Discussion:Amended return still not processed after 7 months

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Discussion Forum Index --> Advanced Tax Questions --> Amended return still not processed after 7 months


Discussion Forum Index --> Tax Questions --> Amended return still not processed after 7 months

Wkstaxprep (talk|edits) said:

26 November 2012
Hi all,

Hope you are well and enjoying holidays.

I filed an amended 2008 return on April 15th 2012 to amend client's return to claim materially participating real estate professional which generated an NOL. I also filed an amended 2006 return on April 15th, 2012 to file a carry back refund cclaim for the NOL generated on the 2008 amended return.

On June 13th, 2012 received letter that return was being transferred to Philadelphia service center for processing and we would hear back within 120 days which would be October 13th, 2012. No futher correspondence as of November 25th, 2012.

I called the Philadelphia office a number of times in October and seemed to get a different answer every time I inquired on status of return. Finally at end of October I was informed by Philadelphia, office that return was transferred yet again and this time to Queens, NY office and the return looks like it is under review and will need some verfication and that I should contact the Queens, NY office.

I went to the Queens, NY office in person at the end of October and they said unless the return has been assigned to someone there is no updated status they can give and they can not even confirm if they have the return or not.

I was also advised to send a fax to the Queens, NY office as to status of return. Bottom line is I have called, written, mailed and faxed both the Philadelphia office and Queens, NY office in addition to calling the practitioner hotline who's only status is that a letter was mailed in June stating to allow 120 days but they have no further information.

I just can't seem to find out what's going on with this return. If it's under audit that's totally understandable but since I can't seem to get a definitive answer as to what's going on is there anything further I can do? Taxpayer is waiting on these returns to be processed in order to move forward with filing current returns. I'm just not sure what to do at this point, do I just wait a bit longer? I mean 7+ months since amended return was filed and the best status update I can get is the return in all probability is in the Queens, NY office but no one is sure who the return has been assigned to if at all? Please help if possible, thanks !!!

Captcook (talk|edits) said:

26 November 2012
I would contact the Taxpayer Advocate office. They can get the ball rolling on things like this when all else fails. They will want detailed records of your contact and correspondence, which it appears you have. I had a series of amended returns netting the client a refund of about $35K that took more than two years to get resolved. A year of that was after the TP advocate had been involved. Good luck!

Death&Taxes (talk|edits) said:

26 November 2012
Took over 2 years to resolve a 160K Golden Parachute refund claim, with the file seeming to be transferred several times before an auditor came to my office and approved the refund. Unfortunately the client, playing golf one August day on Long Island, dropped dead of a heart attack three days before the auditor's visit. The IRS man was gentleman enough to honor the POA of the dead man and conclude the case.

Kevinh5 (talk|edits) said:

26 November 2012
The taxpayer may file a suit for refund in District Court.

Supdat (talk|edits) said:

26 November 2012
Unfortunately, 7 months is not unusual. The last big refund claim I filed took over a year to be issued. Normally, I would wait at least a year before asking before contacting the taxpayer advocate to follow up on a refund claim. However, given, that the amended returns impact current returns, I think you are justified in contacting the taxpayer advocate now, as suggested by Captook.

My experience with the taxpayer advocate is that they are much more effective if the case is referred to them by an IRS agent. Therefore, you might cosider contacting the IRS office, and ask for a referral. Good luck.

Supdat (talk|edits) said:

26 November 2012
Typo - The third sentence of my post should say: "Normally, I would wait at least a year before contacting the taxpayer advocate to follow up on a refund claim."

Wkstaxprep (talk|edits) said:

26 November 2012
Interestingly enough the state amendeds (New York) were processed and refunds issued within 6 weeks, unreal.

Thank you for all the helpful insight.

Ckenefick (talk|edits) said:

26 November 2012
Not unreal.

http://www.treasury.gov/tigta/press/press_tigta-2012-54.htm

Wkstaxprep (talk|edits) said:

26 November 2012
Thank you for the link.

Wkstaxprep (talk|edits) said:

4 January 2013
Update : I went again to the IRS office in Queens, NY and the first few people I spoke to insisted they don't have the return but then someone else helped me and was able to find the contact that was given to me and sure enough the Queens, NY office does have the return just as the Philadelphia office had suggested. I spoke to the IRS rep and she said since it's a refund claim they usually ask for additional documentation and I would hear from them soon and she gave me her direct contact phone number which was somewhat comforting. Well, that was about 3 weeks ago and I left a message yesterday and have not heard back yet. I'm thinking I will wait until Monday afternoon then try to call IRS rep again and if I don't hear back by Wednesday I might as well go there in person again since it's literally 2 miles from my office. Any additional advice would be greatly appreciated. Thanks and Happy New Year.

Ckenefick (talk|edits) said:

5 January 2013
Send the IRS a copy of 6532(a)...then file suit. Enough time has passed.

Taxea (talk|edits) said:

5 January 2013
And in the meantime contact Tax Advocate.

IDrinkYour Milkshake (talk|edits) said:

5 January 2013
I recently had an issue where an auditing agent would not agree with me that a working interest in a oil & gas well had a profit motive since the first year was a loss saying it was a hobby. In addition, the agent stated intangible drilling costs should be organizational costs instead. After 5 months of a back and forth I contacted the TAO and the issue was resolved with no change in 3 days.

Ckenefick (talk|edits) said:

5 January 2013
Lol. "sir, please tell me your hobbies."

"well, i like to bowl, I have some horses and I drill oil wells for fun. It's really a fun way to lose money."

Wkstaxprep (talk|edits) said:

27 January 2013
IRS rep assigned to case told me i would hear from them in february as to what documentation they need to process the refund claim. Will keep you all posted. Thanks!!

Taxea (talk|edits) said:

27 January 2013
As I posted above: And in the meantime contact Tax Advocate.

Wkstaxprep (talk|edits) said:

14 February 2013
update: received call today from IRS office saying that the return has been assigned. IRS rep wants to meet me (the Tax Preparer, power of attorney on file) at my office location in 2 weeks. He said it's not an audit but that he just wants to review the 2008 amended return that created the NOL and the 2006 carryback refund claim and that I should have documentation for any items that were used to amend the return and he assumed the original items on the original returns were correct and no backup documentation would be requested for original items. He said they won't be sending an audit document request because it's not an audit. They just want to review the carryback claim and amended return which created the NOL. Doesn't this sound a bit contradicting? The change on the amended return if you recall is changing taxpayer to a materially participating real estate professional status so he can realize most of his losses without the $25,000 real estate passive limitation. What would you anticipate? What documentation should I be ready to present? Should I ask client to produce a log book as proof of his hours worked on the rental building in case IRS rep asks how we arrived at meeting the hour criteria at each building and only use the log book if needed? Has anyone had a similar experience? Is it possible rep may just do a general overview of the amended return and carryback claim and ask general questions? As referenced earlier client has no W-2 income on return, only rental properties. Thanks!!!

Kevinh5 (talk|edits) said:

14 February 2013
1) Proof of RE Professional status.

2) Log book of hours spent on rental activity.

That's really all that changed - from regular investor to RE Pro.

But I would have proof of all the Sch E items on hand.

Wkstaxprep (talk|edits) said:

14 February 2013
Thank you Kevin. Wouldn't proof of r/e prof'l be the log book or they're not the same?

Kevinh5 (talk|edits) said:

14 February 2013
What qualifies her as a RE Pro? Builder? Broker? Etc. The list is in 469 and the regs to 469.

Real Estate Professional

Also, if grouping is required, proof that the taxpayer made the election to group should be provided at this non-audit examination.

Spending more than 750 hours on rentals isn't enough on its own to make a person a RE Pro.

Wkstaxprep (talk|edits) said:

14 February 2013
Got it thanks!!

Taxea (talk|edits) said:

15 February 2013
Why does he need to meet at your office? Can't these documents be provided via mail/fax? I wouldn't want him in my office. How would you know if TP is spending 750 hrs on the rentals? She would need to provide you with a log.

I would tell the "not-audit" agent that you need time to collect together all the docs and you can only do it if he provides you with a detailed list, in writing, of each item he would like to review. Then I would either meet him at his office or ask him if you can fax the documents to him. After all, you are in the middle of the busiest time preparing taxes and it is extremely inconvenient time-wise, at this time to make time for him. Perhaps he would be willing to wait until after the tax season or allow you to fax copies of the docs to him.

Death&Taxes (talk|edits) said:

15 February 2013
In the case I mentioned above about the 159K Golden Parachute claim, the agent took less than two hours in my office, reviewing the worksheets the man's former employer provided and that was it. I think Kevin is spot on and the last thing I would do is put a log book or copy in mail......and if I received a copy in the mail and was the agent, I might want to look at the original (like the time I found a client's log book was published two years after the fact). Might be nice to have some details of the properties available, like photos, which can give an idea of the duties that took up these hours.....maps too showing their location.

Wkstaxprep (talk|edits) said:

16 February 2013
Can't a log book be reconstructed just like a car log can for an audit? Also buildings were converted legally from 2 family to 3 family rentals so would documentation of the conversion be good to have to help demonstrate hours worked on the rental properties? Thanks!

Wkstaxprep (talk|edits) said:

16 February 2013
Do you think most real estate professionals have a daily log every year in case they get audited? I dont think realistically most r/e pro's keep a log to prove hours. Their main priority is running the business not logging hours.

Ckenefick (talk|edits) said:

16 February 2013
Nonetheless, still seems to be *the* issue in your case.

Wkstaxprep (talk|edits) said:

16 February 2013
Good point!

Joanmcq (talk|edits) said:

16 February 2013
RE Pro is heavily audited. And if he doesn't have a log book, you're sunk. Does the taxpayer have another job? What was your basis for the amendment, and deciding your client was RE Pro?

Taxea (talk|edits) said:

17 February 2013
Have you contacted the Tax Advocate office yet?

Wkstaxprep (talk|edits) said:

17 February 2013
Hi Joanmcq and Taxea,

1.) The taxpayer does not have another job, all he did was run 3 rental buildings on a full time basis

2.) The basis for the amendment was since all he did was spend his time, energy, and resources in rental properties and he meets the required hours, etc in order to have been able to elect real estate professional status on the originally filed return.

3.) I have not contacted Tax Advocate because IRS rep is meeting with me in a week, is there still a need to contact them?

4.) Also,on the original 2008 return taxpayer had an NOL of $20,000. Amending the 2008 return to reflect r/e prof'l status created an NOL of $50,000. Even if the IRS rep disallows the R/E status I will still request a carryback refund claim on the original $20,000 NOL that was never carried back to 2006 (and an election to forego the carryback was never made so taxpayer has to carryback the NOL whether it's the $50,000 that wins the audit or the $20,000 that was already on file but prior accountant never advised taxpayer to carryback the refund and/or make the election to forego the carryback).

5.) Is is likely/possible that the IRS rep will ask more general questions regarding the 1040X such as , how did you determine r/e status?, did taxpayer have a w-2 job?, what kind of properties does he own?, can i see a copy of closing statements?, and not ask for a log? Keep in mind IRS rep said this is not an audit that he only wants to see how the NOl was arrived at, etc. As I said sounds very contradicting, sure sounds like an audit. I have heard from colleagues who have had clients audited for R/E professional that the auditor does not always ask for a log book. Should I only give him the log book if he requests it? And can a log book be reconstructed? The IRS says a car log book can be reconstructed so why not a Real estate profesioonal log book?

6.)Last point, taxpayer converted 2 of the rental properties from 2 families to legal 3 families, evidence by paperwork and $60,000 in capital improvements that are being depreciated on tax return. Wouldn't this help back up taxpayer's case that he spent numerous hours on these rentals?

Thanks so much, you guys/ladies are so very helpful !!

Joanmcq (talk|edits) said:

18 February 2013
Did he do the renovations himself? Can he substantiate the 750 hours per rental?

Taxea (talk|edits) said:

18 February 2013
Note: "he" is being used. Please read it as "he/she"

1. I would send him a statement and whatever calculations/documents you used to determine that the TP is a RE pro and how many hours he spent managing the properties. Why wait for a meeting with him. He is way beyond the 45 day requirement that they have to deal with the issue.

2. If you choose to meet with him do not provide anything the auditor already ask for. Do not meet him in your office. If he does ask other questions, tell him you didn't bring your file with you because you were told by him that this was not an audit so you didn't realize you would need anything other than what he had originally asked for. Keep your answers brief. Do not volunteer or offer anything that you haven't already discussed with him. If he asks for other things tell him you need the time to research his questions. This is not your only client, you can't be expected to keep the nitty details in your head. The auditor should make a detailed list of what he wants and why.

3. You can also ask why he is asking for XXX. What is he looking for. If he can tell you more specifically you will probably be able to provide it but, if he keeps it really general he is probably just fishing.

4. Don't let an auditor talk to your client or your client to him. Clients don't understand tax law and often say things that are best left unsaid.

And yes I would call the tax advocate office asap. Tell them what is going on, what the auditor has asked for and especially that he claims this is not an audit. They do not work for the IRS. They work for you to keep the IRS honest. They can advise you or take the information and settle the issue for you.

My question is, if this isn't an audit then why is (a) an auditor involved and (b) why does he want to meet with you.

Taxea (talk|edits) said:

18 February 2013
Joan does it have to be 750 per rental? I just wondered because they are all on one Sch C. I was thinking you would only have to show 750 for the business, rather than 750 per unit. Could you clarify this for me. thanks

Ckenefick (talk|edits) said:

18 February 2013
Unless an election to aggregate was made...

Wkstaxprep (talk|edits) said:

18 February 2013
I asked the IRS rep if I could meet him at his office he said no he wants to me meet at my office.

An election was not made so t/p will need to show 750 hours per rental. On 2 of 3 the 750 can be documented very well on the 3rd I'm not as confident. On the 3rd however the building was sold in 2010 so t/p will recognize suspended losses anyway.

Kevinh5 (talk|edits) said:

18 February 2013
Taxea, why would rentals be on a Sch C? There are some good reasons, but wondering if your client meets those.

Ckenefick (talk|edits) said:

18 February 2013
If you're 100% confident that your buttoned up, can prove everything, have logs, etc., then have everything ready. I see no harm in this. Of course, if you would rather not do this, then leave all files at home relating to this matter. If they ask questions that you would rather not answer, then write them down and tell them you'll check the files once you have access to them.

And refresh our memories - what type of properties are these?

And what is the Schedule C that Taxea is referring to?

Kevinh5 (talk|edits) said:

18 February 2013
It's a tax form for a sole proprietorship business, Chris.

Laketahoecpa (talk|edits) said:

18 February 2013
Wait - you don't need to aggregate for the 750 hour test. If you client works 750 hours or more (and half of his/her personal services) in IRS defined "real estate professions" then your client is real estate professional.

Next step is to prove material participation in the real estate activity (i.e., the rentals) using the 7 material participation tests under ยง469. So you need to prove your client spent 500 hours or more on each of the rentals. This is where aggregation election would come into play.

And if your client doesn't meet 500 hour test take a look at other 6 tests to see if you can meet one of them.

Ckenefick (talk|edits) said:

18 February 2013
Wait - you don't need to aggregate for the 750 hour test.

I would agree with you, but at least one tax court decision has said otherwise (Bahas).

But then there was a subsequent tax court decision (Miller) that seemed to indicate that the Bahas rationale was wrong.

I remember reading Bahas and saying to myself...Hmmm...

Wkstaxprep (talk|edits) said:

18 February 2013
Real estate professional status t/p needs to prove 750 hours spent on each rental (since aggregate election not made).

Ckenefick (talk|edits) said:

19 February 2013
Read what Lake said. If you even get into this technical issue w/ the IRS, show them Miller.

Wkstaxprep (talk|edits) said:

19 February 2013
Thank you!

Ckenefick (talk|edits) said:

19 February 2013
WKS - What kind of properties are these - why so time intensive?

Joanmcq (talk|edits) said:

19 February 2013
And why Sch C? Should be Sch E.

That explains some; a huge Sch C loss is waving a red flag as much as RE Pro.

Taxea (talk|edits) said:

19 February 2013
Why C? Because WKS said the TP filed as a RE pro.

WKS you can ask to speak with the agent's supervisor if you don't want to call the tax advocate. I don't even have my clients come to my office and if this is not an audit the agent has no authority to go pass the public area of your office location without your permission. I usually do well in dealing with the IRS but when they step past their authority that is a different story.

Kevinh5 (talk|edits) said:

19 February 2013
Taxea:

SELF-EMPLOYMENT INCOME

In general, rental income/loss from investment real estate is not self-employment income/loss. This is the general rule, whether or not the taxpayer/owner/landlord is a "real estate professional" under the Section 469(c)(7) rules.

Here's what IRC section 1402(a)(1), defining "net earnings from self-employment," says: "... there shall be excluded [from self-employment income] rentals from real estate and from personal property leased with the real estate ... together with the deductions attributable thereto, unless such rentals are received in the course of a trade or business as a real estate dealer ...."

Taken from the TA page I linked above.

Wkstaxprep (talk|edits) said:

19 February 2013
Hi again,

The 3 rentals were correctly reported on Schedule E.

The rentals are 3 family rentals.

Tbe reason for so time intensive is they were not buildings in good condition, and they were converted from 2 family rentals to 3 family rentals with t/p doing a good portion of the work himself.

Wkstaxprep (talk|edits) said:

23 February 2013
Tomorrow the IRS rep is stopping by my home office for the review of the amended return and carryback claim. Any last words of wisdom?

Kevinh5 (talk|edits) said:

23 February 2013
Sunday?????? Something is wrong here. Make sure you see her ID.

Taxea (talk|edits) said:

23 February 2013
Take the docs to her rather than having her come to your office. That way if she starts asking for other things you can say you weren't aware she would need to see "whatever" so you will have to provide it at another time. Then ask her for a detailed list of what she wants to see and why she feels the need to review it.

Answer questions only pertaining to the document you have provided. Don't volunteer anything. If she asks for unrelated information tell her you did not review that particular information and would have to do so before you could give her an accurate answer.

Wkstaxprep (talk|edits) said:

24 February 2013
Thanks Kevin and Taxea. I meant Monday is the IRS meeting. Sunday I'm spending preparing for the audit.

Ckenefick (talk|edits) said:

24 February 2013
Don't worry too much about it. You want to be in control of the meeting as much as you can. If you feel uncomfortable or unsure about something, tell the agent you'll have to review the records and get back to him or her. For this reason, you might want to leave some of the docs w/ the client or at your regular office. This idea has been posited more than once.

Wkstaxprep (talk|edits) said:

24 February 2013
Thank you for your support Ckenefick

Taxea (talk|edits) said:

24 February 2013
Much easier to meet in her office then she can't ask you to look up the info while she is in your office.

Kevin I think that is what I said, never as eloquently as you however.

Death&Taxes (talk|edits) said:

24 February 2013
When I worked for a tax lawyer, we would put them in the library, surrounded by law books, then close the door so they wouldn't be disturbed. Maybe I am wrong, but WKS has been waiting for eons to get this affair finalized. Trudging to IRS and then 'having to get back to them' will put another three months into the case, I would bet.

Ckenefick (talk|edits) said:

24 February 2013
Much easier to meet in her office then she can't ask you to look up the info while she is in your office.

She can ask whatever she wants. If you don't want to give her answers or feel uncomfortable, then tell her you'll check the records, or you'll discuss with the client, and then you'll get back to her.

This is just a refund claim anyway. It's not like there will be any assessment if the claim is denied.

Wkstaxprep (talk|edits) said:

24 February 2013
all valid points. Yes, I would like to get this case closed one way or the other. last question, if the IRS denies the r/e professional status, at what point do i say "okay we are not going to fight a long battle on the r/e professional status for the $50,000 NOL on the amended 2008 return but there is still an original $20,000 NOL from the original 2008 return that needs to be accounted for on the 2006 refund claim"?

Thanks

Kevinh5 (talk|edits) said:

24 February 2013
um, isn't the refund statute past for 2008?

Spell Czech (talk|edits) said:

24 February 2013
I think the OP covered that pretty darn well:

"I filed an amended 2008 return on April 15th, 2012, to amend client's return to claim materially participating real estate professional which generated an NOL. I also filed an amended 2006 return on April 15th, 2012, to file a carry back refund claim for the NOL generated on the 2008 amended return."

Spell Czech (talk|edits) said:

24 February 2013
William (or do you prefer Bill): I reread this thread this morning, and I would note that your taxpayer will need only 500 hours per activity, I think, rather than the 750 hours that you've mentioned a couple of times, above, to satisfy the "material participation" part of the manifold tests for Real Estate Professional.

And have your proof of mailing with you at the meeting. Both '08 and '06 returns. I got tripped up *once* by not having it with me...

Ckenefick (talk|edits) said:

24 February 2013
I agree w/ the 500 hours. Bahas wasn't gonna win anyway, but the decision included the comment that each rental had to satisfy the 750-hours test since an aggregation election wasn't made. This comment threw everyone for a loop, including myself. I went back and looked at that case and the subsequent Miller case and read some of the professional commentary on it, and I would agree that all we need is 500 hours. Now, Miller didn't come right out and say the Bahas comment was wrong, it only did so indirectly, by inference.

Spell Czech (talk|edits) said:

24 February 2013
Maybe the IRS's window - is it sixty days? - to challenge this claim has expired...! What is the effect of the June 13, 2012, letter, in this regard? Anybody?

Kevinh5 (talk|edits) said:

24 February 2013
Spell, can you direct us to the code section that requires the IRS to act on a claim within 60 days (or otherwise)? I can only think of the fact that the taxpayer may file a suit for refund if the IRS hasn't acted on the claim within 6 months.

Death&Taxes (talk|edits) said:

24 February 2013
Per BNA, IRS should issue a Statutory Notice of Disallowance. "You can then file a suit for refund in a federal district court or in the Court of Federal Claims. The suit must be filed within two (2) years from the date the IRS mails the notice of disallowance to you. You can also file suit if the IRS fails to act on your claim within six (6) months from the date your claim was filed."

So that is your option should the claim be rejected. I have seen this Notice of Disallowance several times.

Wkstaxprep (talk|edits) said:

24 February 2013
Wow, this is so much help. Thank you.

Spell Czech and Kevin I do have proof of the mailing. The 2008 amended return was filed on April 14th, 2012 via Fedex delivery confirmation. The 2008 amended return statute would be April 15th, 2012 (3 years after original due date of April 15th, 2009) and then you can carry back the 2008 amended retun 2 years to 2006. The 2006 claim was also filed just in time via Fedex on April,14th, 2012.

Spell Czech (talk|edits) said:

24 February 2013
No, I can't direct you to it; that's why I questioned my own mention of it, ok?

Wkstaxprep (talk|edits) said:

24 February 2013
Why would the IRS issue a Statutory Notice of Disallowance? I'm confused on that one.

Death&Taxes (talk|edits) said:

24 February 2013
I was responding to Spell's 60 days, but it applies to your client also, should they be adamant about real estate professional status.

Kevinh5 (talk|edits) said:

24 February 2013
William, for the reason David cited above - 2 years to file suit.

Wkstaxprep (talk|edits) said:

24 February 2013
Sory Kevin I don't see any posts from a David. I found on IRS website the statute for IRS processing refund claims only applies to form 1045 not form 1040X. From IRs wesbite "Carryback claims (Form 1040X) are not subject to the 90-day processing timeframe. However, carryback claims are priority work, and will be processed within the same 45-day timeframe, to the extent possible. "

Wkstaxprep (talk|edits) said:

24 February 2013
"When a customer files a claim timely, the statute remains open for the IRS to examine it. If the IRS takes no action on the claim within six months from the time it was filed, the customer can file suit in court to recover the amount claimed The period for filing suit lasts until two years after the date a certified notice of claim disallowance is mailed to the taxpayer or the date the taxpayer signed Form 2297, Waiver of Statutory Notification of Claim Disallowance On the other hand, if the Service allows the claim (this could be done by the Service Center prior to the case being sent to the field for examination), any further action on that year's return creates a barred statute situation if that year is a closed year"

Ckenefick (talk|edits) said:

24 February 2013
Check the profiles. I'm "Chris," for example.

There's no timeframe in which the IRS is required to act on an amended return. In WKS' case, the amended return is also a refund claim. I mentioned Sec 6532 a while ago.

Trillium (talk|edits) said:

24 February 2013
And Death&Taxes is David (hover over the picture on his user page).

Wkstaxprep (talk|edits) said:

24 February 2013
Okay, thanks, got it :)

Death&Taxes (talk|edits) said:

24 February 2013
While your client can go to court after six months, this means he has to lawyer up.....a tad expensive!

Wkstaxprep (talk|edits) said:

24 February 2013
sorry to keep asking this, but I still don't see the rationale for why the IRS could issue a statutory notice of dissallowance if the returns were filed within the 3 year statute of limitations.

Kevinh5 (talk|edits) said:

24 February 2013
But you already stated the reason yourself, William. I suggest you re-read my posts, David's posts, and your own posts. It's there three times.

Ckenefick (talk|edits) said:

24 February 2013
If IRS issues the NOD, they've essentially created a statute of limitations. That is, you have 2-years to file suit. If 2-years goes by, it's too late.

Kevinh5 (talk|edits) said:

24 February 2013
There, that's 4 times.

Ckenefick (talk|edits) said:

24 February 2013
Honestly, I think he was paying attention, but just didn't understand the legal importance of the NOD.

Kevinh5 (talk|edits) said:

24 February 2013
But he even wrote what it meant himself........Not a problem though. Sometimes I can't see the forest for the trees myself.

Wkstaxprep (talk|edits) said:

24 February 2013
Ok thanks everyone. I will post tomorrow and let you know how how it went. From Will aka wkstaxprep

Ckenefick (talk|edits) said:

24 February 2013
Sometimes I can't see the forest for the trees myself.

I think that is true of all of us.

Death&Taxes (talk|edits) said:

24 February 2013
Next time you're lost, call the Taxpayer Advocate!

Wkstaxprep (talk|edits) said:

27 February 2013
Update: Met with Revenue Agent on Monday. Was expecting middle aged man, suit and tie, briefcase, master tax guide in one hand and and calculator in other hand . Instead got mid 20's kid, ripped jeans, plaid shirt, 7 inch beard that wasn't shaved for 5 years (not that there is anything wrong with any of these things). You pros were right on target with most of the items. Agent wants to see a log book/daily calendar, wants invoices, copies of leases, documentation if apartments were mostly rented or vacant, so on and so forth. After careful consideration and disussing with my client, we agreed that the time and effort to get all this documentation together may not be worth the difference in refund money, we decided that we would see if agent would be willing to simply carryback the original NOL that was never filed by prior accountant and get a refund of $7,000 (instead of the $13,000 we were hoping for). Also, a new development is that one of the buildings is being sold in the near future so t/p will get the suspended losses in year of disposition. Lastly, t/p has not yet filed 2011 original return. On the 2011 original return I will be sure to recommend to t/p to make the aggregate election which will make proving the r/e prof'l status on 2011 and going forward much easier. Thanks again for all the feedback and support. Revenue agent is returning to my office a week from Monday to finalize the carryback for the $7,000 refund. I realized why he wants to meet at my office, he said he likes to get out of the office because the day goes faster for him.

Death&Taxes (talk|edits) said:

27 February 2013
Before you jump into 2011 and aggregation, read this:

"Downside of Aggregation Election

The biggest downside of making the aggregation election is the adverse impact it may have under the so-called complete-disposition rule. Specifically, all the suspended passive losses allocable to the electing taxpayer's aggregated rental real estate interests cannot be "freed up" under the complete disposition rule until after the taxpayer disposes of substantially all of the interests. As a result, if a taxpayer has significant suspended passive losses allocable to certain properties that are likely to be sold in the near future, it may be prudent to defer making the aggregation election until after the sales are made."

http://www.wipfli.com/BlogPost_Tax_4_27_10.aspx

Kevinh5 (talk|edits) said:

27 February 2013
Yup, we've had that very discussion on this site several times, D&T.

Wkstaxprep (talk|edits) said:

27 February 2013
Yes, very good points !

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