kathyc2

Not sure if this is the issue with your client, but 1099's that have an EIN instead of a SSN don't show up on the IRS info site.

I have a client that became a member of a LLC that has income in 15 plus states. Then he recommended me to two more people in the LLC. Not sure what I signed myself up for! First question is CA. Non resident and K1 shows 1,428 income with 100 withholding on 592B. This is less than the 9.3% in 568 instructions. When I run it through software, it shows a balance due of 40. So, based on this I would think I need to file. However, the total CA source income is significantly below the threshold in 540NR, so I would say no to filing. Any CA preparers want to set me straight?

Thanks all!

I have a client that will be inheriting farm land with a pivot irrigation system. They are planning on keeping and renting out the farm land. Some quick research shows that land with the irrigation is valued at about 4 times more than non-irrigated. There are no buildings on the land, so only item for depreciation would be irrigation. I'm thinking the irrigation value could be deprecated over 15 years? Would the valuation when they get it need to show the breakdown between just the land and the irrigation system? Would it make a difference if the rent is cash rent or shared revenue/expense rent for the depreciation?

You should be able to just amend her MFS to MFJ adding his items as the adjustment. You don't have to file him as MFS first.

Since the child lived with both parents, he/she is a qualifying of both parents. The HOH, CTC, and EIC can not be split between the parents. All benefits need to go with either Mother or Father. It doesn't need to be the one with higher income as long as they agree. See Rule 9 in Pub 596 for more detail.

For the most part, I've always been happy with interactions with IRS employees. I find them much more helpful than companies that send your calls to India. I hung up on a call to Comcast recently as the language barrier was too much for them to even understand what I was asking.

If filing as non or part year resident, it still goes on Sch F. If resident it goes on Sch 5.

Wow! I've been fortunate then as the one that died was from 2010 and the one that is now secondary is from 2016.

An old monitor that had been my secondary one bit the dust. I bought a new one (3440 x 1440) and am amazed as to how much crisper everything is. The previous main monitor that is now secondary is 1928x1080. If anyone else has aging eyes and an older monitor, it may be a good investment to take advantage of the newer technology.

The site this article is on is in the business of selling reports for reasonable salary. I'm guessing there is more to the story than what was in the article. But fear sells......

If they personally used the property for the greater of 14 days or 10% of days rented, expenses are limited. See Pub 527.

Here's the full article: https://www.ft.com/content/e8dc2264-6b8d-4ed5-8bbd-e4a67e7d1e46 "The pipeline of new candidates has thinned because university accounting courses have become less popular in the US. Graduates’ starting salaries can also be at least one-fifth higher in finance or technology, and those careers may not require such an expensive professional qualification. “With the length of time it takes to become a partner, the length of time it takes to achieve financial success, the financial model of CPA firms is archaic,” said Alan Whitman, who ran the accounting firm Baker Tilly for seven years until March." Add in the extra year of college needed, long hours and gruntwork for newbies at large firms, perception of boring, etc.

72(t)(2) clearly states: made on or after the date on which the employee attains age 59½ Since it was a 401K penalty can be avoided if separated from service at time of withdrawal.

I had a client yesterday with a balance due notice from 2021. It didn't appear to be first notice since it didn't have the line by line changes section. Rather than wait on hold for hours on the phone, I asked if we could set up an IRS account for her. She agreed and I was able to figure out that 2 of the estimated payments they told me they made for 2021 somehow got posted to 2019 tax year. Of course she then remembered that they received a refund that they didn't know what it was for. LOL! I think I'm going to go the online route rather than phone calls going forward if the client is willing. Much easier!

The business is the LLC. That didn't change. Part of the year it was taxed as a partnership and part of the year as SP. Nothing was dissolved. The business can continue on with the same bank account. Unless they actually took all the money out of the bank account, BS should show the balance of the account. I would probably show his ending ownership at 0% and hers at 100%, but I don't know that it really matters. 1065 return is a final since one owner no longer allows LLC to be taxed as partnership. Since it's the final 1065 return, K-1's are also final.

It depends on if it is a true partnership or a LLC taxed as a partnership. If it's a true partnership, then everything should be closed out. If a LLC then nothing on the company books changes other than combining the equity section combining the partner accounts to an owner equity account.

From an article: "Researchers say the artificial intelligence chatbot has trouble understanding math and makes up facts to cover up its mistakes." Hmmm......

I've only ever used Pro, starting in 1997. Because it's rather pricey I've downloaded various others over the years, but have always decided that for me the extra price is worth it over having to learn how to use other software. The older I get, the less I like dealing with change.

I've also scaled back and had pretty much a stress free season. Each year I go to Costco and get a bag of Lindt truffles and a big bottle of Bailey's. Still quite a bit left in each, so I know it's been stress free. I don't like extending, but this year I have four clients that haven't received K'1's yet, so I had no choice. On the final day I was actually out mowing the lawn!

I disagree. 453(i) (1)In general In the case of any installment sale of property to which subsection (a) applies— (A)notwithstanding subsection (a), any recapture income shall be recognized in the year of the disposition, and (B)any gain in excess of the recapture income shall be taken into account under the installment method. (2)Recapture income For purposes of paragraph (1), the term “recapture income” means, with respect to any installment sale, the aggregate amount which would be treated as ordinary income under section 1245 or 1250 (or so much of section 751 as relates to section 1245 or 1250) for the taxable year of the disposition if all payments to be received were received in the taxable year of disposition. What you are describing normally happens with 1245 property. If 1245 property sells for less than original cost but more than basis, it is ordinary income and goes direct from 4797 to 1040, bypassing Sch D. Since generally 1250 property is depreciated with straight line it is a gain and not ordinary income. The confusion comes because it is taxed at the higher of marginal rate or 25%. However, it is still a capital gain and goes from 4797 to Sch D before showing on 1040. If the TP happens to have net capital loss from a mutual funds or such, they will decrease the 1250 gain. They would not decrease the 1245 gain I talked about earlier because that is ordinary, not capital, income.

Correct. A lot of us (myself included) use the term recapture loosely. See the instructions for 4797 Part III line 26. Line 12 on 6252 pulls from line 31 of 4797. If straight line was taken, line 31 will be zero. The gain can be taken over the like of the installment note.

More than likely it should be zero. Read the instructions for 4797 Part III line 26 to see if anything should be on those lines. If not, you are good.

If straight line depreciation and no bonus depreciation then line 12 is 0, line 13 is 120 and line 14 is 30.

If you want to report the entire 30K gain this year, don't use 6252, just report gain on 4797. If you do want to report as installment the 5K received this year first calculate how much of it is interest income. Then remaining is 80% tax free return of capital (120/150) and balance is 1250 gain. I don't use ATX, so I don't know how you enter it to get this result.