RitaB

Good. If taxpayer was innocent, I hope preparer gets a penalty. I know you have told taxpayer that he has a duty to look at his returns. Good job.

My goal here has been to express my opinion that you are wrong that Christian could get nailed for overstating liability. Of course he could, and should, be hammered for understating liability. So do I. I believe if they were going to hammer us for misstatements, they would have used the word misstatement, not the word understatement (of taxpayer's liability). I think IRS was very clear if you think about it. I'd bet my lunch that no lawmaker ever thought anybody would be fighting over the ethics of overpaying tax. Only tax pros. IRC § 6694 – Understatement of taxpayer’s liability by tax return preparer. IRC § 6694(a) – Understatement due to unreasonable positions. The penalty is the greater of $1,000 or 50% of the income derived by the tax return preparer with respect to the return or claim for refund. IRC § 6694(b) – Understatement due to willful or reckless conduct. The penalty is the greater of $5,000 or 50% of the income derived by the tax return preparer with respect to the return or claim for refund.

Here are the first two listed: IRC § 6694 – Understatement of taxpayer’s liability by tax return preparer. IRC § 6694(a) – Understatement due to unreasonable positions. The penalty is the greater of $1,000 or 50% of the income derived by the tax return preparer with respect to the return or claim for refund. IRC § 6694(b) – Understatement due to willful or reckless conduct. The penalty is the greater of $5,000 or 50% of the income derived by the tax return preparer with respect to the return or claim for refund.

The Spirit of the Law in Title 26 of the IRC is to admonish us not to UNDERSTATE tax liabilities. Yes, I said that like I know. Here's the list of penalties from irs.gov. We really DO need to know them, contrary to some advice we have seen. On here. https://www.irs.gov/tax-professionals/summary-of-preparer-penalties-under-title-26 Note: Yes, some of the amounts are a little low on this because some penalties have been adjusted upward.

She also wanted to deduct all her household utilities. My feeling is they knew better. If not, they do now.

I've never tried, but I did find the following that might help you decide if it's possible or put it back in the lap of the client: "The penalty will not apply to any failure that you can show was due to reasonable cause and not to willful neglect. In general, you must be able to show that your failure was due to an event beyond your control or due to significant mitigating factors. You must also be able to show that you acted in a responsible manner and took steps to avoid the failure." https://www.irs.gov/instructions/i1099gi/ar02.html#d0e2122 My lady in my thread about "they won't withhold more than that" once tried (all by herself) to get out of failure to file penalty because a family member had an accident on Oct 20. That went over like a fart in a space suit. But I digress.

They also never used the 1040-ES forms I printed for years. Pretty sure they just didn't want to deal with anything. Common for October clients. At least they showed up I guess.

Sounds like "easy tax".

You may be right. When I asked her if there were assets in her farm Maintenance and Repair, she said, "Yes, $2,000 for bathroom remodeling."

Client always whines because she owes. They have several 1099-Rs with little or no withholding. Same with W-2s. I tell them every year it would be good to have more withheld. OK, they say. No, they never have more withheld. So, today she actually tells me, "But they won't withhold more than that". Mmmm hmmmm. I Google "How do I have more withheld from my (insert name of company) retirement?" I print the W-4Ps and addresses for all the companies. Print W-4s, too, and highlight line 6. It's one thing to ignore my advice, it's another to treat me like a fool. It was worth a Google. No, no forms with get completed. But it's not wasting time if you enjoy it. It was the same feeling you get when you mess with scammers. It was worth it.

I am using "if your truck costs more than your house and you own neither, we can't be friends." I watch TV a lot.

You really are the absolute best, and it is a shame you have only 52 posts. We need you. I'm only going to say it one time.

This is what amazes me. There's a letter in there telling them what it's for. But here's the run down on remodeling their personal residence and their vet bills. Oh, good.

Don't sell yourself short. And let us know if any preparer gets hit with a penalty for any return where the tax was UNDERPAID on the original return. If preparer did something egregious like putting self-employment income on Line 21, we understand a preparer penalty for that one.

Ok, let's talk about the odds that Christian would be penalized for helping Generous Single Guy pay more tax, at the request of GSG. I'm going with exactly zero.

I understand both sides of this one. The real question is where has he been all of my life...

Yes, and I think the client in my original post probably had an insurance agent that signed her up. She didn't even know how they signed up and was going to ask hubby. I told her that the insurance agent is getting a monthly commission, and I would not hesitate to enlist his help in getting another 1095A. I do not blame the insurance agent, but he's making money on this, and I'm not. I'm still waiting, because frankly, these people are irresponsible in the extreme. They've had nine months to take care of taxes. They could have made a baby by now. This is my first, and probably last, year with this client. If I don't fire them, they'll no doubt fire me when they see what they owe.

Why are you talking to my answering machine? Of course that's what I'll tell her when she drops off. Until then, I got stuff to do.

I just let the answering machine pick up my favorite. She's saying, for the 10th year in a row, "OMG, I have been so busy, if I get my stuff to you by Friday can you get my return done?!" And I will not see her Friday.

Yeah, they have one. He's gonna get the law changed. /s

Well, I will do that after I hug them for losing the $%^& 1095-A. And being surprised that making $20,000 more than last year will affect their subsidy. They are supposed to stay poor for all this to work.

"Yes, we were covered by health insurance." "I need the amount you paid in premiums." "204 a month." "Did you get your coverage thru the marketplace?" "Yes." SOOOOOOOO, now instead of self-employed health insurance deduction, I am telling them how to get a 1095-A and wondering how much PTC they are going to pay back.

Thank you, Judy. I feel like 95% of tax preparers would slap it on Line 21 because they would get away with it. Maybe 96. The LAST thing we should be doing is trusting people to prepare forms correctly. They don't.

I am resurrecting this old thread as I have two election commission members, each works every year, going to meetings, training poll workers, working at the polls, etc. They each made $1705 in 2015, and the SSA threshold amount for election workers for 2015 is $1,600, meaning every dollar was subject to FICA. The county puts this in Box 3 of Form 1099-Misc. Every. Year. (It should be on a W-2, I know, but, I'm not chasing that rabbit.) So, to satisfy the tax gods, this belongs on Sch C, does it not? https://www.ssa.gov/slge/election_workers.htm https://www.irs.gov/government-entities/federal-state-local-governments/election-workers-reporting-and-withholding

Thanks, Elrod. Also, and sorta related, if you become an EA (and maybe if you renew, I don't know) you need to login to your PTIN account and update your credentials.