1040 PostCard

[JohnH]

Wonder if they will like the tax reduction? 

I suspect many will fail to recognize it, especially if their refund is less than the prior year. That will take some explaining, but I suspect some tax preparers won't bother with the explanation.  Some won't explain because they're too busy;  others won't explain because they're politically biased. 

[Christian]

I just looked at the proposed new 1040 as well. I shutter to think of the confusion in 2019 with this. I am easing out the door so I have not to many years to wrestle with all these good things .

[Tax Prep by Deb]

2 hours ago, JohnH said:

Wonder if they will like the tax reduction? 

I suspect many will fail to recognize it, especially if their refund is less than the prior year. That will take some explaining, but I suspect some tax preparers won't bother with the explanation.  Some won't explain because they're too busy;  others won't explain because they're politically biased. 

That's why this year when I met with my clients I gave them the heads up that their refund may not be any higher and warned them of the real possibility of it being less because of the change in withholding and tried my best to explain to them that they are receiving their refund now thru larger take home pay.  I know there is still going to be some that don't get it, but those are the same people you find explaining the same thing over and over to them.

[jklcpa]

2 hours ago, JohnH said:

Wonder if they will like the tax reduction? 

I suspect many will fail to recognize it, especially if their refund is less than the prior year. That will take some explaining, but I suspect some tax preparers won't bother with the explanation.  Some won't explain because they're too busy;  others won't explain because they're politically biased. 

I guess it depends on the geographic location, income level, and composition of income.  A lot of my clients are running into the SALT limitation.   I ran projections for all clients and focused on the change in total tax liability compared to 2017.  For a variety of reasons, most of my clients showed decreases in overall tax in the $500-$800 range with a handful of clients in the $1000-$2000 and a few of $2000 or more in savings.  The reactions were mostly "meh" no matter what the decrease was.  There were some that showed almost no effect on total tax because of the SALT limitations and loss of deductions for unreimbursed job expenses, home office and exemptions.    Others of my clients are retired with mostly investment income from qualified dividends being taxed at LTCG rates, so they are still ending up with much of that income taxed at the same rate as before and the combined standard deduction + exemptions compared to the new higher standard deduction hasn't had *that* much of an impact to them.

The one client with the highest savings is never happy no matter what the result, and he will also be one that will be cross-eyed over the additional schedules. 

[Margaret CPA in OH]

" some clients will not like the subschedules" or the extra cost for preparation whether billing by time or form/schedule.

[JohnH]

Time to announce fee increases?  Or is the prospect of a fee increase, plus hearing about all their friends self-preparing and not itemizing due to the $25K StdDed,  likely to cause more clients to try out TT?

[Catherine]

1 hour ago, Tax Prep by Deb said:

their refund may not be any higher

One of the reasons we always highlight the "This is your total tax" line rather than the refund (or balance due) line.  We point it out as "this is what they get to keep" because that's the important part.  We call refunds "this is the amount you loaned the feds last year" and balance due is "this is what's left to pay" - always focusing on total tax.  We almost never have anyone complain about the refund amount.  (The few that do are clueless and we had one this year complain about the "smaller refund" that was several thousand HIGHER!)

[jklcpa]

17 minutes ago, JohnH said:

Time to announce fee increases?  Or is the prospect of a fee increase, plus hearing about all their friends self-preparing and not itemizing due to the $25K StdDed,  likely to cause more clients to try out TT?

I guess they could try and may or may not get the best result for state purposes here since DE allows itemizing while claiming the standard deduction on the Federal, so I've told my clients to continue to gather their documentation for Sch A deductions.  With the added SALT limitation, the DE itemized calculation will now have the added step of allocating that limitation between the state, any local taxes, and the real estate taxes since DE doesn't allow a deduction for its own state taxes and any out-of-state taxes also claimed as a credit against the current tax liability. We had similar calculations all along for allocating those taxes when the Pease limitation affected the return, so nothing easier there.

[jklcpa]

For any that are interested, below are Schedules 1 through 6, wasting a few more sheets of paper for each return printed:

          

 

[Abby Normal]

I'm never going to print most of those. Only an idiot could turn a 2 page form into 8 pages that are mostly white space and brag about it being an improvement.

Paper companies are probably drooling over how much more paper they will sell.

[FDNY]

I am at a loss of words to express my disdain for this.....words that can be printed here.

[Catherine]

At least electrons are cheap (and I've heard tell they're easy, too - but I wouldn't know about that - some of you guys might be able to chime in, though).

[JohnH]

Schedule 2+4 and 3+5 are obvious candidates to be combined on the same form. 

I think one of two things is likely happening here:

1) Someone is under orders from the current administration to create "post card-size forms";  or

2) Someone is intentionally producing something incredibly stupid in an effort to make the current administration look bad.

[jklcpa]

FTFY:

Quote

things likely happening:

1) Someone is under orders from the current administration to create "post card-size forms";  AND

2) producing something incredibly stupid.

 

[Abby Normal]

22 hours ago, Catherine said:

At least electrons are cheap (and I've heard tell they're easy, too - but I wouldn't know about that - some of you guys might be able to chime in, though).

I positively get a charge out of electrons.

[JohnH]

So, now you're amping up the humor.

[Bart]

You guys are electrifying funny

[JohnH]

Just trying to spark some interesting conversation about current developments. 

[Gail in Virginia]

As long as we keep the conversation positive.

[Catherine]

Great comments, all - but the electron's charge is negative... sorry, my inner nerd had to point it out.

[JohnH]

So a positive thought  about an electron is repulsive?

[Abby Normal]

[Jack from Ohio]

1 hour ago, JohnH said:

So a positive thought  about an electron is repulsive?

No, quite attractive.

[Jack from Ohio]

A Hydrogen ion walks into a bar. 

He orders an entire quart of Scotch. 

The bar tender asks:  "Are you sure that is what you want?"

 

The ion answers in an aggravated voice:  "YES, I'm positive." 

[Christian]

I am an aging "dotard"  . Does the IMPROVED 1040 look like an increase in forms rather than the reverse or is there something I have missed?