BulldogTom

I was wondering if the client could get the policy attached to a GL policy instead of the Auto policy. Even that may be a stretch because it is still auto insurance covered under the Standard Mileage Rate. I think your client is not going to get the extra deduction for the policy. Tom Longview, TX

Waiting for @DANRVAN to answer because I don't know for sure. He is looking at this post right now. Tom Longview, TX

@schirallicpa I would hire @Patrick Michael to walk me through it. And add his bill to your invoice to her. If the client is paying you to know it all, your bill should reflect the cost of learning it all. Tom Longview, TX

IRS Commissioner Danny Werfel gave the Keynote Address at the IRS Nationwide Tax forum today. I think he is a nice guy and he is trying, but I am not sure he has the chops to make IRS an efficient government entity. 1. He was very happy to get 60 Billion to spend on his department. Some of that money is going to go to making videos with his cat to try and connect with taxpayers. Mixed message. Not sure that is how he wanted his remarks interpreted, but that is how I took it. 2. He is determined to make the IRS digital from start to finish. He says you can still do things the old way, but I think he is not telling the truth. In the future, I think everyone will have an account at the IRS and the only way to communicate with the service will be virtually. 3. He said something that struck me...They are able to find and audit lower income individuals and small businesses who cheat, but they have not been able to get the larger tax cheats. They are hiring like crazy, but I think he knows he lost too much talent to audit more complicated returns. He blames it on being underfunded for so long that they could not grow the IRS to the size it needs to be, but I think that is just his excuse to get more money from Congress. I think he will try to keep the audit rates "fair" - his words not mine, but I think he knows he can't take on the big Tax Practices that are shielding the income of the largest companies and richest individuals because his auditors don't have what it takes to win. Unless he can pull talent from the big 4 he is going to be permanently behind the eight ball on compliance at the upper levels of income. Just my opinion, not offended if you disagree. Tom Longview, TX

If so, lets meet up. I know where the best BBQ joint in Texas is located. Tom Longview, TX

Will any of you require your clients to show you proof of filing prior to filing the tax returns next year? I am thinking about it. Tom Longview, TX

Just took a quick look at the instructions for Form 3520 and it looks to me like the 3520form must be filed by the taxpayer (can't tell from the OP if you did that for them or not). Look at the instructions for Who Must File, and if your client received a distribution from a foreign trust, it looks like that should have been included in the year of the distribution. As for the trust requiring a EIN, I would probably reply to the 576A form by denying that my client is the trustee and giving the IRS the name and all information about the trustee to the IRS. Let the trustee handle that, your client should not have to deal with anything other than reporting of the distributions from the foreign trust. Tom Longview, TX

Just read a story that I could not believe. Southwest Airlines is not affected because they still use Windows 3.1 !!!! I don't know if I really ever want to fly that airline again, but right now it is the only one flying. Tom Longview, TX

What a wake up call this is for businesses. A software company that you don't even subscribe to took down the software companies you do use. Lots of questions about where we are going from here will be asked. I wonder if the US government or state governments were affected? Tom Longview, TX

Good morning. I don't touch R&D Credits. Especially for California. Anyone out here an expert? I have a client that is asking. Send me a Private Message if you are interested. Tom Longview, TX

I don't think you need the acknowledgement from the charity. I have always assumed that the trustee of the account is checking the validity of the charitable organization's 501 c 3 status before they set up the distribution. That may be wrong but that is how I always thought about it. The 1 client I have who set up a QCD at my suggestion has never sent me a donee acknowledgement and the amount is significant. I have just entered the info from the 1099R and went on. Tom Longview, TX

Following up on Lee's reasoning, if he has an HSA insurance plan, it becomes tax free if he uses HSA funds to pay for the medical costs not covered by his insurance. It isn't a business deduction, but tax free is still a good result. Tom Longview, TX

Off topic, but I am going to post anyway.... Remember several years ago when some magazine rated ATX very high right after it was purchased by CCH and some of us on this board and the other official board lit up his email to disagree? If I remember correctly, he went on the official board and asked us to please stop emailing him about how bad support became under CCH. Your back and forth just reminded me of that event and made me smile. I wonder if that journalist still puts his email and an invitation to reply at the end of articles he writes? Tom Longview, TX

This was my line of thinking as well. However, I don't know how that fits into his estate plans, as he is in his 70s. Lots of possibilities... Tom Longview, TX

A friend of ours who we square dance with asked me this question. The square dance club he is a member of is an Exempt Organization. He is the president of the club and a director for the EO. They currently rent space to dance in from another EO. The EO that they rent from is trying to sell the building and property, which means the square dance club will not have a place to dance every week. Our friend is considering having the square dance club purchase the property, and he will personally finance the acquisition, taking a note from the club on the building and land. In order for the Square Dance club to make the mortgage payment, they will need to rent the facility to unrelated parties for events. When I read §514, it appears that since the property has a mortgage on it, the EO would have to include the rents from unrelated parties in UBTI? But if they did not have a mortgage, it would be exempt from UBI? Am I reading this correctly? Tom Longview, TX

Same potential client as my other post...just a different question. The seller has not filed a BOI report with FinCen because it is not required until 1/1/25. If my potential client buys the company, do they have 90 days to report or are they still under the coverage of the existing company and have to report on 1/1/25? Does the §338 election make any difference. Of course the new corp that will be formed to purchase the target S Corp will have to report, but will the acquired QSUB have to report in 90 days? So many questions, never enough time to research. Tom Longview, TX

Just did some reading on §338 elections. Very interesting. Nice of congress to let you do a stock sale and record it like an asset sale. Made sense why it is allowed when they gave some examples. If I understand it correctly, the acquired S Corp becomes a Qsub of the purchasing S Corp? And the purchasing entity cannot be an LLC taxed as a corp, it must be a corp? Tom Longview, TX

Depends. The company does not have a lot of assets and the ones it has do not have a lot of depreciation on them. I don't know if they can make a §338 election or not, and I really need to read up on that tonight. Like I said, this may be one I can't do... Tom Longview, TX

My potential client is the buyer. I know the seller and I would never represent that individual. He has his own team of lawyers and accountants but I think he only consulted with the lawyers. I understand there may be "phantom income" for the seller with no recourse if the transaction goes through as it has been explained to me. My potential client has the opportunity to push 50-60% of their income onto the seller's K-1 and I don't think anyone but me knows that this is the outcome they will get from the transaction they propose. I have read about this, but never done a return that has this type of a transaction. Tom Longview, TX

100% owner of an LLC taxed as an S corp is contemplating a sale to 2 employees. Transaction to take place in July. Structured as a stock sale. New owners will continue operations as if nothing changed (but a lot will change). At this point, the LLC is break even, but they are coming into their most profitable months of the year. Anticipate profits for the year. I understand that the company can either "close the books" or they can allocate the income and expense based on percentage of time shares were owned. Right now, it appears they don't want to close the books. Assuming the transaction is structured as stated (which is not certain at this point), how do you make ATX allocate the K-1 items for the year in ATX? I have a zillion more questions for the potential client... Tom Longview, TX

I looked around on my lunch break for some guidance and did not find any either, but it was not an extensive search. If it was not part of the larger financing plan going in, I would not have a problem amortizing over 12 months, but something is tickling the back of my brain that it needs to go to the basis of the property, and I don't know why I keep leaning that way. Like it is part of the construction costs. I just can't put my finger on the rule that is leading my thoughts that way. Tom Longview, TX

Agree, but my question is: Are the other costs capitalized for 1 year? Or are they part of the larger financing package and added to the closing costs of the permanent loan? Or are they an addition to basis and capitalized over the life of the asset? Tom Longview, TX

My email works fine on my laptop. Same setup as my desktop. All three email accounts on my laptop show the server settings as mail.att.net. Very weird. My thought is I need to generate a new secure key because of the change in server settings on the desktop. Like the server sees that there was a change to my settings and deactivated my secure key. Does that sound right to any of you? I am grasping at straws... Tom Longview, TX

Yesterday afternoon I sent an email. No issues. About 5PM I got an email. At 7PM or so, I went to look at email and I got an error message and nothing would send or receive. Looked at my server imap & smtp settings and they were changed from mail.att.net to mail.yahoo.com. This happened about a year ago and I was able to change it back to mail.att.net and it worked fine. This time, it is not working when I changed the server settings back to att.net. Any suggestions? I really don't want to call AT&T support. I think I am going to have to. Tom Longview, TX

I have QB Desktop Pro 2003. I have the CD (which means I need an external CD ROM drive to load it). When I bought the software, Intuit support gave me the install and registration codes. I kept the license agreement from when I bought it that says I can load it onto every computer I own. I never update it. The software is the same as the day I broke the seal on the case. Before I load it on a new computer, I turn off the internet connection because the first thing the program does is go out and look for updates. I turn off the automatic updates and then turn the internet back on. Since I don't use it for payroll, I have no need to update it. The software is bulletproof so I never need support. I feel like I got one over on Intuit, and it makes me smile... Tom Longview, TX