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News, Forms & Procedures - February 2, 2015

Input and Procedures

Deleting Line Items: When deleting a line item use a red pencil to cross it out completely and clearly. Otherwise, do not use a red pencil/pen to make entries or make audit marks.

Deleting Proforma Pages: Never remove an input form with proforma data on it.

Pre-printed data is in the input file and to remove it the item must be

deleted by the data entry operator. If you discard the form or cover over the item, our operator will not delete the information. To delete the form just cross out the input form with a red pencil.

 

New Elections: There are 2 new ‘safe harbor’ elections available for 2014 returns:

  • Safe Harbor De Minimis Reg. 1.263(a)(1)(f): For expensing items up to $500 per invoice. Enter code ‘74’ on 1040 Form 2, in the Election section at the bottom, in zip 15, 17 or 19. This prints a single generic election that covers the entire return. For business returns use the followingcodes on Form 2 for the applicable system to generate the election:
    • Code 83 for Corporation
    • Code 32 for Fiduciary
    • Code 56 for Partnership
  • Safe Harbor Small Taxpayer, Reg. 1.263(a)(3)(h): For expensing up to 2% of a building’s unadjusted basis but not more than 10,000 per building. Total income for the prior 3 years must not exceed $10,000,000. An election is required for each building. Enter each building’s description in the election field on Form C-2 [28B], zip 36; Form Rent [31A], zip 85; Form F-2 [36B], zip 37; Form 4835 [38A] zip 68. A separate election will print for each activity.

Do not enter a code ‘74’ in any of these zips. If you need additional space for the property description, you can attach a Form 90 and reference the form and zip number.

Note: Due to the late addition of these election fields, some proforma forms may not have them although your blank supplies may. You can just attach a correct copy of the updated input form behind the main form using the same activity number, and enter your election information there.

 

RDE E-file: Always check your e-file interactive diagnostics and run a Print with only Create electronic file checked under the Government copy, and then Check E-file diagnostics to clear all E-file errors before transmitting to ExacTax. Procedure charges will apply when e-file corrections need to be applied at ExacTax.

Note: This year’s proforma files do not contain a state PRP (Per Return Pricing) code that allows the complete print preview required to check your electronic filing diagnostics when you have a state return present. To get a PRP code when you are ready to check the E-file:

  1. Go to CS Connect: press the red plug on the toolbar or [Ctrl+K]
  2. On the upper left-corner press the Acquire PRP tab
  3. Select your client(s) and move them to the right-hand pane.
  4. Press the Call Now button in the lower right.

Note: Only get a PRP for the returns you intend to process. Once you get a PRP you will be charged for that return.

 

RDE Prior Year E-file: E-file is available for 2012 and 2013 1040, 1041 (except CA 2012), 1065, 1120 and 990 original returns. Amended returns can be EFiled except for 1040 and CA 2012 541. For years prior to 2012, eFile is not available.

Note: When you send a 2011 or earlier year for RDE processing and the electronic filing box is checked the return will take longer to process.

 

Electronic Funds Withdrawal (EFW): When bank information has been entered at the top of Form {3A} and e-file is requested, in the event there is a balance due, you must specify to either:

  1. Suppress electronic funds withdrawal (zip 11), or
  2. Enter the date to have the payment take place.

Check zip 8 to use 04/15/15 or specify a different date in zip 9.  If both zip 11 (suppress) and zip 8 or 9 are entered, ExacTax will suppress EFW.

Important: An EFW request for federal does not automatically apply to the state. If you want EFW for California you must submit Form CABank {CA33B} and check zip 3 or enter the date in zip 4. Other states must indicate EFW on their applicable ‘Bank’ form. A payment for the CA LLC must be separately requested as well on Form CALLCBnk {CA56Q}.

 

PIN Indicator: Form Pin {3A}, zip 5 MUST be ‘4’ for joint returns and ‘2’ for all others. Do not leave it blank or make any other entry as this delays the processing of your return.

 

Suppress Form 2210: E-file requires that the amount of penalty shown on Form 2210 match the amount of penalty shown on Form 1040. If a code ‘2’ is entered on Form Pen {5}, zip 18, to Print Form 2210 and suppress the penalty on the return, the return will be disqualified for e-file if there is a penalty calculated since it will not match the return.

 

Schedule D: Dates are required on all transactions. You may enter ‘V’ for various or a complete date (MM/DD/YY) but don’t enter a partial date or leave the date sold field blank.

 

Car and Truck Expenses: E-file of Schedule C requires a Form {51} when any car and truck expenses are claimed.

 

Schedule A {70A} zip 28: The 2014 additional local rate for Los Angeles County remains 1.5% and there is no applicable local table code; the ‘IRS’ column should be blank.

 

Form 2441 – Dependent Care Credit: The complete provider name, address and ID number is required on Form {80A}. For California e-file, the provider’s telephone number is also required. Enter the phone number at the end of the provider line and format with the dashes (xxx-xxx-xxxx). The area code is required.

If there are no dependent care expenses this year, the dependent care provider information must be deleted.

 

Form 8867: When claiming the EIC the due diligence Form 8867 must be included with the return. All questions on Form Cr {79} must be answered completely to qualify for the EIC.

If there are any children claimed for EIC there must be at least one entry in the Residency of Qualifying Children section. If there is a Schedule C there must be at least one entry in the Documents or Other Information for Schedule C section.

Note: You can complete the 8867 questions on any return, even if the EIC ends up not applying. If the taxpayer doesn’t qualify for the EIC, nothing will be printed.

 

CA Head of Household: California e-file requires the Head of Household Questionnaire, Form {CA42} to be completed. All starred items must be completed.

Tip: If you enter a code ‘6’ on the qualifying dependent on Form 1040 {1}, zip 67, in the State Use field at the end of the dependent line, the dependent information will be transferred to the {CA42} to the fields with the asterisks. A ‘best time to call’ and phone number are required entries in zips 21 - 24. The daytime phone number from Form 1040 {1}, zip 23 will automatically transfer if nothing is entered on {CA42}, zip 23.