jainen

>>the light in my crystal ball had burned out<< Burnout is always a problem by March 31 in our business. But in my opinion the old crystal ball is not as illuminating as one might think. I prefer the technology of the dark ages--a paper organizer guiding a personal interview. But the original post had a good question--when does a CP2000 become a tax assessment? The IRS sheds light on this at http://www.irs.gov/individuals/article/0,,id=136857,00.html. "The CP 2000 is only a proposal that offers you an opportunity to disagree, partially agree, or agree with the proposed changes. We haven't charged any additional tax at this time."

>>Going paperless<< Every year I think about not sending out my organizers. That would reduce my paperwork right off, and if I changed my phone I could reduce client paperwork as well!

>>your accountant can make you or break you<< To be fair, remember that you can cause your accountant a whole lot of grief too.

>>As a defense to what?<< In the original post, the taxpayer wants to defend against non-filing penalties of 25% (though this is not the main issue in the thread). Is there any authority she can rely on in claiming she thought she HAD filed because she did not object to her husband signing a joint return for her? In all of your citations the spouse was trying to claim she had NOT filed a joint return, and this rule let the IRS win all those.

>>Too lazy<< Hoo, boy, that's a doozy of a citation. Not a single dang tax authority therein, unless you count Form 8829 (ignoring any inconvenient instructions and the words on the form itself). Instead of relying on the regs and case law, this guy justifies an individual's tax accounting in terms of a non-profit corporation's GAAP or cost accounting for grants. At least to my thinking, that's too big a stretch. As for "approximates the number-of-rooms method," his theory does not match the applicability, the methodology, or the result of the IRS calculation. Why, he says as much himself!

>>I wanted to tap every resource available.<< Well, as I said, "There is always another lawyer." The problem is that from here on down it gets expensive pretty fast, and your client might not exactly want you to tap "every resource available," if you know what I mean. He might need some of those resources to get his act together again. One of the most obvious paths (which I am sure he will ask about) is an Offer in Compromise based on doubt as to liability. Unfortunately, his ill-timed run at the court system has locked out any doubt forever, legally speaking. Really, the only thing still in doubt is on what terms he can settle the bill. Another path (which I am sure he will NOT ask about) is whatever results from his degraded opinion of the tax system. He probably feels somewhat cheated by being singled out for examination and then not even getting his day in court.

>>Yes, I can. << Okay, but meanwhile kc has upped the ante with "too many cites." Now my question is, can you support it with rulings that offer at least a one in three chance of success? (That's the current standard for practitioners under Circular 230.)

>>"tacit consent doctrine"<< That's good to keep in mind, but I don't think I would ever rely on those cases. The poor taxpayers always seem to lose under that doctrine, and it seems to carry a heavy connotation of fraud with it. Does it only work for the IRS holding the taxpayer liable, or do you have an example of a taxpayer putting forth the argument as a defense?

>>any other options? << We all love the underdog, so you can expect a lot of answers to this question. Perhaps the court based its opinion on some basic legal principle that seemed so overwhelming that it wasn't even necessary to hear the actual facts. Perhaps that principle was so basic it is simply called "the Statute," that if this was so important why didn't he bring it up before now? There is always another lawyer to take another opinion to another court, the only qualifier being payment of a fee. But judges tend to think alike, so further appeals are uncertain. In my opinion, it is time to look at all the options for dealing with Collections.

>>no such box on the W-2 that is labeled: "non- taxable sick pay"<< Non-taxable sick pay is reported in Box 12 with code J.

>>You could argue that you could remove the common areas from the equations altogether.<< Could you base that argument on some code section or ruling?

>>it's a regular rental of 75% of the property<< The percentage that can be considered rental only includes areas of the house that are used exclusively by tenants, presumably just the rented bedrooms themselves. The bathroom, kitchen, garage, or any other area used partly by the daughter can not qualify as rental, so it is unlikely to reach 75%.

>>it is legal for one spouse to sign for the other<< The limited circumstances when a spouse can sign, and the way it must be done, are explained on page 6 of Pub 501 at http://www.irs.gov/pub/irs-pdf/p501.pdf.

>>Have the daughter pay rent even if the parents give her the money. << Bart, can you cite any authority for parents treating their daughter's use of the property as a rental with money they indirectly pay themselves? It seems to me like an arrangement primarily motivated by tax-avoidance.

>>It was magic!!!!<< Really? I still think you should ask them. If they start talking about magic you should probably consider other software. If they see this as an admirably functional work-around, you know they can get the job done.

>>Anything you want me to ask them while I am here for the next 4 hours?<< Well, one thing I've always wondered is how a single bullet could have hit Kennedy in the neck and Connolly in the leg, plus broke his rib and his wrist, plus not be damaged?

>>The ex husband is not and will not be happy with this decision.<< Oh, really? Did she tell you that? I'll bet the guy is delighted to see the opposition make "a sticking point" about something they can't control. Wait, there's more! The lawyer is proposing the gentleman (who has complied with the tax laws) cover the wife's back taxes (which will carry over 50% surcharge for penalties and interest) as part of the property division. HIS lawyer is going to call that bad faith, and the judge will probably agree. Can't you see her lies? He wasn't "signing her name left and right." He made a point of separating his own finances, knowing (as we all do) that a Schedule C non-filer is understating net income. This businesswoman's claim that she just now "figured out" about MFS -- well, she knew she had not signed a joint return, so is she saying she didn't object while she thought he was forging her name? Which by the way he wasn't? I admit I'm reaching out beyond the stated facts of the original post, but I wouldn't be surprised if he can indeed prove each of his Schedule A deductions. He sounds like the responsible half of the family.

>>behind her back in a lot of areas, including taxes<< Why do I have this prickly feeling that "would be used to help pay the wife the large amount of $$" actually refers to paying the lawyer a large amount of $$? Well, the IRS won't have any objection, so it's fair game for negotiations. Maybe it would generate a refund, though that's not my experience when one adds SE income to a pension (presumably without ES payments because she is a non-filer). What does her lawyer say about becoming jointly liable for whatever the bum did behind her back?

>>Posted Apr 15 2009.... one could file by today such a form stating that an amended form is anticipated and it would "hold" its eligibility while an actual form is prepared and subsequently filed<< I believe this is true, but once again we can never be sure what the original question was so we don't know the exact context of the answer. It sounds like the normal extension. When a taxpayer expects an amended K-1 or 1099, it is not necessary to complete the 1040 by April 15th.

>>Question is whether the detached garage and barn are considered part of the principal residence. << Good question. What facts have you developed to support an answer one way or another?

>>a partnership that is owned by a husband and wife can file as a sole proprietor<< This is not necessarily true. It only applies in community property states or when the spouses are conducting a qualified joint venture and meet other requirements.

>>Then tell me in your oh so smug way that if I just read _________ publication, court case, or code reference, it would be as clear as mud to anyone with half a brain.<< Nothing personal, Bulldog, but I doubt if anyone on this forum HAS a half brain tonight [April 15]. Nobody in my office does. But I'm not going to pull out all those old Post-It notes for such an absurd scenario. In my opinion, you should have stopped half way through the first sentence.

>>tinted all the entries purple<< How could it do that--colors? My monitor only has two colors, a speckly forest green and a pale green tinge. I know it is kind of old, but it still fits perfectly into this cubbyhole on my rolltop desk.

What I would like to see is a way to click on any line of the tax form and select "Same as Last Year," without having to put in all the background numbers. Or, have an option to do the entire return SALY. It would sure make extension day go faster.

>>What happened to Jainen....I miss him, because if nobody else will set us straight, he will.<< No, I won't. I appreciate your kind comment, but you will need to rely on my older posts as Eli does in his 3/15 thread, "Amending from HoH to MFJ." They cover a lot of topics and as you suggest are not always in agreement with the overall tone of this forum.