Lion EA

If you're also asking about Forms 1099-MISC, that law got undone before it became effective. Schedule E types do not have to send 1099-MISC to their vendors. I used to urge my landlords to send 1099s to have a better paper trail. Currently, I don't think I have anyone with a Schedule E Page 1. Isn't a sale of a rental home a 4797 transaction?

I would pay the penalty IF I made an error. I would not pay interest since they had use of the money. HRB would send them a Form 1099 for paying on the client's behalf. So, I would suggest a discount on next year's tax prep fee (or free) instead of paying the penalty. And, if I had any doubts as to what the client gave me, as you do, then I would offer a percentage of the penalty/discount on next year's fee. I would also fire this client (after next year, if they return to claim their discount) unless their attitude changes. We're all human. Both your client and you. There was only one perfect human (or at most only one perfect human, depending on your beliefs) and we crucified him. I'm not scanning nearly enough. Really need to scan everything.

I'm going to charge an amount that's fair to me for my time and effort learning about ACA for those new forms. And, I might raise the amount I charged last year for the then-new NII forms. I might even raise prices for anyone who sends me tax information after a certain date, maybe 15 March, whether or not I put them on extension.

Isn't is current plus two prior years for e-filing?

The EA requirement is over a three-year cycle: something like 72 hours over three years with no less than 16 per year and 2 ethics per year, don't remember if the 2 is included in the 16. I don't pay a lot of attention to that as I belong to NAEA with their 30 per year requirement. And, basically, I take the courses I want and need and don't worry about it as I'm always over. This year I'll have around 40 with credits plus a seminar that gives credits only to CPAs but has topics I want for another 24 or so that I won't receive credit for as an EA and not CPA.

It depends on how swamped I am (am I having computer problems, a respiratory virus, etc.) and how messy I think their returns will be (did they already tell me wife started a business, are they always basis-challenged) whether or not I contact them in any given year. Did they finally give me 2011 and 2012 this summer? Then, I'm not going to chase them for 2013 and rush to finish 2013 on time when they've been late the last couple of years anyway. Are they new and waiting on K-1s and I want/need to show them how concerned I am over their timely filings? I do a lot of handholding. So, the ones that are nice to deal with will probably get a call/email from me trying to get their info by 15 September. I have a couple of PITAs that I won't spend more time on. If I get their documents after 15 September, I will tell them I do NOT guarantee and ask them if they want to take their business elsewhere. Had someone who now has mother's POA and gave me her 2011 and 2012 stuff 14 April 2014 when I already had a stack of 2013 extensions that have a chance of being on time. Mom's stuff had not risen to the top of my stack when son contacted me while we were at my husband's family reunion for five days in MA in August. He wanted returns completed that week while we were away. Mom is so nice, that I would've prepared her returns as soon as we were home. His threat "If you are unable to finish them this week...I will have to move in a different direction." was the last straw. I love his mother, but he's been a real pain since he first started hinting at taking over his mom's finances and moved her out of her house. I wrote back, "I am in MA on family matters and hope to be back at work Monday 21 August. I understand you will move in a different direction this week. My best wishes to your mother and to you." He's in CO and gave me almost nothing re his mother's taxes except a verbal total of capital improvements to her house that sold. I uploaded everything to my portal, and he took it to his CO business CPA firm. I'll continue to visit his mom and talk about Westport Country Playhouse, but I didn't want anything to do with him. Two trusts and mom's personal return off my stack. I really didn't charge her very much as she'd been with me for years and years, sent to me by my broker who sends me lots of clients. So this is the time of year when I decide if they're worth my time!

I'm working on lots of returns. But, my problems are the phone calls: I need a copy of my return for my mortgage company today! The IRS is going to have me arrested in an hour! Are you done with my return yet? I just have a quick question.... RIght now I don't have any questions, but I could use another tax preparer. A couple of new clients (such as a trust and a couple in Singapore for two years) so will have queries, I'm sure.

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You used the right word: Commuting. Commuting is not a deductible employee expense. His business home is Baltimore. We taxpayers are not going to subsidize his decision to live in Charlotte.

Do the medical expenses have to go over the 10% to be used to qualify for the exemption from penalty? I know you can use medical expenses even if you do not itemize. Probably worth going to the IRC to find out. And, how about their annual statements? Is there an information page at the end that has contributions for current year, for prior year? If the client won't search further, and you're talking about less than $1,000, I'd probably stop nudging them and just complete their returns also. Only $250 has got to be a small price to pay for peace of mind while awaiting a baby! Good luck.

If it's taxable, and it sounds like the $2,500 might be, it's also subject to the 10% unless one of the exceptions applies on Form 5329. Maybe # 05? But, per The Tax Book: "For a distribution from a Roth IRA to qualify for tax-free treatment, the distribution must be made after the 5-year period...Reg 1.408A-6,A-2." It would certainly help if your client tracks down those forms the plan administrator sends out each May detailing contributions. ($2,500 seems like a lot of earnings on only $3,000 in a down market.) And, any conversions have their own separate 5-year periods.

Didn't I see his video for the ALS Ice Bucket Challenge?

We have a couple of clergy experts on here, so hopefully they will jump in. His W-2 should have only pay taxable for income tax purposes in Box 1, with employer or pension giving him a letter or put his housing allowance in Box 14 so you know the amount to add to his Form SE. (You probably know it's LOWEST of amount designated in advance, FRV furnished, and actual amount spent.) Also, no Boxes 3,4,5, or 6 for active clergy. Not sure if clergy have any special conditions when qualifying for various credits. If this will be ongoing for your continuing Admin's son, Richard R. Hammer writes an excellent book on clergy taxation, the son's denomination probably has great resources available, and William F. Geisler out of San Anselmo, CA, is an expert.

Two Ritas also agree on that. (And, I have letters after my name, such as EA, MBA, and OLD LADY.)

Well, 2010 was an oddball year. So a little confusion re a 2011 DOD is understandable. Blame it on the changing tax law, and remind them that no one's perfect. Forcing 2014 into your 2013 software, because they were in a rush. You'll fix it now. Blah, blah, blah. Say it with a sincere face and offer them a discount next year (or this year if they haven't paid yet).

Two Ritas agree that traveling to work is commuting, no matter where the pay is issued from. It's really a slam-dunk if he has only one place of work -- commuting. As you say, there can be dozens of alternatives if a second workplace or temporary assignment or...come into play, but that's not what you posted. Commuting.

The decedent did not reside in the house after death. (I hope!) The estate never resided in the house. Did any of the beneficiaries reside in the house? The house was not a personal residence after DOD, unless one of the benes moved in. No personal residence exclusion. Was the house rented for profit? Step up or down. Inherited = long-term capital treatment.

Just a baby, Kerry! Happy Birthday!

I used the Edison quote while raising financial support for my church's volunteers (including me!) to Appalachia Service Project.

MASEA included the following in today's e-newsletter: IRS Warns Of Increasingly Pervasive Phone Scam The Internal Revenue Service is warning people of a sophisticated and aggressive phone scam targeting taxpayers, including recent immigrants. IRS officials said people have been reporting the aggressive phone scam over the last several months, and victims said they're being threatened with being deported, arrested, having utilities shut off or having their driver's licenses revoked. The callers are frequently hostile and insulting, which is a way to scare their potential victims, the IRS said. IRS officials said they will let people know by written notification by the U.S. mail if you owe taxes, and the IRS would never ask for a credit card or bank account number over the phone. The State Attorney General in Connecticut has also recently stated that these types of phone scams have become increasingly pervasive over the last several months. Scam victims are encouraged to report calls to the Treasury Inspector General for Tax Administration.

I won't efile a return I haven't prepared. But, if she insisted, I'd probably have quoted her a really high price so she would be the one to decide not to continue. I think $250 is fair or low. You're better off without a control freak. Be relieved.

This has been a great update on this topic. Thanx, all.

I was at a meeting with 12 tax preparers around the table yesterday. More than one had had client calls recently about "IRS" calls.

People will forget what you said, People will forget what you did, People will never forget how you made them feel.

Thanx, folks. Since coming to me (a referral from a good client) they did not have a refund and were under-withheld enough I don't think the innocent spouse would've had a refund with or without her husband. But, she has a new job and new withholding as of mid-2014. And, nothing had left his Schedule C bank account so did not benefit the family. She was thinking about prior years, and I didn't look at those as thoroughly as I now wished as it was during the crush of tax season. I'll start with the innocent spouse instructions and go from there...