or on behalf of, the partnership as net earnings from self-employment. If you are a limited partner of a partnership (or treated as a limited partner in an LLC) that carries on a trade or business, only guaranteed payments for services you rendered to, or on behalf of, the partnership are net earnings from self-employment. Limited partners do not pay self-employment tax on their distributive share of partnership income, but do pay self-employment tax on guaranteed payments.

Well just to add to my original post. Same guy stops by the other day and asks me to review a return that he prepared (again with paper and pencil) and the 2014 return that he again prepared in the same manner. This is NOT his return or information. I did ask him if these folks gave him permission to let me see this information. He said Oh yes no problem. I did ask for these folks phone number. Should I call them before I review this mess? From what he told me, and I tried to ignore everything as I warned him he shouldn't be discussing this with me, he has screwed up these folks return and shorted them money on refunds both years. Again, I am only guessing here as I haven't looked at this stuff yet. What would other do? Before someone chimes in with "charge him dearly", believe me he will be paying for this one even if it is for wasting my time.

Yep, I agree do a zero return. Been there and done this.

Be careful with this one. Had a return today where the client qualified for the AOC for two of their dependents. The first time I entered the info, the program denied all of the credits stating it was due to my input choices. The second dependent the AOC was taken without a hitch. Deleted the first dependent information, re-entered it exactly as I did the first time and now the program gives the right credit. Come on April 18th.

Wow, after some digging, I found two revenue rulings regarding losses and Ponzi schemes. This is definitely not one for the faint of heart. The situation now is the previous preparer did this completely wrong as I suspected and my initial take was wrong. It looks like an amendment and a whole lot of other paperwork to substantiate the loss. One of the rulings is addressing a safe harbor which I am not digesting. Anyone with any other experience I would certainly appreciate any help or advice.

Thanks, it is definitely a Ponzi Scheme. I have researched the ZeekRewards and it is all over the internet. My problem is the previous preparer has used Sch D and did not use the entire loss amount. This method of reporting I am not 100% comfortable with. I will research further. If anyone else has any experience with this, please reply.

Happened again for the third time. Entered all the info in forms 1095B & C. Moved through the return and bingo, all information of these two forms is no where to be found. Can' wait till this season is over to get rid of this program.

New client never heard of deducting medical insurance premiums on Sch A. I questioned this during the review of their 2014 return. No medical expense deductions and the cost of their insurance premiums exceed the 10% floor. 2015 expenses are even higher previous preparer didn't tell them this. So they say. These folks have rental property and don't know what a depreciation schedule is. Depreciation shows on Sch E on 2014 return but they don't know what it is being depreciated. Previous preparer did not provide the depreciation schedule and there is no form 4562 in their return. Next one, guy comes into my office with a handwritten 2014 return that he prepared himself. Took the wrong education credit and screwed himself out of about 1500.00. Has a kid in school first year so AOC. He leaves happy and I have a 2014 return to amend. All good so far. Same guy calls and says he is preparing return for a friend and doesn't understand the ACA and where or how to input the information (hand written paper return again). I blow him out of the water with all the different ACA calculations, form 8965, 8962 and the formula for determining affordability using the poverty level calculation. Of course, the went through it quick and technical. He says "I think I'm in over my head". Me - Yep you are fixing to blow another hole in your foot. Now he wants to pay me to get his butt out of a jamb with his friend. Yes, I will charge accordingly. But the nerve of some people! (This is a good place for the head banger emoticon)

New client and victim of the ZeekRewards Ponzi-Scheme, lost 10,000.00. Previous preparer was only listing 5k loss at a time which the amount allowable is 3K. This client has received some funds back from the SEC. My take is they should claim a loss until the loss is absorbed or until they receive enough funds from the SEC to cover the loss and any payments received above the loss amount would be taxable. Just to verify, this type of investment loss is recorded on Sch D, correct?

Catherine, I am reading between the lines of your post a bit. If the trust has no income, then it is not required to file a Federal return and therefore no NC filing is required by the trust or the bene. Not sure what kind of trust this is but a CRUT (Charitable Remainder Unitrust) does not pay tax to NC. But, if there is no income, could the Bene receive a 0.00 K-1 form that would be reported on his NC D400 tax return? That seems to be the only way to approach this. Maybe I am missing it totally but I couldn't find any other information to help you.

Thanks for the replies.

<<<<<<The forms 1095-A & 1095-B are the gospel documents for the taxpayer having coverage.>>>>>> How many of these forms have you seen where the information is incorrect? Such as no individual covered in the "person covered" section. I have seen quite a few. Good thing the IRS isn't verifying these forms. If they were, God only knows what kind of a mess folks would be in.

LMAO!!!

Only bad part of this for me is trying to explain why I can't e-file it due to a program that doesn't have the worksheet. It does have a worksheet but when I click on it I get a red warning that says it is for 1040 NR. Guaranteed I'm not using this stuff (I'm being nice and professional here) next year.

As KC said, it is a LTCL