JohnH

Here's a link to their ESA. Their paperwork says on page 8 that contributions are not tax deductible. http://www.timothyplan.com/Annuities/frame...s-education.htm Michigan allows deductions for contributions to Section 529 Plans, but not ESA's.

I file extensions on all 1120S returns, even those I've already completed. Too many ways things can go wrong.

If you don't file a return and it's later determined that one is due, there could be a penalty of $85 per month per shareholder with a maximum of 12 months. I don't see any exception in the rules for "no activity" returns when the corp still exists, and it would be very hard to explain a $1,020 penalty to the client. Not sure I'd want to take that chance.

That's odd. I just checked my NC Sales Tax Report for a client, which is filed monthly. I opened another report, renamed the tab, entered Jan for the month, closed the client, and reopened. The Jan tab still showed a Jan report and the Feb tab showed a Feb report. Either there's something different about the way the system handles the NC reports or there's been a change in the way the system handles the multiple tabs since you last tried it. (I also looked at the "Preferences" but couldn't spot anything that addresses this). I just print paper reports for my files and don't use the feature I described, but I was fairly sure it worked this way because it never automatically updates my 941's when I open them for a new quarter. Follow-up: Maybe mine works differently for some reason because I use Zillion Forms as a separate module.

You could also open the form repeatedly in the same client file. The software will prompt you to append the name of the second and successive forms, which would enable you to name each quarter separately. This will enable you to keep the separate quarters in the return manager for a given client.

Everyone is glad to be of help...

Here was an interesting discussion about the general issue. Looks like there's no clear guidance, but the issue leans strongly toward no deduction. http://taxprof.typepad.com/taxprof_blog/20...uctibility.html

(I borrowed this from a comment posted on a news article. It didn't give attribution so I don't know where it originated) New Element Discovered! Lawrence Livermore Laboratories has discovered the heaviest element yet known to science. The new element, Governmentium (symbol=Gv), has one neutron , 25 assistant neutrons, 88 deputy neutrons, and 198 assistant deputy neutrons, giving it an atomic mass of 312. These 312 particles are held together by forces called morons , which are surrounded by vast quantities of lepton-like particles called peons. Since Governmentium has no electrons, it is inert. However, it can be detected, because it impedes every reaction with which it comes into contact. A tiny amount of Governmentium can cause a reaction that would normally take less than a second, to take from 4 days to 4 years to complete. Governmentium has a normal half-life of 2 to 6 years. It does not decay, but instead undergoes a reorganization in which a portion of the assistant neutrons and deputy neutrons exchange places. In fact, Governmentium's mass will actually increase over time, since each reorganization will cause more morons to become neutrons, forming isodopes. This characteristic of moron promotion leads some scientists to believe that Governmentium is formed whenever morons reach a critical concentration. This hypothetical quantity is referred to as critical morass. When catalyzed with money, Governmentium becomes Administratium (symbol=Ad), an element that radiates just as much energy as Governmentium, since it has half as many peons but twice as many morons.

I love it! Another option would be to at least give us until Tax Freedom Day - that's the first day of the year you begin earning money for yourself. Up until that point everything you've earned goes to pay your cumulative tax burden for the year. Depending upon what state you live in, that date can be as late as May 7 or 8. Of course, if you move to Sweden or Norway, it doesn't arrive until the end of July. I hope we aren't headed in that direction in the US.

Kerry: I don't agree with your subtitle ("Im not as smart as I thought..."). A person is at their smartest when they know they need help and they follow through by asking for it.

How much for asking the SAME #*^%* QUESTION they've asked, every year, for the past 10 years? "Why can't I write off my gas receipts AND my mileage?" "Why can't I claim my car as an office since I work out of it all the time?" "Why do I have to keep a mileage log? My brother in law doesn't keep one." Sometimes it's tempting to adopt the billing practices of Thernardier, the innkeeper in Les Miserables: "Charge 'em for the lice Extra for the mice Two percent for looking in the mirror twice Here a little slice There a little cut Three percent for sleeping with the window shut"

Speaking of plans, keep in mind the old military axiom - "No battle plan ever survives initial contact with the enemy."

If you work with Excel, it's easy enough to design a simple spreadsheet to allocate the income & expenses. It would probably take 10-15 minutes to design one to mirror the relevant lines on the Schedule C, then save the template for future use. One thing I'd do is insert a field to calculate the percentage on each line, just in case you needed to depart from the 50% for a particular line in a given situation. Most of these split C's would only have 10-15 entries, so transferring the info from the spreadsheet to the individual C's wouldn't be much of a hassle. Obviously not as handy as cheking a box, but since that isn't an option it's time to solve the problem another way.

Add NC to the list. Nobody bothered to prepare for a cash shortfall (guess our finance people don't read the newspapers & didn't know tax revenues would decline), so now they're saying tax refunds will be "delayed a little bit".

CHAIRS!?! What are you doing with chairs? If you put these things in your office, people will think they're supposed to SIT in them! Buy an old park bench - the type with the wooden strips running left-to right and the downward taper on the front that makes you feel like you're sliding off when you sit forward. Then break out one or two slats in the middle so people are forced to sit near up the front edge with their legs spread to maintain their balance. Short wooden church pews with the straight backs work pretty well too, but just remember to remove the cushions. But if you have to work with chairs, stack the tax files so high that they look like they're about to fall over. That will prevent some enterprising client from picking up the stack and trying to balance it in their lap while they sit in the chair. Just be prepared to explain why one or two of them can't deduct their hernia operation because it doesn't put them over the 7.5% threshhold.

Tom: Yes, you are reading it correctly. Everyone is a monthly depositor except those who have been notified that they must deposit more frequently based on the "lookback" period. The $2,500 per quarter exception is an out if the employer meets that test, but they have to track whether they are likely to exceed it by the end of the quarter - if they do go over then the penalty applies retroactively. If your client uses payroll software, then it will give her the correct tax deposit amount each month. She just needs to follow through and make the deposit. It's a nuisance, but it's either that or deal with the penalty monster. If she is doing payrolls manually, she can run an estimate of the FTD each month and deposit that amount. In this case I recommend that they round up by $50-$100 or more each month and then adjust the third FTD to the actual remaining amount due in the final month when they prepare the 941. There's no penalty for over-depositing and the cushion helps keep them out of penalty territory.

I saw this completely differently and I think it's a great idea. The clients who keep their mileage records and contributions written on my ceiling won't have to squint as hard since the info will be closer to their eyes. I'm starting work on the project tomorrow.

It will help some people, but for others it will be nothing more than smoke & mirrors followed by a bill at the end of the show.

I know. It's all so confusing sometimes, isn't it?

Since the question has been answered, I'd like to pose a follow-up. I'm forever getting a citation from the PC Police for one infraction or another, but is it OK to use the term "maiden name" without ruffling some feathers somewhere in the PC crowd? :)

It can be done in NC. Sometimes the standard of proof is a little higher for an owner/shareholder, but as long as they are legitimately without work they have the same right to collect unemployment as any other employee.

After checking the box on 39c, take the bunny hop beside line 40 to the "Ln 40-Stand vs Item" worksheet. Then check "Yes" on Line 7. That will pull the entry from Schedule A and add it to the standard deduction.

Would you really want to adjust the estimate based on the $2,400 exclusion of unemployment income? I think I'd ignore it when calculating a 2009 estimate. When people collect unemployment compensation, they frequently wind up earning small amounts from other sources, most of which withhold no income tax (if anything). In all but very special cases, I'd be inclined to assume it's all taxable for estimating purposes in order to avoid ugly surprises next year.

There is a silver lining here: These politicians are actually conservatives at heart with respect to their real-world viewport regarding taxation. Insofar as their own households are concerned, they recognize that THEY are better able to allocate their financial resources than the government. Therefore, they do whatever is necessary to put those policies in place on an individual level by keeping more of it and sending less tax money to the Federal government. Now, if we can just convince them to apply their personal financial insights to public tax policy, we can make some progress.

In any ambiguous situation, I've always understood that the general priniciple is you should take the loss on the earliest possible return. This guards against the possibility of losing the loss in a subsequent audit, where the auditor finds evidence that the loss should have been taken in an earlier year and that year is closed at the time of the audit. On the other hand, if a subequent audit determines you definitely should have waited until a later year, the only thing you would lose would be some interest and maybe a small penalty.