Christian

After doing a woman's and her children's returns for some five years I received her info sometime back. I asked a question on the forum about Form 8962 which info I expected to use for her benefit. On preparing her return I was astonished to discover that her income and that of her dependent daughter far exceeded 400% of the poverty level and so elimanted any premium tax credit. Feeling I might not be up on every aspect of the ACA I advised her I would return their info and to seek help from someone who might have a better grasp of the ACA. The combined tax credit exceeded $13,000 and I felt a CPA might know some way to help reduce or eliminate it that I might not. In talking to her about this I was astonished to hear that she knew very well she had made a mistake. Accordingly I then offered to go ahead and prepare the returns filing her daughter as single which would likely eliminate any premium tax credit she would owe back. She advised no that she and daughter would file their on taxes Turbotax and she would not report the Premium Tax Credit. I told her this was required if she used help from the exchange and further that they would come back on her for the overpayment. I asked what income she used to figure her premium tax credit for 2020 fearing she likely did the same for this year and was told she didn't remember. It finally dawned on me an old client had knowingly defrauded the health exchange by providing a low ball figure on her 2019 income. She also used me to confirm what she knew had occurred and proceeded to what she was going to do anyway file a false return and also avoid any fee on my part knowing I would contact her about such a glaring error. Needless to say she offered me no payment for my time spent on their info. I am sitting here mad as h--- and considering sending off a form to the IRS fraud unit.

It's so comforting to know Walters Kluwer considers me a Quiet Hero. Of course, I knew it all along.

I've had the opportunity to review my earlier work on this. The amounts reported on the mother's and daughter's individual forms in column A of the 1095-A are added and reported on Form 8962 in column A for each month. The amount reported in column B of Form 1095-A is the same on both the mother's and daugter's Form 1095-A and are entered on Form 8962 in column B and are .of course, not combined. The amounts reported in column C of Form 1095-A are combined and shown monthly in column C of Form 8962. The adjusted gross income of mother and daughter are entered on line 2a and 2b. What threw me off was that last year the Health Insurance Marketplace reported the mother and daughter on a single Form 1095-A and for reasons I do not comprehend changed the reporting for 2019.

Darn thing is irritating as h---. I rarely deal with it and my pdf files are invariably too large so I just let them mail it. How is it ATX cannot get this penalty form through the efile system since it is a valid Virginia fom.

A client whose adult daughter is a college student and a dependent have each received a benefit form from the Virginia Healthcare Marketplace. The daughter is shown under her mother's policy although she has a separate policy number. The last time I encountered this problem I added the column figures together to report on a single Form 8962 and ,of course, reported the combined family income at the top of the form as well. Just checking to try and make sure this is still the correct procedure as I process very few of these.

He brought in a bag of Lottery scratch off tickets in amounts which totaled $1,000 thinking he could deduct these against his winnings. My reply "Good luck on that". His deductions fall far short of his $12,400 standard deduction.

A client won $ 1,000 in the Virginia Lottery last year. In reexamining the state lottery subtraction it occurs to me I may have been misinterpeting it. In past years my understanding was that any winnings in excess of $600 meant that the entirety (in this case $1,000) is taxed by the state. On rereading the instructions I am now wondering if $599 can be excluded with the remaining $401 being taxed by Virginia ?

In reading the material provided by WK on the stimulus rebates I am puzzled by this "The rebate amounts are advance refunds of credits against 2020 taxes" which means the rebate amounts will be shown as credits on the 2020 returns I guess ?

That looks to be what I am trying to do. The last time I had this issue I had to get info on how the scholashps were applied. The scholarships requiring the payment of tuition and related expenses must be considered tax free I am assuming. Other scholarships not so construed I assume could be shown as taxable income to the student and payments made by the parents for books and a computer would apppear to qualify for the AOC. In this instance the scholarships are far in excess of the tuition expense and would easily cover the books and computer they bought for their daughter. In point of fact the scholarship income exceeds not only the computer but not a few peripheral items as well which leads me to feel they have no AOC due.

Where exactly in ATX help can I find instructions on filling in this form. A client has some $5,000 of tuition expense and some $8,000 of scholarships and grants. If I can assign some $3,000 of the difference to the student I can get the parents some credit for the computer and books they bought their daughter out of pocket. I addressed this similiar problem earlier this season but feel I need a better grasp of how this is done. I am going to contact the parents to asertain just how the scholarships and grants had to be applied and go from there. I rarely encounter education credits as most of my folks are retired and such so feel a bit unfamiliar with this and need to up my game.

Has the Service allowed modification of the requirement that a client sign the Form 8879 in light of this pandemic or must we still require them to sign thus risking exposure ?

Before I return to my day job. The operative question here is. Why did the much ballyhhooed IRS efile computer system not immediately reject my first return filed in 2014 for God's sake for using an incorrect PTIN number? I have filed for almost six years using an incorrect number and good Lord !!! they are just now catching it ? Them budget cuts must have done them in.

I thought so as well. I not only accessed my PTIN account but called them on their toll free number. The number provided is indeed correct. So much for all that "we do not call you stuff". I suppose they felt it was urgent. Go figure. Just what an ageing tax guy needs at the end of a trying season !! I went to the medicine cabinet and took two blood pressure pills. Just kidding youall.

I just accessed my PTIN account. I printed out the official letter I got on renewal. I'll be darned if the call was not legit. I have been using an incorrect PTIN evidently since 2014. I have the original confirmation letter here in file which I will access when time is available but I swear it confirmed my old number. Of course, the SERVICE never makes an error do they ?

Just received a call reportedly from the IRS saying my PTIN is incorrect. does anyone have a contact number in the Service to check . Say I have been using an incorrect PTIN since 2014.

I finally located the answer.The wife continues to use the tax free basis until exhausted. Alas a moot point as this spouse cannot provide the needed info as to retirement date of her former husband. Good grief !

A new client has come in bringing a pension 1099-R from the Office of Personnel Management showing a pension which she gets based on her deceased husband's record. As with so many of these the taxable amount is not indicated. I have forgotten if a widow is allowed recovery of her deceased spouse's remaing basis in his pension or if it is simply lost. Can anyone address this ?

I filled it in and divided the income as indicated but I saw no calculator and assumed the service would do anything further.

That will be my solution as he as no itemizable deductions and their combined standard deduction of $27,000 is greater than any itemized deductions. I would expect the Service will simply deduct his $252 in tax withheld and send them the remaining refund balance.

I have two clients both over 65 yoa who have married. He owes an outstanding and ongoing tax liability for which he is paying $100 a month. His refund is taken every year until this is paid off. In reviewing the MFS filing status I find she has $20,000 of useable itemized deductions and he gets the standard deduction. The ATX software indicates if I assign her $20,000 to her I must reduce his deduction to $7,000 on his return. The IRS instructions advise each can use their own deductions which would indicate she uses itemized and he gets the $13,500 standard for his return. Which is it ?

In point of fact I finally determined that the former practitioner in reading this used this method even though there was no other parent to claim the daughter. Another incidence in which the IRS instructions can lead a person astray unless combed over again and again.

Is there a toggle in the forum that allows you to see your individual prior posts?

The daughter's concern is that being shown on her dad's return as his dependent would cause problems with her drug benefits through Medicare. Unless I am completely mistaken he HAS to have a dependent to use the HOH status. Under his previous filings he did not indicate she was his dependent and I suppose the Service never cross checked it so no problem arose. I am simply going to delete her from his filings going foreward.

Well shucks ! She is a domiciliary resident and there goes my noble idea.

I questioned the daughter who was the one who raised the medicare concern stating she files an annual form with them stating that no one claims her as a dependent. She advised me that doing so would negatively effect her drug benefits. Apparently the Service never looked into her being shown on the father's return as a non-dependent assuming I suppose he gave that status to her mother but retaining the HOH status for himself. Her mother has never claimed the dependent status for her. In truth it would likely go forward with no problems just as it is but with all the new paperwork (Form 8867) I don't feel it is a good idea to not strictly follow the law.