BulldogTom

If an LLC is taxed as a partnership, and a 50% owner employs his minor child in the business, does the LLC still pay employment taxes? The other partner is the minor child's grandfather. Thanks Tom Lodi, CA

Thanks Maribeth.

I sent one last night, got the federal in 2 hours, still no CA. Please post if you get yours. I will do the same when I get mine. It is 5:30 PM Pacific Time on Tuesday. Tom Lodi, CA

I know what the plan is. Salary deferral, reduces income, taxable when withdrawn, no early withdrawal penalties. Dumb question - are the deferrals taxed for SS and Med? I am sure they are but can't find it in black and white anywhere. Another dumb question - which is better - 403( or 457? Does it depend on the plans? Any risk of losing your contributions? Who directs the investments in a 457? Is it plan specific? Any help appreciated. Thanks Tom Lodi, CA

Thats right! And if they give you any lip, I will chew them out for you. Tom Lodi, CA

To Kyle and Tax guy, If I had it to do over again, I might have actually taken the CPA route rather than the EA route. But I don't like auditing. It is getting better (lawsuits have a way of cleaning up an industry) but audit is alot like home appraisals, made to order. I found that to be very distasteful in the one plus year I spent working for a CPA while in college. When I was offered a position in a large regional CPA firm after college, I passed on it and took the EA exam instead. Unfortunately, our society does not do a good job of promoting its designation, and no one really knows what we do. That is why I don't support the society. On the other hand, the CPA designation brings instant credibility. @ Kyle - I love tax work. It is really cool to work with clients to get them the best result on their taxes. And I love representing clients before the IRS. It is the best part of what I do. When that letter comes in the mail and the client has no clue, and you take them through the process and get them the proper results from their tax situation, it is a great feeling. On the other hand, I don't like clients who try to use me as a pawn to cheat the government. I am not in this to help others break the tax laws, and I resent when clients try to use me for that purpose. I spend a lot of time and money keeping my skills up to date. Your comment about keeping up or getting out is right on the nose. You can't really do this half way. It will bite you in the @$$ if you try. The more you learn, the more there is to learn. If you ever want to get into this business, the best way is to work for someone else to get experience. Usually, that means one of the chains. This is the place where HRB is valuable. They carry the liability while you learn. And their teaching material and classes really are good. I took their class when I first started, and my wife worked for them for 6 years before I had enough clients to bring her into my practice. We are building slowly over time, but building steadily. Some day, perhaps in 4 or 5 years, we will be able to work at just the tax business and I can give up my day job. Sorry for the long post. Tom Lodi, CA

If I remember correctly, you put it in when you actually print the check. You process the bank product, and when they send the check print authorization, you input the check number and send it back to them when you print the check. Have not done one yet this year, but that is how I remember it. But don't trust me, I am too forgetful to be relied upon. Have a great season Eli. Tom Lodi, CA

Thanks Bob. Tom Lodi, CA

HCE (company vice president) has $1000 returned in 2008 from 2007 contributions because company testing limited his eligible contributions. I never did one of these before, but I think he has to ammend the 2007 return? Correct? Is there any way to make the adjustment on the 2008 return? Thanks for the help. Tom Lodi, CA

Even though the checkstub loans really tick me off, I have to say there is one HRB commercial that I thought was really funny. The one where the guy is sitting in his office at work and he keeps hearing tax terms. In the room next door, the boss walks by and catches 2 co-workers whispering those tax terms into to the ventilation system so the other guy can hear them. Boss - "What are you doing?" Co-Workers - " Driving Jim crazy." Boss - "He doesn't have people?" Co-Workers - "No." Boss - "OK, carry on." I thought it was funny. Tom Lodi, CA

this can also lead to some tax deduction bunching planning. We pay our Property taxes in Dec and April in our county. If I am a homeowner and I am close on my sch A every year, I could pay the Dec tax in Jan and take the Standard deduction increase this year, and next year I would have 3 tax payments (Jan, April, Dec) to increase my Sch A. Just a thought. Tom Lodi, CA

Well, let me guess, she wants a ral? Guess what, the bank will not fund it. Tom Lodi, CA

Jainen, You are supposed to be the Compassionate Liberal on this board. Why aren't you "Feeling their pain" (to borrow a phrase) and finding a government solution to their problems? It is not nice to rub it in that you live in paradise. I think the sensible thing for government to do is to ship you to Maine in January so that we all are treated equally. And don't forget to pack your surfboard! Tom Lodi, CA

Wow, how are you adding that up? Are you including the Instant RAL? Because the fees are limited to $100 plus the $30.95 service fee plus the $10 ATX Extortion Fee. On a $5,000 Regular Ral, I come up with $140.95. Of course, I add in my $19 for filing out the App and going through all the disclosures. Have you looked at all the crap we have to print and have them sign this year? What a joke. Their lawyers are working overtime. Tom Lodi, CA

SBBT contract says you can't use another bank. You sign up with them exclusively. Tom Lodi, CA

Every year I go in and modify the master billing form with the check boxes that I always want checked. You do have to replace the billing form in every return that you have rolled over prior to customizing the master. I have gotten into the habit of rolling my practice return as soon as I get the software and modfying the billing sheet so it comes through on every new return. Follow Kyles post on how to replace the invoice, it should work. Tom Lodi, cA

Nope. He is married at the end of the year, the choice is MFJ or MFS. He could adopt a kid and get HOH. Tom Lodi, CA

Good for you. We must always remember that we do this to make a profit. Remember tha about 4/12/09 when that guy comes in with a "simple return" that needs to be filed. Tom Lodi, cA

I can't believe you couldn't find a pink monkey suit to dress him up in!!!! New Commercial - ATX Software - $1,300 Office Supplies - $ 700 Picture of Kerry in a pink princess shirt and tiara - Priceless ROFLMAO. Tom Lodi, CA

This is terrible, but my first thought was "Did you get paid in advance, or are you on the hook for the work"? My second thought was, there must be an estate administrator. Even if it goes to the state to handle, there will be an estate administrator. Funeral homes are not free, they know who is paying the bills, so that would be a great place to start. My third thought was, call the IRS and let them give you advice. I don't like my third thought. Tom Lodi, CA

I think Daune is using them this year. He is a member of the board. You might want to PM him. Tom Lodi, CA

Jainen, The guy may be qualified. But you got to admit, this don't look good. Remember how your Dem friends punished the auto execs for flying to Washington in their corp jets? The press was all over it. Do I smell a double standard? What I really find interesting is the selection of Pannetta for CIA instead of one of the financial positions. He is a realistic, respected consensus builder who is known for his budgeting abilities in Congress. One of his greatest acheivements sits right across the bay from you. Cal State Monterey Bay was his working. When all the congressmen were trying to protect their military bases in their districts, he gave up Fort Ord, but got a uninversity in exchange. That is a peace dividend. I always liked Panetta. He did not play dirty with the opposition party. He respected their views and tried to work with them. So different from most of the pols in Washington today. Enjoy the beach my friend. I have heard the weather has been fantastic the last few days over there. Here is theater of the mind, Jainen on a surfboard with a backpack carrying all his code books strapped to his board. Flowery shorts and berkinstocks. Tom Lodi, CA

Jainen, you don't find it the least bit humorous or ironic that the man who will be in charge of enforcement of the US Tax Code was unable to prepare his own tax return? How about the fact that when he was audited in 2005 for the 03 and 04 returns, he did not fess up about the 01 and 02 returns that had the same error on it? He did not "pay up" until the Senate got wind of it. TWO DAYS BEFORE HIS NOMINATION he "paid up". And you think that blaming a CPA for not catching HIS error when the CPA did not prepare the return spells good news for Tax Professionals going forward? You been drinking the Democratic Kool Aid? Everything is just perfect when a Dem makes an error, because they must be good people because they have a "D" for their party designation. I respect you when it comes to taxes Jainen, but your politics amaze me. Tom Lodi, CA

I love this. The Treasury Secretary Designate failed to pay his SE tax in 2001 -2004. Somehow, two days before he was nominated, he got "tax religeous" and decided to pay up. The Dems are falling all over themselves calling it a "hiccup" and an "honest mistake". Apparently, his self prepared returns for those years were reveiwed by a CPA "who failed to catch the error". Isn't this just great. The guy in charge of the IRS can't properly prepare his own tax returns, and when he gets caught, he blames it on the CPA (that he was too cheap to hire to actually prepare the return) who glanced at it for him. This does not bode well for the next 4 years. Tom Lodi, CA

Hey, want to use my account this year? I would bet that bank only checks last names. I would not want to bank there. Tom Lodi, CA