jainen

>><faster for me to run to the bank< What does the bank do with all those checks? Zip 'em through a little desktop check reader, right? Won't be long before you can get a consumer version of that dandy gadget.

>>low hanging tax prep work<< Sadly, you are probably right. It will be just like when cheap home microwaves destroyed the fast food business, so the only restaurants left are the fancy clubs.

>>a money grab for the IRS<< The RTRP program, like any other government program, undoubtedly costs more than it brings in. The point is not revenue but control. For continuing education IRS wants us reading quick summaries of Pub 17 instead of Tax Court cases. Check! They want professional service to be more expensive so fewer taxpayers will use us. Check! They want the public worrying about credentials instead of taxation. Check! They want us arguing with each other instead of them. Check! With all due respect, Jack, to understand the IRS you have to think like a bureaucrat.

>>take a snapshot of your W2<< I routinely prepare returns with copies sent by fax or email. Gee, some companies ONLY issue a pdf W-2. >>they file your return over the phone<< I do that, too, especially for clients in another city or state. A simple return with a single W-2 doesn't really require an organizer, just an interview from a worksheet. I have clients I haven't seen in years, and once I had a client I never did see.

>>Requires a School name and complete address to claim the credit.<< That sounds simple enough. And entirely reasonable. At least it's not as nasty as getting a tax I.D. for Child Care Credit!

>>Are farmers going to get an extension if have not paid any estimates.<< Good question. A taxpayer can use Form 2210 to request a waiver of the penalty for "unusual circumstances." I would recommend a good faith estimate be paid by March 1st, even if the return can not be filed.

>>Tax Preparation Disclosure and Agreement Addendum<< What's the point of this, either in legalese or a simple note? "Don't blame me" never helps anything. Just do your own job good and let the IRS do its job. Take a hint from the corporate marketing departments this year--focus on how you can benefit the client. Don't promise what you can't deliver, of course, but don't harp on the limitations. Especially don't whine about how hard this all is for YOU. On the other hand, if you aren't already using a standard engagement letter, you do need that.

>>just put the website on the bottom of all of our posts, someone will see them<< Why not also post a few flyers around the neighborhood H&R Block office--someone will see them and you might get some new customers. Come on, folks, leave them alone. They aren't doing anything wrong. It's their private board so they can have whatever rules they want. If you make too much fuss the IRS will notice and jump in with its own rules.

>>the risk is on their shoulders<< That was in the good olde days. In my opinion, that position can no longer be supported under the enhanced Circular 230 with IRS registering all tax preparers and courts sending our colleagues to jail. (On the other hand, "reliance on a professional" no longer works very well for the taxpayer's excuse either.) The question is a tough one. I don't think the IRS will continue to tolerate the generous rulings in current case law, so they may issue better guidance as we all get older. Meanwhile, there is no standard meaning for the many levels of care available. Generally "nursing home" means a skilled nursing facility, which is usually 100% deductible. As for "assisted living," that can range from basically a retirement community that provides meals, to a whole lot of personal care. Maintenance and personal care for chronicall ill (ADL) patients should be deductible. Presumably that would include cooking and cleaning, even if performed by unlicensed aides in the facility. Social activities may push too far, so you may need to have the facility allocate the monthly fee as to specific medical and personal care. In any case, one element that has not changed is that no deduction is allowed unless the care is specifically prescribed by a doctor or other licensed medical practioner.. Moving expenses are never allowed except for employment. But reasonable travel expenses for hospital in-patient or other medical care are deductible.

>>EzTax Return saying that they can efile on January 22 when no on else can<< That is NOT what it says! The header is "IRS opens for e-file on January 30." Then it explains, "IRS forms and schedules will reportedly be finalized by January 22." Then it promises,, "You can file [NOT e-file] your tax return at www.ezTaxReturn.com, starting January 22." And lastly it cautions, "If you file elsewhere before [NOT on or after] January 22, you may not learn the correct amount of your refund when you file." What is your problem with any of this, because I don't see anything false or misleading. H&R Block has a different marketing angle. Since they can't do this year's returns yet, they will review or file prior year returns.

>>a quote from the year 1788 is so appropiate to today<< Yep, politicians are still saying the same thing they did back then, but it still isn't what they are actually doing!

>>$ dispersed to tp were 212K. TP deposited 212k into bank account<< How is this a reverse mortgage? Sounds like an ordinary cash-out home equity loan to me, even though it is in first position. And I don't think the estate can deduct qualified home mortgage interest unless a beneficiary lives there, so it will have to count as an investment interest expense.

>>Put them on deceased tp final return?<< Decedent didn't pay them, so no deduction there! According to Pub 936, "Any interest (including original issue discount) accrued on a reverse mortgage is not deductible until you actually pay it, which is usually when you pay off the loan in full."

>>have to consider who, and when, and how<< I don't think it's really cussing when you plan it out ahead of time.

>>a perfectly logical course of action can't be done<< That logical course of action being, "anything goes"? I can claim whatever donations I want, without documenting them unless I happened to get audited? Or is it the charities who depend so much on tax-deductible donations, but shouldn't be bothered to even acknowledge the terms? If we do get audited, we can make up whatever we need then? Section 170(F) is not just some bureaucratic policy, unless you think George Bush was just a bureaucrat. Congress passed the substantiation rules because the private market--our financial services industry--failed to control its own abuses. The worst was cars--IRS apparently found a lot of overvaluation and special arrangements. Maybe a few preparers spoiled it for all, but in any case you now need a 1098-C. And you can be sure there's more to come. Last year California tried to demand parcel numbers to deduct property tax.

>>Durdens had "failed strictly or substantially to comply with the clear substantiation requirements<< I agree with the court. This isn't rocket science--the substantiation requirements are indeed clear, and not very difficult. And--having the receipt before filing is one of the eligibility factors, so the tax preparer may be at risk for a malpractice claim.

>>he's perfectly capable of defending himself<< But I won't, because I don't care if you agree. Anyway, I actually don't think Marilyn did anything wrong, other than wasting her own time. Unfortunately, innocence isn't much of an excuse when everyone from IRS to non-clients are looking to blame someone for something that IS wrong.

>>It is her responsibility to change her passwords and pins in order to eliminate my access<< Regardless of her responsibility or action, YOUR access is already restricted by Section 7216 and Rev Proc 2008-35. Since you were not intending to prepare a tax return, you can not use her information for ANY purpose without her written consent. The rule is particularly targeted to marketing activities, which in my opinion includes determining her value as a client, essentially what you were checking for. Ten years ago this caution would have been excessive, even ridiculous. But just in case you haven't noticed it yet, IRS and legal standards are changing.

>>say, $375,000 are considered middle class<< The term "middle class" doesn't have much meaning except for political promises. Remember, we are talking marginal rates, not absolute. The EFFECTIVE tax rate continues to rise gradually as income exceeds the top margin so there is very little difference between 375 and 400. Also note that the capital gains rate for that top bracket jumps a third to 20%. And they're also in phaseout again for deductions and exemptions, starting well below 375. They say the new rate only affects 2% of households--450 if they are married; 800 if they are shacking up. Only 425 if they're unmarried with children, but who cares about them?

>>going with Spidell again<< Absolutely no other choice for California preparers! I just finished their 2-credit Ethics course (a full 8 hours before the deadline). It was quite informative about the proposed regs changing Circular 230. In an amazing show of common sense, IRS slashed Section 10.35 (rules about giving tax advice) by 99%. "A practitioner must possess the necessary competence to engage in practice before the Internal Revenue Service. Competent practice requires the knowledge, skill, thoroughness, and preparation necessary for the matter for which the practitioner is engaged." Period.

>>won't be bidding any crazy low amounts<< I'm sure the crazy low amounts will not be legitimate, just like mortgages or insurance or car rental--look at the on-line comparisons for any product or service. The main thing (from a marketing perspective) is to get potential prospects to click on your link, where you provide all the details. I don't know if anybody has noticed, but not every company has the lowest price in any field. Usually it's just the companies that nobody would go to otherwise.

For example, the estate tax is 35% now. One likely proposal is 45%. Although that's less than the automatic jump to 55%, it's still an increase. Nobody wants to vote for a tax increase. If they wait until after January 1st, 55% will be the law of the land. So then everyone can vote for the same 45%, but claim to be cutting taxes! Congress has more questing and character-building than Baldur's Gate. Not as funny, though.

>> Impacted clients complain, but nothing you can do.<< Oh, there is PLENTY that a tax professional can do! Start by getting a genuine news subscription like Checkpoint, so you have perspective on all the rumors and estimates and predictions your clients are hearing. John, I know you were just being sarcastic about the newspaper! Although we'll probably have more late nights in February/March, I don't expect our total processing time or office costs will increase significantly. Fees are usually based on the complexity of the return, which might well decrease if credits and deductions are not extended. At least Form 1099-B is going to be easier and faster in most cases. EIC seems like more because of the due diligence, but that's really only a problem for the big chains with untrained preparers. Your fees are probably already competitive there. Of course if AMT is not patched many clients will indeed have a more complex return. But I expect it to get fixed eventually so meanwhile I'll probably not charge my loyals extra. Overall I'm pretty relaxed about waiting until January 21 for my update class.

>>entering a bidding war<< I don't think it is an auction. Lots of industries are setting up online searches for easy marketing to our mobile society. I mean, if you can find a DATE online, that's got more individual variables than any tax return I've ever seen! We never know about any one new client, but in fact many taxpayers have simple tax returns that are similar to the prior year. Others may be looking for a specialty like N.O.L. or small LLCs. More models of competition is a sign that our economy is changing. So I'd give these guys a year or so to sign up some large firms who will demand the usual sophistication--customer privacy, protection from price-fixing, links to preparer web sites, reliable rating system, etc. It might catch on.

>>A competent psychic should already know the customer is planning to call<< Nowadays it's not enough to be good at one's job. One must also be good at business. Therefore a psychic must not appear to read the CUSTOMER'S mind.