Lion EA

Oh, I move scans to my computer immediately. But, I know clients that've taken pictures on their phones to send to me (or their mortgage company or their broker or...) and never delete them. So, I use the limited-time storage to remind them to get the pictures off their phones after they've sent them where they need to be. They're the same people who don't delete emails from their phone, don't delete texts, etc.

Tell your clients to get FREE Scannable on their smart phones. It takes great pictures -- straightens, gets rid of creases and gray, etc. The free version stores documents for 30 days on your phone, so you do have to move docs to a folder on your phone, or backup to the cloud or your computer or where ever you backup, or to a folder on your computer, or send it straight to your tax preparer before you lose it.

Newest temp regs say you DO need to take annual RMDs from inherited IRAs and then the remainder by the end of year 10. Prior, but still very new, regs said take any amount(s) in any year(s) or none at all as long as entire account is emptied by the end of year 10. So, those that inherited in 2020 and 2021 may have some prior year RMDs to take. Or extend 2021 to see what happens with March's proposed change. It's so hard to keep track.

If your PTEs polled their partners or shareholders and have no requests for K-3 (or you prepare the individual returns and know), then the PTE does NOT have to prepare K-2/K-3 for 2021 only. If you DO have to prepare for one or more, extension. Sounds like we'll be preparing for all for 2022.

If he meets all the qualifications to claim himself, doesn't he meet all the qualifications to claim the RRC3? Is his income too high for the RRC3?

Lots of drop offs earlier than ever. Huge HOLD stack on my floor for missing info, waiting on IRS/software (did you read about the March change to inherited non-spousal IRAs?), or just need to re-proofread now that that last schedule/form is finally in the software. I'm buried but very, very backlogged.

If his parents (or anyone else) do NOT QUALIFY to claim him as a dependent for 2021, and he meets the other requirements, he can claim the $1,400 Recovery Rebate Credit #3 on his 2021 return. If his parents DO QUALIFY to claim him but DO NOT CLAIM him, he DOES NOT QUALIFY to receive the $1,400 RRC. Was he a student for any part of any five months in 2021?

Will his tax home be CA?

I see clients who received the substitute 1099-S with a stack of papers at closing, stuck the whole stack in a drawer, and are sure they never receive it. Of course, I report the sale.

Making a change to tax returns during tax season! Just like the federal government.

https://support.cch.com/kb/solution/sw37113?language=en_US

I am still unclear. Are you saying the estate owned the house, and the estate sold the house in 2021? Or, are you saying that the house passed to the three heirs via will in 2018, and the three heirs sold the house in 2021?

All of us here will want to pick your brain!

Yes, step-up to DOD FMV. But OP doesn't say when was DOD, how long the estate owned the house. Just that there was no activity in the estate until 2021 when the house was sold. We don't know how much appreciation since DOD.

An estate doesn't have a primary residence, so no 121 exclusion. An estate has relatively narrow tax brackets, but if the estate sold the house, then that's what it is. It does save any bad feelings due to one beneficiary being in a higher tax bracket than another beneficiary. You'll want to check the will and the laws of the state.

I have NOT taken this instructor's classes, but for anyone frantically trying to get 1065s and 1120Ss out the door in the next 11 days... Expanded from 1 to 2 Hours. March 8, 2022 - 3PM ET Live 2-hour Webinar: Schedules K-2 and K-3 Knock 2021 Form 1065 Out of Orbit How to Prepare (or Not) K-2 and K-3 for 99% of Clients Presenter: Bradley Burnett, J.D., L.L.M. https://accountantsaccelerator.com/schedules-k2-k3-cpe-course/ NASBA Sandra L. Leyva, Inc. is registered with the National Association of the State Boards of Accountancy (NASBA) as a sponsor of continuing education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Our NASBA sponsor number is 112525.

I can't get the CA 3849. Program keeps generating CA 3853 instead.

If necessary, short-year 990 and short-year 1120. Extend both.

Is he a US citizen/green card holder? I know a couple of the answers. He DOES pay SE tax (can exclude only income tax.) He can take the FEIE OR the FTC, but not both; you'll have to look up the income ceiling on the FEIE. You probably deal with more US citizens moving out of the US than I do. (My one family of citizens living/working in Singapore qualified for AOC for one daughter going to college in the US, but the other daughter attended a non-qualifying school in Europe for a couple years before transferring to a qualifying college for her junior year.)

I asked for them all. I have only 4 partnerships and S-corps and prepare the personal returns for 2 of those businesses that are H/W only and work closely with the personal preparer for a single owner S-corp and know the H/W for the 4th, but don't prepare their personal returns. I did NOT have the 2021 personal information for any of the individuals when I began the biz returns. I knew at least 3 out of the 4 businesses (suspect all 4) had owners with foreign taxes paid in 2020 &/or 2019, but not over $600; but did not know their 2021 personal situations at the time I needed to start the biz returns. I gave the double-letter forms from Compass Tax Educators (biz version plus individual version) to each biz and asked them to survey their owners (themselves) and touched base with individual preparers for those where we work as a team. All 4 businesses returned signed letters from the biz and from each partner or shareholder. I did begin the biz returns prior to the most recent notice. Don't know how I'll feel next year. But this year I wanted to cover my butt, and those businesses, owners, and personal preparers, too.

C-corp returns are due 18 April unless a fiscal year filer.

Tom's class is about 15 minutes with two of them discussing the Forms K-2 and K-3. Then, when the most recent Notice came out, he/they did a 10 minute update. Look for the links at the Compass site: https://on-demand.compasstaxeducators.com/

FOUND THE OTHER VERSION I HAD FROM ANOTHER CLASS. DON'T KNOW IF THIS WAS MARC'S. Schedules K-2 and K-3 Client Statement Owner Name:-----------------------------------------------Owner SSN: Partnership Name:__________________________ Partnership FEIN: The IRS has instituted 2 new form requirements (K-2 and K-3) comprising 39 pages of disclosures that could double or even triple your company’s tax preparation fee. These forms are not required if your partnership or S-corporation has no foreign activities and if the individual partners or shareholders are exempt from filing IRS Form 1116 (Foreign Tax Credit) with their 2021 individual Form 1040. I you do not acknowledge that you are exempt from filing Form 1116 with your 2021 Form 1040, we are required to complete these new forms and your fee will increase dramatically. IRS Notice 2021-39 allows us to rely on a good faith safe harbor of your statement that you do not personally have to file IRS Form 1116 with your 2021 individual Federal income tax form. If you are not required to file Form 1113 with your 2021 individual Federal income tax return, please sign below. Please reproduce and have all other owners individually sign as well in order to avoid our required filing of Schedule K-2 and K-3. “I confirm that I am not personally subject to filing Form 1116 (Foreign Tax Credit) with my 2021 individual Federal income tax return Form 1040.” Signature of above individual:___________________

Email me and I'll attach the one I'm using for you. (Too large, it tells me, to upload here. And, it loses its formatting if I just copy the text.) If I can find the other one which is shorter, I'll include that, too. RitaLewis @DollarsSense.com

Compass Tax FREE on-demand course by Tom Gorczynski includes sample letters. Marc Dombrowski also presented something on this issue, but I can't find it now.