This is really helpful! I don't think he included both our original returns when he did the first amendment - that might be part of the problem. Should I be asking for copies of everything before he submits? I'm worried if I don't see it beforehand, I'll end up with another mistake.

Absolutely request copies of EVERYTHING before he submits! You should get: 1) The complete Form 1040-X 2) Any supporting schedules that have changed 3) A copy of both your original separate returns that are being attached 4) Any worksheets he used to calculate the new numbers Review each form carefully and make sure your children are properly listed with their names and SSNs on the appropriate form. Check that the "net change" column accurately reflects the difference between your original filing and the corrected amounts. Don't let him submit anything until you've had a chance to review it all. Given his track record, you're right to be cautious!

I did this too but recommend using tax software if you go this route. I used TaxAct for my amendment (changing from single to head of household) and it walked me through everything step by step. It was much easier than trying to figure out all the forms myself.

Do you meet with your CPA in person or is it all virtual? I've been thinking about using someone out of state because they're cheaper than local options but wondered if that creates any issues.

I started with in-person meetings pre-pandemic, but we've been completely virtual for the past two years and it works great. I upload all my documents to her secure portal, we have a video call to discuss any questions, and then she prepares everything. For your situation, using someone out of state can work fine for federal taxes, but just make sure they're familiar with your state's tax laws if you have state income tax. My CPA specializes in my state's property tax rules which is helpful for my rental, but if you don't have special state circumstances, location probably doesn't matter much.

Those tax prep chains are so hit or miss. My parents got a great preparer at Jackson Hewitt for years but when that person left, the new person missed tons of stuff. I think it really depends on the individual preparer's experience more than the company.

Exactly! I think that's the problem - these big chains hire seasonal workers, give them minimal training, and then put them to work. Some might be great if they happen to have background knowledge, but many just follow the software prompts. My CPA actually takes continuing education courses every year to stay current on tax laws and asks me thoughtful questions about my situation that the H&R Block person never considered. She caught that I could deduct some medical expenses and home office deductions that were completely missed before.

That's really interesting! I hadn't considered cost segregation. Do you know roughly what percentage of the property value you were able to accelerate the depreciation on? And did you use a specialized firm for the study or was it something your regular accountant handled?

We were able to accelerate depreciation on about 25-30% of our property value, which made a substantial difference in our first-year deductions. The components included things like specialized electrical systems, certain fixtures, landscaping elements, and some interior components that could be depreciated over 5-15 years instead of the standard 39 years for commercial property. We used a specialized engineering firm that works alongside our accountant for the study. While it cost around $4,500 for our $750k property, the tax savings in the first few years more than covered this expense. Your regular accountant likely won't have the engineering expertise to properly classify all building components, so I'd recommend finding a firm that specializes specifically in cost segregation studies.

This is actually really good advice depending on your overall situation. My tax attorney suggested this exact approach, and it's worked out much better for me tax-wise. The corporation gets the full deduction for rent payments, and I can take advantage of depreciation plus potential appreciation personally. Just make sure to set a fair market rent to avoid IRS scrutiny.

Thanks for bringing up Form 4852! I actually didn't know about that option. So if I use my last pay stub to fill out this form, do I need to do anything special when filing my taxes? Like do I need to mail my return instead of e-filing?

You might need to mail in your return instead of e-filing if you're including Form 4852. Some tax software allows you to e-file with this form, but others don't. We ended up mailing ours to be safe. Also make sure you fill out Section 3 of the form explaining why you're filing a substitute W-2 and what efforts you made to get the original (like your phone calls and emails to the company).

Unfortunately that won't help in this case since they're trying to file 2022 taxes now in 2023/2024. They're already past the extension deadline. They need to file ASAP to minimize penalties.

Fired him on the spot? But then you had to find someone new during tax season? How did you even manage that? Most good accountants are completely booked up by March.

This is an important point. A lot of people think any income loss during COVID qualifies, when the form is specifically for days you couldn't work due to very specific reasons. The IRS has been flagging suspicious 7202 claims for audit, so you definitely want to make sure you qualify and have documentation.

Thanks for clarifying! That makes more sense why you're pursuing this. Given your situation, I'd definitely push for including Form 7202. The credits can be substantial. One option not mentioned yet - some tax software programs like TurboTax or H&R Block software allow you to complete Form 7202 yourself. You could potentially use the software just for that form, print it out, and give it to your accountant to incorporate into your return. That's what a friend of mine did when her accountant was being difficult about some rental property deductions.