RitaB

Yes. No.

Hauling tools is nice, but does not make commuting miles deductible. I hear this one a lot. Out of one guy. Every. Year. I guess he thinks I will change my mind. http://www.irs.gov/publications/p463/ch04.html#en_US_2013_publink100033923

I never transmit an e-file until the day after the client picks up. Gives them time to find errors. I just got a text from a client who picked up this afternoon: "Hey, Rita, I forgot to tell you our address is now..." And, yes, their refund is being mailed to them.

Yes, yes, I'm sorry, the outstanding principal was the selling price, which just happened to also be the FMV, AND the amount on 1099-C. I honestly am not asking for help on the 4797. And you know ATX calculates the depreciation for me. I got that part. Don't wanna discuss the 4797. My problem is that I think there is zero debt forgiven because the FMV and the outstanding debt are the same. The lender got a house worth the outstanding debt. Is that not the same as getting the money? How is there income from debt cancellation? If the FMV were $190K and the outstanding principal were $200K, the cancelled debt would be $10K, right? Well, the value of the house and the debt owed are BOTH $200K. The taxpayer did not realize income. The lender did not lose $200K, or anything, why would the taxpayer report income on line 21? I don't see how you can say use $200K as the selling price on the disposition on Form 4797 and then use $200K AGAIN on line 21. Give me a little credit, this is not as obvious as you think: http://forum.thetaxbook.com/showthread.php?23438-1099a-amp-1099c

Yes, she got a 1099-A, and both figures on that were $200K. FMV is used for Form 4797, which I have done, and don't have a question on that. The lender got the house, worth $200K, and the debt owed was $200K, there is no income from debt cancellation. Form 982 is used to exclude income. There is no gain here. See page 2 under "Purpose of the Form": http://www.irs.gov/pub/irs-pdf/f982.pdf

There sure are a lot of cricket sounds today.

Hey, Friday, I was terrible to a client. He's a computer programmer who just doesn't have time to pay his bills or do taxes, apparently. When he picked up 2012 in December, I let him out of here without paying, been doing his return for years, not worried. Well, when he dropped off 2013, I reminded him he hadn't paid for 2012. Then, when he picked up 2013 he said, "Hey, that's a better refund than I thought," and was about to leave without paying. I said, "Yeah, it's awesome, but you haven't paid for 2012 or 2013, and I'm not in business to make friends, so pay up." He laughed till he was crying. Whew, I was glad, cause I just opened my mouth and that rolled out. No filter whatsoever.

I have them leave me a check, which I hold until they get refund. I do that a lot, actually.

Oh, good, all her questions will be answered if the lawyer sees it.

Yeah, that would bother me, too, but I think you'll be a winner if you just give him back his stuff and say, "Sorry it didn't work out. I'm here if you need me later." Then curse a lot after he leaves. He may just come back, but for sure, he'll bad mouth you all over town if you charge him. Nobody that's not self-employed understands.

This is why Gene makes the big bucks. Unless he doesn't.

My best off the cuff answer on yours Margaret is that the taxpayer has income in the amount of the debt forgiven. Obviously, if a rental, you got depreciation to deal with, but if you reduced basis by the amount of debt the taxpayer didn't pay, you covered the gain on the disposal. I think. We really should make more money.

Debt on rental is 200K, FMV is 200K, 1099-C says cancelled debt is 200K. Wait, what? If the FMV of the relinquished rental is the same as the debt, the lender did not lose anything, the borrower did not gain anything. I know to figure the gain or loss on the 4797. Got it. But the 1099-C? If you skip out on credit card debt, you get a 1099-C because you got the keep the $15,000 in shoes, but the credit card company paid for them. You realized a gain of $15,000. The credit card company is out $15,000. This is not that situation at all. The lender got a house worth the amount owed to them on it. The lender got the shoes, in essence. So, would you on Form 1040, line 21, enter the 200K as COD then subtract it with a statement "FMV of property acquired by 1099-C issuer is -200K"? I'm afraid to ignore it. And it does not go on 982. Form 982 is used to exclude gain from COD INCOME. There's no income here.

It' so hard to prove a negative. When I get these questions, I try to give the client something to read, so they can't misinterpret what I said. Ok, they can, and will, but I keep trying. Here's an article, and you might print this thread, too. http://yourbusiness.azcentral.com/write-off-unpaid-invoices-sole-proprietorship-1294.html

If cookie crumbs fall down your shirt, are they booby trapped?

Or two.

This is an old thread, but I have the same situation. I can't find a Worksheet 7 on p. 2, and I've looked at 2012 Form 8582 as well. Lee or Judy or anyone, can you help a girl out? Never mind, found the answer in a 2012 thread: Passive Activity Loss Adj on 4797. My good buddy Bulldog Tom has saved the day. Just needed to check a box. Thank you.

If mammary serves, people think there is a tax credit for everything they want to deduct. Seriously though, I hate this type of thing, it's so hard to prove a negative.

Yeah, you're right, I can't fight Peachtree, either. Even though the forced updates do nothing to enhance my life. It's like updating a Math textbook. Was there a new discovery? No, but we like selling software, so get with the program. And operating system.

Yes, that's what I hear. ATX 2012 and ATX 2013 don't, so I got me a super duper computer Feb 2013 to accommodate them. And, I gotta say, I hate Windows 7, and MS Office How-Much-Crap-Can-We-Put-on-Here-to-Drive-Rita-Crazy. I really don't want a sexy tax program or spreadsheet. I'm a simple person.

Yes, and Friday I was thinking, "Oh, God, don't tell me this, stop talking, stop talking, stop talking..." I will never unhear this stuff.

Nah, I think you still a few decades off. XP was released 10/25/2001, and it's just now, in 2014, becoming unsupported. I'm still rockin a flip phone, because I just want a PHONE, my car is a 2004 Tahoe, my farm truck is a 1998 Z71 with 200,000 miles, my TV looks hideous from the side cause it's as deep as it is wide, but I'm not throwing it out while it works, plus it's in a nice cabinet (made of wood born prior to 2001 even) so nobody has to be offended, and I still have clothes in my closet from 2001. True story. Not ashamed.

When my BFF calls, it's only a two hour break, too.

I had sort of a time out yesterday because I had three clients in here picking up who apparently needed to chat, I mean spill their guts, with somebody. I was completely worn to a frazzle from this nodding and listening and not saying anything. But, evidently, that's what they all needed. When it got quiet in here, I just looked around, told myself, "I'll think about this tomorrow. After all tomorrow is another day," got my purse, went home, ate Bojangles chicken like there was no tomorrow. But there was, so I'm back.

I have a couple of guys in the National Guard who are not scoring any cool points with these pens. They are horrible.