Possi

You are BRILLIANT! Now to get her stimulus check changed to this account. I'm all over this. God Bless you, Judy!

Hmmmm that's a thought. Always a problem though. One getting her out, and two staying quarantined. What a mess. But that might be the only way. No, she is not required to file, and you think it will be auto deposited because her SSI is auto deposited? I mean, you agree with me, that it will? Thanks~

My sister who has multiple problems from MS in the brain and spine to simply poor judgement, has debt on a bank credit card that she cannot pay. Ever. Two credit cards, in fact. She only gets SSI, so the bank cannot garnish that, but I think they can take that stimulus check if it is auto deposited like her SSI check is. I believe that since her SSI check is auto dep'd her stimulus check will be, too. How can I be sure she gets a paper check?

Also, the instructions say to mail with the tax return, so the return must be a paper return, and mail it to a second address. I didn't know I couldn't efile the tax return, but it makes sense. I'll be sending this on a wing and a prayer!

Not me, not yet. I'm still swimming.

New client never depreciated 2 of his rentals. He has a new 3rd property this year that I will depreciate properly. My question is this, must I do separate 3115s for each property? I don't see why I can't combine the figures for the 481 adjustment on the 3115 and divide them on the Sch E on each property as long as they add up.

Indeed, it was not. Judy really nailed it for me. The software was right. I just couldn't wrap my head around the analysis at all. Whew. Thank God for this forum, and especially Judy for holding my hand and walking me through this.

Yes, there is another rental with income of $3091. Yes, the K1 for being a physician does have ordinary income in box 1 of $82760 on page 2 of Sch E. Holy Cow. I completely get it now. Judy, thank you so much. This was confounding me, no matter what I was looking at. I just could not pull it together. Yes, that 130,250 is what pulled both suspended losses up front, and I see it now. I looked back at another with suspended losses that I did a couple of weeks ago, and it was so smooth. This one involved so much more with multiple properties and the K1 physician income. Thank you so very much. I could have trusted the software and let this go, but I HAD to understand it all. I never let the software simply fly. And your help is a game changer. I appreciate you!

Sorry, not gains, but regular income.

Well, since he was actively participating in the sale of the rental, getting it ready and actually selling it, I did put that rental as active participation. Not the other. Just the rental that sold is active. The K1 is definitely non-passive and is clearly indicating that in the program.

Yes, that's what is happening.

No, it is non-passive. He is a physician and started his own business working for other facilities while in the military.

@jklcpa I finally resolved this. I just have one question hanging out there. So, on this Sch E, he had $85k of income on page 2 from his S corp K1 which washed out the losses I was looking for. It was the K1 INCOME I wasn't expecting and didn't have that in my little brain. My question is this. He had 2 properties with around $45k EACH in suspended losses. The gains from the S Corp K1 seem to be allowing all those suspended losses to come to the ballgame and be washed out by the K1 gains. So there will be zero carryforward losses next year, even though there will still be one rental that had them this year. I've never seen this, so is this right? Do those active gains offset the passive losses?

AHHHHHHH AFFIRMATION.... I think I'll contribute in your honor!

I have looked back at a couple of discussions on this, and I think I'm right, but looking for validation. Parents phase out of claiming any education credits, income over $200k. Son has no wages. Son goes to school out of state. Parents funded VA 529 college account for son. VA 529 is in son's name. Total distribution was $30,500. Earnings were $11,880. All of that was spent on college expenses, tuition and fees, supplies and equipment, room and board, etc. Correct me if I'm wrong, but 1099Q in son's name is not a taxable event to son. Parents can claim son on their tax return.

No, the other rentals are still cooking and shouldn't have become part of the suspended losses allowed. I have sent this to TWise and they are looking at it. I'll update when I get a response.

THANK YOU. I U

My client is retired military and he has started his own business as a sort of special ops consultant. He trains SEALs, other military teams, and missionary teams going into hostile territories on various subjects. I have no doubt of his integrity. My question is this; are related classes taken at college deductible as business expenses? These are master's degree classes in missionary, world, hostile territories, etc. Not English and math, but very targeted subjects toward the work he is presently doing. It enhances his credibility in his profession.

Wow, that's true... but way too much work for me... Great information. I am postponing some clients whose income went over the top in 2019. That's about all I'm capable of doing.

That is correct, and I totally get it. With your help, I have narrowed it down to the Sch E being wrong. I have had at least 3 other sales of rental properties this year alone, and they have all been smooth. However, none of those had suspended losses. In the past, the suspended losses flowed real sweetly to the Sch E allowing a large loss on the E and a gain on the sale. Something is wrong with the way this Sch E is computing. You have confirmed that for me. I redacted the screen shot of the Sch E and worksheet for you to see. In the worksheet, it is grabbing "Prior year AMT unallowed loss" from the first 2 properties, it appears, as the "AMT carryforward loss to 2020" is zero on both properties. The only loss on Sch 1 Part 1, line 5 is from Sch E line 21, is $3893. I have no clue. That figure is totally wrong. I am stepping out of here today, and I hope you are, too. If I have not properly redacted these forms, you know what to do! ABORT! LOL Thank you for looking at this. I think it's a software glitch, as I have done these before with no problem. Let me know if you agree. And if so, I will override some figures to get where I need to be. I really don't want to do that because this is a high risk return. There are 4 rentals, all swimming in different water, different states, different times. And one of my high $$ clients. Not many of those. nav sch e wksht.pdf nav sch 1 part 1 line 5 loss.pdf

I just looked again, and the Sch E is netting the suspended losses for 2 properties (he has 4 properties, but only one sold) and showing a total loss of $86k. Not to worry... it's not like it's GOING anywhere. ugh This is not working right. I've done lots of these and none of them are as messed up as this one is. I'll call TWise on Monday and see what they say. I'll also send them the return. This isn't right. Thank you so much for your help.

The 8582 line 4 has income, over $88k, and if that line shows zero or higher, the instructions are not to use this form, all losses are allowed. The 8582 definitely recognizes it and reduces the gain, but then it says "don't use this form" and "report the losses on the forms normally used." Ok, what? Where? So, where do these suspended losses eventually land? I will need to force the entry, but don't know where to put it. I use Taxwise. I need to study this more and see why this 8582 isn't biting. The numbers are on the form, but not anywhere else. I'll repost when I figure it out. Now, where are those BIG GIRL panties?

I use Taxwise. I need to study this more and see why this 8582 isn't biting. The numbers are on the form, but not anywhere else. I'll repost when I figure it out. Now, where are those BIG GIRL panties?

There's the problem. The 8582 isn't kicking in. I'll keep working on it after I close the office. I did click the box for sold property. So it must be something else. Thanks for the guidance.

My client who sold the rental at a gain has suspended losses and I don't see it balancing anywhere. The 4797 is showing the overall gain of $174,928 with no regard to the suspended losses. That lands on page 1, line 6. The Sch E worksheet shows an overall gain of $130,250, reflecting the current year loss, plus the suspended losses. (All reducing the gain on the sale by $44,678.) But, that's where the easter bunny stops. He is being taxed on the overall gain with no regard for those suspended losses. Where, exactly, should the suspended losses land on the tax return? I thought the loss would have been on Sch 1, line 5. It isn't anywhere. I wonder if it's a problem with the software or if it's a problem with my brain? This just isn't making sense.