kcjenkins

Ugg, reached my quota of 'Likes' for the day. Nevertheless, I like your post, Cat.

I bet Bulldog Tom's wife does too! And Catherine's hubby, too, to mention just a couple.

I think Jack and Max are both somewhat correct. Just not talking on quite the same level. Yes, MOST SFRs are incomplete, but yes, sometimes what was omitted is not enough to make a significant difference in the bottom line. However, I, like Jack, would still file the 1040, if only because the SOL never starts til a real return is filed. If you just accept the SFR and negotiate on that, and the IRS later comes up with new info on that year, even 10 years later, they could come back on the client again. Unlikely, but why chance it, when you already have done the work on the 1040 just to verify the SFR? Of course, most SFRs are incorrect because the IRS gets W-2s and 1099s, etc, but they do not get anything on the deductions the client may have. Nor do they take, in most cases, the best filing status. They do single, no dependents, no business expenses, etc. The exact same income, if the client is actually married with 3 kids, is going to have a very different bottom line.

I totally agree. One of the most unbelievable things she claimed was the "IRS has audited her for all those six years and they could not find anything wrong with her work." NO ONE [except certain government officials, for legal reasons] gets audited 6 years in a row if the first 3 are 'no change' audits. Indeed, normally two years of no change is enough to get the t/p a pass for several years. No wonder Naveen's 'spider sense' was tingling.

But you missed the point in the original post. In this case, there IS a significant error in the SFR so a correct original should be filed. Then, the amount owed, if some is still owed, can then be negotiated.

No, Naveen, the fee you quoted is, if anything, low for a return with a Sch C, even without the Form 8839 adoption credit form and New York State return. In AR, I normally set $300 as my MINIMUM for any Sch C. And then when it's an attorney, there are some special issues of when income is recognized, when they should issue 8300s and/or 1099s, trust funds, etc. Be glad this PITA client did not take you up on it. http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Attorneys-Audit-Technique-Guide

Sara, as a tax professional for over 35 years, I'm well aware that the IRS does not use it's full power too often. However, sometimes they do. I hardly need to watch commercials to know that. But that was not my point, anyway. My point was that the average person IS scared of the IRS. Surely, if you've been in this business very long, you know that many clients panic if they get a letter from the IRS unexpectedly? It is that which makes the IRS Scam so effective.

August 1, 2014 By Edward Mendlowitz One time I was working for about a month at a client that was a stock broker. Throughout the office were signs that said P&S with arrows. When I got started on the account, I did not pay much attention to the signs. Instead I concentrated on learning what to do and then doing it. After a couple of weeks I looked at one of the signs and had no idea what it meant, never coming across anything referring to it. After about a month, my boss met me at the client and wanted to discuss my work and go through the work papers. I had kept him informed of my daily and then weekly progress and he felt I was on track, but now he wanted to do a thorough review. While he was with me, I asked if I could ask him a question and he said OK. I asked, “What does P&S mean?” He replied, “Purchases and Sales.” At that point I felt really stupid and told him so. He told me, “You shouldn’t feel so bad. It could have been much worse. I just asked the client that question!” This taught me that early on you can ask as many questions about the business and operations as you want, and it won’t reflect poorly on you. It might even enhance your reputation for thoroughness. However, when you ask a question about something you should know, after you have been working on their records for a period of time, you look foolish, amateurish and/or stupid. The takeaway is to ask about everything you can possibly think about when you first get the client and ask right away whenever something new arises.

Washington, D.C. (August 1, 2014) By Michael Cohn Leaders of the Senate Finance Committee have introduced bipartisan legislation to improve protection for taxpayers against fraudulent tax refund claims made with stolen identities. Sen. Orrin Hatch, R-Utah, ranking member of the Senate Finance Committee, and Ron Wyden, D-Ore., who chairs the Senate Finance Committee, introduced the Tax Refund Theft Prevention Act of 2014, S. 2736, on Thursday. The bill includes new assistance for taxpayers who have been victims of identity theft and requires the Internal Revenue Service to establish a new security feature that individuals can use to protect their tax return filings. “Tax refund fraud is a one-two punch for taxpaying individuals,” Hatch said in a statement. “Millions of taxpayers’ identities are compromised, and all taxpayers have their tax dollars wasted. Our bill aims to address such fraud by enhancing the IRS’s capabilities in detecting fraud and by giving victims the assistance and safeguards they need to repair the damage done by tax theft criminals. In order to further deter this crime, we make tax refund fraud a specific category of a felony offense and enhance security features for filers. Hard-working American families deserve a government that protects both their tax dollars and their sensitive taxpayer information. I am pleased Chairman Wyden has joined me in this advancing this effort.” “We have to better protect lawful taxpayers from this nightmare issue,” Wyden said. “Earlier this year, I made it clear that taxpayer consumer protection must be at the heart of improving the American tax system. This bill offers a comprehensive, commonsense solution to a growing problem that will help prevent fraud and also provide assistance to those who have been victimized. Senator Hatch and I remain committed to protecting the integrity of our tax system.” Under the bill, businesses would be required to report both employee compensation and certain non-employee compensation to the government earlier in tax season. The change would improve the IRS’s ability to identify and prevent fraudulent refund claims. Paid tax preparers would be required to file individual income tax returns and most information returns electronically under the proposed legislation. In addition, the electronic filing requirement for preparers who file over 250 tax returns would be scaled back to 20 returns, over a three-year period, to improve the IRS’s ability to identify and prevent fraudulent refund claims. The existing access that the Treasury Department has to the National Directory of New Hires database would be expanded for the purpose of identifying and preventing fraudulent tax filings and refund claims. Victims of tax refund theft would be assigned a single contact person within the IRS for help with correcting their tax records and receiving their tax refunds. Under the bill, the list of aggravated identity theft crimes that are classified as felonies would be expanded to include tax refund theft. Tax preparers would also face significant new penalties if they inappropriately disclosed taxpayer information in connection with an identity theft crime. Individual taxpayers would be able to add password security to their tax filings under the legislation. If a tax return filer elected to add this security measure, then a valid tax return could not be filed without also using the correct password. Under the bill, due diligence requirements imposed on tax preparers with respect to the Earned Income Tax Credit would be expanded to include a requirement that the preparer verify the tax filer’s identity. The senators’ office noted that many fraudulent returns falsely claim the EITC in order to generate a tax refund. Under the proposed legislation, the IRS would be prohibited, with limited exceptions, from issuing multiple tax refunds to the same account or address. Annual tax statements received by employees for wages earned would be required to use a truncated Social Security number in order to protect the number from identity theft.

Within the IRS, there is a “Political Activities Referral Committee” unit. If you don't know what it is, go to the Politic forum to learn about something the IRS has been keeping secret until it was discovered in a court case. Billy Graham is one of their targets, btw.

http://cnsnews.com/video/cnsnews/playing-trombone-till-cows-come-home

Here's the best info I've found on it http://www.cailorfleming.com/documents/OhioWorkersCompensationBasics101.pdf

Because they keep changing it up a bit, and pretty much EVERYONE is at least a little scared of the IRS. Given how much power they have, you have to be.

They should seriously reconsider their rather emotional decision. A corp is not affected by who owns it's stock. Advise them that it should not cost as such to get an attorney to review the situation and draw up a contract between them as it will cost to disolve one and start another, even without the NOL loss.

Such a letter will also remind your clients that you are caring for them, not just a 'once a year, do the return, take the money, and forget them' business. Cheap but effective marketing.

Personally, I'd just round to 9, why turn a good employee into an unhappy employee over a few minutes? I'd rather raise an issue of her leaving early, if that's a regular occurrence.

You were right.

With apologies to all the men here............... Making The Marriage Choice A wealthy man decided it was time for him to get married, but he was having trouble choosing among three likely candidates. So he gave each woman $5,000 and watched to see what they do with the money. The first does a total makeover -- she went to a fancy beauty salon to get her hair done, buys new makeup and several new outfits, and dresses up very nicely for the man. She tells him that she has done this to be more attractive for him because she loves him so much. The man was impressed. The second went shopping to buy the man gifts. She gets him a new set of golf clubs, some new gizmos for his computer, and some expensive clothes. As she presents these gifts, she tells him that she has spent all the money on him because she loves him so much. Again, the man is impressed. The third woman invested the money in the stock market and very quickly earns several times the $5,000. She gives him back his $5000 and reinvests the remainder in a joint account. She tells him that she wants to save for their future because she loves him so much. Obviously, the man was quite impressed. But how did he choose which one to marry? If you don't know the answer, you're not thinking. He's a man: he married the one with the biggest boobs.

Sara, I'm hurting just reading that. But I totally understand, in fact, you just reminded me of the real reason I did fewer returns than Don. He loved to give me those types, although I never had any with 12 rentals or 18 partners, or with 12 brokerage accounts. Thank goodness. Nine rentals was my max, but what I had a lot of was clients with 3-6 rentals, plus a Sch C plus a farm, plus a K-1 or 2.

We did offer coffee, as it's an 'adult beverage', but I used small cups and never filled them full. I needed it, and did not feel right drinking it in front of them without asking. HOWEVER, I like mine STRONG, so I really did not have too many take me up on it more than once. True! Avoid offering food, it's always a clean-up issue. Vouchers for referrals, on the other hand, are often effective, and clients seemed to like them.

Why didn't you ask it that way? OK, I've retired now, but did, in my active years, 350-450 per year average, Don usually did about 100 more than me. OK, I spent a bit more time with my clients, but everyone loved Don anyway! He was just faster, I think. But we both worked long hours during the season, also. And we probably had more than average number of 1120s, 1065s, etc in our practice, fewer simple 1040s. So I'm sure you'd need to weight for hours as well as number of returns.

Well, the Injured spouse is one who, for example, married him/her AFTER the tax debt was incurred, and in that case, only the funds belonging to the t/p owing the debt will be seized. The innocent spouse is one who did not BENEFIT from the unreported income. It's not just that one of them did not KNOW about it, if, for example, they lived in a bigger, nicer home, drove better cars, etc, than their reported income justified, the IRS is not going to buy the innocence argument.