BulldogTom

quit picking on the ed credits! My oldest just finished his first semester. I was working on my own return today and was very happy to see the credit. I have 7 more year to collect on that credit. Leave it alone! Tom Lodi, CA

To all of you who are fluent in Church issues, and in CA payroll. I know that in CA you have to pay an exempt employee 200% of the minimum wage. Are church employees exempt from this rule? What if their duties are only part time? Can they be paid once a month? Here is the scenario. Our church has 3 employees. All are paid a salary once per month for their services. Employee 1 is the secretary and she comes in 3 days per week for 4 hours each day. Employee 2 is the custodian who is given freedom on when to come in, but generally works one day per week. Employee three is the treasurer who comes in 1 day per week generally, and works a little more on the quarterlies, year end, w2's, etc. None of these employees earn 200% of the minimum wage. Is the church OK under CA law? Thanks Tom Lodi, CA

I like Depreciation Calculator from Cellutionware Software. It is like $400 to get it and it cost about $190 per year for upgrades and support. Kinda weird that they only talk to you via email. No phone calls. I have used that software for about 15 years and it is good stuff. Prints out reports that look just like CCH printed them out. Book, Tax, State, and AMT calcs. Groups and locations. I really like the product, and I think it is a steal fro the price and what it does. But it does not run on a network, and they have no plans to make it do so. Hope this helps. Tom Lodi, CA

Hey Eli, Wishing you and yours a very Merry Christmas. Tom

I am deleting my prior post. Tom Lodi, CA

At my day job, we have been offered an opportunity to expand into Texas. Our company was there years ago before I was on staff. Is anyone an expert on Texas Business and Payroll taxes? I am just looking for a place to start. I assume that there will be a business registration of some kind. Since there is no state income tax, there is no withholding, but that does not mean there are not state level PR taxes. Any help is appreciated. I will be surfing the State of Texas websites for the next couple of days. Tom Lodi, CA

I have a client (mfj) under audit for gambling winnings in 2009. Their documentation is a little on the light side, but there is enough to reasonably reconstruct the facts. We fully expect the client to go to tax court because the correspondence audit is not going well. The wife had a gambling problem and it is her SS# that the winnings are under. They filed MFJ for 2009. The wife died on Tuesday. I am totally blown away by this very unexpected death. These were friends before they were clients and she is not much older than my wife. Her daughter attends my church youth group with my kids. How does the spouse continue on to Tax Court when the Notice of Deficiency arrives? This is a new one on me and I really don't have a clue how to proceed from here. Does the surviving spouse sign everything and attach a copy of the death certificate? Can he testify to what his wife would have testified to had she lived? Can they even proceed without her? I had a very clear strategy in mind for this case, but it depended on the wife testifying about her gambling problem, which she was willing to do. I need to come up with a new strategy, but as I said, the documentation is a little light. They don't have any money, and I am not sure they have enough to pay for the funeral, let alone taxes on phantom gambling winnings. Any thoughts would be appreciated. Tom Lodi, CA

Medlin is correct on the CA issues. Client cannot hold terminated employee checks till payday. Immediate payment if you fire them, 3 days if they quit. They made the payment on July 5, not 6. That was a typo. "Every other Monday" is the next business day for the "every other Friday" pay date, and every pay date is a 100K liability. They have the money to pay. Client just pulled out from a major payroll processor and brought the payroll in house. Never did the PR taxes. This is the first 941 and the PR manager is not the best at PR, let alone taxes. They have a really good payroll person in house for processing the checks. They are happy with that part but struggling to get the taxes. They just thought the software would spit it out for them. But the numbers are not coming out to their deposits. In playing with their software a little bit, it appears the tax deposit reports can be run on Check Date or Period End Date, and the client has not been consistent in the dates that they have chosen. I think that is what is causing the biggest part of the issue. Thanks for putting me on the right track. Found some more info in the Circular E. Appreciate the help. Tom Lodi, CA

Looking for some direction please. Potential client is a next day depositor. Bi-weekly payroll liabilities in excess of 100K. 500+ employees. Pays his taxes every other Monday. Last Payroll of the quarter was on June 17th. Next PR was on July 1. From June 18th to June 30, he cut several manual checks for terminated employees and miscellaneous reasons. Totals about 4K in liabilities. Paid those taxes when he deposited on July 6th (next business day) with his regular PR. Here are the questions: 1. Because he is a next day depositor, does he have to deposit for every paycheck he cuts outside his normal cycle, or is it OK for him to pick up all those small checks with his next payroll? 2. On his software, the Schedule B is showing those liabilities for the quarter on the day the checks were written. But the payments were made in the next quarter with the payments for the July 1 PR liabilities and coded to the 3rd Qtr in his online payment. Shouldn't those have been split out? How to fix if this is wrong? Thanks for your assistance. Let me know if the facts are not clear? Tom Lodi, CA

Thank you Billy. I was all over in Circular E and Pub 15B and could not find it. Never thought to look at the instructions for W2. Duh. Tom Lodi, CA

Our company started offering education assistance to employees. Are these payments required to be reported on the W2? Is it a box 14 entry? Thanks. Tom Lodi, CA

Last year there was an article I read that the IRS would allow preparers to deduct their fees from the client's refund without going through a bank. Has anyone heard anything about this recently? Thanks Tom Lodi, CA

LMAO. That is a keeper. Tom Lodi, CA

Do not let the deadline for filing pass by. There is NO GOING BACK after the date has passed. Your client needs to file the tax court petition on time. The case will automatically be referred back to audit for resolution. You should file your POA and make sure you are getting all the correspondence that is going to your client. Call the IRS and get documentation into their hands right away for the claimed deductions. They will be happy to talk to you, but once the time has run to petition the tax court, you won't get anywhere at all. The information that you rely on is the Code, regulations, and tax court cases. You need to specify where the commissioner has erred in his application of the tax law and show the evidence that backs up your claim. Good luck. Your client needs help, desperately. You should be there for them. If you are uncomfortable with handling this case, engage a seasoned professional who has done this before to walk you through it. It is money well spent on your education. Tom Lodi, CA

Bonnie, are you saying you are not a back seat driver? Somehow I just don't believe you. Congratulations to your son on this accomplishment. Tom Lodi, CA

Seminar for my day job. All week. It is nice to get away from the office, but I think I am getting ready to go home, and I still have 2 days of classes to go. Staying at the Gaylord Texan in Grapevine. Tom Lodi, cA

On line 21, I think you could list the last three in the other section of the entry page. There are some blue boxes there. ATX should then print "see statement" on line 21. That should get you through the e-file barrier. Tom Lodi, CA

KC. I am praying for you and yours. I am in Dallas and everything is about tornadoes and thunderstorms. The damage on the TV is incredible. May God keep you safe. Tom Lodi, CA (Dallas this week)

And the escrow company might have put it on a Form 592B instead of a 593. This is just another way the Republik of Kalifornia borrows money from taxpayers without paying interest. Tom Lodi, cA

Unless the Due Date of the 2007 return was 4/18, I think your client is SOL. The statute is 3 years from the due date of the return. I don't think you get the extended due date on a claim for refund. I think it had to be postmarked by 4.15.11 Maybe someone more enlightened than I could chime in, but I think the statute has run. Tom Lodi, CA

Did Jerome do your taxes? You know he is very smart. Tom Lodi, CA

I replied to your PM. Guess you didn't get it. What you have is withholding on a real estate transaction. Your client should be getting a form 593 from their Escrow Company. When you fill out the CA 540 NR, go to Line 83 (I think) and bunny hop to the worksheet. At the top of the worksheet there is a blue box with a drop down menu for the 593 form. Fill it out and it will flow back to the 540NR. If your client does not have the 593, have him call the Escrow company. They are notorious for screwing these forms up, so check both the 593 and the settlement statement. Let me know if you have any other questions. Tom Lodi, CA

Just sent you an e-mail. Let me know if you still have questions. Have a great weekend. Tom Lodi, CA

I found a thread on the ATX site and ATX is not supporting 2007 and 2008 on windows 7. Only 2009 and 2010. I wonder how long they will allow XP Pro for future versions. I can get some new XP Pro computers, but I don't know how long until CCH forces us to move to Win 7. If I could go 5 more years before I have to switch, I will stay with XP. Tom Lodi, cA

Thanks. Silly me, I went to the ATX (non)support site for system requirements. I should have known that potential marks (I mean customers) will get better information than is on the (non) support site. Thanks again. I appreciate it. Tom Lodi, CA