Kea

I think the adviser was trying to count any reinvestment up until the divorce. She did not know (and she admitted it) if she could count the value on the date of divorce. Even if the Roth rollover doesn't make sense this a good time to start trying to determine if there is a basis. It's already going to be difficult, but it will just get harder to get the info over the next few years. Thanks for all your help.

When I said I liked the suggestion of only using his income I was referring only to its simplicity. It would obviously hurt my client's tax liability. If I can get her info (if she has any in 2009), it makes more sense to go ahead and file MFJ. If he can get her info he can probably get her signature. He may have to give her half his refund (if any). But that could still be the better tax bottom line. I should be getting his info today and I'll get a chance to learn if they are still on speaking terms & if he knows if she had any income and what date they split. Thanks so much for all the suggestions.

I checked with a lawyer who said that they need a real divorce in TX. I did not address the community property issue since I figured that was out of her area.

Both statements agree with what I thought. But just wanted to verify. She's 64 and would get hit with 2 $10K tax bills (2011 & 2012) if the basis is $0. Personally, I think at this point she is better off leaving in the traditional IRA. It will be interesting to see if anything can come of it being from the military in the early 80s, but I'm not holding my breath. Thanks OldJack

Client's ex-husband was in the military & had an IRA. As part of the divorce settlement client got a portion (maybe all?) of his IRA. Her financial adviser is recommending that she roll that IRA into a Roth because she (financial adviser) is assuming that her basis could be higher than the current FMV. She was saying that in the early 80s members of the military could not open a deductible IRA because of their pension. Client is now looking through her records to see if she can find out anything about those original contributions, but I'm not sure what's available. But if the husband did have a basis in the IRA, how would that affect my client's basis if she received it in a divorce settlement? Does she get whatever basis he had or does the value on the date of divorce affect it? Or is there some other calculation / consideration that needs to be made? Thanks

I was concerned about how to file it if they are still "married." Since it's community property how to you get her info to use half and how would you know she would file with 1/2 of his income? It would be much easier to file with just his info, so I like your suggestion that he file file with just his income after they split. He will be massively penalized filing as MFS. He'll still be shocked when he sees how much higher is taxes are single than married -- especially since she previously had no income. But I'm sure tax consequences were not a consideration in the break up. I'll try to search for the state laws regarding dissolving a common law marriage. Not sure where to look, but I'll start with the trusty Google. Thanks

I have a client who was in a common law marriage. I was filing them MFJ. He called today to say he would now be filing single since they broke up. I asked if they got a divorce and he said "no." I believe you need a divorce to dissolve a common law marriage. His that true? It doesn't end as easily as it started, right? If there is no divorce I think I still have to file him MFJ or MFS. Even if I go MFS, this is a community property state and they would have to split everything 50 / 50. Getting her info (if any) could be tricky. I have prepared their returns for several years and she never had any income. I don't know about 2009, yet. Thanks

Congrats!

I figured e-mailing and / or faxing the return to and from Iraq might work, but his wife didn't thing so. She didn't give a reason and I didn't pursue it (figuring the 2848 was sufficient). He left in December and they don't know when he will return. She is in real need of the refund to pay the $2000 cell phone bill due in early February. They use Skype now, but said that really wasn't much of an option while he was in transition over there. Thanks for all your input.

Before the husband shipped out, he and wife met with JAG officers on the base. He did sign at least one other general POA that was signed and notarized. I did not see that form but the wife had a binder with all kinds of legal papers that were filled out before deployment. I know she said several of them had to be notarized. I've already mailed the 2848 with the 8453. Is there any reason to also mail the notarized POA? What if there had only been a general POA? Would that have been sent in with the 8453 -- with the same line checked? Even if it wasn't a 2848? Thannks

Agreed. However if they are getting a refund on the 2009, they may prefer to amend 2008 so as not to delay the 2009 refund. At this point, the 2009 return will probably be done soon anyway. If they would owe for 2009, then the credit could flip it to a refund. Might as well wait to see which makes more sense. This is a new client so I don't know much about their tax situation yet. Thanks

ATX has now added the revised 5405 to the 2009 return. (Original form not included.) My client purchased a new home Nov 15 and wants to amend the 2008 tax return. I guess I can do everything in 2008 using the old form (they meet all the old requirements) and then just substitute in the 5405 from the 2009 program. Seems cumbersome, but do-able. I would prefer to do the whole amendment in the 2008 program. I guess it might be difficult for ATX to send an update to last year's program this late. Not sure of their procedures. Does anyone know if they plan to add it to the 2008 program? Thanks

I know it's not a great option, but you should be able to get satellite internet through a company like HugesNet. They claim to be available everywhere (in the US). The big downside is the price. I believe it is at least $70 or $80 per month.

Thanks Chuck. That's what I did.

Thanks so much. I just got paranoid because I learned I had been wrong previously.

I didn't realize these were such hard questions. Well maybe the 1st isn't. It seems to make sense to just mark "combat zone" even if not selecting a specific zone. I do have the deployment date entered. As for verifying the procedure for e-filing if you use a POA for one taxpayer, ATX support couldn't help because they don't answer tax questions. They sent me to Taxpayer Hotline. He sent me to Tax Law who sent me to another area of tax law who sent me to "someone who could answer that. The last person checked with her "coach" who suggested not sending anything differently and if the IRS wants it they can request it from me. At this point, I've: -gone to the 1040 tab and indicated taxpayer cannot sign return due to being in a combat zone -on the 1040 EF tab, I've checked the boxes for Practioner PIN and POA. -Also on that tab, I filled in the spouse's name in the POA section -- this did generate the checkmark on the Form 8453. -I modified the 2848 to match the form the clients filled out (default was for me to be the POA which is not the case). However, I don't know if that is necessary -- is that form included in the e-file? -Client (spouse) signed 8879. -(after return is accepted I will mail 2848 with 8453) Am I missing any steps or doing any that are not necessary? I had previously been under the impression that I filed everything as normal and just kept a copy of POA in my files. This is what the IRS person decided at the end....but I'm not sure now. Next step -- check Georgia requirements.

It is not populating. Perhaps I am missing a field on the EF Info sheet? Any details on this subject would be appreciated. Thanks

I'm only guessing here, but I think the error means that the amount on the 1040 for the credit must match the amount on Sch M. If you did an override on the 1040, or the amount from the Sch M isn't flowing, then you could get this error. Maybe?

Client's husband is in Iraq with Operation Iraqi Freedom, but I don't see this choice on the list (1040 EF Info Sheet, Misc Info tab). And there is no box for "other." Not sure if it matters if I check a different one or if I leave it blank. Wife is signing and has POA for tax returns. Does this require sending it with an 8453? I didn't see that choice on the list. I did read the posting about specifying the POA on one of the 1040 tabs. I was just going to file everything normally and keep the POA in my files. Anything else I need to do when using a POA? Thanks so much. Edit: I found the checkbox on the 8453 (it was right in front of me). However it won't let me put in "X" unless I override. I haven't used the 8453 since they modified it. I see it is not a signature form anymore. So do I still use the 8879? On the EF info sheet do I check Practioner PIN & POA. Then enter wife's name in "POA, Personal Rep, C/O...." box. I realize these seem like basic questions, but I just want to make sure to do it correctly.

I thought I might be missing something. I must have misread something or skipped a post. Sorry about that.

Maybe I missed something in the discussion, but I don't think she gets head of household. One of the requirements is that she provide > 50% of maintaining the household. From this scenario, I would assume the boyfriend is paying more towards rent, utilities & groceries than she is. I see no problem with claiming them as dependents & EIC.

Why can't he use the old form if he purchased before November 6? I have a client that purchased November 15, so we are still waiting for the new form. Does anyone know if ATX will add it to 2008 & 2009 programs? I would prefer to amend 2008 & do it all in one program.

I have the system config and I followed their instructions for exporting the update history. But I haven't been able to import the history to new program. I've now moved several files from the old to the new and I did get into the program without the Transmit message (not sure if it will be back but it sounds like it won't). I'm pretty sure they didn't mail me an archive disk. Thanks for all your suggestions. I'll probably play with it again tomorrow, or at least this week.

Thanks so much Don. I knew Orrtax / Intellitax no longer existed, so I figured looking for instructions online would be rather futile. I didn't consider it affecting the original "transmit" but it makes sense. I have the ATX CD they sent me (trying to convince me to stay with them), so I might try re-entering them in ATX. But I did about 100 returns that year, so it could take a while. It would be educational to see the differences. I don't really want to keep the software on that computer because I planning to pass it to my husband (his PC is on its last bits). And my Vista machine is having issues that I think a good reformatting will take care of. It got too slow for me and with too many "windows not responding" messages. But it will work fine for what he does. Thanks again.

I'm trying to move my 2007 TRX Intellitax program and files from a Vista computer to a Win 7 one. I've installed the software, but cannot do the initial TRANSMIT to send them my computer info (or for whatever reason they require it). It is giving me an error message about my internet connection (which is working fine). I tried to do a backup (old computer) and restore (new computer) but it tells me that the file was created on a newer version of the software. No, I can't seem to update the program, either. It doesn't give me an error message - it just doesn't seem to do anything. I then backed up the updates from the old computer, but I can't get the new computer to load them. I tried copying files from the 2 TRX\2007 folders (one at the C:\ level and one within the Program Files folder. That didn't work either. Is there an easier way to do this or at least another way? Moving 1999 - 2006 ATX files were very easy -- just install software, tell it to run in XP mode and in Administrator mode, then move the Database Folder. (OK, 1998 ATX was more complicated and involved moving some .ini and .ocx files. But I ran into that moving to XP and Vista.) Now to see if I can move 2008 TRX Taxwise. Thanks!