peggysioux5

Based on the information that TexTaxToo posted, it sounds like being the wife took no distribution in 2024 and she is the sole beneficiary then the IRA is now deemed to be her IRA.....doesn't she need to update the IRA into her name and social?

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New client’s husband passed away in September of 2023. Wife did nothing with the IRA account after husband’s passing and the account is still listed under husband’s social security number in March of 2025. She provided a statement for 2024 showing he should have taken RMD in 2024 and did not (I know, he passed away so difficult to take the RMD…..). If taxpayer (the wife who was 65 in 2024 so no RMD requirement for her at this point) now contacts the financial institution to roll over the decedent's IRA into her IRA, is there an RMD requirement for 2024 by her as beneficiary in 2024? Peggy Sioux

I found the following information in a Spidell article: DOMICILE FOR NONRESIDENT SPOUSE An interesting problem can develop for couples when one spouse is domiciled in California and the other spouse is a resident of and domiciled in another state. The nonresident spouse would presumably have California-source income because one-half of the California-source income of the resident would be attributed to the nonresident spouse. In this situation, the couple must file a joint return because the nonresident spouse would have California-source income. My question is "Why is it that the couple is required to file as MFJ and not be able to file as MFS for both federal and CA?" My situation is that one spouse is a resident and domiciled in CA and the other spouse is resident and domiciled in HI. One spouse does not want to file jointly for either federal or state due to liability issues of the other spouse.

Spoke with the taxpayer and he has no deferred compensation plan; the issuer of the 1099 Misc made an error as Tom suggested in his post.

Taxpayer received a 1099-MISC showing a figure in box 10 (gross proceeds paid to an attorney) of $480. Box 15, nonqualified deferred compensation shows an amount of $1610. IRS states: Box 15. Nonqualified Deferred Compensation Enter all amounts deferred (including earnings on amounts deferred) that are includible in income under section 409A because the NQDC plan fails to satisfy the requirements of section 409A. Do not include amounts properly reported on a Form 1099-MISC, corrected Form 1099-MISC, Form W-2, or Form W-2c for a prior year. Also, do not include amounts that are considered to be subject to a substantial risk of forfeiture for purposes of section 409A. For additional information, see Regulations sections 1.409A-1 through 1.409A-6; Notice 2008-113, available at IRS.gov/irb/2008-51_IRB#NOT-2008-113; Notice 2008-115; Notice 2010-6, available at IRS.gov/irb/2010-03_IRB#NOT-2010-6; and Notice 2010-80, available at IRS.gov/irb/2010-51_IRB#NOT-2010-80. I have never come across a 1099-MISC with an entry in box 15. In my research, I read that the amount should be included in income and there is a substantial penalty that goes along with the amount in box 15; however, I see nothing in in my tax software that references the penalty that applies to 409A. Any help would be greatly appreciated. Would the amount in box 15 be considered self-employment income?? What is the penalty percentage?? Taxpayer only included the figure in box 10 as income. Peggy Sioux

New S-Corp client, shareholders are husband and wife, took a cruise in 2024 to review S-Corp and yearly minutes for S-Corp. I realize the cruise would not be considered a normal and necessary business expense. Should the expense be considered non-deductible expense or a fringe benefit to employees/shareholders and added as wages?

Did you try a different web browser? IRIS seems to work better for me when I use Firefox, and does not work well with Edge.

The taxpayer consulted an attorney, but I do not know how experienced the attorney is....I have asked that the taxpayer forward the actual Domestic Relations Order so I can read the details of the Order. I currently have two summary letters from the attorney. Thank you all for your input and information.

Thank you for the information. I used the spelling of the election that the attorney letter provided. Go figure that the attorney had the spelling incorrect!!

If the taxpayer had retired, then the benefit payments to the ex-spouse would be paid from plan; however, being taxpayer has chosen to continue to work, he has to pay the ex-spouse the monthly Civil Service Retirement System benefits that is due her out of pocket. Seems unfair that taxpayer pays ex-spouse retirement benefits but not able to deduct the amount that he is required to pay by the courts. Hoping a tax professional is familiar with the Gilmore Election and how to handle the taxation of the result of electing the Gilmore Election. Thank you.

I have a client who works for the government that divorced back in 1995. Client is 71 and still working. Ex-spouse hired an attorney several years ago regarding her eligibility to receive client’s retirement benefits and was told at that time that until client retired, she could not receive the benefits. Ex-spouse hired another attorney in 2024 regarding her eligibility to receive client’s retirement benefits and being client is still working and not receiving retirement benefits, ex-spouse is eligible to receive retirement benefits based on the Gilmore Election. My client will now have to directly pay ex-spouse her community property interest for the amount she should be receiving if client had retired. My question is the taxation of the funds that the client is paying the ex-spouse. The notice clearly states the payments are not considered alimony. Is there a way to deduct the payments made to ex-spouse?

If CA LLC taxed as partnership wants to dissolve LLC, with business continuing after dissolution, is a new Federal EIN and CA payroll tax account # required? Taxpayer (owner of business) submitted dissolution paperwork to CA for LLC, but continued using existing federal EIN # and CA payroll tax account #’s. Taxpayer states he has confirmation of dissolution from CA; however, CA has notified business that business owes for several years of LLC tax (taxes for years after dissolution.) Would CA consider LLC not dissolved if business continues even if dissolution papers filed?

I completed Form 1310 listing daughter of former deceased client as the person claiming refund due to deceased taxpayer as she is the trustee of revocable trust that became irrevocable upon taxpayer's death. My question is this: Taxpayer is due a refund; when setting up direct deposit of the refund, does it matter if the bank account that is listed is daughter’s or trust bank account? Being 1310 lists daughter, wanted to confirm that there would be no problem if bank account for direct deposit is a Trust bank account. Or is direct deposit not allowed due to Form 1310?

I see the March 16th thread, but unable to locate the March 1st thread. Would you be able to provide the subject line of the March 1st thread?