New deductions!

[JohnH]

Talking about clients who pay attention, I had mailed a client's return to him on Thursday and he received it on Friday. He walked up to me in church this AM to thank me for getting it out to him, then he asked "Just out of curiosity, what's Schedule M? That hasn't been on my return before has it?".

I commented that he's the first person to notice it this entire tax season, and then explained the MWP credit to him. After I told him how it worked, he asked, "So does it work the same way this year?" I replied that it does, and then he said "So I'll be seeing Schedule M on my 2010 return as well, right?" Again I said yes.

As he walked away he commented, more or less to himself "So that's why my withholding went down last April and then went up a little this January". The guy is sharp.

[FEDUKE404]

Parlor antics

...There's this other massage place nearby where the blinds are drawn tight and with a sign that says to park in back. She confirmed it is not legit, but stays in biz because the local cops are patrons.

Probably for "stress relief."

Do the police officers deduct the charges for said services on their tax returns??

FE

[BP.]

All right, Jesse, Gretel, FEDUKE404, I absolutely stand chastised for my utterly naive comment.

Proof you all have a point: Just had a client in who works as a massage therapist at a lovely and legit spa. There's this other massage place nearby where the blinds are drawn tight and with a sign that says to park in back. She confirmed it is not legit, but stays in biz because the local cops are patrons.

[Possi]

Most of them want the honest returns..

Most of my clients have heard of someone local who gets big refunds for police officers. At least one of them came to me this year because he was afraid of the tax returns filed in the past. I see that from time to time.

All the clients who stay with me know I do honest agressive tax returns. I take all the deductions possible, and I advise them on ways to keep up with their expenses easily.

I hope that gal gets audited. Oh, she had her name on the tax return and her tax ID number.

Ready for this?

name "Donna" That was her full name! "Donna"

ID# 777-77-7777

I swear to my Maker.

And he trusts her.

[FEDUKE404]

LEO folks can be slippery

Why would someone in law enforcement want to be on the wrong side of the law? ....

With all due respect to the many fine people in law enforcement, it has been my experience in dealing with tax matters with many LEOs that a large number of them are more than willing to "bend the rules" in financial/tax matters.

For a long time second "security job" income was paid via 1099's - "I didn't make $600 there so I don't have to report it " was common. Businesses did so even if Barney worked at the same place part-time five days a week. Many with a slightly higher moral fiber would just put the income on the same line as W2 wages - "I DID report it!" And of course I was deemed to be the village idiot by putting said income on Sch C as well as Sch SE. I did not get too many repeat LEO clients - "Well, Joe does not do it that way and everybody else is getting larger refunds."

As I said earlier, it's not necessarily a flaw so much as a mind set - perhaps that someone "owes" them some tax breaks for having a hazardous and/or underpaid job. I'll spare you the details of a recent investigation when it was found that many local LEOs were also working at their "other" job at the same time they were supposedly on duty for their main job. Let's say their bosses now have a "higher" awareness level of their secondary employment.

I have encountered the attitude numerous times. Very strange!

FE

[ChEAr$]

Good think that tax preparer talks to the IRS agents every day so she knows that she can take all these deductions!

I'd have to do more than TALK to IRS agents to get away with that....

Perhaps he talks to IRS agents because they talk to him every day, iow, maybe
they "have his number", and are watching him daily.

If not already, they should.

[Gretel]

Why would someone in law enforcement want to be on the wrong side of the law? You can prob persuade him to see the light, possi, for his own good.

By these standards, Attorneys should be very truthful people, but I think they are in a group with the highest rate of cheating. And yes, they know what they are doing. Having to give an Attorney a 1099 for every dollar paid to them, speaks for itself.

[Burke]

She had taken mortgage interest on Sch A, Sch E, home office, and Sch C.

Sounds like a new one I got this year. Brought in last year's Turbo Tax. Looked really nice, until I dug into a few things. Like the same mileage and bus expenses taken on Sche C, Form 2106, and UPE on Sche E. After all, I suppose TT does ask all those questions about each form...... Also, the fact that he sold 7.78 shares of some fund and reported $24,000+ in income and $147.08 in basis. (No it was not Berkshire Hathaway.)
Sigh..... Nice guy too, just doesn't know what he is doing. I asked him to bring me the source documents for the stock sales, and he printed out all the TT worksheets.

[Jesse]

Reminds me of a story

Why would someone in law enforcement want to be on the wrong side of the law? You can prob persuade him to see the light, possi, for his own good.

My dog totally freaks in thunderstorms. We were gone during one while we left the dog in the house, poor thing freaked out, tore through the screen and escaped. Someone found him and brought him to the police station. We received a fine of $168 for dog running at large. Tried to negotiate but the officer, who was a client, told me he could not do anything about it because "it's the law".

I found out he was doing some construction "side jobs", so I asked him about it and advised that he needs to report this income. He "doesn't make it traceable" is what he told me. I told him but "it's the law", either I report it or I don't do your return. He's no longer my client - oh well!

[BP.]

Why would someone in law enforcement want to be on the wrong side of the law? You can prob persuade him to see the light, possi, for his own good.

[FEDUKE404]

Sign of things to come?

This fellow in NC received active prison time - and rumor has it that ALL (or at least most) of his clients were eventually audited - as a result of his "creative" preparation skills.

"Approximately 60 percent of his clients were car salesmen. [He] materially overstated the itemized deductions and business expenses on his clients’ federal tax returns..."

"... attempted to obstruct the state’s investigation by asking some of his clients to create false documents that would substantiate the fraudulent deductions and business expenses he had included on their returns."

http://www.dornc.com/press/jan05/miller.html

FE

[BHoffman]

I haven't seen enthusiasm like that in a long time. My sister in law tried to prepare their tax return once, but gave up and let me do it. She had taken mortgage interest on Sch A, Sch E, home office, and Sch C.

[Possi]

Triple dipping

I talked to my client today.

He said the depreciation (for which there is NO form) is for his TRUCK. So are the REPAIRS.

SO IS THE MILEAGE!

WOO HOO! I didn't know we could TRIPLE DIP on VEHICLE expenses!

Even he doesn't know what BCP is... although she asked a lot of questions about health insurance.

[Possi]

Not PITAs to me either

I have a few clients like that and I tell them how much I appreciate their being involved in their tax return.

And I would like to think this client was just blindly led to the slaughter, but I'm not so sure he is innocent in this. He is an educated man after all.

I understand about trusting the professionals, though. There was a time I trusted the cheating accountant! Until I learned a little about taxes and I worked for him!! What an eye opener!

[BHoffman]

Not so PITA clients

I have two client for whom I must prepare actual working papers to prove every number on the tax return because they go over them with a very fine toothed comb. The working papers have to be organized and highlighted so that a client of reasonable intelligence can see and understand.

There are lot of preparers out there, I'm sure, who would consider a client like this to be real PITA.

I wish all of my clients would do this, and I wish I had the time to prepare these kinds of working papers for all of them..and I wish it would all be billable time