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ACCOUNTANT TRAINING NETWORK

ProSeries Tax Planning Tools

®

Tax Year 2005

05/06

Webinar Training

This section contains important information about your webinar experience; please review it as soon as possible.

What is a Webinar?

Webinars are on-line educational sessions that allow you to attend training events without leaving your office. You will view the instructor's desktop in a virtual classroom that delivers the most interactive and effective live, on-line training possible. Our experts guide you through the latest version of the software, delivering our comprehensive training programs designed especially for accountants like you. The only requirements are a high speed Internet connection and a phone line. This new web-conferencing format makes it easy to gain valuable knowledge while earning Continuing Professional Education (CPE) credits. To view course descriptions and schedule information, please visit www.accountant.intuit.com/training.

Before Your Webinar

Before your webinar, you must verify that there is a high-speed internet connection at the workstation to be used for the session. If you are running dual/multiple monitors, run your WebEx session in your primary monitor for best results. We strongly recommend that you review and/or print these materials in advance of your class. Your instructor will refer to this guide throughout the webinar. You will also need your Webinar Registration Confirmation and Instructions which contains your event password and the course evaluation.

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On the Day of Your Webinar

Please join your training session at least 10 minutes before the scheduled start time, but not more than 30 minutes as you may not see the event listed. 1. Close any unnecessary open applications. 2. Open your web browser and type the following url directly into the address line (take care not to type this url into any "Search" fields (i.e. Yahoo, Google). http://intuitevents.webex.com/

P If you are viewing this electronically, click the link.

3. Locate the webinar title you are attending on the List of Events by Date page (it is most likely near or at the top of the listings) and click Join Now.

F You can customize this page for your time-zone by clicking in the upper-right corner. By

default, events are listed in Central Time. (i.e. if a webinar is scheduled at 11:00am central time, then you will attend at 12:00pm if you are in the Eastern Time zone, 10:00am for Mountain and 9:00am for Pacific). 4. We highly recommend disabling any pop-up blocking software for the duration of the class.

F If you have any technical difficulties or need assistance with any WebEx related

instructions, please call WebEx toll-free Technical Support at (866) 229-3239.

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5. You are prompted to enter your name and email address, which are used to identify your connection to WebEx. Note that Intuit respects your privacy and does not collect your email address here for marketing purposes. 6. You are also prompted for the event password. This password can be found on your Webinar Registration Confirmation and Instructions, which is the same document that contains the url to these materials. 7. An "Event in Progress" message appears as the WebEx Event ManagerTM downloads. Accept this download to participate in the webinar.

F It may take a few minutes to complete the download. While the "Event in Progress"

message is on your screen, do not click your mouse or use your keyboard.

When the download is complete, you will be placed in the WebEx Event Manager window. 8. To access the audio portion of the webinar, follow the instructions in the first window that appears after joining the event.

F All Webinars are set up as "Lecture Only" which means you can not be heard by other

meeting participants, and only the presenter has speaking privileges.

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Troubleshooting

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If you experience any audio problems, please hang up and call the phone number you called originally and press # to speak with a technical support representative. If your phone connection is lost for any reason, immediately call back into the class. If your internet connection is lost for any reason, please close your web-browser and re-open it. Follow the same instructions to rejoin the event. If you have any additional difficulty rejoining the meeting, first verify that your internet connection is currently working (this may require you to contact your ISP). Otherwise, please call WebEx toll-free Technical Support at (866) 229-3239. You may find it easier to use a telephone headset that keeps your hands free during the training class. If you do not have a headset available, a good quality speakerphone may also prove to be helpful.

Using WebEx Features

Your webinar will be facilitated by a live instructor referring to these materials as well as the on-screen demonstration. There will be time at the end of the webinar for questions, and opportunity throughout to use Chat and possibly Polling (based on the specific course). These features are explained below. Chat Use the Chat panel to communicate with your instructor about your webinar or to respond to questions that the instructor poses to the group or to you individually. This tool works much like instant messaging and text messaging tools. Type your comment in the text box at the bottom of the Chat panel window and press Enter or click Send.

F Please do not use Chat to post

questions about the content being covered in your class. Your instructor may not see the question if it is not posted in the Q&A panel (see next section). In your webinar, you can only chat with the instructor. Your comments will not be seen by other participants. There is no need to change what appears in the Send to field. If you change it by accident, ensure that it displays Host to ensure your comment is seen by the instructor. Keep in mind that your instructor may read your response to the group if they feel it is necessary or needs to be shared. They most likely will not respond via Chat.

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Q&A Your instructor will set aside an appropriate amount of time at the end of the webinar for questions from the group. The instructor will read each question aloud and then respond to it verbally. Application sharing may or may not take place during this time, and the webinar will end once the last question has been answered. You can post your questions in the Q&A panel at any time during the webinar; however, remember that the instructor will answer all questions at the end of the presentation. Polling In certain webinars, you may be asked to complete a Poll. We typically use Polls for one or more of the following reasons: Obtain important information from you about training in general or specific topics, to help us deliver best in class training. · Facilitate an exercise to help you better retain the information being covered. If you are completing an exercise using the Poll, the questions are displayed in the Polling Panel to the right of your screen. Answer the questions directly in the Polling panel and click Submit when you have completed the questions. The instructor will go over the correct answers with the entire group after the exercise. Your individual answers will not be displayed on screen, nor are they published in any way.

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Raise Hand Your instructor does not respond to "raised hands." Please post your comments in the Chat panel and questions in the Q&A panel. Ending the Webinar Once the webinar has concluded, you can select Leave Event from the File menu. You are prompted with a confirmation. Click Yes to confirm.

Once WebEx closes the Meeting Center, you are immediately directed the webinar materials. If you do not need to re-visit the materials, close the second browser window. Completing Your Evaluation Your evaluation contains personal and firm information at the top. Verify that this information is accurate. If you find a mistake, please correct it on the printed copy so we have an accurate record.

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You may also need to contact Customer Service to update your firm information if it is incorrect. Also, near the top of the evaluation form are 2 blank spaces provided for keywords. We use keywords in accordance with NASBA regulations that require CPE providers to validate your attendance during live we-based events. To ensure that you are physically present during the webinar, your instructor will provide 2 keywords at 2 different times. Be sure you write both in the appropriate area.

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If these keywords are missing or inaccurate, we will be unable to process your CPE certificate. Please complete the body of your evaluation. There are several statements provided to gauge your satisfaction and overall experience in the webinar. Note that the scale for each statements starts and 0 and ends at 10. 0 (lowest score) means that you Strongly Disagree with the statement and 10 (highest score) means that you Strongly Agree. We greatly appreciate any comments you can provide to help make webinars better for everyone, particularly if we did not deliver the highest quality of satisfaction. Complete and fax your evaluation form to (214) 387-2910 at your earliest convenience.

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Course Credit You can earn CPE credit for taking this course. For CPE credit information including the number of hours for which this course is eligible, please visit www.accountant.intuit.com/training We must receive your evaluation form with the CPE keywords from the course included (see section above, Completing Your Evaluation).

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Please allow 4-6 weeks to process your CPE certificate.

Intuit, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be addressed to the National Registry of CPE Sponsors, 150 Fourth Avenue North, Suite 700, Nashville, TN, 37219-2417. Web site: www.nasba.org Copyright © 2006 Intuit Inc. All rights reserved. Unauthorized duplication is a violation of applicable law. Intuit, the Intuit logo, Quicken, QuickBooks, QuickBase, TurboTax, ProSeries, Lacerte, EasyACCT, FundWare, QuickBooks ProAdvisor and REP, among others, are registered trademarks and/or registered service marks of Intuit Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of their respective owners and should be treated as such. Notice to Readers All guides and other reference information/materials (collectively "Information") distributed by Intuit Inc. ("Intuit") are prepared for educational and information purposes only and are not legal or tax advice or opinions on any specific matters. You, and not Intuit, are responsible for the applicability and accuracy of the Information as it relates to your practice or to your clients. Accordingly, the Information provided should not be relied upon as a substitute for independent research. Intuit does not have any responsibility for updating or revising any information presented herein nor does Intuit warrant that the Information contained herein is completely free of errors when published. This book is provided as a convenience for Intuit customers, is subject to, and is not intended to supplement, modify or extend, the software license agreement between Intuit and the customer for the applicable product or service.

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Table of Contents

Introduction What this Course is Not

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Chapter 3: What-If Worksheet Column Indicators Where to Go for More Information

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Chapter 1: How to Use this Guide Typographic Conventions Terminology

13 Chapter 4: MFS vs. MFS Analysis Taxpayer/Spouse/Joint Indicators MFJ vs. MFS Comparison Worksheet 25

Chapter 2: Tax Planner Using Planner Worksheets Projecting For Future Tax Years Common Uses Other Helpful Planning Tools

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Splitting MFJ Returns

Conclusion

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Other Training

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Keyboard Shortcuts

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INTRODUCTION What this course is not

Introduction

This course is intended to provide you with an in-depth understanding of the 2 major tax planning tools available in the ProSeries® 1040 program. You will learn how to use the Tax Planner and the What-If Worksheet to help in projecting future tax scenarios as well as comparing hypothetical situations in current or future years for your clients. Additionally, this course covers how to use Taxpayer, Spouse and Joint indicators throughout your data entry process (when preparing Married Filing Joint returns) to help your client's weigh the benefit of filing separate returns instead of filing jointly.

What this Course is Not

Although we will explore some tax saving opportunities as a group, this course is not designed to provide you with suggestions to give your clients in order to maximize their tax situation. It is important that you ensure the accuracy and merit of any projections or estimates you make for your clients. Additionally, you will not learn how to incorporate tax planning services into your accounting practice or how to sell these services to your clients. This course assumes that you have attended the ProSeries: The Basics Webinar or have at least 1-2 years of experience using the ProSeries 1040 Professional Tax Preparation software. Business tax returns (1120, 1120S, 1065, 1041, 1040NR, 990, 706 or 709) and state tax returns are not covered in this course.

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How to Use this Guide

Typographic Conventions Terminology

Chapter 1: How to Use this Guide

This section is designed to give you an understanding of the conventions and terminology used in this guide. These reference materials are designed to complement the information presented by the instructor and to act as a stand-alone training guide.

Typographic Conventions

We use certain typographic conventions throughout this manual. These conventions should help you use this manual more efficiently. The following is a general guide identifying each convention that may be presented:

Convention Meaning

F P

[Text in brackets]

Represents notes or other important information. Indicates tips or other timesaving information. Generally used to indicate keystrokes.

Terminology

Some of the terms used in this guide are program specific, and some are related to the technology used. Use the following table as a reference for any necessary definitions:

Term Meaning

Right-click

Click the secondary mouse button

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Tax Planner

Using the Planner Worksheets Projecting For Future Tax Years Common Uses Other Helpful Planning Tools

Chapter 2: Tax Planner

Use the Tax Planner worksheets to analyze different federal tax scenarios for the current year, for next year, and for several subsequent years. Tax Planner worksheets are available for individual return clients only. You can create up to 4 copies of the Tax Planner worksheets with 3 different columns per worksheet, so you can analyze a client's potential tax situation through 2010 and include alternate situations for some of those years if necessary. You can see a one-page summary of a client's tax projection using the Tax Planner Summary Information Worksheet.

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Using the Planner Worksheets

The summary worksheet draws information from the following Tax Planner subsidiary/supporting worksheets:

· · · · · · · · ·

Taxpayer Information Investment Income Business Income/Self-Employment Income Rents, Royalties, Pass-through Entities, and Other Income (Loss) Passive Activity Income and Loss Adjustments Itemized Deductions Taxes, Credits, and Payments Alternative Minimum Tax

For best results, enter data on these supporting worksheets before printing the Tax Planner Summary Information Worksheet.

To create a Tax Planner in a client return:

9. Go to the Forms Bar and choose Tax Planner, or go to the Tools menu and choose Tax Planner. 10. When the Select Planner dialog box appears, enter a short description for the copy in the field below the Create new copy option, then click Create.

P The Tax Planner Summary Information Worksheet is the central location point when

using the Tax Planner. 11. Select a tax year and enter a description near the top of the Plan 1, Plan 2, and Plan 3 columns. 12. Click the QuickZoom button that's between the Inflation Percentage and Filing Status fields in the Plan 3 column to go to the Taxpayer Information Worksheet. 13. Enter and edit information in the Taxpayer Information section and the Salaries and Wages section of the worksheet as applicable. 14. Go to the Forms Bar, choose another Planner worksheet, then enter and edit information as applicable. Refer back to the Tax Planner to review the client's tax projection.

P The easiest and most effective way to access the Tax Planning subsidiary worksheets is

to QuickZoom from each of the fields on the Summary Information Worksheet. Once you've entered the information you want, Press [CTRL] + [TAB] to go back to the Summary page.

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Once you select a year for a particular plan column, the program copies the information from the current tax return to the planning columns on the Tax Planner subsidiary worksheets. The summary then shows totals from each of these worksheets. You can then change your planning numbers on the subsidiary worksheets and the Tax Planner Summary Information worksheet show the tax results of your change.

F If an amount in the current tax return transfers to your planning columns, but you don't

expect any amount for that item in your planning scenario, enter a zero. QuickZoom from that field to the applicable worksheet & column and replace this year's amount with a zero. The planning feature that copies your amounts to a planning column does not allow you to simply delete an amount to indicate that you do not wish it to be considered for the plan. A zero replaces the amount.

Projecting For Future Tax Years

In a multiple-year projection, the ProSeries program uses the tax rates, the standard deduction and personal exemption amounts, the limitations, and other factors for the current year and the following year. For subsequent years, the ProSeries program uses estimated tax rates, standard deduction and personal exemption amounts, limitations, and other factors adjusted by inflation. Inflation If desired, you may enter an inflation percentage to apply for years 2007 through 2010. The list below includes some of the most common calculations to which the inflation percentage you enter are applied:

· · · · ·

Tax bracket amounts (10% tax bracket is not adjusted by the Inflation percentage entered until after 2008) (IRC section 1(f)(3)) Standard deductions (IRC section 63(c)(4)) Exemption amount (IRC section 151(d)(4)) Exemption phase-out thresholds (IRC section 151(d)(4)) Itemized deduction limitation thresholds (IRC section 68(b)(2))

See the ProSeries Tax Help for a complete list as well as other important considerations that you should take when using an inflation percentage. The inflation percentage is applied ONLY for plans after 2007. Actual rates and amounts are used for 2005 and 2006 plans. Refer to the applicable Revenue Procedure for the rates published for tax year 2006. The interaction of an inflation percentage entered along with new or future tax law rates is limited in scope and may not cover all circumstances.

P The inflation rate increase used to calculate many of the 2006 amounts was

approximately 2.7%. You may use this as a guide when deciding what percentage to enter for 2007 and forward.

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Adjustment Percentages For certain income and expense items throughout the Tax Planner, you may enter the percentage of increase or decrease in that income or expense amount expected for the plans being prepared, using the current year's amount as a base. Percentages should be entered as whole numbers or numbers with a single decimal, such as "15" for 15% or 15.3 for 15.3%, and reductions should be entered as negative amounts, such as -15 for a decrease of 15%. For example, if the current year's wages amount is $25,000, and a 15% increase to salaries and wages is requested, Plans 1 through 3 will each contain wages of $28,750 ($25,000 plus $3,750, which is 15% of $25,000). You can then change the resulting calculations simply by typing over the amounts ProSeries has entered in Plans 1 through 3.

F If you enter an amount directly into any plan, or if you change an amount calculated by

the program using the percentage increase, the program does NOT replace your entry. Using the example above, if you enter $25,000 in plan 2 directly, then you enter 15% as an adjustment to salary in this adjustment space, ProSeries calculates the salary amounts for plans 1 and 3, but the $25,000 you entered for salaries in plan 2 is not changed. Similarly, if you subsequently change either plan 1 or plan 3 salaries directly, any later changes you make to the adjustment percentage does not affect those changed amounts. In order to force the program to use the percentage to determine a particular plan's expected amount, delete any entries you have made in that plan's field. Alternative Minimum Tax The Tax Planner Worksheet for Alternative Minimum Tax computes any alternative minimum tax (AMT) that may be applicable to any of your plans. Tax Planner calculates the following adjustments for AMT for you: Medical deduction adjustment Tax deduction adjustment Miscellaneous itemized deductions adjustment Tax refund adjustment F You must manually compute other adjustments in order to obtain an accurate alternative minimum tax. This applies to the sale or other disposition of assets, in particular.

· · · ·

Common Uses

At the bottom of the Tax Planner Summary Information Worksheet you may choose to prepare Form 1040-ES using the results from this plan. To do so, check this box and ProSeries automatically carries the results to the worksheets used for the preparation of this form. You may also choose to prepare Form W-4, Employee Holding Allowance Certificate, using the results from this plan. To do so, check this box and ProSeries automatically carries the results to Form W4.

F Additional entries may be required on either of these worksheets.

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Other Helpful Planning Tools

ProSeries provides numerous reports and summaries for various types of information. This section introduces you to those that may be most helpful when completing a Tax Planner for a client. T wo-Year Comparison Worksheets A Two-Year comparison worksheet is available for all client returns. You can use these to help clarify client confusion about why their tax situation may have changed from the prior year as well as to help with future projections. There are 3 Two-Year Comparison worksheets available in ProSeries. One provides a general overview for the entire return. Two others are available for Schedules C and E, by activity, so your client can see how a specific business activity or Rental/Royalty investment is trending year over year (YOY).

You can open the Schedule E Two-Year Comparison worksheet just below the Schedule E Worksheet on the Forms Bar.

The final column reflects the year over year comparison. For Schedule C and E comparison worksheets you can display amounts or percentages using the correspondi ng checkbox. The Two Year Comparison Worksheet displays both amounts and percentages at once and so no checkbox is provided.

If you transferred the client return the information carries from the prior year automatically once you complete the current year return. Otherwise, you can enter amounts directly on these worksheets.

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Tax History If you need to look back further than 2 years you may find the Tax History report helpful.

The Tax History report is available via the Forms Bar or Open Forms dialog box just below the Two-Year Comparison worksheet. If you transferred the client return the information carries from the prior year automatically. Otherwise, you can enter amounts directly on this form.

F When entering prior year information directly, the calculations here are limited. You will

want to have the printed copy of the return available so you can simply enter all of the correct amounts including totals and subtotals.

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What-If Worksheet

Column Indicators Where to Go for More Information

Chapter 3: What-If Worksheet

Use the What-If Worksheets to compare a client's federal individual return to up to three hypothetical returns, using the current year's return as a base.

To use the What-If Worksheets for an open federal return:

1. Go to the Forms Bar and choose What-If Wks. 2. Click the check boxes near the top of the worksheet to manipulate the information in the columns. 3. If applicable, click the use 2006 tax rates check box for a column. 4. If you check this box for a column, ProSeries calculates that column according to 2006 tax rates and other factors, such as 2006 standard deduction and personal exemption amounts. 5. Enter and edit the information in the columns as applicable. 6. Review the client's tax projection. 7. The line numbers on the pages 1, 2 and 3 of the What-If Worksheet refer to line numbers on Form 1040.

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Column Indicators

You can use the various column indicator checkboxes at the top of the What-If Worksheet as a shortcut way to see the effects of just a few changes on income and deductions without having to retype all the 2005 data into columns 2 through 4.

Following any of these processes, you can change the results by simply typing over the calculated values or type a new value into a blank field.

F Unlike the Tax Planner, ProSeries does allow you to simply delete an amount to indicate

that you do not wish to be considered for a scenario. A zero also replaces the amount.

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Copy Check whichever boxes you wish to activate column data copying on the worksheet. ProSeries carries all enterable data from the column listed first to the column listed second. Add Check whichever boxes you wish to activate the addition of two columns on the worksheet. ProSeries adds all enterable data from the column listed first with the column listed second, then displays the results in the column listed third. Subtract Check this box if you wish to activate the subtraction of column 3 from column 2 on the worksheet. ProSeries subtracts all enterable data in column 3 from column 2, then displays the results in column 4. Clear If you would like to blank (remove the entries) from any column and start over, simply check the appropriate box for the column you wish to clear. Note that once you do this, all of the numbers from that column disappear including those you have entered or changed. When you check a box to cause the program to copy information to Columns 2 through 4, the program copies the information to a field only if the recipient field is blank. This means that if you copy from Column 1 to Column 2, and Column 2 already has an entry on line 8a for interest income, the Column 1 entry won't overwrite the entry in Column 2. If you want to completely copy, add, or subtract from one column to another, you must first clear the destination column completely. This feature allows you to change part of a column, then copy all other information from another column without overwriting the part you've changed. To clear a column, click the box for that column at "Clear amounts in column." The program clears the column just as though you had highlighted each field and pressed either the delete or the backspace key.

Where to Go for More Information

The What-If Worksheet is not a comprehensive tax-planning tool. Additionally, it does not support all calculations that may be required for every tax situation. To learn the rules and limitations for the What-If Worksheet, open the worksheet and review the Tax Help.

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NOTES:

___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________

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MFJ vs. MFS Analysis

Taxpayer/Spouse/Joint Indicators MFJ vs. MFS Comparison Worksheet Splitting MFJ Returns

Chapter 4: MFJ vs. MFS Analysis

When you prepare a federal individual return for a married couple, you can assign the data for certain fields to the taxpayer, to the spouse, or jointly to both the taxpayer and the spouse.

Taxpayer/Spouse/Joint Indicators

A Taxpayer/Spouse/Joint field is a field in which you can assign data to the taxpayer, the spouse, or both. A Taxpayer/Spouse/Joint field is also known as a T/S/J field.

F The T/S/J designations feature is available only for individual return clients whose filing

status is Married Filing Joint. Show T/S/J Indicators Option This first time you mark a client Married Filing Joint, ProSeries prompts you to turn on the TSJ indicators. It also provides the ability for you to watch the help tutorial on how to use this feature. If you chose not to enable them, you'll need to do so before you can use this feature.

To enable TSJ indicators:

1. Select Options from the Tools menu. 2. Check Show TSJ Indicators from the Form Indicators section of the General options.

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To assign the entire amount of a T/S/J field to the taxpayer, the spouse, or to both:

1. Enter the amount in the field. 2. If the amount is assigned appropriately, press [ENTER] to move to the next field, and continue to enter data. 3. To change the allocation of the amount, click the T/S/J indicator to see the Taxpayer/Spouse/Joint menu.

This is the Taxpayer/Spouse/Joint menu. Click the T/S/J indicator, then click Split Stmt to open the Taxpayer/Spouse/Joint split statement that supports the field. The Split Statement option is not available for all T/S/J fields. For example, the Split Statement is not available for amount fields in expanding tables or for text fields.

4. Choose Taxpayer, Spouse, or Joint. 5. The menu disappears and T, S, or J appears in the T/S/J indicator. Press [ENTER] to move to the next field, then continue entering data.

P For a quick way to assign the amount for a numeric T/S/J field, type the letter T, S, or J

before or after you type the amount. (You can use this method only for numeric T/S/J fields.) ProSeries uses the taxpayer, spouse, or joint (T/S/J) designations in the MFJ vs MFS Comparison Worksheet, which compares tax liability and other factors for married clients deciding between filing jointly and separately. The state individual return products also use the T/S/J designations. ProSeries also uses the taxpayer, spouse, or joint (T/S/J) designations for the Split MFJ Return procedure.

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Split Statements You can also split an amount between the taxpayer, the spouse, or both in a detailed statement using a Split Statement. Click the T/S/J indicator to see the Taxpayer/Spouse/Joint menu or click with the right mouse button and choose Split Stmt.

A split statement consists of detailed descriptions and amounts that are automatically totaled on a single line on a tax form. A split statement is similar to a supporting statement, but in a split statement you can assign each component amount to the taxpayer, the spouse, or both. The split statement also shows the total amount assigned to the taxpayer and the total amount assigned to the spouse.

Where to Go for More Information For on-screen instructions, go to the Help menu, choose Help Center, select Tutorial Videos, and then choose Taxpayer/Spouse/Joint Indicators.

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MFJ vs. MFS Comparison Worksheet

The MFJ vs. MFS Comparison Worksheet is a planning tool to assist in the determination of the most advantageous filing status for your client. It is your responsibility to review the transactions in the return to verify that the amounts shown are accurate for your client's tax situation. See the tax help below for questions about specific lines.

P To view the T/S/J indicators on the Dependents Section of the Federal Information

Worksheet, you must close and reopen the Federal Information Worksheet or right mouse click on the dependent's first name to select taxpayer or spouse. Check the box at the top of the form to activate the calculations.

Summary You can obtain a quick assessment of your client's advantage/disadvantage should they elect to file separate returns using the Summary section at the top of page 3. Line E displays the total tentative savings based on the calculations performed throughout this worksheet. Negative amounts on this line represent the opposite of saving and your clients would end up paying more in tax by filing separately.

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Splitting MFJ Returns

Use the Split MFJ Return command on the File menu to create new Married Filing Separate (MFS) returns from an existing Married Filing Joint (MFJ) return. You might want to use this feature because:

· · · ·

It's more advantageous for your clients to file MFS returns. Your clients are required to use the MFS filing status for their federal return. Your clients want to file MFS returns without regard to tax implications. A state requires that your clients file an MFS return.

F This feature is available for Form 1040 returns only. The existing MFJ return is

unaffected by the Split MFJ Return command. Review the tax help for information about what items ProSeries carries to the MFS returns. After using the Split MFJ Return command When you return to HomeBase, you'll see the client's existing MFJ return (which remains unchanged) and the new MFS return(s). Open each new MFS return and review it for accuracy. Run Final Review for each new MFS return.

P Use the Permanent Comments section

of the Client Status Worksheet to indicate the year in which you generated a Tax Planner, What-IF Worksheet or split the MFJ return.

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Information about the Split MFJ Return procedure Data assignment: ProSeries assigns data to the taxpayer's MFS return and the spouse's MFS return according to the Taxpayer/Spouse/Joint indicators for specific fields and specific forms. Rounding: In ProSeries, most dollar amount fields don't allow for cents. For those fields, ProSeries rounds decimal amounts when the data assignment is Joint. For example, if $99 in the MFJ return is being assigned jointly to two MFS returns, ProSeries assigns $50 (not $49.50) to each MFS return. Passwords: If the MFJ return is password-protected, the MFS returns are also passwordprotected. Pay-Per-Return: If you're using ProSeries/1040 on a Pay-Per-Return basis, there is no charge for creating MFS returns from an MFJ return. There will be a charge to print, however. Custom Letters: If the MFJ return includes a custom client letter, it is included with the new MFS returns. Returns are not connected: There is no connection between the MFJ return and the MFS returns. After you create MFS returns, any changes to any of the returns does not affect the other returns. Electronic filing and Bank Products: Electronic filing and Bank Products information in the MFJ return is not copied to MFS returns. If you are going to file an MFS return electronically, you must enter electronic filing-related information in the MFS return. Similarly, you must enter Bank Products-related information in the MFS return if you are requesting a Bank Product for that client.

NOTES:

___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________

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Conclusion

ProSeries provides these exciting features absolutely free of charge each year. They work directly with your client data so you don't need to reenter anything into a new tool. Also, the functionality of these features are consistent with the functionality that you're used to in the ProSeries software. Take full advantage of all of the tools provided to you. You can learn about even more exciting features in the ProSeries: Practice Management Tools webinar (www.ProSeries.com). Here are a few key points to remember about ProSeries tax planning tools:

·

When using the Tax Planner, open the Summary Information worksheet and access all of the subsidiary worksheets using the QuickZooms for each field to adjust your plan amounts. You can use positive or negative adjustment percentages of to change all plan amounts for the current worksheet. If you want a specific amount to be 0, enter a 0 in that field. This is not the same in the What-If Worksheet, where you can simply delete the amount. Use the Tax Planner for more complicated scenarios or situations that require more depth and accuracy. Use the What-If Worksheet for quid-pro-quo questions, What if...?". Remember to pay special attention to negative amounts in the What-If Summary and MFJ vs. MFS Comparison Summary. These negative amounts represent the opposite of the initial line description.

·

·

·

Take some time after this course to think about how you can use these tools to better serve your clients and how to implement them into your practice. You can also use the opportunity to grow your business, strengthen your competitive edge and increase your profits.

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Other Training

Here are some other training courses you might be interested in: ProSeries: e-file Solutions In TY04, over 1 out of every 4 e-filed returns received by the IRS was sent through Intuit's e-filing center. Let the experts show you how to get up and running with e-file as we demonstrate the entire end-to-end process. You can also use this opportunity to get clarification on any part of the e-filing process, with a comprehensive question-and-answer session. This 2-hour webinar is a must for anyone who files (or plans to file) returns electronically. ProSeries: Advanced Tax Scenarios Don't waste valuable time researching (and putting off) your complex tax returns. We'll take you through complicated 1040 tax scenarios, as well as discuss the advanced features and functions that can help you be the most productive. ProSeries: Practice Management Tools ProSeries software provides various tools to help you maximize your profitability and manage your practice. This 2-hour course is recommended for professionals and administrative staff who want to learn about these highly effective practice management tools and get the most out of their ProSeries software, and like all ProSeries training, while earning valuable CPE. ProSeries: Individual Update Seminars & Webinars The Individual Update Seminar is the most popular ProSeries® seminar we offer. We've added a variety of new features and enhancements to the ProSeries products this year, many of which were recommended by ProSeries customers like you. Our seminar will help you take advantage of these improvements. Free QuickBooks® Product Webcasts Webcasts are free 1-hour online informational sessions you can view on your computer, focused on a particular product or family of products. Designed to provide in-depth information and product demonstrations to help you become more familiar with QuickBooks products for you and your clients. You can participate in live Webcasts and earn FREE CPE credits, or you can view our recorded Webcasts at any time (CPE not offered on recorded Webcasts). New QuickBooks Webinars for Accountants These in-depth webinar sessions­designed for accounting professionals and taught by accounting professionals­focus on solving some of the most common pain points that occur in supporting your QuickBooks clients. Earn valuable CPE credit while learning how to help your clients manage their business finances. QuickBooks ProAdvisor(SM) Certification Tap in to the source of knowledge you need to provide best in class, competitive services to your clients using QuickBooks. Tap into Intuit's database advertising and grow your practice even more. Become a QuickBooks Certified ProAdvisor today!

*High Speed Internet Access recommended for Webinar and Webcast training sessions.

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Keyboard Shortcuts

You can use these keyboard shortcuts from just about anywhere in ProSeries to quickly perform a function that you would normally access from the menu bar. You can also access menu's using the keyboard by holding [Alt] and pressing the corresponding letter(s) (For example, [Alt]+[F] opens the File menu, then [N] to open a new client return. When you hold [Alt], the program underlines the corresponding letter to type for each menu on the menu bar.

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