Kea

I hope all you good folks at TRX in Murfreesboro have survived the tornadoes.

New client wants to deduct mileage, cell phone and internet service as unreimbursed business expenses as he has in previous years. He is a test engineer / marketing and his wife is an executive assistant. Other than a log showing business use, what else is required for cell phone and internet? Are the rules the same as for self-employed? These don't seem right to me. It seems that they would use the cell phone and internet anyway. Cell phone could have extra costs due to extra business use. Do these expenses have to be "Required" by the employer or can the employee deduct them if the costs are for their own convenience? I know they have to be "reasonable and necessary" but just not sure how to adjust for an employee. Thanks

Normally she does work through an agency. In this case, Dad hired her directly because he already knew her from when she worked for a friend of his. I didn't do a lot of research into it at the time (OK, none - it was tax season). I didn't want to take the time to figure out how to get Dad set up with withholding. I was lazy and I admit it. Also, I was trying to simplify everything for Dad. And I thought it was going to be short-term. (I know, just excuses.) This should have been set up last year, but it wasn't. And it won't apply to this year. I'm just trying to fix it now, after the fact. I would be happy to set up a W-2 for her now but as I understand (from Quickfinders) that requires an EIN. If the EIN is created in 2009 it won't apply to wages paid in 2008. Also, I'm not sure I can get an EIN for a deceased person - with the exception of the estate EIN (which I already have). I also have never had to learn how to deal with TX FUTA laws. Dad is required to file a 2009 tax return but it will be on extension because I do not yet have court documents to sign the return. In addition, I am missing some 1099s that must have gotten lost in the mail forwarding shuffle. If I can get an EIN valid for last year, do I still file the Sch H as a stand alone by 4/15? Again, what about the issue of signing? Thanks for all the suggestions.

Thanks!

I like the gifting idea best. I knew I was putting a burden on her by simplifying for Dad. But if had only been for a month or so, it wouldn't have been too bad. But a whole year of taxes when she's probably never been a contract worker before would be overwhelming. She's a very nice lady and very caring. I would really hate to overburden her after all she did for Dad. BTW, if anyone needs a home health care nurse in Houston, you can PM me. She is still looking for a job.

Thanks - the re-issue with $0 sounds easiest. Just curious, how do you void one? Thanks!

Seems plausible. It would satisfy the IRS matching computers. Thanks. But it also seems wrong for the 1099 to have been generated in the 1st place. Can the father-in-law "un-issue" it?

help?

help?

I think the name on the account has to match, too. Is the account in his business name only, or is his real name on it, too?

I don't know how many customers TRX has, but it's a fair number. This may actually get ATX more (i.e. new) customers while saving them shipping costs. They just have to ship one CD (and lots of books) to TRX. TRX then ships to all the individual customers. There is a reason bulk rate pricing can work for everyone. ATX can increase sales without increasing customer support or sales staff. I'm switching back to ATX next year (and staying with TRX). I left for price and customer support - not because of the software. Now I can get the best of both worlds.

My dad hired a home health care nurse last year after he had surgery. She typically worked through an agency, but Dad hired her directly because he knew what good work she did for a friend of his. She asked for withholding, but since she wasn't going through an agency, I thought it seemed more like self-employment / contract labor. Also, I was just trying to make it easier for my Dad so as not to try to figure out how to do withholding. We only expected her to stay for about a month or two. Well, Dad never made the full recovery we were hoping for and she stayed with him until he passed in January. She called me last week to get the info so she can do her taxes. I'm only just now trying to tackle Dad's return - but it has to go on extension anyway (no letters of testamentary yet). I still need to get all his records of how much he paid her (I'd guess $45 - 50K). I'm sure she's never done a return as self-employed before and the tax hit (that's my fault) will be a shock to her. I don't want to do that to her since she asked for the withholding and because she was so good to my dad. I could put the info on a Sch H now (need to learn about this, too - I haven't done a Sch H since intro classes 12 years ago). But Quickfinders says I need to issue a W-2 with an EIN. He didn't apply for an EIN. If I got one now, it wouldn't be valid for 2008 (already had this issue on someone else's return). How can I fix this after the fact? Thanks

Client brought in 1099 Misc with $13,830 in box 7. He says he sold some old, unused computers and electronics to his father-in-law's business. (I guess it was a LOT of stuff!) It looks like the 1099Misc is in error. It should not go on Sch C. Typically I'd say a sale goes on Sch. D, but since they were personal assets, the loss is not deductible. (I don't have a basis -- but these items depreciate quickly). And since it is on a 1099Misc, the IRS will look for it elsewhere. Do I show this on line 21? If so, can I show offset with basis (maxed at $13830)? They really didn't "earn" $13K! It's new to me. Thanks.

Thanks for the advice - I figured I needed an extension, and was hoping I wouldn't need the 1310. I haven't mailed a return in a while. Thanks also for the sympathies.

My father passed away in January and his will is with the lawyer somewhere in the court process. I will be the executrix. I am the sole heir. If I understand correctly, I can't sign / submit his return until I have been appointed by court? Since it will be an original return, I don't need a Form 1310 for the refund? If the Form 1310 is not attached, I can e-file it? If it can be e-filed, I should submit the letter of testamentary with a Form 8453 - or do I just keep in my files? Thanks

Actually I worked with someone else at VMSUS. If I remember correctly, his name was Guy. He worked on it for about 3 hours to no avail. Then Kyle called me to say was going to look into it. Their conclusion was that it might have been from a bad update. But future updates never fixed it. The techs at TRX worked on it for about 2 hours (and it even went past closing time) but could not fix, either. That tech did mention that TaxWise doesn't like multi-function printers, but that doesn't explain why it won't print to .pdf printers other than the one embedded in the software. TaxWise prints several worksheets I don't use and prints the pages in a strange order. So I print to .pdf, open the file, write down the pages I want in the order I want, then print to my duplex printer. It's inconvenient, but at least I can print 2-sided and have the right pages on the back of the appropriate pages and don't print pages I would just shred anyway. I got my renewal letter from TRX today. It confirmed ATX with all states and business forms for $299. That works for me! (If I get this printer problem next year, I will be quite unhappy.)

I'm using TaxWise and it hasn't printed to most of my printers since the 1st week of February. I can only print to its built-in .pdf or to my old, slow HP. Neither rebooting or tech support has been able to fix it. All other programs print OK. This is the first time I've heard anyone have a similar problem to what I've had. I'd say there is a connection, but it's a different program. Hmmm?

I've had several clients who lost a parent in the last year. I thought I was just sensitive to it since I lost my father in January. But I guess there was an unusually high death rate in the last year.

It wasn't TRX's fault that Intellitax got bought by TaxWise. So for the people that already bought Intellitax - whether through TRX or directly - did end up with TaxWise. But I do agree that if any of us didn't like TaxWise, we should have been able to cancel and go somewhere else. But for the price, my complaints about TaxWise are minor.

I switched to TRX 2 years ago. Their general plan is that as long as you buy the software by May 31, you get the $299 or $699 price. They don't guarantee that you can get that price after 5/31. So far, they haven't raised their prices after 5/31. Also, if you renew by 5/31 each year you will always get the $299 price. (I assume it's the same plan with the $699 package.) You do get a "repackaged" version of whatever software. From what I can tell, it is the same as what is sold directly by that company. But I've never gotten a "direct" copy to compare to, so, I could be wrong. The main reason for the lower price is bulk rate purchasing. I left ATX after the poor customer service (including taking down the old board right before 4/15) and the ever increasing cost (I have a small practice). But I do miss the software. Intellitax (07) was OK, and I do have issues with TaxWise (08). I would probably return to ATX at this lower price. I hope it has all states at that price, because the others did. I only do 4-5 states per year, so I would hate to have to pay $100s extra to get one or two states.

Off the top of my head, I would say to use it in 2009 since that is the 1st date of service. Kinda like insurance - you count it where it is used even if you are cash basis. Maybe?

There's no 8332. Shared custody 50/50 & each claims 1 dependent outright - per divorce decree. Each will meet the over 6 months rule for 2008 since they still lived together the first few months. (I'll stress the OVER 6 months rule again to them this year.) Thanks

Mom and Dad divorced last year. They have 2 children. Divorce decree specifies which child each parent will claim as a dependent. Children spend 1/2 time with each parent. (I already explained over 6 month rule to them last year.) Dad is my client (but I may see Mom later - already gave them all warnings about conflict of interest last year before divorce, but they've both contacted me this year). He tells me Mom paid all Day Care expenses. Fine, no problem, Dad can't claim credit and he's not trying to. But can Mom claim dependent care credit for child Dad claims as dependent? Thanks.

Upper 30s in Austin this morning. Blizzard in N. Texas yesterday. It's weird!

Thanks to everyone. I now have a good summer reading list.