Terry D EA

Claiming a dependent is not an absolute. I too have trouble with the 1040 page 2 statement. In my case, the dependent's return accidentally got e-filed. It was in the batch and should have been removed. Parent's return was in the same batch and got rejected for obvious reasons. Re-filed without the dependent which made the return accurate because of the disallowance of dependency. Then amended both. So. I don't think I violated anything here. If my memory serves me correctly, there was some discussion this year about filing a return when you could and then amending the return to include forms that were delayed. Not sure where that came from? Here is another scenario. Had a client file his return 2nd week of season. He was told by WalMart that he would not get his 1099 statement until the end of April (so he claims). Amounts are not known and the guy needed his refund. So, to the best of my knowledge and from the information presented I filed the return and told him that if and when he receives this statement he must amend the return. Ideally, if what this client says is true, then an extension would be the best way. But again I ask, what would you do?

Gotcha John. I like the invoice too but I know I took a beating on this one. I am figuring this way, I kept the price around 500 this time and will gradually increase it to where it should be. I think I have used the folders you speak of. Keeps things neat too.

I just finally finished what I call a real tax return. This return consists of form 1040, Sch A, B, two C's D with barter exchanges, 7 E's, 2 K-1's with 7 4562, and all other associated forms, worksheets, AMT worksheets, form 2441 etc; and then we have the State. My stapler can only handle 60 pages. Stretched the stapes to the limit but they are holding. Now with adding the client's information the client folder is about one inch thick. How do any of you organize a mess like this? Here is what I have done. Two hold punch at the top of the forms, organize them by income, expenses and Itemized deductions; etc., with a binder (guess that is what it is called). I am glad to be done with this one.

It looks like you have it all in line. It appears smart decsions were made regarding the sale of the home. If it was sold at FMV or less then the beneies come out okay with no taxable gain. I've seen this numerous times where there was a lack of planning and the beneies had to pay tax. Even had one client get really upset with me a few years ago when I told her that the proceeds were to be split between her and her sisters evenly and that each would most likely have to pay tax on the proceeds because the home was given to them 5 to 10 years before their mother passed which meant mom's basis was their basis. Q4- I personally like the details and itemize them on a statement attached to the return. That way it covers any questions.

Paper cutter works just fine. I guess we all have to deal with whatever comes our way with this stuff.

<<<Why do people think you have to go to the court in Nashville>>> Cause most state laws state that you have to file the small claims action in the State where the defendent lives. I know here in NC it is that way as I was in the process of pursuing the small claims option. Now, I am not a lawyer and could have missed this completely. But it didn't seem like a good option to me.

<<<IF the parents are getting refunds anyway, why go through the bother of filing and then amending? just put on extension>>> Maybe the parents need their refund????? Essentailly, it would be the parents' call.

Question 1, I am unsure of how I would handle this. There is a responsibility to file an accurate tax return. If you're willing to do an amendment at no cost as you discovered it was your error, then do so. Question 2, I don't think it matters if the estate is open or closed when it comes to the gain/loss resulting from the completion of the estate tax return. The 1041usually has a K-1 attached for the beneficiaries so it is my opinion the loss should be reported on their individual income taxes for the year. Question 3, This one is a little sticky, who owned the house at the time of sale? If it was owned by the estate, then the proceeds should have passed through the estate and not directly distributed. If the beneies received the house as an inheritance, then process taken was okay. Question 4, after all assets, funds;' etc have been distributed according to the will, and the only thing remaining is income to the estate, then each year an estate tax return will have to be completed to show the income and K-1's to the beneies.

(I did this right before Terry posted she had received her check) I hope you can see by my picture that I am not female. Anyway, no offense taken, but I didn't return the software and I did use it, but not to file any returns. They have not asked for it back either. Doesn't matter really cause what can they do with a defective product?

I think the better way is to go ahead and file the parents return now especially if they are getting a refund. Then I would wait until May to file the amendments for both. Did this indentical thing last year and all was resolved by July or August. You may have to wait a long time for the dependents's amended return is processed which again, if there is a refund due the parents then they may not want to wait. Also, if there is a balance due, and by waiting, you will put them in a possible penalty and interest situation.

I agree NO! the Visa prepaid card is the only option or have them open an account with a credit union or some bank that won't have a large deposit to open requirement. I had a client (friend of ours) ask me to do the same thing in the past and NO! Doing this could cost you your business. Again, don't do it.

I am using a HP2015 which has been cranking out forms for a few years now at 30 pages per minute. I buy my toner from Rapid Refill Ink. They are the only ones who have the high volume cartridge that gets approximately 10,000 pages and in the case of tax returns about 8,000. cost me $117.00. I have a beef with printer makers as well with the only limited copies from the toner cartridge supplied with the printer. I low toner light is on right now but like MAS I am going to get every last piece of dust out of that thing before I change it.

check out the link below as this should clear up any questions regarding the tie breaker rules. In this scenario, look at the last line in the tie breaker rules, the grandmother, providing she has the higher AGI, can claim the EIC and HOH as well. By the original post, I am assuming the grandmother has the higher AGI. Now, with this said, it comes down to choice. if the father who can claim the EITC and does not, then the Grandmother can. It might be a good suggestion to work with the returns for all interested to see who which would return the higher refund and if all things being equal, it would benefit all. <<<<<Tie breaker rules only apply if two or more people claim the same child. The first tie breaker is parental relationship which will be won by the father, which will be end of the conversation.>>>>> Not exactly correct either. Joan's response is correct for this scenario. http://www.eitc.irs.gov/central/abouteitc/basicqualifications/tiebreaker/

<<<<<I do have a client like this. She actually has two S-corps and thinks filing 13 months after the deadline is current filing.>>>>>> Has she been penalized by the IRS for these late filings? My client has filed late for the last three years and well after the extension but to the best of my knowledge has never been penalized. Slipped through the cracks maybe???

This was extended until Sept 15, 2011 but as I said, never heard from the shareholder.

I want to know what the difference is between OLTPRO and OneDesk. Same renewal price, or at least very close, what is the difference?

Thanks for the reply. I was afraid that was what the penalty would be. Really isn't my problem and if they get assessed then I hope they learn from it.

Have an S-corp client that has not filed for 2011. I just found out after a phone call yesterday that there were medical issues surrounding not filing. Has anyone witnessed the IRS assess late filing or failure to file penalties and if so, what might this S-Corp be facing. They usual file late every year and I have never seen any notices or penalties assessed. They do drive me nuts but this time I can understand.

I agree and I have been reading alot on this including the instructions for the 5227. Now that you have jogged my memory a bit, I believe you are correct with the changes a couple of years ago. Also, these are very sensitive returns. The one that I do, I make sure to follow the order of distributing the income. Interest first, dividends, second; etc. Everything is supported by notes and statements with the tax returns.

I am sure glad others chimed in here. These rules seem to change all of the time and if it is something you don't deal with all the time, the water gets a little muddy. I think you need to look at KC's repsonse above and that may very well may enable you and your clients to come to a final decision. it is terrible that folks treat each other the way they do. For you, and moving forward, you should choose to prepare the taxes for only one of them as it puts you in an awkward situation and may present a conflict of interest if you assit both of them. JMHO

Never said testing or anything else would help. No amount of testing, course work, update class, college classes, classes on ethics; etc will prevent someone from taking short cuts or engage in unethical practices. I did say the requirements should be across the board for all and just because you can put the letters CPA behind your name doesn't make anyone a tax guru who knows all and will do it correctly. As far as I am concerend, the three folks who brought the initial law suit probably couldn't pass the test. As I said somewhere else, you wouldn't go to a brain surgeon who couldn't pass a test would you? Even if the brain surgeon passed all required tests, this doesn't make him immuned to mistakes or unethical practices. One significant difference is the brain surgeons mistakes get buried, ours just cost money and can be fixed.

The software does require form 1041 to complete the 5227 and the K-1 just like ATX currently does and has done in the past. Agree on the efiling issue. What bothers me is the complete non use of the 1041-A. Not using this form in the past with the 5227 generated a 5k penalty. That is why I am really being careful.

<<<<<<Married couple lived together (in Ohio) with their 2 kids for all of 2012 until October.>>>>>> Regardless of when the divorce was finalized, and by your post, they lived together as a married couple for more than half the year and therefore their only choice is MFJ or MFS. Correct me if I missed it here but if they are divorced or separated on the last day of the year it doesn't necessarily mean they are divorced or separated and living apart for the entire year.

I can't answer the question as to what their marketing scheme is and how they can offer it for free. I have completed one individual tax return and have noticed what you all are pointing out. I don't like the letters either. No cover page, and I don't like the fact that their are no shareholder letters and no page 2. I am very detail oriented and want to produce a professional looking tax return. As far as OneDesk being a reseller like TRX was, I certainly hope not cause I surely won't go that route again. I think the renewal for next year (2013) is 499.00. The price is attractive but you got to be careful.

If you're talking about the sandwich yes.