JohnH

It may not be a scam. I, for one, would drive to Arkansas from NC to avail myself of your services if I needed tax advice. Money would be no object, and distance would not discourage me. It's entirely possible that there's someone else out there having the same level of discernment that I possess.

This is an interesting development. I assume ATX and other software vendors won't be too far behind the curve on this change (or maybe they've already done it) In any event, it causes me to ask some interesting questions. Does The tax preparer have an obligation to tell the client about this change? Or are some tax preparers going to relish their role as unofficial collection agents for ACA and just withhold the information from the client? My take on it is that this is the first shot across the bow on an ACA version of "Don't ask, Don't tell". Any anyone who fails to advise their client of this option may be costing the client money - in some cases a lot of money. Then if the client later finds out about it but can't get the penalty back, they might have a valid issue with the preparer who didn't fully inform them of their options at the outset.

Just noticed when filing an extension that NC Dept of Revenue has upped the minimum Franchise Tax for all corporations from $35 to $200. Hope they use that extra cash wisely.

And if they call a few days latedr asking "How's it going?", here's the procedure. 1) Pull their file from wherever it is in the stack; 2) Check to verify you've received everything else you asked for; 3) Answer their question; THEN.... 4) Put their folder at the bottom of the stack. Usually only takes a couple of calls like this to get them to leave you alone so you can get some work done.

I agree. That was anything BUT an "Oh, by the way" comment. If it had been truly innocent, he would have taken your advice. Bart, the client was clearly making a feeble, amateurish attempt to tag you with some responsibility if the issue ever came up in an audit. The first thing out of his mouth would have been "I told the preparer about it, and he said it was OK to ignore it." Then he would have been harassing you to pay any penalties & interest (maybe even the tax liability itself - some people are funny that way). I can't help but wonder if he had already visited another preparer, received the exact same advice, and so you were his next stop. Eventually he will figure out that the only way to get away with this is to just not mention it. But even then, it's likely he will try to shift blame if he's ever audited. I feel sorry for the last preparer in the chain - you should be glad you're not that person. Sometimes the most profitable thing to happen in a business relationship is when they take their business elsewhere.

Well, she got to dream about the anticipated big payday for 3 years. Not much different than spending $2,650/ year on lottery tickets, and roughly just as sensible.

I never have decided on the best response to "what do you charge?" Maybe, "If that's the first thing you have to ask, then you probably don't want to pay it." My next best is, "I charge by the question. The answer to the first question is free, but there's a charge for every question after that." Then if they ask "How much for each question?", I'm home free. My answer is "$100 each. What's your next question?"

Thanks Eric. You're a real blessing to this group and we appreciate all your efforts.

I think the most likely course of events will be along these lines: 1) Taxpayers who are assessed the penalty (tax) will begin to complain loudly, asserting that "nothing has changed" in spite of the executive order. The news media will be abuzz with stories of this type because it fits their narrative. 2) The administration will recognize that their credibility on this issue is in jeopardy. 3) There will be a strong push for administrative relief and threats that heads will roll if it isn't done. 4) If #3 doesn't achieve results, extreme pressure will be applied to congress to pass legislation granting retroactive relief from the penalty (tax) for individuals. 5) This will play out over several weeks or months, probably at least into mid-year. Depending upon implementation, people who have already filed at that point may find themselves outside the window for relief. Or they may have an option to amend - who knows? There is a strong sentiment in this country that Washington preens and postures, but nothing favorable to the average taxpayer ever gets done. They simply cannot allow that perception to continue if they are to maintain any credibility. =================== Or I could be wrong... ===================

Tell him to mention to the preacher that if he saves the $695 that will mean he can put more in the offering plate. That might help in the decision making process.

In thinking about this a little more, there is NO WAY I would advise a client to go ahead and file if the return includes a penalty (tax) under ACA. I'm not going to be the one holding the bag if something happens in the coming months to relieve them of the penalty and for some reason they can't get it back. I'll suggest an extension and then a "wait and see" approach. If they choose to go ahead and file, then I've given them the best advice, and they made the potential wrong choice.

Rita: I like the way you cope.

Look at it as a positive. They long ago forced you to work as their unpaid data entry clerk. So becoming an auditor is a promotion.

The right click also works in the situation you just described. Drake usually provides multiple ways to accomplish the same task. By the way, if you haven't experimented with macros in Drake, you should do so. They can save you lots of data entry time, especially for repetitive entries.

I'm still absorbing some of the new features in Drake, but several look very interesting on the surface. Their Fixed Asset Manager is supposed to be greatly improved and customizable. They now offer a pop-up menu at the top of the screen for navigation and several other features. And a right-click gets you lots more options this year. Many years ago I read an article which said you should always right-click anytime you are working on a document of any type, just to see what's available. I use right-click in Word and especially in Excel, so it's nice to see this feature being expanded in Drake. Here's a link: https://drakesoftware.com/service-learning/videos/new-features-for-drake-tax-2016/

This issue is very much a moving target and I won't make any assumptions about timing. The one major experience we have in this area is the silliness that surrounded the $100 per day penalty, which for most employers was rescinded retroactively (although there was no mechanism for initially imposing it, as there is with the coverage penalty). If I have any clients who are significantly affected by the penalty, I'm going to suggest that they file an extension and let's see what happens in the coming months. That will be cheaper for them than paying me to amend a return if the rules change in their favor later in the year. Of course if they have a significant refund in spite of the penalty, then they probably won't go for that. But at least they will be on notice that if they just can't wait, and if things subsequently change, the the additional work won't be a freebie.

Wonder what that return looks like? Gross Income: $ 33.00 Amount withheld: -0- Balance of Tax Due $ 33.00

Yep, problem solved. Permanently.

Thanks for clarifying my comment. Yes, the point of suggesting a phone conference or a sit-down is to establish that it will be billable time. And, as you said, the "need" for further answers generally goes away once that idea gets on the table.

Social media, email, and texting are valuable resources for maintaining client communication, but only if used efficiently. The intent is to keep the client out of your office and off your telephone so you can get some work done. But if the time expended in answering client questions isn't already built into their fees, then anything beyond short, simple answers to basic questions needs to be handled appropriately. It is easy enough to reply that the question is too complex, additional info is needed, or the matter requires a phone conference or sit-down meeting to tease out all the variables. Otherwise you will find yourself in a quagmire.

Mine arrived. I agree - it is packed with info, well organized, and very good use of color.

These days, with email and texting capability, there's no reason to give info to a third party (with the possible exception of a valid subpoena). Email a password protected file toe the client and let them do whatever they wish with it. I have never yet seen a situation in which a third party had a valid reason for obtaining info directly from me. Not that they haven't tried. I've had a couple of bankers to offer silly excuses for getting info from me,, but I risked losing the client rather than cave in.

I've always thought the stretch IRA fell outside the original intent of IRA plans. I don't fault anyone for availing themselves of whatever the laws permit (full disclosure - I inherited a relatively small one that I am stretching out as long as possible). But there really isn't a good argument for allowing the stretch IRA to exist. I have the same view of the backdoor Roth, but that's another issue altogether.

I resolved not to make any resolutions. Dang! Only one day into the year and I already failed.

I saw an article about this a few days back. It was written by a financial advisor, but he's one of those rare exceptions - a F/A I actually respect. I'm pretty sure he said the effective date is expected to be when the legislation passes, thus effectively grandfathering existing stretch IRA's.