Max W

I have changed my thinking on this. That would be to make 2017 the Final Return, then next year, if the management company send a 1099 for the the months prior to changing the bank account, it will be easier to deal with.

Trust assets were completely distributed in March 2017. This when the trust should have been closed. However, the executor failed to close the trust bank account until this year. The property management company continued to send payments to the trust bank account and issued a 1099 for the rental income. So, now if the 1041 were to indicate Mar 17, 2017 as the closing date of the trust, there is sure to be a CP2000. Would the IRS accept an explanation, if it can be shown that the balance of the income after March was reported on page 1 of the beneficiaries Sch E? TIA

Thanks, for your opinions. There more of a screwup than this which will post in another thread.

Decedent Irrevocable trust specified a 1/3rd distribution to the three beneficiaries. The Executor, one of the beneficiaries decided to distribute his share to one of the others. He had the consent, not written of the other two. Effectively he changed the terms of the trust. In some states, if not most, any change has to be approved by a probate judge. The state in this case is CA. I prepped the 1041 using the 1/3rd distribution, even though one got no money and another got 2/3rd's and they want the K-1's to reflect that. Since I have to go by what the trust dictates, I don't think I should change it. Am I right on this position? TIA

.....until you get caught. http://www.theprogressiveaccountant.com/Tax/feds-sue-three-florida-liberty-operators

I think the only time I've used codes is for wash sales and for the homeowners exemption.

Client cashed in SSAR's and RSU's which were reported in Box 1 w-2 and form the basis. Is it better to report these as a "Offset to W-2" or to use the adjustment Code B. I prefer to use the former because there was another transaction on the same 1099B for which no basis was reported. The Offset approach provides more detail, whereas using the Adjustment Code lumps everything together. TIA

Never mind. I got the basis from the Yearly reports the client provided.

Here is a spreadsheet of the transactions for 2017. At the bottom, there is a formula for calculating the basis of the RSU's, /RLT's. on lines 6-20. Can anyone decipher it? I would be very, very grateful. 2017--Transaction_Details_.xlsx

Yes, you can pro-rate the exclusion. Some people are under the impression that their state tax is also excluded. Not so, unless they have severed all connections with that state and that is often hard to prove.

This could cause some headaches down the road as the MIP info is transmitted to the IRS. If the return doesn't match, there is sure to be a CP2000 in someones' future.

The fact that the client got her a refund on her claim, doesn't mean that the 1040X won't be audited. If that happens, then the refund would have to be repaid - with penalties and interest. To be deductible, any contribution over $250 has to be acknowledged by an CONTEMPORANEOUS written acknowledgement from the donee org. There are no exceptions and there have been a number of court cases that have upheld this. I know of many cases where amended returns provided refunds, but were later audited with unpleasant results. It may not seem logical, and we all know the IRS doesn't do illogical things. :}

And tonight is the start of Passover. It always starts before Easter Sunday, for good reason.

Here is a detailed report, with examples, from Roche/Genentech that addresses all of these issues. It is 28 pages and I'm not sure it uploaded. 2017_Tax_Reporting.pdf

I posted something similar recently and now I am beginning to understand it. However, is the CG reported on 1099-B, offset by any basis, or is it what it is?

Oh well. the UN condemned the tax. That should make everything all right. The condemnation is not of the tax per se, but the use of the tax funds to arm violent, destabilizing forces in Africa and of the methods used to collect the tax. Sort of sounds like the old IRS before the taxpayers bill of rights.

That's the problem of dual citizenship. You can be taxed by both countries. Eritrea is rightfully claiming him as well as the USA. If he wants to have the benefit of both countries, he has to suffer the consequences as well.

Client died in Dec 2016. (see initial post)

So, it looks like there will be three tax returns; Dec 22 2016 to Dec 31 2016; Jan 1, 2017- Dec 31, 2017; and again for 2018 as the assets weren't istributed until recently.

Client with a Revocable Living Trust, died on 12/22/2016. There were no trust transactions until Jan 2017, which were rental receipts . Can the, now revocable trust, use a Jan-Dec calender year? And, if so, can it then use the section 645 election? TIA

My procedure is to look back 20 years, not just the 8 that she claims are missing. Although, the IRS only looks back 6 years, there may be prior years that she filed, or was SFR'd and owed tax, years that would be potential amendments. When calling PPL for a compliance check, my first question is - "Are there any taxes due and, if so, for what years"? Then I request account transcripts for those years and also ask for their CSED dates. My next question is - "What years is the IRS looking for?" They will usually say the last six, but if there is no filing requirement, the number maybe less. The final request is for the Wage & income transcripts for any missing years and for any years for which tax is due. This may exceed the limit of 10 transcripts, so you would have to make a second call, or use Eservices , or a service such as Canopy.

A family member? Be Careful! It might be the potential client them self.

Capital gains is on Line 13 of both CA (540)NR and the CA (540). You may have to use Non-resident returns for both states.

It has been a while since I used ATX, but can't you change the business use from 100% to 50% on the depreciation. If it affects the expenses, you can adjust those accordingly.

The California allocation form is CA (540), or CA (540)NR. Notice the parenthesis, it is different than the 540 form.