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Tax Organizer Questionnaire - What's New for 2020?

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#1
Wiles  
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For those of you that send out questionnaires to your 1040 clients each year, what *new* questions have you added for this year?
 

#2
sjrcpa  
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I haven't done anything yet, but will ask about PPP loan and EIP.
 

#3
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Have not prepared them yet but am hoping I can find template questionnaires. I liked UT''s but since I no longer use them, do not have access to what they may include as questions for 2020. I do not see where Lacerte has added anything specific to 2020 but I want to make sure I add questions about PPP, EIDL, EIDL advance, forgiveness status, stimulus money, etc. I am going to have to devote a couple of days to updating all of my engagement letters for taxes. Hate it!
 

#4
belle  
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CornerstoneCPA wrote:. I do not see where Lacerte has added anything specific to 2020


Lacerte added three abbreviated questions under a new header "CARES"...." asking about EIDL, PPP, Covid related retirement distributions. I plan on expanding on those.
 

#5
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In addition to what's already been mentioned, I think it's important to be cognizant of the remote work/work from home COVID dynamic shift. Many individuals have relocated while continuing to work for the same employer remotely, or have "temporarily" moved to a lesser populated area, with plans to return to their domicile/home/etc once things get back to normal.

For that reason, I'll be designing a simple question that will help determine if an individual client spent any material amount of time away from their state of residence during 2020.

CornerstoneCPA wrote:Have not prepared them yet but am hoping I can find template questionnaires.


If you're a member of the AICPA's tax section, their annual compliance kit includes organizer templates.

If you're not a member of the tax section, I highly recommend it. The included subscription to the Tax Adviser magazine alone is worth the additional fee.
 

#6
Webster  
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A small thing, but in addition to the above, asking for the amount of any charitable contributions even if the client is not planning on itemizing.
 

#7
Wiles  
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For that reason, I'll be designing a simple question that will help determine if an individual client spent any material amount of time away from their state of residence during 2020.

This is a good one. This is one of those questions that makes your head droop when they answer Yes.

ManVsTax - Can you provide a (copyright protected) summary of any questions that the AICPA have added to their list?
 

#8
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I'll circle back once I've had a chance to review them in detail. I gave the individual organizer templates a quick skim when they first came out, and the only question that stood out as new was an EIP question, which I'll be modifying as I noted here:

viewtopic.php?f=10&t=19995
 

#9
CathysTaxes  
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The Tax Book usually publishes an organizer.
Cathy
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#10
Wiles  
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Thanks. I am happy with my existing questions. I am just looking for what's new. What we should consider adding to our existing questionnaire.
 

#11
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With regards to the residency issue we need to be aware that many states in the northeast have passed laws similar to Massachusetts TIR 20-5 where they say we do not care if you worked out of state (ie no tax New Hampshire) your wages are still taxable in Massachusetts.
 

#12
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CathysTaxes wrote:The Tax Book usually publishes an organizer.


I do not really see anything new or specific to 2020 in their organizers.

The target questions will be where they worked/lived, stimulus money, PPP/EIDL/EIDL Advance, if they utilized any provisions of the CARES Act, etc. I know I am looking for specific wording used by some of the producers of the organizers but AICPA, Tax Book, and others I have seen do not include anything. Lacerte did add a few but not satisfactory, IMO. I may end up having to devise questions based on topics in my head and discussions on this forum.
 

#13
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Three new questions: 1. EIP, 2. "Did you make at least $300 in charitable contributions by check or credit card? If not, how much?", 3. separating unemployment compensation into its own question.
 

#14
belle  
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CornerstoneCPA wrote:
.... Lacerte did add a few but not satisfactory, IMO. I may end up having to devise questions based on topics in my head and discussions on this forum.


I agree. I'll *share* what I come up with if you will too :lol:
 

#15
HowardS  
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New question:
Are you going to make some attempt to fill in this organizer or am I wasting my time sending it to you?
I suffer from depreciation.
 

#16
ATSMAN  
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I was almost 90% done editing my organizer but then we heard that the Covid relief package is almost ready to be voted tomorrow. I think I will hold up for another week to see if it has any new details :o :o :o
 

#17
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belle wrote:I agree. I'll *share* what I come up with if you will too :lol:


Deal.
 

#18
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This is what LaCerte added. Ugh...

CORONAVIRUS AID, RELIEF AND ECONOMIC SECURITY ACT (CARES ACT):

-Did you receive an economic impact payment? If so, how much?
-Did your business have any PPP loan amounts forgiven?
-Did you receive a distribution from your retirement plan because of COVID?
 

#19
Wiles  
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Wow! I am surprised Lacerte remembered they had an Organizer.
 

#20
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Wiles wrote:Wow! I am surprised Lacerte remembered they had an Organizer.


Given the typical client does not use them, they are nothing more than an aid for questions tax preparers need to ask. :roll:
 

#21
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Not organizers, but I'm adding the following to the "U.S. filing obligations related to foreign investments" section of all of my compliance engagement letters. I feel like it's a good C.Y.A. for preparers as we move into 2021. Virtual currency is becoming a lot more common and I'm not going to try to determine in what country a virtual currency wallet's servers are. I'm pushing that responsibility to the client.

If a virtual currency account is maintained in a foreign country, the virtual currency account would generally be considered a foreign financial account. You are responsible for determining and monitoring where your virtual currency accounts are maintained and informing me if any of your virtual currency accounts are foreign financial accounts. You are responsible for asking me if you have any questions. All such questions should be communicated to me in writing.

I will likely also reword the above as a new question for my 1040 organizers. Double C.Y.A.
 

#22
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CornerstoneCPA wrote:
Wiles wrote:Wow! I am surprised Lacerte remembered they had an Organizer.


Given the typical client does not use them, they are nothing more than an aid for questions tax preparers need to ask. :roll:


I have had good luck with one page of questions maximum for clients to answer. I think I'm at around 60% filled in.
 

#23
CathysTaxes  
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When I used detailed organizers, my responses usually are 'why don't I just fill out my own return'.

I prefer, the max, one page of questions and a listing of the W2s and 1099s from the previous year.
Cathy
CathysTaxes
 

#24
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I have always had separate engagement letters/questionnaires for partnerships, S-Corps, and C-Corps. I am tired of having so many by the time I factor in individuals, non-profits, gift tax, fiduciary, etc. Has anyone consolidated tax engagement letters and questionnaires into a single document for all for-profit entity types? I feel like it must be possible...heck, I see much larger firms using 1-4 page engagements whereas some of mine exceed 30 pages, and it has developed out of fear of lawyers or lawyers saying "add this, too."
 

#25
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I've really overhauled my organizer for 2020.

Started with the AICPA templates... deleted a few questions, combined a few questions, and added quite a few questions meant to boost efficiency and cut down on back-and-forth (hopefully) this filing season.

In addition to my questions about new addresses and moving during the year, I added:

1c) Did you spend a material amount of time (more than 30 days) away from your residence for any reason during the year (including but not limited to COVID)?

If yes, please provide details and locations:
_______________________________________________________________________________
_______________________________________________________________________________


The AICPA templates did not have a question of that nature. I feel it's important, as noted above.

I need to work on the wording for the economic impact payment question as well due to the Appropriations Act.

Is there any reason to ask about minimum essential coverage anymore? The AICPA templates still have questions about that. Can you be dinged as a CA resident for not carrying minimum essential coverage?

Other notable pain points for me that I'm attempting to resolve --

Clients frequently forget about the tax ramifications surrounding their HSAs and don't upload 5498-SAs and 1099-SAs. I've added questions which qualify the client on contributions and distributions to an HSA, and instruct the client to upload 5498-SA or 1099-SA as applicable. Also a question in which the client certifies that all distributions and payments from the HSA were used for qualified medical expenses.

Getting clients to put direct debit and direct deposit info directly into the organizer if they want direct debit and direct deposit. These particular questions are long but informative and warn the taxpayer about supplying a savings account for a direct debit (had a payment last year for a client rejected because this happened). More often than not in the past clients do not supply this information and I end up requesting it when we deliver the draft, but then have to go back in the software later to add the information and print off the efile authorizations. I'd rather get it all up front.

I've integrated child tax credit due diligence questions directly into the organizer this year. Major pain point last year. I had to go back with these follow up questions for many 1040 engagements. My wording and creation, hope it helps:

Child Tax Credit Due-Diligence (All Clients)

1) Do you have any dependent children age 16 or younger (as of December 31, 2020)?

If yes, please complete the remaining questions on this page.
If no, please skip the remaining questions on this page.

2) Were ALL of your dependent children age 16 or younger either a US citizen, US national, or US resident alien during the year?

If no, please add details: __________________________________________________________

3) Did ALL of your dependent children age 16 or younger live with you for at least half of the year AND receive more than half of their support from you during the year?

If no, please add details: __________________________________________________________

4) If your return is selected for examination or audit, can you provide documentation to substantiate the accuracy of your answers to questions 2 and 3 above?

If no, please add details: __________________________________________________________

5) Was any Earned Income Tax Credit, Child Tax Credit, Additional Child Tax Credit, Credit for Other Dependents, or American Opportunity Tax Credit reduced or disallowed on any of your prior returns?

If yes, please add details: __________________________________________________________
 

#26
Wiles  
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Thank you all. Here is what I added to our organizer questionnaire for this year:

Did you work remotely in another state?

Did you receive a COVID economic impact payment? How much?

Did you receive a COVID-related retirement distribution?

Did your business receive a PPP loan, SBA debt relief or any other COVID-related benefits?
 

#27
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All great questions above to include. I use ProSystemFX and they only had one or two questions related to COVID. I created an additional page with the COVID-related questions.

This year, the telecommuting/temporary relocation state tax issue is something that I'll address right away with clients. It would not surprise me to find a client or two that worked away from home, maybe at a camp/second home/family member, for 183 days or more and may be a statutory resident of that state for 2020.
 

#28
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This is what I have come up with so far, combining some ideas from this thread and others I have thought up in various readings and other concerns.

• Did you receive an Economic Impact Payment in 2020? If so, what amount(s) did you receive and what was/were the date(s) of the payment(s)? This includes the second round of EIPs approved in December 2020 that may have been received in 2021.
• Did you receive a COVID-related retirement distribution under the CARES Act Regulations?

• Did you move during 2020?
• Did you change employers during 2020?
• Did you reside in a State different than your state of residence for any reason?
o If YES, how may days did you reside in at least one other state?

• Did your business receive a Paycheck Protection Program Loan (“PPPL”) during 2020?
• If your business did receive PPPL, what amount did you receive?
• If your business did receive PPPL, have you applied for forgiveness?

• Did your business receive an Economic Impact Disaster Loan Advance of up to $10,000?
o If YES, what amount?
• Did your business receive an Economic Impact Disaster Loan?
o If YES, what amount did you accept and have funded to you?

• If a virtual currency account is maintained in a foreign country, the virtual currency account may be considered a foreign financial account. You are responsible for determining and monitoring where your virtual currency accounts are maintained and informing us if any of your virtual currency accounts are foreign financial accounts. You are responsible for asking us if you have any questions. All such questions should be communicated to us in writing.

• Should you require an extension of time to file, keep in mind extensions have been deemed by the Supreme Court to be a nondelegable duty and such duty rests solely on the taxpayer. While we may file extensions on your behalf with written authorization, it is ultimately your responsibility to ensure and verify all required extensions are timely filed no later than the original due dates of your tax returns. Relying on your tax preparer to file an extension does not satisfy any reasonable cause test in the event of IRS and/or state-imposed penalties and interest in connection with tax returns deemed late filed. Extensions are also only an extension of time to file a completed and accurate tax return, not an extension of time to pay taxes due.
 

#29
Wiles  
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Thank you. Those are all good. We work hard to keep our questionnaire to 3 pages, which is 2 1/2 pages too long for a majority of our clients.

Like the stimulus checks in 2001/2002, will the IRS be providing us a place on their website to search for EIP payments made to a taxpayer?
 

#30
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I am hoping (HOPING) the IRS sends a letter notice for the second round, and lists what the taxpayer received for BOTH rounds.
 

#31
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Wiles wrote: We work hard to keep our questionnaire to 3 pages, which is 2 1/2 pages too long for a majority of our clients.



I am trying to reduce mine based on what typically applies to my client base, but damn if lawyers and their conduct do not continue to make me afraid to not ask a question and have the client answer it on a signed form. I want to include a smart remark about my engagement packet being so lengthy because of lawyers, but some of my clients are lawyers and law firms.
 

#32
belle  
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@Cornerstone - I like what you've done. I'm still working on mine (I did the 8 hour Spidell update class over the weekend.)

You might want to add to this "... have you applied for forgiveness? Did you receive forgiveness in 2020?
 

#33
Wiles  
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Those of us in CA will still need to ask for Forms 1095-B & C. Correct?

Also, we need to ask for the FTB Form 3895 instead of Form 1095-A. Is that correct? Or do we ask for both??
 

#34
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Have wasted much of today in preparing the 1040 engagement, only to forget I was using the wrong method of radio buttons in DocuSign. DAMMIT!

Entire package is 33 pages between insurance engagement wording, questionnaires, due diligence for certain credits, and other legal crap I now include because of IRS and my lawyer. Insane...
 

#35
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IMO this one is absolutely necessary for all Sch C clients...

Were you unable to work due to a Federal, State, or local quarantine or isolation order related to COVID-19, been advised by a health care provider to self-quarantine due to concerns related to COVID-19, or experiencing symptoms of COVID-19 and seeking a medical diagnosis? If, so how many days? Were you unable to work due to caring for someone regarding the same? If, so how many days? (see form 7202)
 

#36
CathysTaxes  
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So I sent questionaires to clients via email after I stripped it down to three pages. What a bunch of crybabies! The 80 something client was happy to get the full 12 pages.
Cathy
CathysTaxes
 


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