kcjenkins

I would take the deductions, since he spent the money for a legitimate business purpose, with full intent to make a profit. Just because the situation changed does not negate that. If he still intends to later restart again, you might want to capitalize them and spread them out over the future years, but if he can use them this year, I'd be inclined to advise taking them now. None of us know what the future will bring, so a dollar of tax saved now is worth more, in most cases, than a dollar of taxes saved in the future.

Well, actually that is somewhat helpful, JB, because it tells you that the attorney is totally tax-challenged. It's good to know that up front, because now you know not to rely on anything he says about the taxes. Extend your client's return, and Mom's, and after the 18th, you can start reading up on IRD, 1041s, etc. This is a good chance to learn something new, help your client, and maybe even teach a lawyer something! It would be nice if it were that simple, but it's not. On the bright side, Son gets a step up in basis on any equipment he inherited from Mom, and gets to start brand new depreciation on that basis. Don't forget, that includes wells, fences, barns, storage sheds, etc. If they were jointly owned by Mom and Son, then he gets a step up on Mom's half. All good reasons to extend, so that you have time to get him the maximum tax benefit from his loss of his Mom.

Whoa! There are several issues here that need to be addressed first. One, if the divorce states that he gets half, it SHOULD HAVE BEEN DONE AS A QDRO. If it was, then the trustee is wrong, and two new 1099Rs need to be issued, correcting hers to show half, and sending him one for his half. But if it was not done as a QDRO, then she has to pay tax on the entire amount, period. Now, if that is the case, the next question is, is this property settlement, [non deductible] or is it alimony? That is a legal question, because it's not alimony just because she pays him money. You have to look at all six rules to determine if it qualifies as alimony. Only if it does can she deduct it, and he pay tax on it. We've already had several threads on that subject, where I listed the six tests.

Just remember, while they were together most of the year, if they both claim the kids, he would win under the tie-breaker rules if he has the higher AGI. So given that, unless she has a higher AGI she should not claim the kids. No point in starting a fight that you know in advance you can not win. They lived together long enough that they both have 'custody' rights, so filing her MFS with just herself claimed is the smart thing to do. Let her lawyer deal with what share of the refund she might be entitled to, if any.

Hey, JB, was the attorney's name "Coop"? Because I had one of his where it stated "The Plaintiff [husband] will claim the exemption for the Defendant [wife] for one-half the year, and she will claim herself for the other half of the year."

Yes, all their sites, except sales, seem to be 'down for maintenance' right now. I very much doubt if it's maintenance, it's probably an unplanned problem they are working to fix. And I have no doubt they are frantically working to fix it. It's really a pain, tho, how they have these situations happen and they do not bother to communicate to the users. Clearly, things do happen, beyond the control of the company, sometimes. But the lack of communication is still irritating.

I don't think there is any practical way to do that, but you could certainly post in the General chat section a request that people do spell out the name of the state, or at least the 3 or 4 letter abbreviation, when they post about a specific state-related question. Many of us would be willing to do that.

Also, most states, the program itself will let you go to the 4562, up at the very top there is a blue box where you can click, and change from the Federal view [default] to the AMT version or the STATE version. Then you print it. Alternatively, you go to the tabs at the bottom, select Print Options tab, and there select by checking the boxes, to have it print the state form, and/or the state Detail, etc. An often overlooked feature that is really nice.

The instructions were to input ALL income, whether taxable or not. So that is what I am doing.

AMERICAN FUNDS SMALLCAP is 95-4253845 AMERICAN FUNDS NEW PERS is 95-2817150

Also, rethink your statement that "Client went bk in Feb 2008, but since the credit union canceled the 'visa' in december I can't use the bk." That just supports the fact that he was still insolvent after the foreclosure. You do not have to be in the middle of the bankruptcy in order to use that as a defense against the taxation of the canceled debt. The issue is simply 'solvency', and the fact that he had to file bankruptcy even after the loss of the house just helps you establish that he was still insolvent. IRS will not fight you over that, once you put down that he filed BK.

Something sounds wrong here. You are saying that she has a basis of $31K, and she has taken $53K of depreciation, so her total original cost was $84K, right? If that is the case, the son's basis is also $31K. The lower of her basis or FMV.

You have the amount that was added to his W2, which is part of his basis. The other part is the amount that he had to pay to exercise the option. Usually simple to figure, because the combined amount should be equal to the FMV of the stock on the date of the exercise of the option. Might be a small amount for fees of the transaction. Example: Stock was worth, on 12/15/05 a total of $2000. His option allowed him to purchase it for $500. His W-2 was then 'grossed up' to include the $1500 difference. So in fact, he paid $2000 for the stock, he just did not have to dig into his pocket for but $500, the company paid, but added it as income, the other $1500. His basis is $2000.

If there was no withholding, you do not need to send it. If you do need to, and you don't have it, but you know the amounts, and you have another one from the same casino, you can MAKE A NEW ONE yourself, using the ATX program. Since it will match up with the files that the IRS has, on computer, they will be happy to accept your 'replacement copy'.

Then I'd check with the bank, Linda, if the amount is large enough to be worth it, to see if they were set up by, and administered by, an exempt organization. Occasionally these sorts of accounts are deductible, but rarely. If they are just a way of collecting funds for a needy person, it's not. But if it's set up by a church, for example, it might be. Usually, the amount is not big enough to justify digging into it, tho. I've had a client argue with me, until I pointed out, that even if that $100 did turn out to be deductible, it only made a $2 difference in his tax bill. That was the end of the argument. Not worth the trouble to find out.

That has already been done, the link was posted. I'm just going to ignore it for a while, and see how many users it gets.

And the 1099G form has a box to indicate what year the refund is from.

That's it. Linda gets an A and gets to go home early. The rest of you have to stay and clean the blackboards !!!

It's a Pop Test, Terry, because you guys were looking sleepy and not paying attention! ;~)

Nope. Try again. "Its head weighs as much as the tail and one-half of the body combined.."

Do you mean how to book it on the S Corp books? The sale does not affect the S Corp, except that the stock ownership changes. The sale, tho, is between the old owner and the new. The seller may have a gain or a loss, the buyer has an increase in his capital account equal to the capital account he 'bought'. Any difference is an adjustment to 'outside basis', not inside the corp books. Hope that helps.

Well, I know with the early renewal that 'training' is free, but frankly, that may be more than it's worth, at 'free'. It sure would not be worth $179. I was foolish enough to pay for a training seminar this year, thinking that they might teach me something about the new stuff, client write up and document manager, and that would be worth my time to not have to figure it out by myself. WHAT A WASTE. There was NOTHING about either of those, and the tax program presentation was worse than I could have imagined anyone could mess it up. If I had not won back the price at the casino as I left the seminar, I'd have been totally PO-ed, instead of just disgusted that I had wasted an entire day on something that was that poorly presented, by people who knew a heck of a lot less about the program than I did. Of course, the fact that they were TaxWise employees, who had been there to give the TaxWise training the day before, could explain that. Just did not explain WHY they sent them without teaching them something about the program first?

A trout's tail weighs eight pounds. Its head weighs as much as the tail and one-half of the body combined, and the body weighs as much as the head and tail combined. What does the whole trout weigh?

No, if their AGI is zero, and they had no SS etc, even if not taxable, no stimulus payment. By the way, did you see the funny message at the end of the IRS calculator that Cathy posted? I entered zero wages, zero total income, and this is what it told me...... "According to law, the economic stimulus payment amount that married couples filing jointly would otherwise be entitled to receive is reduced by 5% of the amount that their Tax Year 2007 Adjusted Gross Income exceeds $150,000. You would have been eligible for an economic stimulus payment of $0, but your AGI exceeds $150,000 by enough to reduce that amount to zero." Mind you, that was with an AGI of zero. I never knew that zero exceeds 150,000, did you?

Why not just open up the Windows Notepad, open the note, use 'cut and paste' to copy it to the notepad. Then you can delete the note in the return. After you copy all the notes for that return onto the notepad, you can then save it with a title like 'T/P name, 2006 Notes'. And/or print it out and put it into the client's file. Alternatively, you could then 'cut and paste' that notepad page into a linked 'Statement' so that it is in the file with the return. To add a Statement to the return, just click on Forms, List, then Create a Statement.