Margaret CPA in OH

In looking through a cabinet, I noticed a can of compressed air. I decided to blow out my keyboard having noticed a bit of cat hair floating about (see avatar for responsible parties). Wow! I think I found another cat! So now I've blown and picked and prodded between the keys but still see wisps here and there. Any really effective ways to get out the rest without completely dismantling the thing? I may do that but not until after the season for fear that it will never be the same.

Personally I no longer take deductions without 1099's being issued where required. I obtained a pretty major business client several years ago when he was audited. Although he had records up the proverbial wazoo, he did not have W-9's for subs paid about $20,000 total. The auditor denied each and every associated payment costing this client a lot of money. Ever since then, he never pays without a W-9 in hand. After a Workers' Comp audit, he never hires a sub without seeing that sub's coverage form. Sometimes it takes a financial hit to learn to follow the rules.

No authority here but I worked in academic research for about 15 years at several universities. Generally speaking, researchers are hired as tenured or nontenured staff but can also be graduate students or independent using the facilities while collaborating with others. Much of the time, grants are obtained by researchers but are awarded to and managed by the institution. I was paid by several grants including NIH and ACS. My first job, during the Vietnam War, was lost because the researcher's grant was renewed but not funded due to the war. Some graduate students and post doctoral fellows are paid from institutions that have money (endowments, for example) to do so but others must find their own source of funding. Many foreign grad students and post docs bring their own grants/fellowships for living expenses and research expenses may be covered by the institutions for collaborative reasons. All this to say that someone receiving grant money may or may not be an employee of the given institution and accounting for the funds just to treat a researcher as an employee may not be at all feasible. This case sounds as if the researcher procured his own funding and is not an employee of the institution but also is not self-employed in the traditional sense. He/they should have done a better job of understanding more thoroughly the tax ramifications of this income.

This is from a colleague. The Goodwill was originally substantially greater than $100,000 (these are all working, not real, numbers. The unamortized balance on the books was $100,000. The total business assets sold for $100,000 and the fmv (not basis) of the equipment was $50,000. I don't know whether it's too late to allocate the entire purchase to the Goodwill. I think the contract may have stated that the equipment is worth $50K but the confusion was how or even if the goodwill sale could show a loss. KC, why couldn't the book value of the seller be 100K? Book value is what it is. I believe the buyer was purchasing the entire business assets for a total of $100k and the fmv of the equipment was $50k. So, per jshtax, the seller shows ordinary income on the depn recapture of the 0 basis equipment but what to do with the high book value of the goodwill. I just thought it an interesting issue. Not my client but wanted to throw it out to the great minds here.

Why not if his 'place of business' for record keeping, scheduling, etc. is his home?

Okay, so he isn't self-employed and is funded through a grant. Then I wonder why the income isn't on a 1099-G and reported on line 21 as a taxable grant. Or it could just be linked to that line as other income. Could he be considered a student as a graduate student? I guess I don't understand why the software is not allowing the credit. It is limited to actual expenses paid but I assume the payments for care at least meet this amount.

Why not report the income on a Schedule C?

This is a bit backwards. Partnership has had sale of assets, not distribution. Assets include equipment and goodwill. Total purchase price was, say, $100,000 with equipment valued at $50,000 so goodwill is $50,000. However, goodwill on the books is still worth $100,000 and equipment is fully depreciated. Is it possible to have a loss on sale of goodwill? Would that be ordinary and the gain on equipment capital or ordinary? My partnership 'answer book' does not address and I don't find it in MTG, at least to my satisfaction. Thanks!

KC, beautiful and heartbreaking.

Thanks so much, all, for chiming in with this. Frankly, I forgot which year they graduated and it was June, 2013. I had prepared a return in 2013 for the son's 2012 income, all of $369, and didn't recall whether the daughter had been in college since fall 2012 or 2013. Now I only have to get the dad's income to see whether his situation is as grim as I hope it is not. If it is below that $43,000, then it appears that he is eligible to file with 2 dependents (son's $5000 does not apply for support) as both were in school at least 5 months of the year. They were 18 at graduation. Mr. Pencil, it was a very good school system and the dad was not always low income. In the early years he was employed at a large firm making a very good 6 figure income but was downsized about 6 years ago. He continued doing well as a consultant (training on certain software) until recently. In 2012 his Sch C was $70,000, the lowest in a while. The kids had great assistance when babies and toddlers through the programs that facilitated the adoption. Dad is pretty smart and has a wide circle of educated supportive friends who helped raise the kids. They moved to the community with great schools just for the extra help available and it paid off with the daughter. I think the son is just more interested in non-academic pursuits and maybe is a bit slower maturing. Many kids, maybe more boys than girls, take more time than others. My son was in high school at 10 but decided his own path and is only now, at 33 finishing his degree in engineering. Diff'rent strokes (but made his father and me crazy all these years as we both have master's degrees and he did not value education!).

The income is what raised the question - the details say that 'the support test does not apply' for qualifying children but doesn't explain if there is no limit upper or lower. I know that $5000 is greater than the listed $3900 limit but 'does not apply' is pretty vague to me. I guess that the age is the determining factor and it's sad that it is less than 2 weeks. Yes, cutoffs have to be somewhere. Estimated payments for dad? Well, I always provide vouchers based on projected income but, until last week, had no idea of his dire straits. My guess is no payments were made as he was trying to save the house. At least he was there long enough for the kids to graduate from a really good school system and the daughter is doing very well in college on all scholarships. Son, not so much and had issues at birth. They are adopted and were crack babies raised by a single dad. What a guy!

Thanks, Pacun, for the quick reply. I know dad makes too much at $43,000 for one child, however not for 2 children. My question relates to the part of Qualifying child criteria that says the support test does not apply. Does dad lose out because son is 13 days over 19 even though dad provides more than 50% of son's support? The age test is the breaking test here, right? They will be so unhappy to lose out for 13 days of age but it is what it is, sadly. Thanks again.

Finally I have a client which qualifies-with a wrinkle I don't know how to smooth. Twin children of single dad turned 19 Dec. 18, 2013. Daughter is full time student so clearly a dependent. Son is not a student but has struggled with work as has dad, self-employed. I don't have dad's income figures yet but he has struggled financially to the point of putting house on the market for short sale or foreclosure and is living with kids in a friend's house. Son does not meet all the criteria to be dependent as his income was $5000. However, for EITC the rules state that support test does not apply. With this, I am not sure how to file son's return - dependent or not? - or dad's return when I get his figures. Son wants his refund yesterday but not sure what his status is. He will receive full federal and state refunds no matter but could make a big difference for dad. Just wait until dad gets it all to me? What is the answer if dad qualifies with less than $43,000 AGI? Sigh, and I was hoping to avoid this for another year. Not to be.

Well, congratulations! I will toast you later, just sorry that it has to be from afar. Nonetheless, I acknowledge your new, worthy status. Hold your head a little higher this weekend reflective of your august new position in (this) world!

Thanks for this Square discussion. I got one maybe 2 years ago, before I had a smartphone. Now I've had this phone for a year and don't remember how to use the device. I found the app on the phone and found the little square device (amazing that I didn't lose it!) but don't remember how to use it. Any reminders? I will look on the website again. Some clients tomorrow may be willing to let me try it out on them.

Oh, I LIKE that-a present every tax season. For me that's usually a dive trip but I can stretch that a bit. The more comments I read, the more I am lusting after this toy. Don't think I can wait until after tax season now!

I'm thinking the same thing, KC!

Wow, that's a great price. I will check it out among other options. Do you have one? We have a notebook by Asus that has been pretty good but has its own limitations.

Thanks, KC. I did check the link and learned a lot which is, in part, why I think it's well worth waiting a bit longer. More research to do but this board is so valuable, proven once again, for so much more than tax research!

http://blog.petflow.com/i-cant-believe-how-funny-this-is-i-am-in-tears-make-sure-your-sound-is-turned-on/ I really hope this works as I thought it soooo funny!

Thanks so much for all the great feedback. This is not intended to replace my business desktop which is made by my computer go-to guy who has made my last 5 computers. I also do not use my laptop for my tax business, just for CPR classes and church work. I am finding that my smartphone is not so easy for web browsing (old eyes) and my Kindle Fire is slow on the internet (but I love watching old tv shows when I'm on the treadmill) but my FitBit and Garmin software is on my laptop. My laptop takes a long time (all relative, isn't it?) to boot up and is less convenient than I would like. Laptop isn't as lap friendly as it used to be and these tablet PC's seem a nice compromise for fun and light duty work plus Skype. I like the lighter weight feature among others. Well, it isn't an immediate purchase so will keep all this in mind until after the season. I am thinking it would be great to have on my July dive trip to Palau and Truk lagoon, though! Thanks again, all!

I've been considering a replacement for my clunky dated laptop and pondering a tablet PC. A good friend and attorney just got and highly recommended the Microsoft Surface Pro 2. Sounds really good but not sure I am ready to spend $1000+ when laptops are so much less. But, but, it can do so much more, is lighter, more powerful, etc. Pros? Cons? Alternatives?

Delivering the mail with a guard cat http://www.tastefullyoffensive.com/2014/01/mailman-battles-angry-cat-while.html

I, too, have had a couple of issues with IE11. My computer guy uninstalled and reinstalled IE10. He said IE11 was, for some things, not quite ready for prime time. I trust him. He has built my last 5 computers and does semi-annual maintenance or remotes in whenever I need it.

I have already psubmitted 2 sets of W-2's through Accuwage. Hmmmm..... Guess they are stockpiled?