mcbreck

I've never figured out when a rehabber / flipper qualifies for capital gains versus ordinary income taxation. In this scenario I think A gets capital gains and B gets ordinary income treatment. A isn't a builder but an investor IMO. I have a guy who buys pieces of equipment (tractors / bull dozers / skid steer loaders), rehabs them and sells them for a profit. He claims capital gains on the items. He uses the funds to pay for his wife's graduate school tuition.

Why do you think it's a scam? They've been in business for a while.

Whether there is a fiduciary duty to distribute the income isn't my responsibility. The point is that I don't have a liability and don't need to verify that the administrator distributed the income in a timely manner on a simple trust to claim the DNI deduction.

I've been doing some reading and this pdf came up: http://daviswillms.com/yahoo_site_admin/assets/docs/ten_things_davis_willms_2018_updated.28475652.pdf Here is the IRS code he links to that I'm getting at 652(a) so you don't actually have a click on it: Subject to subsection (b), the amount of income for the taxable year required to be distributed currently by a trust described in section 651 shall be included in the gross income of the beneficiaries to whom the income is required to be distributed, whether distributed or not. There was a discussion last year that you can only deduct on the 1041 the income actually distributed and that is completely false. Per this attorney on a Simple Trust the 65 days to pay it out isn't applicable as they do not actually have had to pay it out to take the distribution deduction. The 65 day rule only applies to Complex Trusts and Estates. I just found this interesting as I've had attorney's and CPAs argue this isn't true. Several years ago I had an attorney freak out that I was taking a deduction on money he hadn't actually distributed.

I've been fingerprinted multiple times and maybe I'm wrong but I thought you needed it submitted to do the EA background check which is performed AFTER you pass the test. I did the EA 17 years ago so maybe they no longer do that or with my memory maybe they never did. I've had to submit fingerprinting for the securities regulators multiple times so maybe that's what I'm remembering.

PIA isn't new - it's been around for years as I'm a subscriber. I did a $79 for 3 years deal last time. I use a VPN because my client who works at the FBI, my nephew who works at Apple in Cupertino and a firm I work with said to do it. Plus my wife is required to use a VPN 100% of the time for work at a major University. It slows my speed down from about 200mb to 170mb but upload drops to 20mb. Neither of those impact my life at all. The primary problem is that RingCentral won't let you log into your administration accounts via the VPN. I can still run all my phone calls through them while on the VPN. I've used Drake, TaxWise and ATX on the VPN and never had a problem. My client who works for the FBI said you should assume anything that is "encypted" has been hacked. While I use encryption for PDF files, he doesn't allow me to do that with his files. My nephew at Apple smiled when I told him this and said it was a rather safe assumption to make. His opinion was encryption is safer than unencrypted but it's still not safe. I've had multiple people tell me the document services that CPAs love to use aren't really much safer than just emailing the documents. Basically if someone is smart enough to get your emails, they are smart enough to figure out how to get around the encryption.

I'd imagine it would also apply for anyone who is non-licensed and hasn't been fingerprinted previously? CPAs and EAs were fingerprinted to get licensed iirc.

So when a client drops off their data, you individually go in and roll their data over from last year? I'd never considered doing that, I just do them all at once when I've installed the software.

I utilize the client progress feature pretty much any professional software offers. When someone drops off I write their name in a notebook with the date. When they have been notified their return is done and ready for pickup I mark them off. If they pick up and don't pay me, their name goes in the back of the notebook as a reminder. Also, their information is stored in such a way I know where they are within the system. Drop offs that haven't been touched go in 2 different locked drawers in my credenza. Items in current process go in 2 other locked drawers on the other side of my credenza. If I'm done with it or we are waiting on data which I don't expect to arrive very quickly, they go in a locked "safe" in another room. If I'm done and expecting pickup in the next 24 hours, I put them in a bankers box. At the end of each day my desk is completely cleared off. I don't like client data sitting in view of other clients coming in my office. Anything I'm currently working on gets locked in my desk drawer (it's never more than 3 files).

It's art so you can deduct the lesser of the FMV or the cost basis. This is why art generally gets flushed through a few circular sales before being donated. Bam, that basket is worth $100k.

Stock market earnings in 2022?

Was this is a payroll tax issue? Do you have signature authorization to file the tax forms? If both of those are yes, you are likely liable.

Some pensions are tax free if part of the contributions were made with after tax income. Back in the 70's, that wasn't all that uncommon for employees to contribute after tax money and the corporation to contribute before tax money. That generates a portion being tax free. That's what happened with my client and their pension which was rolled into other pension plans via a merger. The only way to figure it out is for the plan to tell you via their actuaries.

I think you need to contact the plan administrator. My understanding is it is different for every person. Good luck. I have a friend / client who worked at Ozark Air - was purchased by TWA. Then TWA's pension was raided by Carl Icahn, went bankrupt and were bought by American. He gets about 1/3rd of the pension he should receive. Part of his Ozark Air pension is non-taxable but it was rolled into TWA and then American so it was complicated.

Yes, it's exceptionally rare and I generally get through very early in the morning. I start calling at 7am and usually can get through before 8am.

When someone declares their rate on the internet, I'm always very skeptical. It's pretty common for people to declare they charge astronomical rates ($1k for a basic return). There are firms that advertise on the internet their rates and there are averages put out by the industry. The NSA put out a 400+ page survey with average pricing.

I already set mine up. The photo portion is essentially voluntary at this point if you want to call in and be verified that way.

Seems to me for small firms, you could do one of two options for delivering electronically. 1. have us upload via EFTPS. If I can pay the tax via eftps, why not have us upload a copy of the form to include with payment? Then in February I upload the W2s or 1099s. Basic pdf software can go into it and read what you've submitted if it needs more information. It could quickly add up all your numbers. 2. have a fax number which automatically scans, reads and routes the form to your account. I work with a firm where we fax in new account forms, W9s, IRA agreements and the software routes it to the client's account and the software marks off that you've delivered the form. If their current machines scan 1099s in this way, they should be able to eliminate all that and just have the software scan the pdf you've delivered.

It's weird that I receive a hand written 1099 from a law office and it was scanned incorrectly by the IRS. But they did scan it. It's the small companies who file information that is lost - that's why it's only 30m pieces. I file paper payroll forms for a few tiny offices (mine included) - were those all just destroyed? They need to immediately stop requiring 1099's be on the original red ink forms.

If you have VOIP, you enter the phone number you want caller ID to show (it can be ANY number you want) and you enter the name of your business that will show up on caller ID.

On April 18th last year I started intermittent fasting with the goal of losing about 20 lbs but ended up losing 33 and am well below the BMI index "overweight" bracket which is nice. On April 18th of this year I decided to initiate weight training workouts (I've been walking about 20miles per week since last summer). The stronger I get in my 50's, the better shape I'll be when I'm in my 70's (is the theory). In September we are taking a vacation and I'd like to be pretty lean by then. Not sure where yet but we have friends in Portugal so we may go back there. Otherwise my only recuperation is sleeping better. During tax season I always have insomnia and that goes away almost instantly on the last day of taxes. The first few days I was sleeping 10 hours per night.

If there is distributable net income that is not distributed, the 1041 would owe the tax. You can't just delay paying the tax but you can delay distributing the money.

Back during the economic meltdown of 2008 I received bills from the states of Washington, Oregon and Colorado wanting me to pay for their state license to have an office within their state. We aren't within 1,000 miles of any of those and have one total client who lives part of the year in Oregon. Thankfully Illinois has transitioned out of requiring a business license within their state and an agent to represent you if you do any business within the state. When will the Supreme Court get the case for cities charging earnings taxes for workers who worked remotely during the pandemic? I have a client who is a consultant and his employer is within the city but he's been working for Fortune 500 company outside the city limits for 6 years. Pre-pandemic the city said he wasn't a city worker but during Covid they reversed and said that was no longer allowed. He doesn't live in the city, hasn't been in the city in years for work but the city claims he's a city worker and subject to the tax.

That was interesting. Thanks for posting.