Yardley CPA

Client received letter from Pennsylvania Department of Revenue indicating they have no record of receiving a corp return. My ATX system shows the file as being transmitted and accepted. Does the transmitted file contain any identifying features...if so, how do I access that information? I see the information for the file at the bottom of the E-file Manager. It shows the return as Accepted and the date and time. Are there any other identifying features I can obtain besides the date and time?

I never understand why people switch tax prep packages??? ATX has been flawless for years!! <cough>

Bart...you're giving FDNY too much credit. He may be worthy of half a good joke...but 1 or 2??

For the vast majority of my clients, I email a secured pdf (using Adobe Acrobat Standard) version of their completed return. Each client is aware of their password which opens the attachment. This allows them to review their return and ask any questions. I include the 8879 as part of the pdf. If the returns looks good, they print the 8879, sign it and return it to me and that allows me to efile. A few older clients who do not have email receive a paper copy of their return along with the 8879. Adobe Acrobat has been easy to use and has worked well for me.

The new season is basically upon us. Hope everyone is doing well and enjoying December festivities! Was hoping for some feedback on tax newsletters you may receive (whether free or paid) that provide general updates on taxes. I prefer the updates to be personal tax information but I am very willing to receive corporate updates as well. I receive emails from my CPA Societies but wanted to see what type of information you may receive or subscribe to? With the anticipated changes that should take place the coming months, I'd like to stay as up to date as I can. Thanks very much

As the Fall season gets into full swing, we'll be nearing another tax season in no time. Hope everyone is doing well. MFJ Client purchased an investment property many years ago and continued to rehab it in the hopes of putting it up for rent. That never happened and now the client is selling the property. I believe the expenses associated with rehabbing the home can be added to the basis. The home was never included on a Schedule E and was never depreciated as it was never ready to rent. Would the sale be handled on Schedule D as a long-term capital gain / loss? Would appreciate any information you can share. Thank you.

Thank you again!

Thank you for chiming in, JKL, Lion and Sara. I've never had this situation in the past and appreciate all your comments. Am I able to simply delete the current rental assets? Won't that throw up any flags at all? I know I'll be input them again, with new amounts based on the husband/wife basis...but simply deleting the current rental assets is the way to go? I assume I add the husbands 1/2 and the wife's FMV At Date of Death together and depreciate the rental as one property? Assuming this is correct, is the combined amount depreciated using the date of death? Thank you again for all the input

Thank you, JKL...I knew I had previously touched upon this. Appreciate you referring to my old post. I'll look over the responses. Yes, same client. :-)

MFJ, wife passed away in early 2016. Return is on extension and I'll be working on it this weekend. They owned two rental properties and I know this forum has provided information on having the ability to extend the depreciation of the rentals when one spouse passes. A few questions: If both rental properties are in the midst of their depreciation, can I simply start depreciating them again, over 27.5 years? Is the date of death the new date for when the rental was placed in service? Is the basis the fair market value of the rentals at the spouses date of death? If one of the rentals has been fully depreciated prior to the death, I assume it can be depreciated again following the same rules for the questions above? Is there anything I'm missing or should be looking out for? Hope everyone enjoys the fall season! The new tax year will be here before you know it.

How were the 529's set up? There are different options on who can receive the disbursements from the plan. I believe they can be set up so that the distributions can go to: Account Owner Beneficiary Directly to the School In some instances, the owner can pay the school and other expenses and then reimburse themselves. In any event, a letter from the school (assuming they are willing to provide this), cancelled checks and 529 statements should all help in proving the payment was made. Good luck and please keep us posted on how this goes.

Great information!

Do they both meet the exclusion stipulations? If so, I believe they qualify. Topic 701 - Sale of Your Home If you have a capital gain from the sale of your main home, you may qualify to exclude up to $250,000 of that gain from your income. You may qualify to exclude up to $500,000 of that gain if you file a joint return with your spouse. Publication 523, Selling Your Home, provides rules and worksheets. Topic 409 covers general capital gain and loss information. Qualifying for the Exclusion In general, to qualify for the exclusion, you must meet both the ownership test and the use test. You're eligible for the Section 121 exclusion if you have owned and used your home as your main home for a period aggregating at least two years out of the five years prior to its date of sale. You can meet the ownership and use tests during different 2-year periods. However, you must meet both tests during the 5-year period ending on the date of the sale. Generally, you're not eligible for the exclusion if you excluded the gain from the sale of another home during the two-year period prior to the sale of your home. Refer to Publication 523 for the complete eligibility requirements, limitations on the exclusion amount, and exceptions to the two-year rule. Reporting the Sale If you receive an informational income-reporting document such as Form 1099-S (PDF), Proceeds From Real Estate Transactions, you must report the sale of the home even if the gain from the sale is excludable. Additionally, you must report the sale of the home if you can't exclude all of your capital gain from income. Use Form 1040, Schedule D (PDF), Capital Gains and Losses, and Form 8949 (PDF), Sales and Other Dispositions of Capital Assets, when required to report the home sale. Refer to Publication 523 for the rules on reporting your sale on your income tax return. Suspension of the Five-Year Test Period If you or your spouse are on qualified official extended duty in the Uniformed Services, the Foreign Service or the intelligence community, you may elect to suspend the five-year test period for up to 10 years. You're on qualified official extended duty if for more than 90 days or for an indefinite period, you're: At a duty station that's at least 50 miles from your main home, or Residing under government orders in government housing. Refer to Publication 523 for more information about this special rule to suspend the 5-year test. Installment Sales If you sold your home under a contract that provides for all or part of the selling price to be paid in a later year, you made an installment sale. If you have an installment sale, report the sale under the installment method unless you elect out. Even if you use the installment method to defer some of the gain, the exclusion of gain under section 121 remains available. Refer to Publication 537, Installment Sales, Form 6252 (PDF), Installment Sale Income, and Topic 705, Installment Sales, for more information on installment sales. https://www.irs.gov/taxtopics/tc701.html https://www.irs.gov/uac/irs-issues-home-sale-exclusion-rules

Good post, Edsel. Not sure how they would even remotely qualify for the exclusion. Here are the rules: If you are a U.S. citizen or a resident alien of the United States and you live abroad, you are taxed on your worldwide income. However, you may qualify to exclude from income up to an amount of your foreign earnings that is adjusted annually for inflation ($92,900 for 2011, $95,100 for 2012, $97,600 for 2013, $99,200 for 2014 and $100,800 for 2015). In addition, you can exclude or deduct certain foreign housing amounts. You may also be entitled to exclude from income the value of meals and lodging provided to you by your employer. Refer to Exclusion of Meals and Lodging in Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad, and Publication 15-B, Employer's Tax Guide to Fringe Benefits for more information. Other Rules Not foreign earned income: Foreign earned income does not include the following amounts: Pay received as a military or civilian employee of the U.S. Government or any of its agencies Pay for services conducted in international waters (not a foreign country) Pay in specific combat zones, as designated by an Executive Order from the President, that is excludable from income Payments received after the end of the tax year following the year in which the services that earned the income were performed The value of meals and lodging that are excluded from income because it was furnished for the convenience of the employer Pension or annuity payments, including social security benefits Isn't the most important stipulation the fact that you live abroad? In any event, I don't see how they would legally qualify for the exclusion.

Thanks very much for the replies. I have a current LLC client that I use standard on and do not depreciate the vehicle separately. I also read that there is a component of depreciation within the standard but wanted to make sure I was not doing anything incorrectly. I very much appreciate all the replies!

Would appreciate some input on how to record some expenses of a newly formed, Single Member LLC in New Jersey. Taxpayer will be providing maintenance and repair services for an international equipment provider. He will receive a 1099 - Non-employee Compensation form at the end of the year (not claiming this is the correct approach, just stating what I've been told by the client). Here are some of his expected expenses: Vehicle purchase - I assume can be depreciated and also subject to yearly mileage per diem / or actual expenses? New Laptop - depreciated Home office deduction - taxpayer indicates office will be used solely for activities of the business. Taxpayer will be required to keep machinery and parts in inventory at his location. He has a large garage he plans to use for this. Can this structure be depreciated in any way? Any other thoughts or suggestions are greatly appreciated.

http://www.journalofaccountancy.com/news/2017/jun/circuit-court-strikes-down-ptin-user-fees-201716814.html?utm_source=mnl:alerts&utm_medium=email&utm_campaign=05Jun2017&utm_content=button

A few thoughts: - Send out a mass mailer postcard. I think you can target zip codes that you are looking to attract from. While obviously there is a cost involved in that, it is very direct...assuming the recipient glances at it. - Post information about your services on Social Media sites. - Join local chamber of commerce or community groups. - Offer $xx new client discount. I offer a $25 new client discount and I also credit my current clients $25 when they refer new clients. - Sponsor a local sports team. In my area the name of the sponsor is placed prominently on the uniforms. These are just thoughts I threw out there. In some cases you will be spending some money for these ideas. Depends on what you're looking to do and how much you are willing to spend. Good luck!

Rich....did they include the functionality of credit for taxes paid to other jurisdictions? I know at one point they provided that to everyone on a trial basis at the end of the 2014 season. Maybe they lumped that into you quote?

https://www.nytimes.com/2017/04/26/us/politics/trump-tax-cut-plan.html?emc=eta1 WASHINGTON — President Trump on Wednesday proposed sharp reductions in both individual and corporate income tax rates, reducing the number of individual income tax brackets to three — 10 percent, 25 percent and 35 percent — and easing the tax burden on most Americans, including the rich. The Trump administration would double the standard deduction, essentially eliminating taxes on the first $24,000 of a couple’s earnings. It also called for the elimination of most itemized tax deductions but would leave in place the popular deductions for mortgage interest and charitable contributions. The estate tax and the alternative minimum tax, which Mr. Trump has railed against for years, would be repealed under his plan. As expected, the White House did not include in its plan the border adjustment tax on imports that was prized by House Republicans. However, it did express broad support for switching to a so-called territorial tax system that would exempt company earnings abroad from taxation but would encourage companies to maintain their headquarters in the United States. The plan would include a special one-time tax to entice companies to repatriate cash that they are parking overseas. Mr. Trump also signaled support for changes to the tax code that would help families with child-care costs. His plan also would end the 3.8 percent tax on investment income that was imposed by the Affordable Care Act. Trump administration officials called the blueprint one of the largest tax cut and broadest revamp of the tax system in history. “We want to move as fast as we can,” Steven T. Mnuchin, the Treasury secretary, said at an event in Washington as the White House planned an afternoon rollout of its principles for what it bills as the first overhaul of the tax code in three decades. “This bill is about creating economic growth and jobs.” He vowed it would be “the biggest tax cut and the largest tax reform in the history of our country,” in line with Mr. Trump’s grandiose portrayal. But there was no expectation that the White House would elucidate how the deep cuts would be financed, and administration officials are cognizant of the challenges of pushing through a proposal that could dramatically add to the national debt. If, in fact, the proposal cuts taxes but fails to close loopholes or raise some other taxes, it would not be a true reform of the tax code. It would be a tax cut along the lines of President George W. Bush’s tax measure in 2001 and 2003. Nor is it clear that it would be the largest in history. Tax cutters from Warren G. Harding and Calvin Coolidge to John F. Kennedy and Ronald Reagan vie for that title. Mr. Mnuchin offered few specifics about the blueprint, other than confirming that its centerpiece will be a 15 percent business tax rate, which would apply not only to corporations, but also to small businesses and other large owner-operated conglomerates, such as Mr. Trump’s real estate empire. He also said the White House is not on board with the border-adjustment tax that is central to House Republicans’ tax plan “in its current form,” setting up an intraparty struggle over the elements of the plan and how to offset the deep reductions envisioned. Mr. Trump also wants to increase the standard deduction for individuals, according to people briefed on the plan, an attempt to fulfill his promises to provide tax cuts for middle-income people and simplify the process of filing returns. That proposal is likely to engender strong resistance from home builders and real estate agents, who fear it would diminish the importance of the mortgage interest deduction, as well as other sectors that could see the tax benefits associated with their businesses curbed or eliminated. And Democrats are gearing up for a fight. “Trump’s latest proposal is another gift to corporations and billionaires like himself,” said Tom Perez, the Democratic Party chairman. “Trump must release his tax returns, as millions of Americans are demanding, before Congress can consider any Trump tax plan. We must know how much Trump would personally financially benefit from his own proposal.” Mr. Trump also signaled support for changes to the tax code that would help families with child-care costs. His plan also would end the 3.8 percent tax on investment income that was imposed by the Affordable Care Act. Trump administration officials called the blueprint one of the largest tax cut and broadest revamp of the tax system in history. “We want to move as fast as we can,” Steven T. Mnuchin, the Treasury secretary, said at an event in Washington as the White House planned an afternoon rollout of its principles for what it bills as the first overhaul of the tax code in three decades. “This bill is about creating economic growth and jobs.” He vowed it would be “the biggest tax cut and the largest tax reform in the history of our country,” in line with Mr. Trump’s grandiose portrayal. But there was no expectation that the White House would elucidate how the deep cuts would be financed, and administration officials are cognizant of the challenges of pushing through a proposal that could dramatically add to the national debt. If, in fact, the proposal cuts taxes but fails to close loopholes or raise some other taxes, it would not be a true reform of the tax code. It would be a tax cut along the lines of President George W. Bush’s tax measure in 2001 and 2003. Nor is it clear that it would be the largest in history. Tax cutters from Warren G. Harding and Calvin Coolidge to John F. Kennedy and Ronald Reagan vie for that title. Mr. Mnuchin offered few specifics about the blueprint, other than confirming that its centerpiece will be a 15 percent business tax rate, which would apply not only to corporations, but also to small businesses and other large owner-operated conglomerates, such as Mr. Trump’s real estate empire. He also said the White House is not on board with the border-adjustment tax that is central to House Republicans’ tax plan “in its current form,” setting up an intraparty struggle over the elements of the plan and how to offset the deep reductions envisioned. Mr. Trump also wants to increase the standard deduction for individuals, according to people briefed on the plan, an attempt to fulfill his promises to provide tax cuts for middle-income people and simplify the process of filing returns. That proposal is likely to engender strong resistance from home builders and real estate agents, who fear it would diminish the importance of the mortgage interest deduction, as well as other sectors that could see the tax benefits associated with their businesses curbed or eliminated. And Democrats are gearing up for a fight. “Trump’s latest proposal is another gift to corporations and billionaires like himself,” said Tom Perez, the Democratic Party chairman. “Trump must release his tax returns, as millions of Americans are demanding, before Congress can consider any Trump tax plan. We must know how much Trump would personally financially benefit from his own proposal.” The long-awaited White House blueprint is intended to formally begin the push to get a tax overhaul done before the end of the year. Officials have cautioned that the announcement will be light on detail and should not be viewed as the final word in what is likely to be a mammoth negotiation. While Mr. Trump has portrayed the effort as a top priority, he had no plans to appear publicly on Wednesday to roll it out, leaving that task to Mr. Mnuchin and Gary Cohn, the director of the National Economic Council, who are to brief reporters at the White House in the afternoon. The plan contrasts starkly with one that has been championed by House Republicans, who had proposed paying for their tax cuts in part with the new tax on imports, an effort to ensure that the measure would not swell the deficit. But on Wednesday, many Republicans — even leading proponents of that plan — insisted they were in broad agreement with the White House on the contours of a tax rewrite. “I think there’s 80 percent or more common ground here — we’ve got some work to do,” said Representative Kevin Brady, Republican of Texas and the chairman of the Ways and Means Committee. “I think the president is going bold here.” Mr. Mnuchin said this week that the tax changes would spur the economy to grow by 3 percent, which he said would pay for the vast cuts in federal revenues. But even Republicans privately concede that stronger growth would not entirely offset the cost. Democrats scoffed at the notion on Wednesday. “America is a great nation,” said Representative Ted Lieu, Democrat of California, “but we haven’t yet discovered magic.” He called Mr. Trump’s tax proposal “mathematically impossible.” Republicans have long called for comprehensive permanent changes to the tax code, but lately they have shown increasing openness to the possibility of tax cuts with an expiration date. If they embark on a plan to move legislation that adds to the deficit and cannot be filibustered by Democrats, Senate budget rules dictate that the tax cuts would expire after a decade. “The goal is to make it permanent, but there’s lots of levers here,” Mr. Mnuchin said. “If we have them for 10 years, that’s better than nothing.”

Have you found the ATX Planner to be accurate? More often than not, I find the estimated tax ends up being much lower than the planner originally indicated, even after all the income and deductions are reasonably estimated.

I make it a regular practice to provide my clients with tax planning for the following year. I use the tax planner included with the ATX program. Are any of you using a reasonably priced alternative that you find works better than the ATX Planner?

I agree with rfassett. He provided you with information and you spent time reviewing that information for each year from 2013 through 2016. Based on that review, you believe 2014 will have a large balance due. Personally, I would not agree to prepare only the returns that result in a refund. Since I'm aware of the entire situation, I would agree to prepare all the returns or none of the returns. May not be a good business decision, but I agree with rfassett, and would send them on their way.

I submitted my personal return this morning and my last client about 1/2 hour ago. The 2016 season is a wrap, except for a few extensions. For whatever reason, this was one of my more difficult seasons. Between the extra checklists for the Child Care Credits & EIC, and the clients missing information, it was a trying season. Maybe a lack of motivation on my part played into it also. In any event, thanks to everyone on this board for being a source of reference and a group that I have come to depend on. I sincerely appreciate all of your input and wish you an "off season" filled with relaxation. I'm sure I'll still see you around here over the summer and fall! Best to all of you!

My NJ extension form does not offer a pay by check option. The direct debit option is hard coded with an X and does not even give an option to pay by check. Any ideas would be appreciated?