Lee B

According to a very large survey, the average Uber driver makes well under the federal minmum wage.

IRS, Security Summit Partners warn of new twist on phone scam; crooks direct taxpayers to IRS.gov to “verify” calls IR-2018-103, April 24, 2018 WASHINGTON — The Internal Revenue Service today warned of a new twist on an old phone scam as criminals use telephone numbers that mimic IRS Taxpayer Assistance Centers (TACs) to trick taxpayers into paying non-existent tax bills. The IRS and its Security Summit partners – the state tax agencies and the tax industry – urge taxpayers to remain alert to tax scams year-round, especially immediately after the tax filing season ends. Even after the April deadline passes, the tax scam season doesn’t end. In the latest version of the phone scam, criminals claim to be calling from a local IRS TAC office. Scam artists have programmed their computers to display the TAC telephone number, which appears on the taxpayer’s Caller ID when the call is made. If the taxpayer questions their demand for tax payment, they direct the taxpayer to IRS.gov to look up the local TAC office telephone number to verify the phone number. The crooks hang up, wait a short time and then call back a second time, and they are able to fake or “spoof” the Caller ID to appear to be the IRS office calling. After the taxpayer has “verified” the call number, the fraudsters resume their demands for money, generally demanding payment on a debit card. also have been similarly spoofing local sheriff’s offices, state Department of Motor Vehicles, federal agencies and others to convince taxpayers the call is legitimate. IRS employees at TAC offices do not make calls to taxpayers to demand payment of overdue tax bills. The IRS reminds taxpayers it typically initiates most contacts through regular mail delivered by the United States Postal Service. There are special, limited circumstances in which the IRS will call or come to a home or business, such as when a taxpayer has an overdue tax bill, to secure a delinquent tax return or a delinquent employment tax payment, or to tour a business as part of an audit or during criminal investigations. Even then, taxpayers will generally first receive several letters (called “notices”) from the IRS in the mail. Scammers are endlessly creative aren't they ?

Clarifying Note: The linked version is much easier to read due to bullet points and indentations which do not display on the copied text. In fact in several places, the copied text version is confusing because of missing bullet points etc.

Here is a link to the Fact Sheet dated 4/20/18: https://www.irs.gov/newsroom/new-rules-and-limitations-for-depreciation-and-expensing-under-the-tax-cuts-and-jobs-act If you don't click on links, here is the text: New rules and limitations for depreciation and expensing under the Tax Cuts and Jobs Act FS-2018-9, April 2018 The Tax Cuts and Jobs Act, signed Dec. 22, 2017, changed some laws regarding depreciation deductions. Businesses can immediately expense more under the new law A taxpayer may elect to expense the cost of any section 179 property and deduct it in the year the property is placed in service. The new law increased the maximum deduction from $500,000 to $1 million. It also increased the phase-out threshold from $2 million to $2.5 million. The new law also expands the definition of section 179 property to allow the taxpayer to elect to include the following improvements made to nonresidential real property after the date when the property was first placed in service: Qualified improvement property, which means any improvement to a building’s interior. Improvements do not qualify if they are attributable to: the enlargement of the building, any elevator or escalator or the internal structural framework of the building. Roofs, HVAC, fire protection systems, alarm systems and security systems. These changes apply to property placed in service in taxable years beginning after Dec. 31, 2017. Temporary 100 percent expensing for certain business assets (firstyear bonus depreciation) The new law increases the bonus depreciation percentage from 50 percent to 100 percent for qualified property acquired and placed in service after Sept. 27, 2017, and before Jan. 1, 2023. The bonus depreciation percentage for qualified property that a taxpayer acquired before Sept. 28, 2017, and placed in service before Jan. 1, 2018, remains at 50 percent. Special rules apply for longer production period property and certain aircraft. The definition of property eligible for 100 percent bonus depreciation was expanded to include used qualified property acquired and placed in service after Sept. 27, 2017, if all the following factors apply: The taxpayer didn’t use the property at any time before acquiring it. The taxpayer didn’t acquire the property from a related party. The taxpayer didn’t acquire the property from a component member of a controlled group of corporations. The taxpayer’s basis of the used property is not figured in whole or in part by reference to the adjusted basis of the property in the hands of the seller or transferor. The taxpayer’s basis of the used property is not figured under the provision for deciding basis of property acquired from a decedent. Also, the cost of the used qualified property eligible for bonus depreciation doesn’t include any carryover basis of the property, for example in a like-kind exchange or involuntary conversion. The new law added qualified film, television and live theatrical productions as types of qualified property that are eligible for 100 percent bonus depreciation. This provision applies to property acquired and placed in service after Sept. 27, 2017. Under the new law, certain types of property are not eligible for bonus depreciation. One such exclusion from qualified property is for property primarily used in the trade or business of the furnishing or sale of: Electrical energy, water or sewage disposal services, Gas or steam through a local distribution system or Transportation of gas or steam by pipeline. This exclusion applies if the rates for the furnishing or sale have to be approved by a federal, state or local government agency, a public service or public utility commission, or an electric cooperative. The new law also adds an exclusion for any property used in a trade or business that has floor-plan financing. Floor-plan financing is secured by motor vehicle inventory that a business sells or leases to retail customers. Changes to depreciation limitations on luxury automobiles and personal use property The new law changed depreciation limits for passenger vehicles placed in service after Dec. 31, 2017. If the taxpayer doesn’t claim bonus depreciation, the greatest allowable depreciation deduction is: $10,000 for the first year, $16,000 for the second year, $9,600 for the third year, and $5,760 for each later taxable year in the recovery period. If a taxpayer claims 100 percent bonus depreciation, the greatest allowable depreciation deduction is: $18,000 for the first year, $16,000 for the second year, $9,600 for the third year, and $5,760 for each later taxable year in the recovery period. The new law also removes computer or peripheral equipment from the definition of listed property. This change applies to property placed in service after Dec. 31, 2017. Changes to treatment of certain farm property The new law shortens the recovery period for machinery and equipment used in a farming business from seven to five years. This excludes grain bins, cotton ginning assets, fences or other land improvements. The original use of the property must occur after Dec. 31, 2017. This recovery period is effective for property placed in service after Dec. 31, 2017. Also, property used in a farming business and placed in service after Dec. 31, 2017, is not required to use the 150 percent declining balance method. However, if the property is 15-year or 20-year property, the taxpayer should continue to use the 150 percent declining balance method. Applicable recovery period for real property The new law keeps the general recovery periods of 39 years for nonresidential real property and 27.5 years for residential rental property. But, the new law changes the alternative depreciation system recovery period for residential rental property from 40 years to 30 years. Qualified leasehold improvement property, qualified restaurant property and qualified retail improvement property are no longer separately defined and given a special 15-year recovery period under the new law. These changes affect property placed in service after Dec. 31, 2017. Under the new law, a real property trade or business electing out of the interest deduction limit must use the alternative depreciation system to depreciate any of its nonresidential real property, residential rental property, and qualified improvement property. This change applies to taxable years beginning after Dec. 31, 2017. Use of alternative depreciation system for farming businesses Farming businesses that elect out of the interest deduction limit must use the alternative depreciation system to depreciate any property with a recovery period of 10 years or more, such as single purpose agricultural or horticultural structures, trees or vines bearing fruit or nuts, farm buildings and certain land improvements. This provision applies to taxable years beginning after Dec. 31, 2017. Page Last Reviewed or Updated: 20-Apr-2018

I may be suffering post tax season short term memory loss, but I don't seem to recall that apologizing is part of the ATX Playbook ?

I believe the current requirement is any preparer who files 11 or more returns from the 104x series.

Almost all of the detailed reports that I see, bill the next term's tuition at the end of the previous term. Then they post the payments ( Scholarships, loans etc ) when the term actually begins. So you have a timing problem, where you can't see the whole picture unless you can look at the detailed reports showing prior year, current year, & next year. It's a real mess and I suspect what is actually reported on most tax returns is usually not completely accurate.

I think the information is usually supplied to the employee by the employer, i.e. Medical professionals working in VA or BIA hospitals .

Since many of the IRS computers are still running on Windows XP, supported by a large contract with Microsoft, this probably was inevitable.

Just clarify my post is about the estimated payment Form 1040 ES and instructions.

In the spirit of providing assistance to confused taxpayers and preparers, on Friday the IRS released a revised Form 1040 and instructions I did notice that the 110 % rule remains unchanged. In order to maintain my mental equilibrium, I have chosen to ignore the other 12 pages :-)

Judy, thanks for pointing me in the right direction. Much appreciated.

All I can say is if you are using ATX, the way the worksheets and Form 3800 work together is almost incomprehensible.

(IRA Phaseouts if you are covered by a retirement plan at work from irs.gov) If Your Filing Status Is... And Your Modified AGI Is... Then You Can Take... single or head of household $62,000 or less a full deduction up to the amount of your contribution limit. more than $62,000 but less than $72,000 a partial deduction. $72,000 or more no deduction. married filing jointly or qualifying widow(er) $99,000 or less a full deduction up to the amount of your contribution limit. more than $99,000 but less than $119,000 a partial deduction. $119,000 or more no deduction. married filing separately less than $10,000 a partial deduction. $10,000 or more no deduction. If you file separately and did not live with your spouse at any time during the year, your IRA deduction is determined under the "Single" filing status

New client age 75, whose spouse died last summer. Client received a taxable $154,000 IRA distribution check just before Christmas. She turned around and wrote a check on January 16th depositing the $154,000 into a different IRA, constituting a rollover. Investment Advisor says she isn't required to include the $ 154,000 her RMD calculations for 2018 , since the money was in her personal bank account on 12/31/17 ??? Does this mean you can legitimately do this at the end of every year and avoid most of the RMD ???

That's right up there with the clients who have a voicemail setup, but they never check it so the voice mailbox is full and won't accept any more messages :-( That's why I mostly send texts.

Best Guess: Your CA Efile form and supporting worksheet are not the most current version or has been corrupted. !. Delete the form and worksheet, add it back recreate the efile and submit. 2. If that doesn't work, go to the return manager, select your client, go to utilities and redownload forms, recreate your efile and submit. 3. Or you have a corrupted file in your program, which support will need to find and fix. Good Luck,

Interesting, my local SS office will not make appointments. You walk in take a number and wait.

I totally 100 % disagree, Form 3115 was designed to specifically to take care of situations like this. Not taking depreciation more than once is the choosing of an incorrect method. Do not amend File the 3115 and deduct all of the depreciation in the current year.

I had something very similar happen to me over 30 years ago when I was the Controller for a Food Service Wholesaler, working too many hours, not enough sleep, ingesting too much caffeine. My situation was more intense because in addition to the eye issues, I was also pretty dizzy. Had my office manager call 911, went to the emergency room where they didn't find anything. Had a complete exam several days later by an internist who said I was fine. He said that what happened to me was an "aura" which usually proceeds an intense migraine, which i have never had. He told me that you can also experience the "aura" without the migraine. Get some rest and hopefully it will disappear.

I think it might be identity theft !

How do you make 401 k contributions that big ? Do you mean a profit sharing or a custom defined benefit plan ?

Another bump in the road of life Hang in there, hopefully you will have your computer back soon, up and running. Keep us posted

Interesting question ? Can Heloc mortgage interest, which is nondeductible on Schedule A be made deductible on Schedule E by converting a second home into a rental ? We will find out eventually. Perhaps you can volunteer to push the envelope ?

This was discussed about a month ago. What Judy is referring to is that the loan must be secured by the property purchased. Example : Proceeds from a Heloc secured by primary residence used to buy second home. Under new rules this is nondeductible. In effect, the old interest ruling rules will not always result in a deduction.