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Small White Dragon posted:You're in Oregon, right? Oregon is all hosed up. We started the disconnect back in 2001 with the Bush Jr cuts (especially the estate tax) and bounce back and forth every few years with compliance/not complying with federal rules (depreciation is a big one). This year is messy since the D governor is in a bit of a tight race with a Republican so she's trying to appear business-friendly after a few years of happy tax increases, so we're getting piecemeal tax legislation. Our state is eventually going to go broke from the employee unfunded pension liability (PERS) so it's a ticking time bomb over here. Live in Washington, man. AbbiTheDog fucked around with this message at 22:46 on Aug 29, 2018 |
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Aug 29, 2018 22:42
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sale on Banksy art posted:My client's very clearly signed in pen return was rejected for being a photocopy and I don't know wtf. Lol, try it again and hope that it crosses a different flunky's desk.
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Aug 30, 2018 05:24
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sullat posted:Lol, try it again and hope that it crosses a different flunky's desk. That's why you have them sign in blue ink.
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Aug 30, 2018 18:32
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So I just found out that despite being on different health insurance plans, I’m not allowed to contribute towards a HSA when my wife contributes towards an FSA. Do I have any options to avoid paying penalties? She was on my insurance plan until she got a new job earlier in the year.
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Aug 30, 2018 20:54
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I rent out an apartment I own. I have an arrangement with the tenant where as a general rule he will take care of most small fixes expenses and then discount them from the monthly rent. For tax purposes do I report my income as the full amount of rent minus the expenses or just report the net amount as income with no expenses? This is a non-US property if it makes any difference.
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Sep 6, 2018 14:19
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So I sent in an extension to file maybe a day or two after the deadline to file it. The IRS waited until loving today (5 months later) to send me a letter saying that I sent it too late and need to file immediately. Am I going to get some super bad fine or am I just charged some reasonable amount of interest on what I owed (if I owed anything)? Guess I'll go find a tax professional, but just trying to get a hint of how boned I am. Ur Getting Fatter posted:I rent out an apartment I own. I'm no expert but I do know that if you get cashback on your credit card, it is not taxed because the IRS officially considers it a "discount" on the final price of what you paid, as opposed to a reward/prize after the fact. By that logic, if you are giving a discount on your rent (especially if the rent checks you deposit reflect this) then you can say you discounted the tenant's rent and thus didn't collect the full amount. It would probably help if you describe the discount as "a incentive in the form of a discount for your tenant taking good care of the place" as opposed to specifically describing it as you reimbursing him for him providing you goods or services, which the IRS could more easily assign a dollar value to.
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Sep 14, 2018 22:56
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Zero VGS posted:So I sent in an extension to file maybe a day or two after the deadline to file it. The IRS waited until loving today (5 months later) to send me a letter saying that I sent it too late and need to file immediately. The main purpose of the extension is to keep any late penalties on the "failed to pay" scale, which is 0.5% per month, rather than "failure to file", which is 5% per month, so if you were late on the extension you get the higher penalty (interest is same in both cases). So your penalty will be higher, but the actual amount depends on your amount due and it caps at a set percentage/amount. Note this only applies if you owe money; there's no penalty on late filing a return with a refund, though if you don't do it within 3 years of the original due date you can no longer receive the actual refund money. quote:I'm no expert but I do know that if you get cashback on your credit card, it is not taxed because the IRS officially considers it a "discount" on the final price of what you paid, as opposed to a reward/prize after the fact. By that logic, if you are giving a discount on your rent (especially if the rent checks you deposit reflect this) then you can say you discounted the tenant's rent and thus didn't collect the full amount. It would probably help if you describe the discount as "a incentive in the form of a discount for your tenant taking good care of the place" as opposed to specifically describing it as you reimbursing him for him providing you goods or services, which the IRS could more easily assign a dollar value to. Nononono, very specific treatment by IRS of this kind of thing, you treat it as rent income if the tenant pays for expenses, but you can then deduct those expenses like regular ones. See here for details.
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Sep 14, 2018 23:56
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The failure to file penalty is capped at 25% of the tax owed. There is a minimum penalty of $205, or 100% of the tax owed, if it is below $205. Since you're 5 months past, you're probably hitting the cap. That being said, if this is the first time you've had to pay a penalty, you can request a first time abatement of the penalty.
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Sep 15, 2018 05:09
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I was working for the past 5 years overseas. In 2013 and 2014 I had money taken out of my paycheck and given to a vested benefits organization that was then transferred to a swiss bank's vested benefits/retirement account. Normally you aren't allowed to get it out until you actually retire/get old enough, but since I have moved from europe permanently I got to withdraw it all as of this month. My question is does this count as income I need to report to the IRS? I reported my full salary before this money was taken out on my 2013 and 2014 returns, so my assumption is no since it was basically just sitting in a bank account and was already reported/"taxed" (not actually taxed since I was under the foreign earned income exclusion). My parents think I have to report it as capital gains or something though, so...? If it matters, it was on the order of 15k USD. Is there an easy yes/no answer to this or will I have to pay someone to figure it out?
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Sep 26, 2018 21:58
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No there is not an easy yes or no answer, it will depend on how the organization is classified for US tax purposes and whether there is any gain. In general, you must pay tax on all your income, including any gains from disposition in a foreign asset. It's not clear from your description what occurred. For example, if this organization is considered a PFIC for US tax purposes, you would need to calculate additions to tax under Section 1291 on disposition and report using form 8621. Alternately, if this is a trust, you may need to file form 3520 instead, and could also be taxed on any deferred gain. In addition to the above, you may also have been required to report your ownership in this deferred benefit organization on an FBAR or on form 8938. In short, if it was me, I'd have a CPA take a look.
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Sep 26, 2018 22:20
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There was only something like 10 dollars of interest gained during the short time it was in there. I did use a CPA (or something similar) to file my taxes and this portion of my income was on the forms I gave him, so maybe I should just ask him about it to be safe. I did file an FBAR form but I forget what for exactly. Taxes were so much simpler when all I had was a W2 to enter.
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Sep 26, 2018 22:47
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That's for sure! Could be it's as simple as picking up an extra 10 bucks in interest income, or as complicated as one of the issues above. The US has intense anti-deferral rules designed to catch bad actors, but they are very broad and catch a lot of perfectly innocent and simple situations in their insane web.
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Sep 27, 2018 00:46
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Anybody here done the EA thing? I’m thinking of seeing if the Bank I work for will pay for it. I don’t do tax work for the bank but I’m in commercial lending so it does intersect with my work, figured it might teach me some stuff and maybe I could do some volunteer stuff too. Any guidance on whether or not it’s worth someone else’s money or my time would be great. If you’ve done it and got prep stuff you like that would be cool too.
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Oct 5, 2018 01:23
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Get in the game
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Oct 5, 2018 04:31
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tumblr hype man posted:Anybody here done the EA thing? I’m thinking of seeing if the Bank I work for will pay for it. I don’t do tax work for the bank but I’m in commercial lending so it does intersect with my work, figured it might teach me some stuff and maybe I could do some volunteer stuff too. Ugh. As a CPA...... It takes roughly 3-5 years for a CPA/CPA candidate to start getting a solid handle on their poo poo. I've been doing this for 20+ years, and consistently run into areas I have no clue how to handle (or saw once ten years ago and don't remember what the hell is going on). Even if you get your EA, you're going to stand out trying to talk/communicate to someone who does it full time - I can read about insurance, but I don't sell insurance full time, and if I try and discuss insurance with an actual insurance agent it's going to be obvious I don't deal in that world. Worse, if you give confusing info to a client, 99.99% guarantee the client will misinterpret it and their tax preparer is going to be swearing at you. Worst, worst, worst case scenario is you give vague tax advice/tips to a customer, customer (like any good customer) gave you bad info/didn't tell you the whole story, and the customer screws up something, they have legal standing to sue your bank ("YOUR EMPLOYEE, HOLDING OUT AS A TAX PROFESSIONAL WITH AN EA DESIGNATION, GAVE ME TAX ADVICE I RELIED UPON AND THEY WERE WRONG. PAY MEEEEEEEE!!!!!). Advice? Unless you want to prepare taxes just don't bother. If you want to take a few classes to stay up to date on the current laws to have a conversation topic, that would be cool too.
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Oct 5, 2018 21:12
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Yeah, I’m pushing towards EA (very slowly now that I’m hitting non-1040 stuff gah  ) and it’s not worth it unless you’re actually doing taxes. You get stuck with a fair amount of continuing education requirements afterwards too.
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Oct 6, 2018 17:22
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Harveygod posted:Question about the Retirement Savers Tax Credit: Follow-up question: It's looking like we're going to end up with an AGI slightly too high to qualify for the credit (probably going to land on around $66000). We haven't maxed out our IRA contributions yet (only contributed $2000 to each of our Roths), so my plan is to contribute just enough to my Traditional IRA to bring the AGI to $63000. My question is: Can I wait until early next year to do this? I know I have until tax day 2019 to make 2018 IRA contributions, but will those (Traditional) contributions lower my AGI for 2018 (even though they were made during 2019)? My understanding is "yes, they will" but I wanted to confirm before I the end of 2018. The reason I want to wait until after the new year is so that I can know exactly how much to contribute to the Traditional (and I don't want to over-contribute to Traditional because once we get the Saver's Credit (and our kids' credits), our total (nonrefundable) credits become greater than our tax bill). I also plan to immediately convert it to Roth since we almost certainly won't qualify for the credit in 2019 anyway.
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Oct 10, 2018 21:38
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Not sure if this would be the business tax thread too. If I did business as a sole proprietor and then formed an LLC for the same thing would I be able to use the business expenses from the sole proprietor work for the LLC taxes? In hindsight that seems like an obvious no, I would need to do the taxes separately. What if it was a single member LLC and was changed to C or S or P? Is that even possible?
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Oct 11, 2018 03:14
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22 Eargesplitten posted:If I did business as a sole proprietor and then formed an LLC for the same thing would I be able to use the business expenses from the sole proprietor work for the LLC taxes? No. They are distinct separate legal entities. 22 Eargesplitten posted:What if it was a single member LLC and was changed to C or S or P? Is that even possible? No, that's not possible as far as I know. The only allowable change would be C to S, as you have to initially form a C and then petition for S status.
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Oct 11, 2018 03:19
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However, since an LLC is a pass through entity the revenues and expenses are reported on your individual tax return anyway, unless you specifically elect for it to be taxed as a corporation. If the LLC has more than one owner an information return is required, but the tax reporting still flows through to the individual owners. You would still report the sole proprietor and LLC pieces on separate Schedule Cs, but the net result should be the same as if it was one business.
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Oct 11, 2018 03:27
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Harveygod posted:Follow-up question: It's looking like we're going to end up with an AGI slightly too high to qualify for the credit (probably going to land on around $66000). We haven't maxed out our IRA contributions yet (only contributed $2000 to each of our Roths), so my plan is to contribute just enough to my Traditional IRA to bring the AGI to $63000. Yes, just make sure you tell your IRA custodian that the contributions are for 2018 when you make them.
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Oct 11, 2018 13:31
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Motronic posted:No. They are distinct separate legal entities. Ooohhh, hold up a bit. If OP forms a single member LLC during the year, I'd feel fine just tossing everything onto one schedule C on the 1040. From a practical standpoint I can't think of any difference it would make to prepare two schedule Cs. Yes, technically, the SP expenses would be on THAT schedule C, but the two schedule Cs would simply be netted against each other at the end. NOW: If there's other owners of the LLC, then yes, you would need to file separate returns for the LLC. A while back (ten years?) the IRS allowed you to skip filing an 8832 to go from LLC -> C and then file an 2553 to go from C -> S. If you file a 2553 that's filled out properly for an LLC, they're assuming you know what the hell you're doing so you can just file the 2553 to go from LLC - S Corp.
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Oct 11, 2018 17:29
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Man, this thread is 7 years old and 200+ pages (and furu isn't around anymore). Can this get locked up and a new one started?
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Oct 13, 2018 20:14
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I can write up a new thread in a little while if folks want that, just need a few days to recover from extension filing ending yesterday and finish up my CE credits. Haven’t been here from the start though, so if there’s any info posts people want copied to the new thread (or tax preparer goons who want a shout-out to anybody looking to work with them) let me know. Also, new thead title suggestions welcome  .
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Oct 16, 2018 17:13
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Is $1575-1850 a high prep fee for a federal + state 1040 with a simple schedule C? It's an accountant with a very niche specialty (daily fantasy sports income). Last year I was very profitable in DFS so I did not question it too much and wanted an accountant with that specialty. This year I have lost money so I'm trying to be more frugal overall, and I see that all he did really was tally expenses and profits on a schedule C so I'm not sure the niche expertise is necessary. I just got his engagement letter for 2018 and I'm trying to figure out if it's worth it. I like the guy, don't want to haggle over a couple hundred if his price is reasonable but if he's overcharging and I could save $1000 it would be hard to justify not switching.
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Oct 25, 2018 19:50
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SurgicalOntologist posted:Is $1575-1850 a high prep fee for a federal + state 1040 with a simple schedule C? It's an accountant with a very niche specialty (daily fantasy sports income). Last year I was very profitable in DFS so I did not question it too much and wanted an accountant with that specialty. This year I have lost money so I'm trying to be more frugal overall, and I see that all he did really was tally expenses and profits on a schedule C so I'm not sure the niche expertise is necessary. I just got his engagement letter for 2018 and I'm trying to figure out if it's worth it.
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Oct 25, 2018 19:59
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SurgicalOntologist posted:Is $1575-1850 a high prep fee for a federal + state 1040 with a simple schedule C?
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Oct 26, 2018 09:50
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SurgicalOntologist posted:Is $1575-1850 a high prep fee for a federal + state 1040 with a simple schedule C? It's an accountant with a very niche specialty (daily fantasy sports income). Last year I was very profitable in DFS so I did not question it too much and wanted an accountant with that specialty. This year I have lost money so I'm trying to be more frugal overall, and I see that all he did really was tally expenses and profits on a schedule C so I'm not sure the niche expertise is necessary. I just got his engagement letter for 2018 and I'm trying to figure out if it's worth it. Depends what format you're providing the information. If you're giving him a one page summarized schedule of your revenues and expenses and he is just copying that to the schedule c - would agree it's high. If you're sending him a manila folder full of receipts and poo poo and having him go through it for you - it's probably market for a CPA with a true specialty in gambling industry.
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Oct 26, 2018 11:27
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Yeah it's like 20 rows on a spreadsheet. Sounds like I'll be looking for a new accountant. Thanks for the advice everyone.
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Oct 26, 2018 16:42
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Yeeaaaahhhh, for pure tax prep that’s crazy, Closest I’ve ever come to that kind of cost was one which had Schedule C, six rental properties, multiple states, and a partnership (in a pear tree...), and even THAT was several hundred dollars cheaper. Not sure what the specialization is worth to be fair, never had a complicated fantasy sports return so maybe I’m underestimating the difficulty there.
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Oct 27, 2018 05:01
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That’s how much we charge s corporations where we also do their bookkeeping for the year. Sounds high as hell for a simple schedule c.
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Oct 28, 2018 05:23
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Epi Lepi posted:That’s how much we charge s corporations where we also do their bookkeeping for the year. Sounds high as hell for a simple schedule c. MadDogMike posted:Yeeaaaahhhh, for pure tax prep that’s crazy, Closest I’ve ever come to that kind of cost was one which had Schedule C, six rental properties, multiple states, and a partnership (in a pear tree...), and even THAT was several hundred dollars cheaper. Not sure what the specialization is worth to be fair, never had a complicated fantasy sports return so maybe I’m underestimating the difficulty there. What city and firm size are each of you in?
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Oct 28, 2018 14:18
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Long Island, NY. Small firm just 3 accountants and half a dozen support staff.
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Oct 29, 2018 13:39
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H&R Block here, pretty sure rates are set corporate-wide though I’m in Delaware specifically. As for the pricing debate, I will note thanks to the promotion H&R Block kept running the last few years where we offered new people half off what they paid the prior preparers, I got to see what lots of people charge for this sort of thing and don’t remember anybody charging THAT much for a return with relatively straightforward Schedule C. Again, honesty compels me to note there might be some other services/expertise included that are bringing up the price, but on its face I can’t see charging that much.
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Oct 29, 2018 20:06
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Admiral101 posted:it's probably market for a CPA with a true specialty in gambling industry. I'm going to go one of three ways here: 1) CPA thought OP was full of crap and this was the "pain the butt premium" fee. Sorry OP, but sometimes we bill clients to get them to go away - OP might be too small for the CPA to want to bother with, might be a pain in the rear, might be trying to push a gray area, whatever. CPA is passive-aggressively trying to get rid of them, but clients bitch when you fire them, but they're quieter if they go away on their own. Our industry is not know for extroverts or assertiveness. 2) CPA is a specialist, as mentioned, and you're paying full rates for a specialist but don't need one. 3) Some CPA firms don't charge hourly but charge "by the form" and that's simply what all the forms come out to be. I'm guessing it's more of #2 than any of the other, but yeah, find someone else.
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Oct 30, 2018 20:19
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I wanted to give him a chance to explain:CPA posted:We completely understand your concern on fees. Yes, we are by no means the lowest cost competitor, and we do not market ourselves like that. There are complicated nuances to DFS along with other industries that me and my partners 30+ years of collective accounting experience encompass. We have spent a considerable amount of time working with clients who were given incorrect advice in forums and by other CPAs. We believe our fees are justified by not nickel and diming our clients through sending invoices for 6 min of our time (i.e. phone calls or emails). We are always open to having conversations with our clients throughout the year and believe in proactive tax planning (i.e. not just talking with our clients one time a year during tax time). That's all true I guess, e.g. we had a 10 minute conversation earlier in the year to determine whether I should pay estimated taxes and he didn't bill me. Not really a strong justification though.
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Oct 30, 2018 23:16
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I specialize in expat taxes and I charge a premium because there are always complications and things they forgot to tell me, no matter how simple it looks at first. Also non-specialists always gently caress something up. So I charge a bunch up front instead of gradually cranking up my fee as issues emerge.
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Oct 31, 2018 01:33
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I just saw draft versions of the 2018 forms are available. Kind of interesting.
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Oct 31, 2018 05:02
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I'm an expat living in a high inflation country. The IRS posts yearly reference exchange rates, but these are averaged out for the entire year. This means that if I used that reference rate I end up with a higher income than what I actually made. Can I use the actual exchange rate at the time I received each payment, or does it have to be one unique exchange rate for the entire year?
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Oct 31, 2018 17:35
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You can translate at the spot rate at the time of payment assuming your functional currency is the US dollar: https://www.irs.gov/individuals/international-taxpayers/foreign-currency-and-currency-exchange-rates. On fees, it varies. I won't bother with a return for less than 3,000. It just isn't worth it. If you feel your current provider is charging too much, feel free to shop around.
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Nov 1, 2018 03:34
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