1. I have a client who is a household employee for her grandchildren. The children are under age 18 but are not disabled and the parents are married and well which means she meets the exception for wages not required to be taxed SS and Medicare. My client was paid in excess of $8,000 and was not issued a W2. Where is this income reported on the 1040? I can only find guidance on income reported for household employees without a W2 who are paid less than $2,000 and my program will not allow me to e-file a return if I add $8,000 in non-W2 wages to line 1 with memo HSH. My thought is to add this income to Line 21 with the same memo. Please help.
2. Can Bob expand somewhat on his answer to a prior video question about capitalizing (versus deducting) operational expenses of a residential, rental property when it is not being rented. Is Bob talking about operational expenses between one tenant moving out and finding another tenant or perhaps a more lengthy time when the owner/landlord is doing a major remodel of the property. When Bob is proposing capitalizing those costs, does he then simply start depreciating them over 27.5 years when the rental activity begins again. Finally, please confirm whether Bob discontinues the following expenses as well : depreciation, real estate taxes and mortgage interest.
3. I was watching your taxspeaker video where you said all numbers should be redacted especially the preparers EFIN #. I know you use Ultratax also, I’m wondering how you select things to print. I’m trying to find an easy way to print things and when I select Client copy with redacted numbers I’m wondering about the estimate forms that need to be sent to the IRS and states that have to have to the full SSN # listed. So how do you get those to print with the full number and all the other numbers redacted?
4. Client has mortgage with a farm cooperative bank that also lends to homeowners in rural areas. Client has no farming activity – just the mortgage with the bank. A farmer accountant I know explained to me that patronage dividends in this case were more like dividends on stock in the bank and shouldn’t be subject to SE tax. I can’t find any information to guide me in this. Should patronage dividends in this case be reported on Sch F and subject to SE tax?
5. We have to upgrade our computers this year as Win 7 support is ending in January 2020. Would you recommend Win 10 Pro? Is there a checklist we can use to make the software compliant with privacy regulations?
6. We have multiple clients returns that we haven’t finished this year due to confusion on the K-1 box 20 AE Code which is labeled as excess taxable income. Our software has no data entry field to enter this and references that the amount will go on Form 8990. That form is still in software development. Bob has discussed in a prior video the Box 13k rules and that that excess interest expense is only deductible in future returns against this AE income. Does that mean that the the current year K-1’s with AE income needs to be entered and cause addition 2018 taxable income or does it carryforward to 2019 returns. I don’t want to file the current returns if this is going to effect the current year returns. The instructions on 8990 always reference over 25 million in income and none of our returns will reach anywhere near that level of individual income. We did get the 10 pages that Bob made available to video subscribers, but we are still confused.
7. Can you take 100% bonus depreciation or Sec 179 on the trade-in value above boot?
8. On self-rental and the QBI deduction. If the self-rental is a multi-unit property is all the income QBI or just the income from the one unit?
9. Does Tax speaker have a Security Plan template that meets the FTC Standards Rule guidelines. How can we obtain it.
10. Do you 1099 advertising businesses that are not a Corporation? Are they considered a service or a product? I feel like this could be argued either way. Half our office believes you should issue a 1099 while the other half thinks it s a service and therefore wouldn’t issue them.
11. As a newish preparer… How do you think the future looks for the industry? Do you believe it is still a secure profitable career choice?