Lee B

"Request non-assertion of accuracy penalty in an audit or underreporter notice due to reasonable cause: when a taxpayer I audited or has a CP2000 notice, the taxpayer must contest the penalty during the audit or CP2000 process prior to the assessment. Taxpayers need to argue that they made a reasonable attempt to properly report their tax liability. Reliance on a tax pro, ignorance of the law, and other factors can be considered in requesting non-assertion of the penalty. If the accuracy penalty is already assessed, the taxpayer must request audit or CP2000 reconsideration to have the penalty abated."

Too many returns falling thru the cracks, which will be in limbo for many months.

Haven't seen it mentioned.

Substantial Tax Understatement is one of the two Accuracy Penalties. All you can do is tell what happened with good documentation.

May qualify for the Other Dependent Credit

Hopefully, this is not an accuracy penalty because I don't believe FTA can be used with an accuracy penalty. Based on your post, I don't know what the "reasonable cause" would be?

Knock on wood! So far I haven't had any issues arise that has required me to call the IRS I have had to call the Oregon Dept of Revenue 4 or 5 times and gotten thru after 15 or 20 minutes.

Copied from the Office Of Personnel Management website: Holidays for Federal Employees New Year's Day (January 1). Birthday of Martin Luther King, Jr. (Third Monday in January). Washington's Birthday (Third Monday in February). Memorial Day (Last Monday in May). Independence Day (July 4). Labor Day (First Monday in September). Columbus Day (Second Monday in October). Veterans Day (November 11). Thanksgiving Day (Fourth Thursday in November). Christmas Day (December 25

I don't know what kind of assets the pts owns, but if the husband is still alive what is the logic for dissolving the partnership right now ? Given what you have posted so far, I would probably wait until the end of 2021 to switch over the payroll and the pts at the same time.

Copied from The IRS Mind website: "Many penalty abatement requests are denied – requiring the taxpayer to appeal the adverse decision: the IRS uses an automated decision-making tool to make penalty relief determinations. This tool is flawed and often produces incorrect adverse penalty determinations. Taxpayer often receive adverse penalty abatement determinations that appear not to consider all of the facts and circumstances. Taxpayers should appeal their decision to the IRS in order to have the entirety of their circumstances considered."

Copied from the IRS Mind website: "Many penalty abatement requests are denied – requiring the taxpayer to appeal the adverse decision: the IRS uses an automated decision-making tool to make penalty relief determinations. This tool is flawed and often produces incorrect adverse penalty determinations. Taxpayer often receive adverse penalty abatement determinations that appear not to consider all of the facts and circumstances. Taxpayers should appeal their decision to the IRS in order to have the entirety of their circumstances considered."

Given the details you provide this sounds like a knee jerk response. I think you would have a very good chance of getting this reversed in appeals..

"Rev Proc 2013-30 facilitates the grant of relief to late-filing entities by consolidating numerous other revenue procedures into one revenue procedure and extending relief in certain circumstances. This procedure provides guidance for relief for late: S corporation elections, Electing Small Business Trust (ESBT) elections, Qualified Subchapter S Trust (QSST) elections, Qualified Subchapter S Subsidiary (QSub) elections, and Corporate classification elections which the entity intended to take effect on the same date that the S corporation election would take effect. Generally, the relief under the revenue procedure can be granted when the entity fails to qualify solely because it failed to file the appropriate election under Subchapter S timely with the applicable IRS Campus and all returns reported income consistently as if the election was in effect. For purposes of this guidance, the “effective date” is the date the election is intended to be effective and cannot be more than 3 years and 75 days from the date relief is requested. To assist in determining if an entity qualifies for late election relief, Rev. Proc. 2013-30 includes flow charts, as well as specific guidance for each of the five categories listed above. If an entity does not qualify for relief under Rev. Proc. 2013-30, the entity may request relief by requesting a private letter ruling. The procedural requirements for requesting a letter ruling and the associated fees are described in Rev. Proc. 2021-1 PDF) (or its successor). Again, it is important to know that Rev. Proc. 2013-30 relief is only for late elections that would otherwise be valid. For example, the S election must still contain signatures from all the shareholders. Also, if there was an invalid shareholder or the corporation was not qualified during any part of the tax year, the S election is not valid for that year."

"Intuit developed the Non-filer Sign-up tool for the IRS and delivers this tool through its participation in the Free File Alliance." Interesting

If you want to seriously blame someone, blame the elected officials in DC and their appointed servants who created this situation.

https://www.irs.gov/credits-deductions/advance-child-tax-credit-payments-in-2021

Wouldn't you have to have a signed 2848 in order to do it for them? I think that the approach that Sara's firm is taking makes a lot of sense.

"Taxpayers who do not wish to receive the advance payments, whether for changes in income, status of dependents, or otherwise, will be able to opt out of automatic advance payments in order to avoid having to make a year-end repayment. The unenrollment process will be completed via a tool on the online IRS portal; however, this feature is not yet available as of their June 7, 2021, announcement and any alternate means to opt-out in the meantime have not been provided. A similar tool to be released later in 2021 will allow taxpayers to update relevant income and dependent information on the IRS portal so that they may receive a more accurate monthly credit payment."

Perhaps these returns or your program somehow reverted to an earlier version. First check the version of your program to make sure it's the current version. If it's not the current version, back up all of your clients before updating if it is, then reload forms on one of these returns to see if that fixes the problem.

This is not inventory, its an investment so it's just like buying and selling stocks,bonds, mutual funds or ETFs, except that you can that you can buy something directly thus skipping the intermediate step of selling for cash then buying something. Perhaps in that sense it's kind of like bartering.

"Small Business Administration funding for the Paycheck Protection Program has been exhausted; however, $6.2 billion remains available for underserved areas. Applications that are already in the pipeline will likely be approved and funded. The state tax treatment for PPP loans and forgiveness varies from state to state, and there continue to be changes. The Restaurant Revitalization Fund is for more than just restaurants, Mankowski noted. “It includes caterers, bars, wineries, and other entities in the food industry. There have been over 300,000 applications. $2.7 billion has been distributed, with monies set aside for women, minorities, veterans and others.” The Shuttered Venue Operators Grant program had 11,600 applications by the beginning of May. Eligible applicants may qualify for grants equal to 45% of their gross earned revenue, with the maximum amount available for a single grant of $10 million. $2 billion is reserved for eligible applications with up to 50 full-time employees. Economic Injury Disaster Loans are, in fact, loans and therefore are not forgivable, Mankowski noted. “They are not to be confused with the EIDL Grants (of $1,000 per employee), which are forgivable," he said. "Loans have been increased to $500,000 per entity. If you previously applied for a loan, you can also apply for increases.” The SBA has been using Form 4506-T, which allows a lender (in this case, the SBA) to verify with the IRS that the forms supplied to prove the applicant’s income match those in the possession of the IRS. “

"It’s been a busy year for the Internal Revenue Service. More than 136 million federal tax returns have been filed so far in 2021, with over $254 billion in refunds processed, despite the problems caused by the shutdowns and additional legislation generated by the pandemic. The service shared a number of additional stats at a recent update meeting with stakeholders, according to Stephen Mankowski, the tax chair at the National Conference of CPA Practitioners, including: 94% of refund returns were filed electronically, with 92% direct deposit. The IRS answered 9.9 million calls, with the month of March at times experiencing 1,500 calls per second. A thousand IRS employees will be added by summer. Advance child tax credits will begin to be sent out by July 15, 2021. Nationwide Tax Forums will begin — virtually — on July 20, 2021. New applications for FIRE (Filing Information Returns Electronically) will be available in September." . . . . . . . . . "Darren Guillot and De Lon Harris have been designated as co-commissioners of the Small Business/Self Employed Division since Eric Hylton’s retirement at the end of March. Much thought was put into the configuration of the department, including compliance with various offices, such as Examinations and Enforcement, and incorporating many aspects under the Collection Division. Regarding COVID, things are changing rapidly, with the safety of taxpayers and employees remaining paramount. Only a few in-person interactions are occurring with the consent of the taxpayer and representatives in accordance with CDC guidelines. More than 90% of SB/SE Exam employees are still teleworking. Currently, the SB/SE is looking to hire 3,100 new employees, including 1,300 revenue agents and 400 in campus for correspondence exams, according to Mankowski. “There will be more hires in 2022,” he said. “Some of the staff will be specifically assigned to work against abusive promoters, tax scams, and abusive tax shelters.” Collection will continue to be a stand-alone division. Automated levies have been halted since April 2020 due to COVID. Installment agreements have been modified to include new tax debt. The automated levy program will be returning soon, but the IRS wants to ensure that no additional stimulus payments could be affected by this program. Collection is hiring 518 specialists, including bilingual employees. They are also working on “voice-bots” to help implement online payment agreements and set up installment agreements or transcripts. The program was created in December 2020 and turned over to IT in March 2021. Next year, it is expected that these bots will be able to address many of these calls and help increase the level of service to over 50%. In addition, the Automated Collection System will be increased with new staff hiring. The IRS currently has 1,921 revenue officers in the field, with over 650 more officers to be hired this year. This allows growth as the current staff needs to be trained. Due to low staff, they are looking to bring on new employees to focus on high-income deficiencies and delinquent filers. Meanwhile, delays on processing refunds continue, according to Mankowski. “Congress kept tweaking some of the qualifications for the stimulus payments recovery rebate credit based on different years’ returns,” he said. “One agent told me that from the start of filing season he had more than 800 calls with an Error Code 900 issue. When a taxpayer files a return and qualifies for additional stimulus money based on a prior year’s return, it gets moved into that category. When you call, you’re told the return will need additional processing to recalculate the recovery rebate credit. They estimate it will take 10 weeks from the date of filing.” Roger Russell Senior Editor, Accounting Today

Doesn't make sense to me????

Especially when they don't even bother to implement a solid operating agreement and if they have one they don't follow it. Too many clients think all they have to do is register with their state, get an EIN and file a tax return, then they're golden.

Your tendency to abbreviate and not complete explanations and questions leaves me unsure of what the your clients situation really is and what are the questions you are asking???