I spent part of my weekend finishing up my own 1040, so I can’t be too self-righteous about procrastinators. Still, my return was 95% done on April 15. This was really just going through the information I had put together for my extension and making sure I hadn’t missed anything. I had gotten all of my information to the preparer (me) months ago.
Meanwhile, I have clients who have gotten me nothing, or maybe just their W-2. These taxpayers often are making the perfect the enemy of the adequate. They want to go through their checkbooks to identify every possible charitable deduction. And that last deduction is rarely worth the wait.
Just get the stuff you have to your preparer now. If you later find a deduction that matters, we have three years to amend the return. But you only have nine days left to file on time.
Ethics time. I am trying to find four hours of “ethics” courses to take before year-end, because the Iowa Board of Accountancy requires it for license renewal. Robert D. Flach sums up my feelings:
The powers that be seem to feel that unless tax preparers are forced to sit through at least 2 hours of redundant ethics preaching each and every year they will suddenly begin to create large fictional employee business expense deductions for clients, or add erroneous dependents, and false EIC claims, to client 1040s.
I have been preparing 1040s for over 40 years. If I ain’t “ethical” by now, having 2 hours of preaching thrust upon me isn’t going to miraculously make me honest.
In real life, “ethics” courses really seem to be CYA seminars — how to document your file and prepare engagement letters to help ward off frivolous lawsuits. That can be useful, but I’m not sure “ethics” is the right name for it.
Tony Nitti, Artists Rejoice! Tax Court Concludes Painter’s Activity Isn’t A ‘Hobby’. Tony covers a Tax Court case last week where the IRS improbably went after an art professor’s Schedule C art business on hobby loss grounds. She won the hobby loss issues, but Tony thinks she will lose other parts of her case, in which the IRS says she deducted personal expenses on her business filing.
Peter Reilly, TIGTA Must Disclose More About Investigation Of Possible IRS Release Of Koch Industries Return Information. Peter looks into whether Koch Industries is an S corporation and learns that some highly political people are humor-impaired and comically challenged.
Russ Fox, Legaspi Gets 21 Months:
Francisco Legaspi didn’t want to go to jail. Back in November 1992, he pleaded guilty to tax evasion. Instead of showing up for his sentencing in January 1993, he headed to Mexico and then Canada to avoid prison. That worked for 20 years. In 2012, the State Department found him when the Bureau of Diplomatic Security found his Facebook page. (A helpful hint to any fugitives out there: Avoid posting anything on the Internet. Law enforcement reads the Internet, too.) They forwarded his information to the Royal Canadian Mounted Police who arrested him; the Mounties always get their man.
Now he’ll serve that 21 months.
Kay Bell, Estate gets $14 million tax refund on value of art. Kay’s a little giddy about her Baltimore Orioles sweeping Detroit. Now they have to face the Royals, managed by the Magic 8-ball.
Jim Maule, Do Squatters Have Gross Income? A woman moves into an abandoned house. Nobody kicks her out or demands rent. Prof. Maule ponders the implications.
Janet Novack, IRS: We Made A Mistake Valuing Michael Jackson’s Estate. They want more.
Annette Nellen, California to study alternative to current gas tax. Most gas taxes aren’t indexed, and technology is reducing gas consumption. This makes paying for roadwork more complicated.
TaxGrrrl is hosting a bunch of guest posters, including Josh Hoxie, When Income Tax Cuts Masquerade As Estate Tax Repeal; Rebecca McElroy, Making Changes To The Tax Code Starting With The Medical Expense Deduction; and Elaine Kamarck, On The Tax Code, Time for America to Have it Our Way.
TaxProf, The IRS Scandal, Day 515
There’s nothing wrong with being nostalgic unless you’re trying to do it on someone else’s dime.
News from the Profession. Why are People in Public Accounting So Ridiculously Good Looking? (Adrienne Gonzalez, Going Concern). If you think we’re hot, you haven’t seen the actuaries.