This week has been a catch up to ensure clients meet specific requirements of the Tax Cuts and Jobs Acts.

The latest e-filed individual jointly filed tax return was rejected due to a lack of explanation statement with an automatic waiver of penalty for lack of withholding. This taxpayer reports the end of the year on a K1 with guaranteed payments. These are subject to Federal and Fica taxes and are calculated on the tax return. The client files and pays estimated payments quarterly. The total paid was less than the tax liability for 2018. Once the explanation was attached the return was accepted despite lack of withholding.

In the last several weeks the filing of Corporations registered in Delaware has been delayed due to the finalization of the Delaware Corp forms.

Also, a Florida Corp with a Partnership shareholder has also been delayed in filing due to a Section 199A software update required to finalize that tax return.

Clients are disappointed with the loss of business meals, however, per dium meals and incidentals became more attractive for those with extensive travel.

Those clients with outstanding penalties and abatement requests in progress found themselves pushed into collections during the shutdown.

Online EIN applications work as long as there is no need for assistance. In that case, the IRS has guaranteed a 4-day turnover, however, the queue was a bit longer due to closure.

E filed returns are being accepted within hours. Practitioner assistance is available still with little wait.

So far we are ahead of the game but as the deadlines approach, I wonder if extensions will be required due to the tax law changes and its effect on the state taxing authorities and software companies.

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