joanmcq

Don't forget that the prior depreciation taken doesn't go away; it's still prior depreciation, and will be recaptured when sold, regardless of whether it is rented again.

The losses directly relating to the disposed of rentals are freed up completely. The gain and loss from the sales are netted with any other rental income/losses for the purpose of freeing up any losses from properties that aren't sold, which can be more than the 25,000 if the gain was big enough. That all works out on the 8582.

I have two upstairs bedrooms as my office. One is very small, and I meet clients there, and the other is the messy area I work in. those are the only two rooms upstairs, and the stairs are right by my front door. If someone can't do stairs or is allergic to cats or dogs, I meet them at a local Starbucks. I am by appointment only. If one runs late, and the next shows up, they can wait outside if it's nice weather, or in my always messy living room. If you do good work, your clients shouldn't care. Oh, and I have a locking mailbox for drop-offs. Since 2002, I have had only one couple who just couldn't 'deal' with the fact that I work from home.

I do know a CPA who reads German and is looking for contract work; in fact she just had a job where it was translating German invoices. I could hook you up if you would like.

He doesn't get a rental loss if the estate owned the property, but he could take a misc itemized deduction for losses on final distribution. If necessary, find someone who knows German, and have them translate the document.

Yeah, that can be the case. The point I was trying to make is that the RMD based on the decedent's life needs to be taken out ASAP to correct the error. Then the benes will have the choice as to what to do with the account going forward.

Is your client the sole heir, or were there others? The 8865 is filed for a foreign partnership. If she was the sole heir, it wouldn't be necessary.

I've had a few instances of that; for example, a store/vendor that doesn't take Discover or I forget my biz checkbook when I go to a tax group meeting. Since I'm not a corp or other entity, I just book instances like that to 'owner contribution'. Same as if I pay cash for something (rare, but when its a mailing that costs less than $2...). A corp has to be vigilant. But IMHO, a one time error isn't going to pierce the corporate veil, but repeated, habitual, comingling will. Not to mention run you afoul of the 'running it like a business' part of the biz/hobby determination.

The beneficiaries have to take the decedent's final RMD and then they can decide how they want to proceed with their inheritance.

The cost of getting your EA isn't anything that any of us that have already been licensed in one form or another have not paid. You could have studied on your own, but chose to go to a conference for your review. You also chose to go to a conference for the rest of your CPE. As Lion said, there are a lot of lower cost CPE credits available than conferences. Conferences are fun, but are a luxury. And my gripe on the other thread is that CPE is something you should have been doing all along IMHO, whether required or not. I have over 80 hours of CPE already, and I'm not even a year into my two year CPA cycle. And I haven't been able to afford a conference in two years.

My point is though you may be getting more than the required CPE and going far above and beyond what the average unlicensed preparer does, many do not, and these are the people I am competing with for fees, as well as you. Even if many people do not recognize what an EA is or what the title encompasses, it does give you the ability to represent your clients in audit, to get a POA, and therefore expand your practice into areas you formerly could not. And even EA's don't know everything. Can you spot all the mistakes in this article? http://www.foxbusiness.com/personal-finance/2011/06/30/tax-tips-for-sub-s-corporate-structures/ written by an EA who shouldn't be allowed near a typewriter, much less being published. Now I'm not sure in which forum I read it, but software does code where an efile comes from. Now this won't stop unresgistered preparers from doing paper copies on TurboTax, but the efiles can be tracked. Kinda big brotherish, but hey, I'm above board, and I don't care if the IRS knows how many returns I prepare. They do already. I apologize for appearing to only reply to your post rather than to both yours and Pacun's. I'm not good with quoting posts.

Thanks, Taxbilly. I guess it was after I started doing taxes. Blessed are those that have cites! I'm spending a lot of time in bed on my laptop after having minor surgery, but my brain is mush from the painkillers. lol. As opposed to the normal mush from too much tax work.

Collecting miles or other benefits was determined not to be income, even if the employee was reimbursed for the expenses. The example I remember is when I traveled for biz a lot. I joined frequent flyer programs on all the airlines since my employer booked the trips. It was ruled at some point that the miles I earned and later used for personal trips weren't income. This ruling happened way back, when these programs were fairly new. And please excuse my vagueness about the rulings, etc. I remember them because they were pertinent to me at the time, but that was a long time ago in a galaxy far, far away. I don't even think I was studying tax yet at that point.

No, Jack, I don't take my car to the dealer for repairs, but I do take it to an ASE certified mechanic. Under the new rules, once you pass the test, you do not have to retake it. I passed the CPA exam 11 years ago; I don't have to retake it. EAs don't have to retake the exam. That's not a relevant arguement. I know there are a whole lot of previously unlicensed preparers that are diligent in their education and take this profession seriously. There are others that are not. I'm tired of the bitching and moaning from y'all that will have to step up; I paid a hell of a lot of fees and a lot for education when I had 50 clients and those same fees and costs when I had 30, and I still pay those fees now that I've broken the 100 client level. So, since we have already established that I paid more fees than the unlicensed preparers at 50 clients (and stayed in business, and had a profit, and enough of a profit that I did not want to leave the profession or stop working my own clients), why do you say that anyone with 50 clients will drop out? Either they raise their prices to cover the fees, or they don't and take less profit. Or they stop preparing taxes. The main part of the fees are a one time thing, fingerprints, testing, etc. The CPE requirement is something that any professional should have been doing all along. The PTIN is $62.50 a year. At least the EAs got a reduction of the EA fee, I didn't. I'm just tired of the bitching about what is not a big deal IMHO. Yes, nothing will stop the person who buys a copy of TurboTax and doesn't sign the returns. But the laws do put teeth into the prosecution of such people. And data mining will help the IRS find them and shut them down.

I concur with all who are saying keep biz and personal strictly separate. Before I had a biz card, I had one personal MC I used only for biz. Are you a registered biz? Do you have a biz license, etc? I get Capitol One biz card solicitations all the time, so why not just get a biz card from the same company? And the biz cards tend to have different bonuses; for example my Discover biz card gives me 5% cash back on all office supplies all the time, whereas my personal Discover card has different rotating 5% bonuses. But I still keep them separate; I don't book a biz trip hotel on my personal card just because that month my personal card has a bonus on hotels.

No the admin isn't the best; not enough checks on fraud and the big givaway to Big Pharma when the drug benefit was added (the drug benefit BTW was really not out of concern for seniors, but pandering for votes and a way to further bankrupt the program, so that the Neo-cons could tout a reason to gut the social welfare programs). Now if Medicare could bargain for drugs the way private insurers do, how much less would the government pay for drugs? By my one month of being w/o insurance and seeing the difference between what I paid for generics and what the ins companies pay was really opened my eyes. But at least medicare keeps our seniors from going bankrupt becoming indigent for lack of medical care. Look, I am frustrated not with government, which really is a necessity, but with politics and ignorance. Now I know the registration is a big pain for those of you who haven't had to do anything in the past to declare yourself a tax preparer (and some of you do go above and beyond to learn and keep up with changes, etc but there is a vast group out there who don't), but licensing, exams, CPE requirements, and Circular 230 are things that EAs, CPAs, and tax attorneys have had to deal with since we got our licenses. In CA & OR there are licensing requirements, but the costs (although in CA, not the PITA factor for CPE it seems; although they require mcuh less than I need). So I view this as a leveling out. Some of this stuff is why CPAs and EAs really have to charge more; it's just damn more expensive keeping up with education and licensing. So put on your big girl & boy panties and suck it up. IMHO it's been a travesty that for the most part tax preparers have been under less oversight than the barbers we joke about giving tax advice.

Well they do manage our healthcare if you have medicare, and a lot of seniors seem to like it. Yeah, sharing across different parts of the agency would be nice, but that might be a bit much to ask for. Like if I fax a POA directly to the Taxpayer Advocate, do ya think she might enter the darn thing so I don't have to fax to CAF too? Maybe next year they will be set up to cross reference so that you'll only need one set of prints. In fact, that might be a good thing to bring up to your Practitioner's Liasion. That is their job: to kind of mediate between the IRS & practioners.

Thanks Pacun, I think I misread the OP. Report as sale, but there shouldn't be COD. Might be gain or loss, and neither will likely have a tax effect.

Hey, I was fingerprinted and had a background check just to get a license to sell cars. I think our profession, what with sensitive financial data and the amount of faith our clients put in us to prepare statements (tax returns) that are signed under penalty of perjury should require at least the same level of non-criminality as a car salesman/woman. Doncha think?

I don't understand the question. She received a 1099-A for the accquisition? or disposition. Generally if the FMV is higher than the loan value, there is no COD and therefore no taxable transaction on a pricipal residence.

When my dad was selling his house, I got rid of all but the newest 7 years of returns. he had them back to 1958 too. along with the paperwork. It was interesting looking at them. His 1958 wasn't a postcard though; and he didn't have any of us kids then or the house.

I'm not saying its the best deal for the employee, but I have several clients that DO work from home and some things are paid for, like internet and office supplies, and some are not, like utilities, depreciation. etc. The company gets a benefit by being able to hire from a wide area, and the employee doesn't have to pull up stakes and move to the Bay area for a job. We don't deduct internet and we do deduct depreciation, utilites etc. I had another who was doing sales work. The company wasn't going to set up an office for one employee in a region.

'The box' only takes what they put in...GIGO. If they are like the DIY people I've seen audited, they have no idea what they entered or what was on the return. Just saw the green refund meter go up and thought they were all good. And probably even thought 'the box' was finding them all sorts of deductions their accountant didn't know about. lol.

jainen, I am quite familiar with the restrictions Sec 280(a) puts on employee home offices. I determine all of the 'convenience of the employer', what is or is not reimbursed, etc. And since I am in Sacramento, usually for example, Bay area companies can actually pay the employees less to work from home, not more, since the employers are not renting expensive office space in SF and the cost of living is less in Sacramento. The accountable plan is most often used for closely held corps, not big public ones.

Well it kinda depends on the corp and employee. Closely held corp/employee? Set up an accountable plan. I have had several clients whose home offices were legit; worked remotely for large corporations. I have no problem taking these home offices.