The Tax Return screen is where Tax Returns are created, prepared, edited, and processed. The following instructions will guide you through the entire process of tax preparation, including electronic filing of the Return. Chapter 6 will show you the different ways you can access different functions, along with introducing you to a few functions not mentioned during the Tax Preparation and Electronic Filing directions.
Different areas of the Tax Return screen will be open and available depending on whether you are in the Tax Return Lookup screen or working within an actual Tax Return. When a Return is opened or a new Return is created, the Tax Return Screen opens. This screen looks as follows:
The Navigational Tabs are located at the top of the screen. These tabs allow the User to move between Individual 1040 Returns, Business Returns, and the Website swiftly by simply clicking on the appropriate Tab.
The Tax Return Menu is located along the top of the screen. It includes most of the functions of the normal Menu Bar, along with additional functions for preparing Tax Returns. There are three additional Menu Bar items: Return, Form, and Print. These Menus items are covered in detail in the next chapter.
The Tax Return Toolbar is located directly underneath the Menu bar and contains all of the basic functions you will need in the preparation and filing of a tax return.
This black bar shows the Taxpayer`s Name and Social Security number, along with the date the Return was created. Note: If an asterisk (*) appears next to the taxpayer`s name, a change has been made in the return, but the return has not been saved.
This screen located on the left hand side shows all of the Forms associated with the Return, including documents that are not sent as part of the Return, such as the Invoice. To open a Form from this screen, double click on the particular Form and it will open in the Form screen to the right.The Attached Forms screen is divided into either two or three separate sections:
· General-This screen shows general information concerning the preparation of the Tax Return.
· Federal-This screen shows Forms and Worksheets related to the Federal Tax Return that will be sent to the IRS and/or should be held as a record relating to the Tax Return.
· State-This screen shows Forms and Worksheets related to the State Tax Return if this Return has an associated state return file.
This screen located on the right hand side shows the Form, Worksheet, or other document currently open. When a Return is created, the first open document is the Client Data screen. When you open any document to view or edit it, this is where the document will open and where you will be working.
The first step in creating a new Tax Return is filling out the Taxpayer Questionnaire, which can be found at this end of this Manual and is also available as a PDF. This step is essential to gather all of the information necessary to accurately prepare the Tax Return. It is also of the utmost importance to review all of the Due Diligence questions with the taxpayer and spouse, if applicable, before completing the return. Alternatively, if the taxpayer and spouse are present while the Return is being prepared, the program can be setup to ask required Due Diligence Questions. See page 29 for details. Most of the data entered into the program should come from the Taxpayer Questionnaire, the Due Diligence questions, and External Sources such as W-2s and 1099s.
Follow these steps to create a Return:
1.
Click on
2. Enter the Taxpayer`s Social Security Number. Alternatively, you can scan the barcode of the client`s W-2 form and the social security number will autopopulate. As source documents with barcodes are scanned, the appropriate forms are added to the return with all of the information entered. You can open these forms from the Attached Forms list to view them and add any additional information that may be necessary. You can move from one field to the next by pressing Enter or Tab on the keyboard. It is not necessary to enter the dashes in the social security number. (Example: 123-45-6789 can be entered 123456789).
3. Re-enter the same social security number next to Confirm Entry, and click OK. The Client Data screen for the new Return will open.
4. Alternatively, click the W7 button if the client does not have a valid social security number. The Client Data screen for the new Return will open.
This step allows you to open a Return you have already created to continue preparation of the Return. Note: This function also allows you to add a new Return by filling in the Social Security number in the Return Lookup screen and clicking Add.
To open an existing Return:
1.
Click on
2. Under Search Criteria, next to Last Name or SSN, select the search criteria you want to use from the dropdown list.
3. Enter the data that corresponds to the search criteriaof the Taxpayer and click Go, and only Taxpayers with that search criteria will appear.
4. Or, click Go without entering any search criteria, and a list of all Returns will appear, or to use other Search Criteria, see page 148.
5. Double click on the correct Return after scrolling down to find it, and the selected return will open.
The next step in preparing a Return is entering general information into the Client Data screen about the taxpayer, spouse, and dependents, if any. To move from field to field within the Client Data screen, use either the Enter or Tab key on the keyboard. To delete information, use either the Delete or Backspace key on the keyboard. It is not necessary to fill in every field in the Client Data screen, however, filling in as many fields as possible will make it less likely you will experience errors during Verification, Transmission, and IRS Acknowledgment. Please note that the following directions only assist in where to enter the proper information. Please consult professional tax guides in determining what the proper information should be.
Bookmarks
Bookmarks can be entered in any field in
any Form as helpful notes to yourself as the Preparer about that particular
field for the client. Bookmarks can act as a helpful tickler file of items that
need to be addressed before the return is completed. Also, Bookmarks are
automatically time stamped so that the Preparer can keep track of when the
Bookmark was created. Bookmarks will appear as a Verify Error and may prevent
Printing and/or Transmission depending on how you have set the Verification
Settings during Office Setup. See page 23
for details.
To create a Bookmark:
1. Right click the mouse while in the field of any form, and a dropdown list will appear or press the F6 function key on the keyboard.
2. Click on Bookmark in the menu. The Bookmark Field will open.
3. Enter comment or question and click OK to save or Cancel to exit without saving. A new item will be added to the Attached Forms list named
4. Bookmarks.
To view, edit, or delete a Bookmark:
1. Double click Bookmarksunder General in the Attached Forms list. The Return Bookmarks window will open.
2. Double click on the Bookmark you want to work with. The form where that Bookmark is located will open, and the data field for that particular Bookmark will be highlighted. At this point, changes to the field itself can be made.
3. Press the F6 key on the keyboard to open the bookmark for the highlighted field.
4. Click OK to save the Bookmark as is and return to the previous screen.
5. Edit Bookmark and click OK to save Bookmark as edited and return to previous screen.
6. Click Delete to delete Bookmark and exit the Return Bookmarks window.
Entry of the Client Data Screen
There will be fields in the Client Data
screen where helpful information at the bottom of the screen will be available.
For example, when the Filing Status field is highlighted, the code for each
filing status will appear. To move from field to field in the Client Data
Screen, press Enter or Tab on the keyboard.
To fill out the Client Data Screen:
1.
Next to User Status, enter a User Status Code if
you want to ……. Alternatively, click
2. Next to Transcription Mode, enter “X” only if you want to disable the calculation engine and make every field a data entry field only. If an “X` already appears, this Login Account has been setup for Transcript Mode by default. Delete the “X” to disable Transcript Mode. Transcript Mode can be established as a default setting for all returns for a specific Login Account. For details, see page 47.
3. Next to Prep ID, click the Choices button at the bottom of the screen to open the Paid Preparers window, click the Prep ID for this user, and click OK. The Prep ID will be entered into the field. To set a default Preparation Shortcut ID for this user, see page 47.
4. Next to Site ID, click the Choices button at the bottom of the screen to open the Site ID window, click the Site ID for this location, and click OK. The Site ID will be entered into the field. A Site ID is not a required field and can be left blank. To set a default Site ID for this location, see page 26.
5. Next to Receipt #, if a receipt number does not already appear, enter the receipt number. This is not a required field and can be left blank. To set up the program to automatically assign receipt numbers, see page 23.
6. The Owner field is read only, and the name of the user for this Login Account will appear. In the blank field next to the Created by field, enter an “X” to limit the access of this return to only this Login ID and Administrators.
7. Next to EFIN, enter the EFIN of the Tax Preparer. This information will already appear if it has been setup for this Login.
8. Next to SSN, the Taxpayer`s social security number will already appear. Check this number with the Taxpayer`s social security number to be sure it has been entered correctly.
9. Next to DOB, enter the birthday of the Taxpayer. This field will be highlighted in white when the screen opens. When you press Enter or Tab on the keyboard after entering the DOB, the next field to be highlighted will be Name. The taxpayer`s age will appear next to the DOB field.
10. Next to DOD, enter the date of death of this taxpayer, if applicable.
11. Next to Name, enter the First Name of the Taxpayer, press Enter or Tab, enter the Middle Initial or leave blank, press Enter or Tab, enter the Last Name, press Enter or Tab, enter any other identifying information (Example: Jr.) and press Enter or Tab on the keyboard. The next field to be highlighted will be Occupation.
a. Enter the name of the occupation of the Taxpayer and press Enter or Tab, or
b.
Click
13. Next to Dependent, mark an “X” in the box only if this Taxpayer is claimed as a Dependent on another person`s Tax Return. Otherwise, leave blank. Press Enter or Tab. The next field to be highlighted will be Blind.
14. Next to Blind, mark an “X” in the box if this Taxpayer is legally blind according to IRS regulations. The next field to be highlighted will be Disabled.
15. Next to Disabled, mark an “X” in the box if this Taxpayer is disabled according to IRS regulations. The field to be highlighted will be Home Phone.
16. Next to Home Phone, enter the Taxpayer`s home phone number, press Enter or Tab, enter the Taxpayer`s Work phone number (if any), press Enter or Tab, enter the Taxpayer`s Cell phone number (if any), press Enter or Tab, and enter the Taxpayer`s Email address, and press Enter or Tab. The next field to be highlighted will be Text Message. Note: The Cell Phone number must be entered to use the TextLink feature.
17. Next to Text Message, mark an “X” in the box if the Taxpayer wants to receive information from you by Text Message on their cell phone.
18. Next to Cell Phone Carrier,
a. Click on the Choices button at the bottom of the screen to bring up a window including all of the TextLink supported cell phone carriers.
b. Click to highlight the Taxpayer`s cell phone carrier. Click OK. The Choices window will close and the cell phone carrier and code will appear in the Client Data screen.
19. Next to Preferred Contact, enter “C” for cell phone, “E” for email, “T” for text, or “P” for home phone, depending on the taxpayer`s preferred method of contact. These choices will appear at the bottom of the Client Data screen for quick reference.
20. Next to Form 1040 NR, enter “X” to prepare a Form 1040NR for this taxpayer.
21. Next to Preferred Language, enter the taxpayer`s preferred language for communication.
22. Next to Taxpayer Male/Female, enter “M” if the taxpayer is male or “F” if the taxpayer is female.
23. Next to Filing Status, enter “1” for Single, “2” for Married Filing Jointly, “3” for Married Filing Separate, “4” for Head of Household, and “5” for Widow or Widower. These codes are provided at the bottom of the Client Data screen for quick reference.
a. If you Enter 1, 4, or 5 and press Enter or Tab, the highlighted field will move to Address Information.
b. If you Enter 2, and press Enter or Tab, the highlighted field will move to Spouse Information. Enter the Spouse`s information in the same manner as you did the Taxpayer`s information. Note that the Spouse`s last name will autopopulate as the Taxpayer`s last name as soon as you type in the first letter of the last name if it is the same as that of the Taxpayer. If the last names are the same, press Tab on the keyboard to keep the name. If the last names are different, change it accordingly.
c. If you Enter 3, and press Enter or Tab, the highlighted field will move to If MFS, did you live together at ANY time during the tax year?
i. Mark an “X” if the Taxpayer and Spouse did live together during any time in the tax year. The box below will become highlighted.
ii. If you marked an “X” in the previous field, mark an “X” next to If so, did you live together during the final 6 monthsif the Taxpayer and Spouse lived together during the last six months of the tax year. Leave the field blank if they did not live together during the last six months of the tax year.
iii. Press Enter or Tab until the field under Spouse Information is highlighted, and enter the Spouse`s information in the same manner as you did the Taxpayer`s information regardless of whether an “X” was entered for either of the two questions.
24. Under Address Information, if the taxpayer has a domestic address,
a. Enter the Taxpayer`s mailing address (street address or P.O. Box) and press Enter or Tab, enter Apartment Number, if any, and press Enter or Tab.
b. Next to C/S/ZIP, the highlighted field will move either to the Zip Code or the City, depending on what you have entered during Setup.
i. Enter the City if the highlighted field moves to the City field, press Enter or Tab, enter the two digit State code, press Enter or Tab, and enter the Zip Code.
ii. If the highlighted field moves to the Zip Code field, enter the Zip Code. The City and State fields should be automatically filled.
c. Next to APO/FPO, enter “1” if the Address is an APO, DPO or FPO address, enter “2” if this is a Stateside Military address, or enter “3” if this a foreign address. If none of these apply, leave blank. Press Enter or Tab.
d. Enter the Combat Zone if applicable. Otherwise, leave blank. Press Enter or Tab. Next to Date, enter the date the taxpayer went into the Combat Zone.
e. Next to US Citizen or Residency, select “Y” for yesif the taxpayer is a U.S. citizen or resident in the U.S. for the entire tax year. Otherwise, select “No”.
25. Under Address Information, if the taxpayer has a foreign address, move the cursor to the empty field next to Foreign, click in the field to mark an “X”, and press Enter. The Address Information will change to reflect fields for a foreign address.
a. Enter the foreign address information, as applicable.
26. If the customer will be using any type of Direct Deposit,
a.
Next to Bank
Name, enter the Taxpayer`s bank`s name, or click on
b. Next to Routing Number, enter the Bank`s Routing number unless it was already entered automatically with the bank`s name.
c. Next to Account Number, enter the Taxpayer`s account number at that bank and press Enter or Tab.
d. Next to Account type, select Checking or Savings, to designate the type of account.
27. To track how you are growing your client base,
a.
Under Client
Referral and next to Referral Type,
enter the type of referral or click
b. Next to Description, enter additional information to help you track your referrals. (Example: Name of existing client who referred new client.)
c. Under Appointment Information, enter the Preparer, Date, and Time information for next year`s appointment to meet with this Taxpayer. The next field to be highlighted will be the First Name under Dependents.
28. Answer the questions regarding CADRPlus. Enter a “Y” to purchase the CADRPlus for the taxpayer and family. Otherwise, enter an “N”. Enter an “M” if the taxpayer is male or “F” if the taxpayer is female.
29. Answer the five questions regarding Health Insurance coverage. Enter a “Y” to answer yes, and enter an “N” to answer no according to the Taxpayer`s answers on the Taxpayer Questionnaire.
30. Under Dependents - Children and other qualifying individuals, if the Taxpayer does not have any Dependents leave this section blank. If the Taxpayer does have Dependents,
a.
If
you have been following along with the previous directions, the first
highlighted field will be First Name.
If not, click in that field to highlight it, or if you will need to fill in
more than 9 dependents, click
b. Enter the First Name of the first dependent, press Enter or Tab, enter the Last Name of the dependent, press Enter or Tab, enter the Birthdate of the dependent, press Enter or Tab, enter the SSN of the dependent, and press Enter or Tab. Note that the Dependent`s last name will autopopulate as the Taxpayer`s last name as soon as you type in the first letter of the last name if it is the same as that of the Taxpayer. If the last names are the same, press Tab on the keyboard to keep the name. If the last names are different, change it accordingly.
c.
Under Relationship,
click
d. Under MO, enter the number of months the dependent lived with the Taxpayer during the tax year, or enter MX for Mexico or CN for Canada if the dependent lived in one of those countries for the entire year.
e.
Under Codes,
in the first square,
click
i. Enter “1” if the dependent lived with the Taxpayer,
ii. Enter “2” if the dependent did not live with the Taxpayer because of an agreement either by divorce or other agreement,
iii. Enter “3” if the dependent is the Taxpayer`s parent, or
iv. Enter “4” if the dependent does not fit one of the above descriptions.
f.
Under Codes, in the second square, the program will
automatically select the proper EIC status for this dependent based on the
information already entered. If this status is incorrect because other
circumstances are applicable, click
i. Enter “E” if the dependent is an Earned Income Credit (EIC) qualifying child under age 19,
ii. Enter “S” if the dependent is a student under age 24,
iii. Enter “D” if the dependent is permanently and totally disabled, or
iv. Enter “K” if the dependent is an EIC qualifying child who has been kidnapped,
v. Enter “N” if the dependent is not eligible for the EIC.
g. Under Codes, in the third square, the program will automatically select whether the dependent is eligible for the Child Tax Credit based on the information already entered. If this status is incorrect because other circumstances are applicable, enter an “X” if the dependent is eligible for the Child Tax Credit or remove the “X” if the dependent is not eligible.
h. Under Codes, in the fourth square, enter an “X” if the Taxpayer is eligible for Dependent Care expenses on Form 2441 for this dependent because the dependent is a child, or “D” if the taxpayer is eligible for Dependent Care expenses because the dependent is disabled, or leave blank if the Taxpayer is not eligible for Dependent Care expenses for this dependent.
i. Under ST, different codes may be available depending on the State entered for a particular return. Enter a code from the bottom of the Client Data screen if applicable.
j. If there are more dependents, enter them in the same manner. If not, move to the next section.
31. Under Non-Dependents claimed for EIC and Disabled person`s dependent care expenses, if the Taxpayer does not have any Non-Dependents meeting these requirements, leave this section blank. If the Taxpayer does have Non-Dependents meeting this description,
a. Follow the directions above for Dependents, except under Codes,
i. In the first square, enter “X” if this is a Head of Household qualification.
ii. In the second square, enter the EIC Code,
1. “E” for Eligible,
2. “S” for Student,
3. “D” for Disabled, or
4. “N” for None.
iii. In the third square, enter a “D” to claim dependent care expenses if the person is disabled or enter a “C” if the person is care for because the taxpayer or spouse is a custodian.
b. Under ST, different codes may be available depending on the State entered for a particular return. Enter a code from the bottom of the Client Data screen if applicable.
32. The Client Data screen is now finished, and you are ready to move to the next step, Adding Forms. It is not necessary to exit this screen.
If your client needs to file an Extension for time, rather than a Return, add Form 4868 after the Client Data screen has been completed, according to the general directions below for adding Forms. Form 4868 can be printed or electronically filed.
If the Extension is being electronically filed, it is not necessary to add Form 8879, Electronic Filing Authorization, as directed below for E-filing Returns. During Verification and Transmitting, an Error will appear that Form 8879 has not been attached. This error can be ignored and you can continue the process.
It is now time to add Forms to the Return. Begin by adding External Source Forms-these are Forms whose information is generated solely by external sources, such as W-2s and 1099s. These forms can be entered manually or by scanning a barcode as described below. Please note that source documents are entered by scanning the barcode. The data from the form is automatically added to the return. On the other hand, actual pictures of documents can be scanned and added to the Document Archive, which is described later. Any data from these documents is not added to the return automatically.
Next, add Forms which are secondary to the W-2, such as Schedule A, B, C and D. These Forms will include information derived both from external sources, such as receipts, along with information from the Taxpayer, such as whether a home office was used exclusively for work purposes. If you have entered any Business Activity Forms, follow with the entry of the Depreciation Forms, which will become available upon the creation of the Business Activity Form (directions are given in detail below). Finally, review the Form 1040 and add any additional information that is needed. Note the items above do not include an exhaustive list of Forms, external sources, or other information which need to be added, but were simply given as examples.
Forms can be opened, edited, and otherwise altered by using either the Form Menu or the Return Toolbar. These directions give general instructions for adding and completing all Forms, along with specific directions for a few commonly used Forms.
To Add Forms to the Return and complete them:
1. Click the
2. If the Add Form button is used, select the form you would like to add by scrolling down to the Form or by entering the Schedule/Form Number in the box at the bottom and pressing Enter on the keyboard to automatically add the Form or by pressing Tab from the keyboard to highlight the Form. You can also double-click on a form in the list to add it to the return file. Enter all external source forms first, such as W-2s and 1099s. The W-2 Form is highlighted by default. The forms are organized as follows:
a. The first tab, Federal, shows the forms in order by Form Letter and Number.
b. The second tab, Index, shows the Forms in order by description and field in alphabetical order. This option allows you to find a Form by the description of the field even if you do not know which Form to use.
c. The third tab, ProForma, shows the Forms for storing prior year data and Forms for data entry.
d. The fourth tab, State, shows forms used to prepare State Returns.
e. The fifth tab, Depreciation, shows forms used to calculate Depreciation. Additional Forms will become available in this list as Business Activity Forms are added to the Return.
3. Enter data into the Form in the same manner as the Client Data screen. General rules for filling out Forms are as follows:
a. The field is ready to have data entered when it is highlighted.
b. Use the Enter or Tab keys on the keyboard to move between fields.
c. Darker areas have been autopopulated from other fields in the Return.
d. Other areas are calculated fields which are either already autopopulated or will autopopulate as you add information. (Example: Social Security and Medicare wages and contributions are calculated when you enter Federal Wages. If you change the automatically entered Social Security and Medicare wages, the Social Security and Medicare contributions will be recalculated to show the new figures based on those wages. )
e. A calculated field which has been overridden (the calculation has been ignored and another value has been entered) will appear in red.
4. The bottom of the screen is available for the following information and actions:
a. It will give a more detailed description of what information belongs in a particular field when it is highlighted for quick reference,
b.
It
will provide different Choices such as Codes or information from the
Database when the Choices… button
is clicked.
i. Click
on
c. It will provide access to helpful or necessary Worksheets when the Worksheets button is highlighted.
i. Click
on
d. It will provide links to other Forms when the Form Links button is highlighted.
i. Click
on
5. When the Form is finished, you can continue working on the Return by adding additional Forms or moving to the next section. It is not necessary to save individual Forms as you finish them.
6. After you have entered all External Source Forms, enter all Forms and Schedules secondary to the Form 1040. Example: Schedule A, B, C, D
7. If a Business Return has been created in this program that is associated with this Personal Return, import the Schedule K-1(s). See page 146 for details.
8. Special Note on Depreciation - There are two different Asset Entry Formats available:
a. Regular Non-Vehicle Assets – Follow the directions below to add non vehicle assets to a Business Activity.
b. Vehicle Assets – Follow the Add Vehicle Asset directions to add all vehicles to Business Activities. Also add any vehicles used in conjunction with Form 2106.
To add a Regular Non-Vehicle Asset for a business:
1. To open the Business Activity Asset window,
a. While in the Business Activity Form (Example: Schedule C), hold down Ctrl on the keyboard and press the N key at the same time (the All Forms and Schedules window will open to the Depreciation tab), or
b. Click Depreciationin the Attached Forms list under the General Section, or
c. Add a Form as instructed above and go to the Depreciation tab, and double click the Business Activity for which you want to add an Asset. There will be a selection for every Business Activity already added to the Return file. The Business Activity Asset window for the Business Activity will open showing a list of any Assets that have already been added.
2. Click on the New Asset button. The Asset Details window will open.
3. Scroll down the list to find the type of Asset, click on the type of asset so that a checkmark forms next to it, and click OK.
4. Under the General tab, enter the information that applies to this Asset and check any boxes that apply.
5.
If
the Asset qualifies for the MACRS bonus depreciation because of the Date Placed
in Service, the
a. Each Federal Asset that qualifies will automatically be elected for the Special Bonus Depreciation. Check the first checkbox, only if you would like to elect out of the Special Bonus Depreciation for this Asset.
b. If the Taxpayer`s Resident State allows the Special Bonus Depreciation and you would like to elect to take this depreciation, check the second checkbox.
c. Click OK. The Special Depreciation Allowance window will close.
6. Select the Depreciation Tab, and enter the information for the Federal Return, and the State Return, if applicable.
7. If adjustments to depreciation need to be made, there are now three areas where you can make adjustments, as follows:
a. Basis Adjustment – Located at the top of the screen, enter in an amount to adjust the starting depreciable basis.
b. Adjusted Depreciation – Located in the Prior Depreciation section, enter an amount to adjust prior year accumulated depreciation.
c. Depreciation Override -– Located in the Current Depreciation Section, enter an amount to override the calculated depreciation or check the box at the bottom to override depreciation to zero.
8.
Click
To view the depreciation breakdown of an asset after the Business Activity Asset window has closed:
1. While in the Business Activity Form (Example: Schedule C), hold down Ctrl on the keyboard and press the N key at the same time. The All Forms and Schedules window will open to the Depreciation tab.
2. Double click the Business Activity which has the asset you want to view. The Business Activity Asset window will open.
3. Double click on the Asset you want to view. The Choose Asset Class window for this particular asset will open.
4. Click the Depreciation Tab. The depreciation breakdown will appear on the screen.
To remove an Asset from a Business by Sale or Casualty:
1. Follow the directions above to open and view the Choose Asset Class window for the asset you want to remove.
2.
Click
a. Enter the information and check the boxes in the highlighted fields as applicable. The darkened fields will become calculated and filled as you enter the highlighted fields.
b. Click OK.
3.
Click
a. Enter the information in the highlighted fields as applicable. The darkened fields will become calculated and filled as you enter the highlighted fields.
b. Under Form 4684 Occurrence Link, and under Description,
c. Choose New Occurrence from the dropdown list to create a new Form 4684 and automatically enter the information into the Form 4684, or
d. Choose an Occurrence already appearing to link the Casualty or Loss to an already created Form 4684 and automatically enter the information into the Form 4684, or
e. Choose Manual Transfer of Asset Basis to not link Form 4684. This Form will have to be added and the information entered manually.
f. Click OK.
4.
Click
a. Enter the Date Taken out of Service which is the date the Asset is no longer used for business purposes.
b. Click Ok.
To delete an Asset from a Business:
1. Follow the directions above to open and view the Choose Asset Class window for the asset you want to remove.
2.
Click
3. Click Yes to delete the Asset or No to abandon the deletion of the asset.
To add Vehicle Asset for a business:
1. To access Business Activity Asset window,
a. While in the Business Activity Form (Example: Schedule C), hold down Ctrl on the keyboard and press the N key at the same time (the All Forms and Schedules window will open to the Depreciation tab), or
b. Add a Form as instructed above and go to the Depreciation tab.
c. Double click on Car/Truck to open Business Activity Asset window.
2. Click on the New Asset button. The Asset Details window will open.
3. Scroll down the list to find the type of Car or Truck, click on the type of Car or Truck so that a checkmark forms next to it, and click OK.
4. Under the General tab, enter the information that applies to this Vehicle and check any boxes that apply, and answer all Vehicle Questions. Note: If the vehicle was placed into service and depreciated in a previous year, the program will automatically use actual expenses and depreciation for the deduction. If the asset was placed into service during the current tax year, the program will use the larger deduction available (depreciation and actual expenses vs. mileage) unless the Force Mileage Standard Rate option is chosen.
5.
If
the Asset qualifies for the MACRS bonus depreciation because of the Date Placed
in Service, the
a. Each Federal Vehicle that qualifies will automatically be elected for the Special Bonus Depreciation. Check the first checkbox, only if you would like to elect out of the Special Bonus Depreciation for this Vehicle.
b. If the Taxpayer`s Resident State allows the Special Bonus Depreciation and you would like to elect to take this depreciation, check the second checkbox.
6. Click OK. The Special Depreciation Allowance window will close.
7. Next to Depreciation Override to Zero, check the box to override the calculated depreciation and set it to zero.
8. Under the Mileage Expense Tab, enter all of the information as applicable for the vehicle, as follows:
a. Next to Total Vehicle Mileage, enter the total mileage of the vehicle. Entering the mileage amounts creates the business use percentage. It is also used to attach the vehicle asset to the corresponding Business Activity.
b. Enter the Total Commute Mileage to subtract this mileage from the Total Vehicle Mileage in the final calculation, or enter the Avg Daily Commute Miles and the program will calculate the Total Commute Mileage to subtract from the Total Vehicle Mileage.
c. To attach the asset to a Business Activity, enter the total miles driven for each Business Activity.
9. Under the Depreciation Tab, enter the information for the Federal Return, and the State Return, if applicable.
10. If adjustments to depreciation need to be made, there are now three areas where you can make adjustments, as follows:
a. Basis Adjustment – Located at the top of the screen, enter an amount to adjust the starting depreciable basis.
b. Adjusted Depreciation – Located in the Prior Depreciation section, enter an amount to adjust prior year accumulated depreciation.
c. Depreciation Override – Located in the Current Depreciation Section, enter an amount to override the calculated depreciation or check the box at the bottom to override the depreciation to zero.
11. Click
Please Note if you would like to view a breakdown of All Vehicle Assets by Business Activity select the Car & Truck Form from the Attached Forms Screen.
After all of the tax data has been entered into the return, the following steps ensure the proper completion of the return.
Finishing the return after all tax data has been entered:
1. After you have entered all secondary Forms, open Form 1040 by double-clicking on RET 1040-FEDERAL RETURN under FEDERAL in the Attached Forms Screen.
a. Review the Form 1040 making sure all of the information is complete and fill in any additional information that must be entered on Form 1040 directly.
2. Open Form 8879 which will be automatically added to the return file under the Federal Attached Forms list. The Refund Type field will be highlighted when the form is opened.
a. Next to Refund Type, enter “1” for Check from IRS, “2” for Direct Deposit from IRS, “4” for Tax Payment Due, or “5” for a Refund Transfer from bank. These codes are provided next to the box and at the bottom of the screen for quick reference.
i. If a “5” is entered, indicating a Bank Product, the Electronic Bank Application will be added to the Attached Forms list. See directions below for completing the Bank Application.
b. The cursor will now move from the Home Phone and Work Phone number as you hit Enter or Tab on the keyboard. These numbers should be autopopulated from the Client Data screen, but enter the phone numbers if they do not appear.
c. Under Other Documents Attached, select any additional documents that need to be attached to the Return, and use the Choices section at the bottom of the screen to determine the appropriate entry.
d. Under Part II, Declaration of Taxpayer, Line 6c, check the box only if the Taxpayer wants the IRS to automatically withhold funds from the Taxpayer`s refund to pay federal income taxes owed by the Taxpayer.
e. The cursor will now move to the Taxpayer`s PIN. If the PIN is not set up to automatically generate, enter a 5 digit number selected by the Taxpayer. It cannot contain all zeros. To set the program to automatically generate taxpayer`s PINs, see page 25.
f. The cursor will now move to the Spouse`s PIN. If the PIN is not set up to automatically generate, enter a 5 digit number selected by the Spouse, if applicable, and hit the Enter or Tab key on the keyboard. It cannot contain all zeros.
g. The cursor will now move to the Prior Year AGI. Enter this amount from last year`s Return if the information has not autopopulated. When this field is complete, hit the Enter or Tab key on the keyboard.
h. The cursor will now move to the Spouse`s Prior Year AGI. Enter this amount from last year`s Return, if applicable and the information has not autopopulated. When this field is complete, hit the Enter or Tab key on the keyboard.
i. The cursor will now move to the Taxpayer`s Prior Year PIN. Enter the 5 digit number selected by the Taxpayer for last year`s return.
j. The cursor will now move to Spouse`s Prior Year PIN. Enter the 5 digit number selected by the Spouse for last year`s return, if applicable.
k. The cursor will now move to Signature Date. Enter the date the Taxpayer and Spouse are acknowledging and electronically signing this return.
l. The cursor will move to the next section, and the PIN codes fields will be autopopulated. If the taxpayer and/or spouse manually entered their own codes, change these figures by highlighting on each code and using the Choice button at the bottom to enter the proper code.
m. The cursor will move to the ERO/Paid Preparer PIN. Enter a 5 digit number selected by the ERO or Paid Preparer. It cannot contain all zeros.
n. The remainder of the information should be autopopulated. However, if it is not, continue to hit Enter or Tab and move through the rest of the Form and enter information where it is missing.
3. Other forms that may have been added to the Return File and may need attention are as follows:
a. The File Options Form will be added to the Attached Forms list when data is entered into the return indicating that the taxpayer will be receiving a refund. This Form is a helpful tool allowing the Client to view all of their options concerning mailing or e-filing the Return, along with options for using Bank Products.
b. If the Taxpayer is eligible for the Earned Income Credit and Form 8867, the Preparer EIC List will have been automatically added to the Attached Forms List. These questions should be answered so that the User satisfies the Due Diligence requirements of the IRS in regards to the Earned Income Credit.
i. Open the Bank Application by double clicking on Bank App under Federal in the Attached Forms list.
ii. Enter all data on the screen-Banks will not process partially completed Bank Applications.
4. The Return is now ready for the Verification Process. Verify, E-File, and Print the Return. See directions below.
5. The following documents should be printed:
a. A Preparer`s copy of the Bank Application will need to be printed or saved as a PDF with the Return if a financial product is being purchased. This application should be signed by the Taxpayer and kept by the Preparer in his or her office or electronically.
b. A Truth in Lending Disclosure statement will be printed with the Bank Application, if applicable. This statement should be signed by the Taxpayer and kept by the Preparer in his or her office or electronically.
This program allows you to create an electronic file of the entire return, including all source documents and any other paperwork associated with the return. The scanner allows you to take pictures of the documents that can be viewed in the Document Archive and printed at a later date if necessary. This step helps you create a paperless office and still meet your due diligence requirements. You can also import files into the Return File and attach documents to the electronic Return that is sent to the IRS.
To Add Pictures of Documents or Import Files to the Return File:
2. Click the Scan Document button to add a picture of a document to the return file, and use the scanner to position the picture of the document. The Capture Document Image window will open.
3. At the bottom of the open window, select from the dropdown list, Identification, Income Sources, or Other Items, and enter an identifying name for this document.
4. Click the Snap button to take a picture.
5. Click the Crop or Rotate button at the top of the window to crop or rotate the picture, if necessary.
6. Click the Savebutton to save the picture of the document with the accompanying information.
7. Click the Import Document button to add an electronic file to the return file.The Document Import window will open.
8. Enter the File Name or browse to locate the file.
9. Enter a Descriptionof the file.
10. Click the OK button to save the document to the return file.
11. Additional documents can be added to the return file in the same manners (either scan or import), or click Close to close the window.
To View a Picture of a Document Already Scanned or a Document Imported:
1. While the return file is open, double click on Document Archive under General in the Attached Forms list. The Archived Documents Listing window will open.
2. Click on the document you want to view to highlight it, and click Open. The picture of the document will appear.
3. Click Closewhen you are finished viewing the document.
To Attach Documents to the Electronic Version of the Return to be Filed with the IRS:
1. While the return file is open, double click on Document Archive under General in the Attached Forms list. The Archived Documents Listing window will open.
2. Click on the document you want to attach to the electronic version of the return to be filed with the IRS to highlight it, and click Attach Document. The Document Attachment Listing window will open.
3. Click Close.
The next step is Verification of the Return. The program examines every field in the Return to determine whether there are errors that must be fixed before the Return is sent to the IRS. The Return should be verified even if the Return will be filed by mail.
To Verify the Return:
1.
While in the Return you want to Verify, click
2. If no Errors are found, the No Errors/Reject window will open. This window states that the Return has been verified successfully.
a. To Transmit the successfully Verified Return, hold down the Ctrl key on the keyboard, and hit the “T” on the keyboard at the same time. The Return will be queued to be Transmitted on the WIP.
b. To Print the successfully Verified Return, hold down the Ctrl key on the keyboard and hit the “P” on the keyboard at the same time. The Print Final Return window will open allowing the return to be printed immediately, a PDF of the return will be generated, or the return will be queued to be Transmitted on the WIP depending on the configuration created during Setup.
c. To Transmit or Print at a later time, click OK. The Return will still be open.
3. If Errors have been found in the Return, the Return Errors and Rejects window will open. This window will open automatically on the Verify tab and the Verify Errors will be listed by Package, Form, and Message.
4. Click on an error to highlight it and correct the problem.
a.
To
view the Details of the Error, click the
b. To correct the Error, double click on the Error. The Form where the Error is occurring will open, and the Field where the Error is occurring will be highlighted. Fix the Error and press Enter on the keyboard. The Return Errors and Rejects screen will appear and the next error will be highlighted. Continue correcting all of the errors until the process is finished.
5. Click the Verify button to run the Verification process again. Continue to fix errors and run the Verification process until all of the Errors are fixed and the No Errors/Rejects window opens.
This program allows you to easily electronically file your Clients` Returns. The Returns are queued to be Transmitted from within the Return after the Return has been prepared. During Transmission from the WIP Summary, the Returns are sent to Central Site, which then sends the Returns to the IRS and any applicable state agencies, for States that support e-filing and are listed in Appendix 2. Note that Form 8879 and the proper State filing Form must have been attached during Tax Preparation. Please see page 102 for further directions if this step has not been completed. If you are not e-filing a Return, skip this step and move to the next step, Printing the Return and other Related Forms.
Two types of State E-filing are supported:
Federal and State Electronic Filing - The Federal Return is sent to the IRS with the State Return. Once the IRS acknowledges (accepts) the Federal Return, the IRS sends the State data to the appropriate State department. State Returns must be sent with the Federal Return. Central Site will receive acknowledgements from both the IRS and the State and will send them to your program during Transmission. However, if there is an error with the State Return, the State agency will contact the Taxpayer directly.
Independent filing for States - The Federal Return and State Returns are sent separately to the taxing authorities. If both a Federal Return and State Return are being filed, Central Site sends the Federal Return to the IRS and waits for an acknowledgment. Once the federal acknowledgment has been received, Central Site sends the State Return to the proper State agency. It is not necessary to send the State Return at the same time as the Federal Return, and a State Return can be filed even if the Federal Return has not been processed by this program.
To Queue Returns for Transmitting to Central Site for E-filing:
1.
While in the return file, click
2. Check the boxes under the Queue column for those Packages you want to queue for Transmitting at this time.
3. Check the box Submit for Diagnostics only if the return needs to be examined by Technical Support before it is sent to the IRS and/or State agency.
4. Click Queueto send the Returns to the Transmit Queue in the WIP Summary or click Close to abandon the function. The action taken will depend on how you have selected the Transmission settings in Setup. The Return Lookup window will appear and the Return will be highlighted.
5. To Transmit the Returns from the WIP Summary, see page152.
The final step for preparing every Return is Printing all of the necessary copies of the Return. (This step may have already been completed as part of the Verification process.) If a paper Return has been created, it can be printed at this time. There are other options available for printing separate parts of the Return. See page 146 for further directions.
To print all of the necessary copies and accompanying paperwork of the Return:
1.
While in the return file and after it has been
verified successfully, click the
2. If there are additional Verify Errors in the Return, the Return Errors and Rejects screen will appear. If you still want to Print the Return, and you have allowed Printing with Errors in Setup, click Next. The Print Final Return window will open. If you have not allowed Printing with Errors in Setup, the Verify Errors must be corrected before Printing can occur.
3. If there are no Verify Errors in the Return,
a. If you have chosen Print Immediate in Print Options in the Printer Setup, the Print Final Return window will open.
b. If you have chosen Batch Printing in Print Options in the Printer Setup, the Return will be queued for Batch Printing in the WIP. To Print the Return from the Batch Printing option, see page 159.
c. If you have chosen Transfer in Print Options in the Printer Setup, the Return will be queued for Transfer in the WIP and will not Print. This Return can be printed later from the Transmitting computer.
4. Once you reach the Print Final Return window, choose the Printer you want to use next to Name from the dropdown list. The default printer created during Setup for printing Returns will automatically appear.
5. There are several choices available at this point, some of which can be combined with each other (Example: Print Preview and then Print), as follows:
a. Click Printto Print the Return, or
b. Click SignDoc to enter an electronic signature from a Signature Pad on the document, or
c. Click the Email Doc checkbox first, and then click SignDocto enter an electronic signature from a Signature Pad on the document and email a signed/encrypted copy of the tax return to the Taxpayer.
d. Click Queueto queue the Return for Printing in the WIP, or
e. Click Filter to choose only certain pages of the return to print or archive, or
f. Click PDF to create a PDF of the Return, or
g. Check the Encrypt PDF box to encrypt the PDF so that it may be safely emailed to the client, or
h. Click Preview to preview how the Return will look when Printed, or click Close to close the Print Final Return window.
6. Every item chosen in Return Printing during Printer Setup will Print. To change the list of Items that will be printed, see page 33.
This function allows you to send an encrypted PDF of the tax return to the Taxpayer. This feature must be enabled under Text Messaging in Office Setup. See page 31.
To email an Encrypted PDF of the Tax Return:
1.
While in the return, and after it has been
verified successfully, click the
2. Once you reach the Print Final Return window, select Email Encrypted PDF Copy of Tax Return. The PDF Password Window will open.
3. Select a PDF Password by one of the following two methods,
a. Click OK to accept the automatically generated PDF Password. The Password consists of the last four letters of the taxpayers` name and the last four digits of the taxpayers` SSN, or
b. Enter a new unique PDF Password and then click OK to open the Email window.
4. Create the Email by the following directions,
a. Enter the Subject to describe the email,
b. Click into the body section and enter the message you wish to convey,
c. Check the Send Attachment Password box to send a second email that contains the PDF Password created previously in step 3 and will be needed to open the PDF.
d. Select the Taxpayer and/or Spouse box(es) to designate whether to send the email to the Taxpayer, the Spouse or both. Note: If the boxes are greyed out and cannot be checked, an email address was not entered on the Client Data Screen for that individual.
5. Click Ok to send the Email message.
TextLink allows you to send your Clients Text Messages about the status of their Returns, such as whether a Return has been acknowledged, whether a loan has been approved, or whether a check is ready for pickup.
To send a Text Message:
1. Open the Return of the Client as directed above for Continuing an Existing Tax Return.
2.
While
in the Return, click the
3. Type in your message up to 160 characters.
4. Click OK. The TextLink-Text Confirmation window will open.
5. Click Yes to send the message. The TextLink-Success screen will open showing that your text message has been sent.
6. Click
OK to close the window,
or click Cancel
to close the TextLink-Text Messaging Option.