employer identification number: Temmuz 2012

To contact us Click HERE
Income Withholding Order/Notice Income withholding is the court or administratively ordered deduction of a specified amount from a parent’s income for payment of child support. All employers must honor an income withholding order/notice for child support from any state. Out-of-state income withholding orders/notices are valid throughout the country including US Territories. All states are required to use a standardized withholding form entitled Order/Notice to Withhold Income for Child Support (OMB No. 0970-0154). A child support income withholding order/notice must be paid before all other garnishments, with one exception. The only exception is a Federal (IRS) tax levy entered prior to when the child support order was established. It is the date the child support order is established, and not the date the withholding order/notice is served on the employer, that determines precedence. The employer deducts the specified amount of child support each pay period and sends it to the: State Collection and Disbursement Unit (SCaDU)
PO Box 98950
Las Vegas, NV 89193-8950 Payments must be by money order, cashier’s check or business check payable to SCaDU, including electronic funds transfer (EFT). E-Mail SCaDU for EFT Instructions. The following information must be included with each payment:
Full Name of the employee
Social Security Number of the employee
Employer’s Name and telephone number
Amount withheld for each employee

$2 Income Withholding Fee Payable to State Treasurer Employers are required to deduct an additional $2.00 fee from the income due the employee for each income withholding, not to exceed two withholding fees per month per employee. These fees are sent to a different location! The fees are payable at least quarterly to: Nevada State Treasurer’s Office
PO Box 749549
Los Angeles, CA 90074-9549 ***NOTE: THIS IS A FEE AND IS NOT THE CHILD SUPPORT PAYMENT. CHILD SUPPORT PAYMENTS MUST BE SENT TO “SCADU” AS NOTED ABOVE*** If an employer receives notices to withhold income for more than one employee, the employer may consolidate the fee amounts payable to the State Treasurer and pay those amounts with one check. Each payment to the State Treasurer must be attached to a statement which provides the full name and social security number of each employee for whom the fee is made, and the fee amount(s) transmitted for the employee. Employer’s Cost Recovery Nevada Revised Statutes (NRS) 31A.090 allows employers to deduct up to $3.00 for each withholding from the amount paid the employee as reimbursement for the employer’s cost of carrying out their responsibilities. To recap: 1. Deduct child support payment, send this to SCaDU 2. Deduct another $2.00, send to the State Treasurer 3. Deduct up to $3.00, employer keeps this amount Source:https://dwss.nv.gov/index.php?option=com_content&task=view&id=69&Itemid=171#FeetoState
Got a QuickBooks Mess?
Call The QuickBooks Gal!775-348-9225

Call Northern Nevada's Only Intuit Solution Provider!Sales, Support, and Training775-348-9200qbdoc@qbdoc.comwww.qbdoc.com
The QuickBooks GalCustom Business Solutions1755 E Plumb Lane, Ste 101Reno, NV 89502775-348-9225jayne@qbgal.com

IRS Increases Mileage Rate to 55.5 Cents per Mile

To contact us Click HERE

IR-2011-69, June 23, 2011WASHINGTON — The Internal Revenue Service today announced an increase in the optional standard mileage rates for the final six months of 2011. Taxpayers may use the optional standard rates to calculate the deductible costs of operating an automobile for business and other purposes.

The rate will increase to 55.5 cents a mile for all business miles driven from July 1, 2011, through Dec. 31, 2011. This is an increase of 4.5 cents from the 51 cent rate in effect for the first six months of 2011, as set forth in Revenue Procedure 2010-51.

In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2011. The IRS normally updates the mileage rates once a year in the fall for the next calendar year.

"This year's increased gas prices are having a major impact on individual Americans. The IRS is adjusting the standard mileage rates to better reflect the recent increase in gas prices," said IRS Commissioner Doug Shulman. "We are taking this step so the reimbursement rate will be fair to taxpayers."

While gasoline is a significant factor in the mileage figure, other items enter into the calculation of mileage rates, such as depreciation and insurance and other fixed and variable costs.

The optional business standard mileage rate is used to compute the deductible costs of operating an automobile for business use in lieu of tracking actual costs. This rate is also used as a benchmark by the federal government and many businesses to reimburse their employees for mileage.

The new six-month rate for computing deductible medical or moving expenses will also increase by 4.5 cents to 23.5 cents a mile, up from 19 cents for the first six months of 2011. The rate for providing services for charitable organizations is set by statute, not the IRS, and remains at 14 cents a mile.

The new rates are contained in Announcement 2011-40 on the optional standard mileage rates.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

Mileage Rate Changes

Purpose	Rates 1/1 through 6/30/11	Rates 7/1 through 12/31/11
Business	51	55.5
Medical/Moving	19	23.5
Charitable	14	14

Intuit QuickBooks Payroll Update: Revised Tax Tables

To contact us Click HERE
Intuit has released Payroll Update 21113, which includes revised tax tables.
What do I need to do?
It's important that you receive everything in the Payroll Update to make sure that you are in compliance with legislation that affects your payroll. Just follow these three simple steps:

Check to see if you have Automatic Updates turned on.
-- Choose Help > Update QuickBooks.
-- On the Options tab, you will see either Yes or No selected for Automatic Update.
If Yes is selected, you should receive all Payroll Updates automatically when they are released the next time you are connected to the internet.

You can verify that you received Payroll Update 21113 from within QuickBooks. Go to Employees > Get Payroll Updates. You should see a message that says, "You are using tax table version 21113."
If No is selected for Automatic Update, you need to download the update manually.

Disk delivery customers: The next disk delivery is scheduled for the end of September and will include these updates. If you have an internet connection and would like to download the update now, you can go to http://payroll.intuit.com/support/kb/1001166.html to manually download the updates.

Got a QuickBooks Mess?Call The QuickBooks Gal!775-348-9225

Bookkeeping For Small to Medium Businesses, CPA's and Tax Preparers

To contact us Click HERE

Have you struggled to find just the right bookkeeper for your firm and your clients’ businesses? Do they all have too many personal problems, quit after a short time, or don’t really understand debits and credits which ultimately result in mistakes or costly rework? Are you tired of spending your valuable time on rework or hiring a replacement for inadequate support?
Meet Books and Pay, Experienced Bookkeepers and Payroll Specialists. We are dedicated to serving local Businesses and providing knowledgeable bookkeeping support to Accountants and Tax Preparers to bring you legible, orderly and compliant books 24/7, not just at tax time.
As Advanced Certified QuickBooks ProAdvisors, Intuit Solution Providers, and certified members of the Sage AccountCare Program, we understand how the software works. Our years of experience with local businesses have given us insight into how the average small business owner does his or her books, the mistakes they make and the gaps in their knowledge that ultimately result in costly end of year support.
Our Services Include:

Bookkeeping in our centrally located offices
Remote bookkeeping services and support - We dial in remotely...daily, weekly, monthly, or quarterly to reconcile & "clean up" your books
Complete data entry, including CPA journal entries
QuickBooks software sales, support and training

Additional services:

Weekly, Monthly, Quarterly or On Demand Bookkeeping
Regular transmission of vital reports to Accounting Professional (Financial Statements, Trial Balance, General Ledger & Payroll Summary)
Payroll and all related payroll reporting, including W-2 and 1099 processing
Shoebox to Computer projects (our specialty!)
Software installation & updates
Phone support and training
Bank Reconciliation – bank accounts, credit cards, lines of credit
Checking for logical or inconsistent postings
Verifying online charges for legitimacy

Save time and make money by outsourcing your bookkeeping needs to us.
Call us at 775-348-9225 and ask for me Jayne Miller, for a free, no-risk phone consultation and a customized quote for your firm or your clients’ businesses.

Got a QuickBooks Mess?Call The QuickBooks Gal!775-348-9225

Download QuickBooks When You've Lost Your Disk

To contact us Click HERE

I got a call today from a fellow who had lost his QB 2009 Enterprise disk and needed to install the software on an additional computer. He had it installed on 3 computers and wanted to add a seat (he owns a 5-user license). He had misplaced his disk and wondered if he could get a copy or some connection to a download.

My suggestion was to call Intuit and have his license information handy. They could help him,

Out of curiosity, I did a Google search to see if there is a convenient way to get that download link information without bothering the folks at Intuit for such a simple task....there is!

You can use this link to get downloads of most current versions of your software, but you must have your license information in order to do so. To get that, just press Ctrl and the 1 key in the top row of your keyboard at the same time.

Keep this information just in case you have this issue in the future....great that Intuit makes it so easy!


Got a QuickBooks Mess? Call The QuickBooks Gal! 775-348-9225 jayne@qbgal.com

8 Temmuz 2012 Pazar

"SUMMER" RERUN - MY ALTERNATIVE TO THE YARD SALE

To contact us Click HERE
{Arecent BUZZ post referenced Trish McIntire’s post on garage sales, and theToday show recently had a segment on garage sales, stating that many municipalitiesare imposing more regulations on such events. Here is a rerun that discusses my alternative to the agita of having agarage sale.}
In the summer Americans usuallyclean out their closets, attics, basements, and garages to get rid of “stuff”they no longer need or want.
While some items are true garbageand need to be thrown away, many others still have a useful life – and can beput to good use by someone else.
What do you do? You can have asidewalk, yard or garage sale and try to make some extra money. Not what Iwould do. Do you really want the great unwashed masses tramping through youryard or garage, and possibly your house as well? This activity usually wastes afull day, is loaded with potential for agita, and in the end you never get whatyour stuff is really worth. During the last hour of the sale you often end upalmost giving away what is left just to get rid of it.
A better idea is to donate yourunwanted, but still usable, items to a church or charity. With this method youmay ultimately end up with about 1/4 to 1/3 of the current market value of thestuff in your pocket (depending on your federal and state tax brackets) – whichis probably not much less than you would end up in a yard sale anyway – youavoid the agita, and you get to help out a needy cause.
If you itemize you can deduct the“fair market value” of used items donated to charity. According to the IRS,fair market value is the price a “willing,knowledgeable buyer would pay a willing, knowledgeable seller when neither hasto buy or sell.”
You are responsible for determiningwhat the items you are donating are worth. The charity is not required to, andin most cases will not, provide you with a value. There are several onlineguides to help you come up with a number. Click here for the Salvation Armyvaluation guide.
Whenever you make a contribution ofused items you should always make and keep a detailed listing of the items youare donating with the condition and value of each set of items (i.e. 6 pairs ofmen’s pants, good condition, $60.00, 5 pairs of men’s shoes, good condition,$75.00). You may want to attach a copy of the listings to your tax return.
You cannot deduct the contributionof a used item unless it is in at least "good" condition. Donationsof clothing and household items with a minimal monetary value, such as usedsocks or underwear, are also not deductible
When using a local charity’s bin atthe mall to make your donation be sure that what you are dropping off on anyone day is not worth more than $250.00. If the total value of items donated toa charity in a single day is more than $250.00 you must have a writtenacknowledgement from the charity with its name and address, the date of thecontribution, and a description of the items donated. The acknowledgement mustalso indicate whether you received any goods or services from the charity inexchange for the donation.
TTFN

DON'T LISTEN TO BAD ADVICE

To contact us Click HERE

Justthought I would repeat some commentary from my publication THE SCHEDULE C NOTEBOOK -
Ibelieve it is bad advice to tell ALL taxpayers who have a Schedule C businessto incorporate. There is no tax advicethat applies to all businesses in all situations (except don’t cheat). Thedecision to incorporate a business requires careful review of all the specificfacts and circumstances of the individual situation. And taxes are not the onlyconsideration. In a majority of cases it is not financially beneficial, eitherin the short or long term, to incorporate.
Whileincorporating will certainly reduce one's 1040 audit risk, it is very often notthe best idea for the average sole proprietorship. Incorporation can generatemuch more paperwork, recordkeeping, federal and state tax filings, costs, andgeneral all-round "agita" than it is worth.
Forone thing, like a marriage, it may be relatively cheap to "get into"a corporation, but it can be very expensive to "get out of".
Thereare indeed times when it is better financially to incorporate a one-personbusiness, especially when excessive health insurance and other employee benefit costs are involved. Butcertainly not in all cases.
Somesay the decision to incorporate is a “no-brainer”. There is very little, if anything, about taxlaw that is a no-brainer – especially when it comes to business taxes. That iswhy tax professionals exist. Thedecision to incorporate is by no means a “no-brainer”. It involves a lot ofbrain work!
TTFN

Default Gateway of 0.0.0.0 in Vista

To contact us Click HERE

Strange one just occurred - woke up my machine from sleep, and plugged in the various cables in no particular order. Everything looked good, except no network access. Could ping the local network (including the gateway), but nothing outside of that. Everyone else on the same subnet was seeing external IPs just fine.

A quick investigation with IPConfig showed that I had two default gateways, once with the correct address but another with an address of 0.0.0.0. And it was the one that was first in the list.

No idea where it came from - Vista does use that address if you are using dial-up networking, but I wasn't (although my mobile was plugged in through USB to charge it, so perhaps it is related in someway). Anyhow - that was clearly the problem, so it was just a case of getting rid of the rogue gateway address.

Tried "ipconfig /renew". Tried "ipconfig /release" then "ipconfig /renew". Tried unplugging network cables, mobile phones etc. No luck. Reboot was looking likely. Last attempt was to use netsh. Success :)

For those of you who may get stuck in a similar situation, here's the netsh rune that you need to cast:

netsh interface ipv4 delete address "Local Area Connection"
addr=a.b.c.d gateway=0.0.0.0

where a.b.c.d is your local IP address. netsh can do just about anything to your local network config - well worth some exploration if you're *really* bored.

Targeting .Net 2.0 from VS2008

To contact us Click HERE

Following on from the previous post about old assemblies being updated with the latest .Net 3.5 service pack, I thought it also worth mentioning the other gotcha that can happen when targeting old versions of .Net from VS2008.

If you have a project that is set to target .Net 2.0, VS will dutifully only allow you to add 2.0 assemblies to the project, ensuring that you don't accidentally make use of 3.0 or 3.5 framework features that perhaps aren't installed on the machines of your target audience. However, VS will still use the latest compiler to compile the code, hence you can make use of 3.0 language features such as var, lambdas etc. These work, even on a box with just the 2.0 framework installed, because they are all handled via compiler magic - there was no change to the resulting IL to support the new 3.0 language features.

Now this can either be a good or a bad thing. Good, because you can start making use of the new language tools without requiring your customer to upgrade anything. Why bad? Three reasons I can think of:

For a big project, switching compilers is not a simple decision. Your app has all been fully tested, both internally and through man-years of usage in the field, but by switching the compiler, you have (potentially) just changed every line of code. The only sane thing to do would be a full regression test of the whole system - who's to say that the new 3.0 compiler doesn't have some bugs in it, or (equally likely, I think), it fixes some bugs that were present in the 2.0 compiler, but which your code unknowingly relied on to function correctly.
If you start using 3.0 features on your dev machines, don't forget that you'll also need to upgrade your CI build servers. If they are only building your project, that might be an easy choice. If they are shared by several teams, that may be more difficult.
If you ship code to the customer rather than binaries, you need to ensure that your customer is also happy to upgrade from VS2005 to VS2008, otherwise they won't be able to build your code anymore.

What can you do? Well, if you're in the "it's a good thing" camp, then just get coding. If the bad things are important to you, then the bad news is that there's not much you can do on your development machines to help (other than go back to VS2005!). What you can do is to ensure that on your CI build machines you specify the TargetFramework option to MSBuild. This forces MSBuild to use the appropriate versions of the compiler and other tools. See this blog for more details. That way, if a dev uses some 3.0 language feature, it will cause the CI build to fail and hence get spotted nice and quickly. You don't have a CI server? Shame on you.

Enable SSH on ESXi

To contact us Click HERE

Don't normally bother writing blogs that just reference another blog, but this one gem me a while to find, so if only for my own reference I'm copying it here:

Go to the ESXi console and press alt+F1

Type: unsupported

Enter the root password

At the prompt type “vi /etc/inetd.conf”

Look for the line that starts with “#ssh” (you can search with pressing “/”)

Remove the “#” (press the “x” if the cursor is on the character)

Save “/etc/inetd.conf” by typing “:wq!”

Restart the management service “/sbin/services.sh restart”

Original entry was here, nice one :)

7 Temmuz 2012 Cumartesi

QuickBooks Gal has a NEW COMPANY

To contact us Click HERE
Books And Pay
Bookkeeping and Payroll Professionals
Advanced Certified QuickBooks ProAdvisorsFull Charge Bookkeeping & PayrollWeekly, Monthly, On-Demand SupportShoebox to Computer is Our Specialty!

Experienced Bookkeepers and Payroll ProfessionalsLocal Owned Since 1999! Peachtree AccountCare Partner & QuickBooks ProAdvisors since 1999!Northern Nevada’s ONLY Intuit Solution ProviderQuickBooks Point of Sale and Enterprise Solutions Certified Sales & Support

Legible, orderly and compliant books 24/7, not just at tax time!Bookkeeping in our centrally located offices or remote accessDaily, weekly, monthly, or quarterly to reconcile & “clean up” your booksComplete data entry, including CPA journal entriesPayroll and all related payroll reporting, including W-2 and 1099 processingShoebox to Computer projects (our specialty!)Bank Reconciliation – bank accounts, credit cards, lines of creditSoftware installation & updatesWe support your office staff—let us “check up” monthly to keep your books on track!

Save time and make money - Outsource your Bookkeeping
Call the Bookkeeping and Payroll Professionals

Books And Pay
775-348-9225
jayne@booksandpay.com

A Division of Custom Business Solutions

Changes to Nevada Law Affect 3rd Quarter Modified Tax Return

To contact us Click HERE
Changes to Nevada Law Affect Modified Business Tax Liability NOW! Use this Form!

If you are a bookkeeper or business owner in Nevada, you should be aware that recent changes to Nevada law affect Modified Business Tax effective 3rd Quater 2011.

As of today, QuickBooks MBT worksheet is not compliant. I am sure Intuit is working on this and will fix it very soon, but in the meantime, follow this link to the Nevada Dept of Taxation Form that you should be using immediately.

Books And Pay
Bookkeeping and Payroll Professionals

775-348-9225

jayne@booksandpay.com

Advanced Certified QuickBooks ProAdvisorsFull Charge Bookkeeping & PayrollWeekly, Monthly, On-Demand SupportShoebox to Computer is Our Specialty!
A Division of Custom Business Solutions

Download QuickBooks When You've Lost Your Disk

To contact us Click HERE


Got a QuickBooks Mess? Call The QuickBooks Gal! 775-348-9225 jayne@qbgal.com

Strike Through Line on Text - Pro X Adobe Acrobat PDF

To contact us Click HERE

If you want to put a strike through line through text on an Adobe Acrobat Pro X PDF you created then you have come to the right place. A strike through line is a line that runs through text on your PDF. The text remains visible but it is clear that the text has been crossed out.

A lot of people don't realize they can manipulate the information inside a PDF but you can.

If you want to put a cross out line through your text on an PDF you created using Acrobat Pro X follow these step by step instructions. It is easy to do.

Step 1 - Open PDF

Open your Adobe Acrobat Pro X PDF as you normally would.

Step 2 - Highlight The Text

Highlight the text by dragging your cursor over the word or words you want to want to run a strike thru line through.

Step 3 - Right Click Over The Part You Highlighted

Now right click and select "Cross Out Text" in the menu that appears.

Step 4 - Strike Through Line Appears

Now you'll see the strike through line. The information you selected now appears as if it has been crossed out.

I hope that helps!

If you are not familiar with creating a PDF file using Adobe Pro X using a scanner, I wrote a post that will show you how. How to Create Adobe X PDF Using Scanner

Are you getting a ton of blanks when you scan Pro X PDF's on Scanner? Here's How To Fix

Why Poured Water Won't Come Out Bunn Coffee Machine Brewer

To contact us Click HERE

Pour Over Chamber Lid (Closed)

I have to start off with a disclaimer that I don't represent bunn or claim and expertise on repairing Bunn-O-Matic Coffee machines. That said, as a coffee drinker I have used this kind of equipment heavily both to drink coffee and for professional, work purposes so I do have some knowledge on the topic ;-)

It sounds as though you have poured water through the screen at the top of your Bunn Coffee Machine and no water is coming out. There are a number of possible reasons you are not seeing water fill the coffee pot but only one that I can speak with any remote expertise (and I mean really, really "remote" expertise) and that your issue is related to how you are filling the tank.

The Model Of The Brewer
If you are using a model C Bunn coffee maker you definitely need to directly pour your own water in the equipment at the top of the machine as opposed to running it directly from you plumbing. All or most of the plumbed versions (CT, CTF, CWT, CWTA, CWTB, CWTF, CWTFA, CWTFB Single CW, Single CWF) I believe all have a 'hatch' at the top that will allow you to water directly into the machine.

Is The Tank Empty?

If you are using a brand new (or used purchased) Bunn O Matic Pot for the very first time, the tank in the coffee machine is completely empty. I have no idea how much water your tank holds but one pitcher of water might not be enough to fill the tank. You need to fill the tank first and then any other subsequent adding of water will result in the excess water leaving the tank and pouring into your coffee pitcher sitting on the burner under the filter funnel.

Pour Over Screen With Lid Open

Steps To Fill Tank and Get Water Pouring Into Pot
I know this process works for Bunn O Matic C Series Machine but it probably works for others as well.

For C Series (I recommend keeping an empty pitcher on the burner beneath where the water comes out in case the water suddenly starts coming.)

1. Make sure the heater switch in back of the machine is set to 'Off'

2. Pour one coffee pitcher of water into the pour over screen at the top of the Unit. Be sure to use the coffee pitcher that is provided for the machine

3. Wait two minutes as this will allow the water enough time to run into the tank

4. Repeat steps #2 and #3 two more times so that you have added a total of three pitchers. Make sure you allow two minutes between each pitcher poured.

5. Now, on model C your tank is full (again this may vary from yours). If you experience water coming out before you fill it three times, your tank is smaller than a C series so stop as it is full. Just let the water pour into the pot under the dispenser.

6. Go ahead and turn the heater switch you turned 'off' in step on to 'ON'. On Bunn O Matic makers when you fill them for the first time, you want to let it sit for 20 minutes. Keep the pot under where the water comes out as some dripping may occur when you do this for the first time.

7. Now, you have a tank full of coffee ready hot water. Now when you pour another pitcher into the tank water will come out. Go ahead, add your filter, add your ground coffee and make yourself a cup of fresh coffee.

What If The Pot is Overflowing or Under Filling?

You are really only going to have this problem on Bunn units that are directly plumbed into a water line as opposed to pour-over type units. If you are having trouble getting the right amount of water to dispense into the pot, you'll of course wind up with a wimpy cup of coffee (too much water) or a robust, nasty cup of Joe (too little water). I wrote an article that will teach you how to change the amount of water that empties into a pitcher when using Bunn units. Click Here To Read This Article.

OK, What Coffee Should I Put in My Pot?

Well, now we are getting a little more subjective. I have no idea. There are so many great brands of coffee out there to choose from that I wouldn't know where to start. I do drink a lot of Ellis coffee as well as a lot of Maxwell House coffee, so I did do a comparison of the two. The article linked below compares the two and will direct you to a more thorough review of these coffee brands. Check out the link below.

Maxwell House or Ellis? The Better of These Two Brands Of Coffee

5 Temmuz 2012 Perşembe

DON'T LISTEN TO BAD ADVICE

COST BASIS REPORTING

To contact us Click HERE
Lastweek over at ACCOUNTING TODAY Roger Russell stated the obvious - “Complexity of Cost Basis Reporting Requires Tax Expertise”.
Rogeridentified the problem –
“Every new piece of legislation meant tosimplify certain tax areas generally adds complexity of one sort or another tothe Code. {tax pros} often refer tonew tax legislation as an ‘Accountants Full Employment Act.’
A case in point is thecost basis reporting requirement, in place during this past tax season. Whilecomplicated enough by itself, the situation is exacerbated by differences inthe requirements for brokers and investors.”
Asa tax professional, perhaps the biggest challenge, and time consumer, I facedduring the past tax season was the new Schedule D/Form 8849 format.
Rogerexplained –
“Beginning on Jan. 1, 2011, it becamemandatory for brokers and other financial intermediaries to report cost basisinformation on Form 1099-B to investors and to the IRS for equities acquired onor after that date. The new requirement, spelled out in the Emergency EconomicStabilization Act of 2008, also covers mutual funds acquired on or after Jan.1, 2012, and will cover debt securities, options and private placementsacquired after Jan. 1, 2014.”
Andas I explained in my post “That Was The Tax Season That Was” –
“A new Form 8949 was added to report theindividual short-term and long-term transactions in three separate categories –sales where the cost basis was reported to the IRS on Form 1099-B, sales wherethe cost basis was not reported to the IRS on Form 1099-B, and sales that werenot reported on a Form 1099-B. Aseparate Form 8949 was required for each of the three categories. The Schedule D served as a summary of the8949s.”
Iwent on to detail the biggest problem with this new requirement –
“The various brokerage and mutual fund housesall treated the new Form 1099-B portion of the year-end consolidated tax reportdifferently.
For the most part thisnew system required some additional time, but not additional agita. In many cases the 1099-B reporting wasexcellently broken down into separate categories of short-term “covered”(transactions where cost basis was required), short-term “non-covered”,long-term, and undetermined term. And again and loss analysis, with cost basis for all, or almost all, transactionsprovided, was also included in the report in the same format.
In some the 1099-Breceived by the taxpayer included the cost basis for all transactions –although you often had to read the fine print to discover if the cost basisshown had actually been reported to the IRS.
The worst cost basisreporting formats came from Morgan Stanley Smith Barney and TD Ameritrade, withTD the bottom of the barrel. The 1099-Bfor these brokerages was not broken down to list different categories oftransactions (as described above). Transactions were listed alphabetically, regardless of term or coverage,with cost basis information shown only where required.
MSSB reports includeda gain and loss analysis, but it was merely broken down by short and long term,as had been done in past years. TD didnot include a gain and loss analysis in its consolidated statement. The client had to go online to generate theanalysis, also still in the short or long only format.
The additional workrequired for clients of these brokerages was not so bad with only one or twopages of transactions. But several hadmultiple (as many as 50) pages of transactions (can you say “churning”) – makingproper reporting much more difficult and time consuming than in the past.”
Requiringbrokerage and mutual fund houses to report cost basis is a good thing. In tax seasons past the biggest challenge,and time consumer, was determining cost basis for investments sold by cluelessclients. Brokers and funds were oftenalready providing profit and loss statements with much cost basis information,which was helpful, and when this was not automatically included in a ConsolidatedYear-End 1099 Statement, or some cost basis information was missing, I could inmany cases get the information direct from a client’s individual broker.
Makingcost basis reporting mandatory will eventually save lots of time during taxseason. However, it will take a longtime to fully phase in to maximum reporting. By the time that comes I will be retired.
AndI expect we will never have 100% cost basis reporting. What about the stock that was inherited froma relative, or was received as a gift when the taxpayer was a child? It is easy enough to determine the cost basisfor inherited investments, assuming you know the date of death, and futureregulations could require brokerages to determine cost basis based on date-of-deathvalue at the point the investment is transferred into the account. But determining the basis of a giftedinvestment can be almost impossible.
Inthe meantime to make things a little easier perhaps the IRS could establish arequired pro-forma format for all Form 1099-Bs from all brokerage and fundhouses, and all houses could come to an agreement that Profit and Lossstatements included in the Consolidated Year-End 1099 Statement be done in thesame pro-forma format (if industry-wide agreement is at all possible).
Ideally,all 1099-Bs (and P+L statements)would be “broken down into separatecategories of short-term “covered” (transactions where cost basis wasrequired), short-term “non-covered”, long-term, and undetermined term.”
And, while I am as happy as a pig in reality tv transferring broker-provided profit and loss statements to Form 8849 (and in the past Schedule D) as is, how do I really know that the information provided by the broker is correct. And what is my responsibility as a tax pro to make sure the information is correct?
The alternative is to have all clients keep detailed, contemporaneous, and ongoing records of all investment purchases.
Ohwell, I can dream, can’t I!
TTFN