Home

CopyRight Notice

1. Fields Data For AUTO AUTO C Description Delivery Van Delivery Truck Oven Date Acquired 01 01 2003 05 01 2003 06 30 2003 Cost 15000 25000 7000 Business Percentage 100 100 100 Method M M M Life 5 5 7 ENTERING CHILD amp DEPENDENT CARE EXPENSES FORM 2441 To open the Child amp Dependent Care Expenses Screen Form 2441 type 2441 in the selector field and press Enter Fields Data SSN EIN 587999556 EIN X Provider s Name Short Stuff Academy Address 5788 Elm Street Zip 94010 Amount 3450 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 29 When entering child care expenses make sure the expense amounts are listed on BOTH the Dependent Screen and the 2441 Screen Press ESC to return to the Data Entry Selection Menu ENTERING OFFICE IN HOME INFORMATION In addition to owning Patty Cakes Bakery Amelia s storage facility is at her home for lin ens and other catering materials She qualifies for Office in Home expenses which are entered on the 8829 screen To access this data entry screen type 8829 Office in Home Enter C in the For field The storage room at the Carter s house is 180 sq ft of the 2000 sq ft home Input the following additional information Fields Dire
2. Drake Software Evaluation Guide Copyrighted Material 16 Program Navigation 2003 DRAKE TAX SOLUTION FEATURES Drake Software offers numerous value added features to enhance and simplify tax prepara tion The software is designed to ease the return preparation process In addition to the pro gram resources highlighted below the program boasts the following convenient features Information flows to related forms automatically Message pages display errors or alerts that may prevent successful e filing and or IRS rejection Zip code and Employer Identification Number databases speed data entry in several key forms Built in calculator is accessible in any data entry screen by pressing F10 Blank forms are available to view or print Unformatted worksheets are available by pressing CTRL W Calculate amortization or search Drake s stock index from within the Tools section of the Menu Bar HEADS DOWN DATA ENTRY Drake Software enables users to enter data by keying it directly into screens or using the Heads Down Method The Heads Down Method uses field codes that correspond with Proformas your clients can prepare during an interview This option is a great time saver as it allows data to be gathered by a tax professional and entered by a data entry operator Toggle between data entry methods by pressing CTRL N EMAILING Use Email to Drake to send and receive emails from within the Drake Software progr
3. Quick Estimator Prepare a quick estimate of the tax return with minimal data entry Save information for later tax preparation File gt Quick Estimator Quickbooks Import Import a client file created in Quickbooks Tools gt File Maintenance gt Quickbooks Import Repair Index Files Re index all database and client files Tools gt Repair Index Files Reprint Damaged Check Reprint damaged checks EF gt Check Print Search EF Database View client e file status EF information reject code and reject code description EF gt Search EF Database Security Administrator can set security levels for each pre parer Setup gt Preparers Select Returns for EF Select from a list of calculated returns to create an electronic transmission file EF gt Select Returns for EF Setup New Checks Enter check range when new checks are received from bank EF gt Check Setup gt Setup New Transmit Receive Connect and transmit return EF gt Transmit Receive Unlock Client Files If a file has been locked use this option to unlock and edit the return Tools gt File Maintenance gt Unlock Client Files Update 2002 to 2003 Update the previous year s client data Last Year Data gt Update 2002 to 2003 Update Config 2002 2003 Bring forward last year s setup e g firms prepar ers pricing macros etc Last Year Data gt Update
4. TOOLS F3 e Open Return F1 e Calculate F2 e Print F3 e View F4 e Pre Prepared Entry F5 e Quick Estimator F6 Exit F7 e Logout Preparer Select Returns for EF F1 Transmit Receive F2 Process Acks F3 Check Print F4 Check Setup F5 e Setup New F1 Void Unused F2 Check Register F6 Search EF Database F7 Copy EF Returns to Disk F8 Copy EF Returns from Disk F9 e mail to Drake F10 Install Updates F1 Download Fonts F2 Blank Forms F3 Repair Index Files F4 File Maintenance F5 Backup Restore F1 Change SSNs on File F2 Clear BBS Files F3 Export Client Data F4 Export EF Data F5 Password Protect Files F6 Unlock Client Files F7 Delete Print Files F8 Delete Client Files F9 Change File Type F10 Quick Books Import F11 Letters F6 Letters F1 Mailing Labels F2 Envelopes F3 Postcards F4 Amortization F7 Edit EIN Database F8 Stock Search F9 Scheduler F10 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Program Navigation 15 REPORTS F4 LAST YEAR DATA F5 SETUP F6 e Depreciation List F1 e All Client Reports F2 e Standard F1 e Custom F2 e Review F3 e EF Reports F3 e Standard F1 e Custom F2 e Review F3 e Fixed Asset Manager F4 e Filled in Screens F5 e Hash Totals F6 Organizers F1 Proformas F2 e Update
5. Setup gt Colors Copy EF Returns to Disk Copy print files of calculated returns from the hard drive to a disk EF gt Copy EF Returns to Disk Copy EF Returns from Disk Copy print files of calculated returns from a disk to the hard drive EF gt Copy EF Returns to Disk Delete Client Files Permanently delete client files Tools gt File Maintenance gt Delete Client Files Delete Print Files Delete the temporary print files that are created when returns are calculated Tools gt File Maintenance gt Delete Print Files Depreciation List Print a list of client s depreciable assets Reports gt Depreciation List Directories Paths Set up CD drive letter drive location of current year last years files and shared drive letter for peer to peer networks Setup gt Directories Paths Download Fonts Copy Softfonts which are necessary to print tax forms to the printer This must be run each time the printer is turned off Tools gt Download Fonts Edit EIN Database Edit specific employer information in the EIN Database Tools gt Edit EIN Database EF Set up Electronic Return Originator information Setup gt ERO State ERO Information EF Reports Create standard and custom reports of EF data Reports gt EF Standard or Custom Reports e mail to Drake Send e mail directly to technical support Receive broadcast e mails from Drake including a we
6. 3 The correct answer is D Examine WK_EIC This worksheet shows how EIC was calcu lated A is incorrect Examine the 8812 for the Additional Child Tax Credit calculations B is incorrect The Preparer s Earned Income Checklist only determines EIC eligibility C is incorrect You can view the WK_EIC to examine the calculations 4 The correct answer is A Examine Form 8812 and WK_ 8812 The 8812 calculates the 1200 in Additional Child Tax Credit The WK_8812 calculates zero on line 15 Child Tax Credit B is incorrect The EIC form does not display dollar amounts and the WK_EIC calculates the Earned Income Credit C is incorrect You can view the total Additional Child Tax Credit on the 8812 but the 8867 is and an EIC eligibility checklist D is incorrect The 2441 is used to report Child and Dependent Care expenses 5 The correct answer is B Screen 2 and 2441 Screen Enter child care expenses on Screen 2 the Dependent screen and the 2441 Screen Child and Dependent Care Expenses A is incorrect Screen is the Name and Address screen You would enter Child Care Expenses on the 2441 Screen and the Dependent screen C is incorrect Screen 3 is the Income screen and the MISC screen is used to enter mis cellaneous codes and notes D is incorrect Screen 1 is the Name and Address screen You would enter Child Care expenses on Screen 2 Drake Software Evaluation Guide Copyrighted Material 40
7. OPEN A RECORD IN THE EF DATABASE Select EF gt Search EF Database on the Menu Bar 1 2 Type the SSN of the primary taxpayer without spaces dashes or additional characters 3 Press ENTER or click OK in Windows 4 Use PAGE UP and PAGE DOWN to access additional records for a taxpayer The Main screen of the record opens There are six separate screens available for viewing with the following information on each screen 1 mi Main screen F1 e Taxpayer information e Federal and State acknowledgement codes e Acknowledgement dates e Transaction date e Filing status e Refund amount or balance due e Reject codes Bank codes and loan status e Bank check information Bank DD Info F2 e Detailed loan information e Direct deposit information e Document Control Number Fees Errors Miscellaneous F3 e Earned Income Credit EIC e Adjusted Gross Income AGI e PINs firm number preparer number ERO number e Bank distribution fees Reject F4 Enter and view the reject code description and solution DE F5 Open the first screen of return data entry for the SSN EIN displayed WEB F10 e Connect to Your online EF Database to check the most current information avail able from the Service Centers e View pending Bank State and Federal Information about one or multiple clients e View reports of your EF information for the current tax season Drak
8. The Signature page for electronic filing is either the 8879 to send an electronic signature or the 8453 which must be mailed to the applicable IRS Service Center within 3 business days after the ERO has received acknowledgement from the IRS that the return has been accepted The 8879 must be signed by the taxpayer BEFORE the electronic return is transmitted and then is retained in the tax preparer s office for 3 years Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Electronically File the Return 41 If the PIN screen is completed within the software Form 8879 is produced when electronic filing otherwise Form 8453 is produced To complete the PIN screen the taxpayer and spouse must choose a 5 digit number to serve as their signature This may be entered by the preparer The preparer must also enter a 5 digit number on the PIN screen This number is self selected but must be used for the entire season STATE E FILING Each state has its own application requirements for Electronic Return Originators ERO and users of bank products Refer to the following table to determine if a state application is needed to electronically file returns to that state or if an application is required to offer bank products Bank Products State State EF Application Required Applications EF Center Required Alabama All EROs are automatically accepted Memphis A
9. d C 9 Once a W 2 has been entered in Drake how can you create another blank form for a second W 2 a Press Insert b Press Page Down c Press F3 d Press ESC 10 What information is found on WK_ 8812 a Due diligence information for the Child Tax Credit b Due diligence information for the EIC c Calculation for the Advanced Child tax Credit d Calculations for the Child Tax Credit 11 Within Drake Software on the C screen how can I find the business code a You cannot You must check the Schedule C instructions b In the business code field Press Shift c You cannot The client will know the appropriate code d In the business code field press ESC 12 Press F4 from EF gt Search EF Database This give you access to what information a Taxpayer demographics b Federal Reject Codes c Bank or Direct Deposit Information d Sends you to Your EF Database on support drakesoftware com 13 How can you access blank federal and state forms within Drake Software a From the Menu Bar choose Tools gt Blank Forms b From the Menu Bar choose Setup gt Options gt Blank Forms c You cannot get blank forms within the software d Open a return and enter no information Drake Software Evaluation Guide Copyrighted Material 66 CPE Exam 2003 DRAKE TAX SOLUTION 14 True or False You can email returns inquiries or information to Drake from within the software 15 Which one of the following is NOT
10. etc Tools gt File Maintenance gt Export EF Data Filled In Screens Print the Data Entry screens for a return Reports gt Filled in Screens Firm Set up the preparer s firm information This is the information that prints on the bottom of 1040s Setup gt Firm Fixed Asset Manager Print various asset reports Reports gt Fixed Asset Man ager Hash Totals Print a report showing the number of screens fields and keystrokes used on one return Reports gt Hash Totals Install Updates Install update disks CDs or Service Pack files Tools gt Install Updates Letters Edit the coupon estimate pre season after sea Setup gt Letters son and result letters for clients Letterhead Activate or remove graphic letterhead for letters Setup gt Letterhead and bills Macros Set up shortcut keys for commonly used words Setup gt Macros phrases addresses etc Samples are pre pro grammed to show examples of input Mailing Labels Generate mailing labels for clients service cen Tools gt Letters gt Mailing ters DORs etc Labels Open Returns Open an existing return or create a new one File gt Open Returns Options Set user preferences that affect viewing printing Setup gt Options calculation optional documents EF etc Organizers Print client information and preseason sheets for Last Year Data gt Organizers gathering tax data based on last
11. 1 800 890 5900 or our courteous and knowledgeable support staff at 1 828 524 8020 This Evaluation CD contains e A complete copy of the 2003 Drake Software e All State Programs e Computer Based Tutorials e Practice Returns and Solutions in PDF format e 2003 Drake User s Manual in PDF format e 2003 Drake Business Package Manual in PDF format e 2003 Client Write Up and CWU Manual in PDF format We are proud to offer our tax preparation software as one complete suite e Tax preparation software for Forms 1040 1065 1120 1120S 990 706 709 and 1041 e All State Personal and Business tax preparation packages e Electronic Filing e Bank Products e Blank Federal and State Forms for viewing and printing e CCH Online Master Tax Guide e Many other features Drake is a pioneer in the Tax Software and Electronic Filing Industry This year alone Drake filed over 3 5 mil lion IRS accepted electronic returns If you are not already e filing your client s returns let us help you Elec tronic Filing is FREE for Federal and State returns in Drake Software Thank you for reviewing our product Drake Software Evaluation Guide Copyrighted Material 2 Software Installation 2003 DRAKE TAX SOLUTION Software Installation Install the 2003 Drake Software Evaluation CD using the instructions located on the back of the CD cover Additional installation may be necessary Please read the topics below for details STATE AND CITY PROGRAM
12. 3450 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 29 When entering child care expenses make sure the expense amounts are listed on BOTH the Dependent Screen and the 2441 Screen Press ESC to return to the Data Entry Selection Menu ENTERING OFFICE IN HOME INFORMATION In addition to owning Patty Cakes Bakery Amelia s storage facility is at her home for lin ens and other catering materials She qualifies for Office in Home expenses which are entered on the 8829 screen To access this data entry screen type 8829 Office in Home Enter C in the For field The storage room at the Carter s house is 180 sq ft of the 2000 sq ft home Input the following additional information Fields Direct Expenses Indirect Expenses Insurance 250 Utilities 500 Other Expenses 250 ENTERING MOVING EXPENSES FORM 3903 During the last year the Carter s moved to a new location because Bill changed jobs To open the Moving Expenses screen type 3903 Moving Expenses on the Adjustments Tab Enter the following moving expenses on the 3903 Screen Fields Data Miles from Old to New 125 Miles from Old to Old 14 Transportation amp Storage 5400 Travel amp Lodging 58 Amount Reimbursed 95 Drake Software Evaluation Guide Copyrighted Material Return
13. CTRL S is used to split a MFJ return into two MFS returns allowing you to compare the differences D is incorrect CTRL N enables the Heads Down Method The Heads Down Method uses field codes that correspond with Proformas you can prepare during an interview 2 The correct answer is D CTRL S Use this Hot Key to split a MFJ return into two MFS returns allowing you to compare the differences A is incorrect With Drake Software CTRL S enables you to split the MFJ return B is incorrect CTRL F is used to force an entry in a field in data entry C is incorrect Use CTRL W in any numeric field to access an unformatted schedule 3 The correct answer is C With your cursor in the data entry field on a Drake Screen press CTRL W Key this short cut in any numeric field to access an unformatted sched ule A is incorrect CTRL F is used to force an entry in a field in data entry B is incorrect With Drake Software you can use CTRL W in any numeric field to access an unformatted schedule D is incorrect ESC is used to save and exit to the Data Entry Selection Menu 4 The correct answer is C ESC This Hot Key is used to save a data entry screen and return to the Data Entry Selection Menu A is incorrect Use CTRL W in any numeric field to access an unformatted schedule B is incorrect Use CTRL S to split a MFJ return into two MFS returns allowing you to compare the
14. ESC to return to the Data Entry Selection Menu The information entered is saved automatically as it is typed When you return to the Data Entry Selection Menu screen notice the Name and Address selection is highlighted indicating that data is entered on this screen If a screen is highlighted but contains no data the screen must be deleted or it can cause E filing errors Press CTRL D to delete the current data entry form Drake Software Evaluation Guide Copyrighted Material 24 Return Preparation 2003 DRAKE TAX SOLUTION ENTERING DEPENDENT INFORMATION William and Amelia have two dependents Press PAGE DOWN on the keyboard to pro duce an additional Dependent screen for the second child s information Enter the following information Fields First Dependent Data Second Dependent Data First Name Carolyn Richard SSN 239 21 1123 245 62 2235 Relationship Daughter Son Months in home 12 12 Date of Birth 07 11 1995 12 18 1984 Qualifying Child Care 3450 Expenses Hope Credit Expenses 4200 If Over 18 amp a Student X Press ESC to return to the Data Entry Selection Menu ENTERING WAGES W 2 In the first field of the W 2 screen enter T for taxpayer or S for spouse The corre sponding taxpayer or spouse information is populated in the Employee Name Address fields Remember help is available in each data entry fie
15. Electronically File the Return 2003 DRAKE TAX SOLUTION Electronically File the Return Drake users can electronically file Federal tax returns either through Drake or directly to an IRS Service Cen ter State returns can be piggybacked on Federal returns or sent directly to the state depending on state requirements In addition the Piggyback states can be sent separately to the IRS as a State Only packet with the exception of Hawaii and Oregon The flexibility in EF options that Drake offers can be useful when filing a multi state return or when the initial State return has been rejected and must be re filed Becoming an Elec tronic Return Originator ERO requires some pre season planning but pays off when tax season arrives ERO STATE ERO SETUP The temporary EFIN assigned by Drake does not enable electronic filing but allows system testing Preparers who are new to E filing must apply to the IRS for an EFIN ERO information MUST be entered before attempting to elec tronically file live returns 1 On the Menu Bar go to Setup gt ERO State ERO Information 2 Enter or edit the information 3 Click OK or press ESC to save and exit If the preparer is filing through Drake and has returns for more than one IRS Service Center all the returns can be filed in the same batch without changing the processing site Drake sep arates the returns and sends them to the correct IRS Service Center Ret
16. Fields Taxpayer TP Data Spouse Data SSN 400 00 6666 241 41 4441 First Name William Amelia Last Name Carter Carter Date of Birth 5 25 1960 12 18 1962 Filing Status 2 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 23 Program Feature SSN Pressing Shift in a completed Social Security Number field will produce information about the validity of the entered Enter the following data on the Name and Address screen for the Carter s return Program Feature Drake Software includes an integrated ZIP Code database To speed data entry on Screen 1 W 2 W 2G 1099 1099G or the Schedule C screens enter the zip code before entering the City and State fields Typing the zip code populates the city state county and resident state fields Fields Data Address 14998 New Heights Road Zip 94010 Daytime Phone 415 344 3443 Evening Phone 415 645 6456 Occupation Computer Technician Presidential Campaign Fund No Enter number without dots or dashes To avoid IRS rejection of electronically filed returns use only the characters allowed in addresses letters numbers ampersand amp hyphen and forward slash SAVING DATA When the Name and Address screen is complete press
17. SCHEDULE A COST OF GOODS SOLD Type A and press Enter Enter the following data and press ESC when finished Fields Data Inventory at the beginning 4000 of the year Purchases less cost of items 238190 withdrawn for personal use Cost of labor 6000 Inventory at end of year 4000 9A Cost Do the rules of section 263A No apply to the corporation Drake Software Evaluation Guide Copyrighted Material 52 Business Return 2003 DRAKE TAX SOLUTION Fields SCHEDULE E COMPENSATION OF OFFICERS Type E and press ENTER to access the Sch E Enter the following data and then press ESC Name Ownership amp Percent of Corp Stock Owned of SSN Participation Compensation Officer Time Common Preferred Jane 400005999 100 100 0 2100 Doe SCHEDULE K OTHER INFORMATION Type K and press Enter Enter the following data into the correct fields and then press ESC to save the screen and exit Fields Data 1 Accounting Method Accrual 2 Principle Business Code 722110 2c Product or Service Restaurant 3 Corporation Owned more than No 50 of a domestic corp s voting stock 4 Is corp a sub in an affiliated par No ent sub controlled group 5 Did any entity at year end own Yes 50 or more of corp voting stock Name Robert T Dickson ID 256807327 Percent Owned 100 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE
18. Type K and press Enter Enter the following data into the correct fields and then press ESC to save the screen and exit Fields Data 1 Accounting Method Accrual 2 Principle Business Code 722110 2c Product or Service Restaurant 3 Corporation Owned more than No 50 of a domestic corp s voting stock 4 Is corp a sub in an affiliated par No ent sub controlled group 5 Did any entity at year end own Yes 50 or more of corp voting stock Name Robert T Dickson ID 256807327 Percent Owned 100 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Business Return 53 Fields Data 6 Did Corp pay dividends gt cur No rent accumulated earnings and profits 7 Did one foreign person during No the tax year own at least 25 10 The number of shareholders at 2 the end of the year 11 If the corp has an NOL and elects X to forego carryback enter X FORM 4562 DEPRECIATION The items in the tables below are 100 for business use so leave that field blank The date placed in service is 06 04 1986 The cost and depreciation basis are the same amounts Type 4562 to access Depreciation Enter the following information and press ESC when complete Prior Depreciation Description Cost Method Life Fed State Glass Building 8914 90 ARP 19 7996 67 7996 67 Tiling 8150 ARP 19 7310 55 7310 55 Roofing 6183 ARP 19 5546 15 5546 15 Air
19. select the type of return to create Our sample is an Individual return Since this is the default press Enter NAME AND ADDRESS SCREEN Each time you create a new client the Name and Address Screen opens initially The information provided on this screen flows to each of the forms for this client Our Evaluation Taxpayers are William and Amelia Carter from Burlingame CA e They are filing a joint return e They have two children Richard Carolyn e William receives a salary from two computer jobs e Amelia owns a bakery of which she is a sole proprietor Fields Taxpayer TP Data Spouse Data SSN 400 00 6666 241 41 4441 First Name William Amelia Last Name Carter Carter Date of Birth 5 25 1960 12 18 1962 Filing Status 2 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 23 Program Feature SSN Pressing Shift in a completed Social Security Number field will produce information about the validity of the entered Enter the following data on the Name and Address screen for the Carter s return Program Feature Drake Software includes an integrated ZIP Code database To speed data entry on Screen 1 W 2 W 2G 1099 1099G or the Schedule C screens enter the zip code before entering the City and State fields Typing the zip code populates the city s
20. 2002 to 2003 F3 e Build EINs from 2002 F4 e Update Config 2002 to 2003 F5 Options F1 Firm Information F2 ERO State ERO Information F3 Preparers F4 Pay Per Return F5 Directories Paths F6 Pricing F7 Macros F8 Letterhead F9 Letters F10 Colors F11 Equipment F12 e Printer Setup F1 e Modem Setup F2 e PDF Printer F3 HELP F7 e Check Installation F1 e Version Info F2 e Copyright Notice F3 e Support F4 e Drake 2003 Help Topics F5 e Show Setup Admin F6 Tutorial F7 e CCH Tax Research F8 e Show Users F9 Drake Software Evaluation Guide Copyrighted Material 16 Program Navigation 2003 DRAKE TAX SOLUTION FEATURES Drake Software offers numerous value added features to enhance and simplify tax prepara tion The software is designed to ease the return preparation process In addition to the pro gram resources highlighted below the program boasts the following convenient features Information flows to related forms automatically Message pages display errors or alerts that may prevent successful e filing and or IRS rejection Zip code and Employer Identification Number databases speed data entry in several key forms Built in calculator is accessible in any data entry screen by pressing F10 Blank forms are available to view or print Unformatted worksheets are available by pressing CTRL W Calculate amortization
21. 3 Answer the questions below See Answers Part 3 on page 39 for explanations of answers 1 In return 400008001 why have we calculated a Child Tax Credit of 191 a Examine Form 8812 calculations line 13 reads 191 b Examine Form 1040 line 49 c Examine WK_ 8812 lines 1 11 d You cannot tell why from the forms produced 2 What form must be completed for due diligence and saved for each taxpayer qualifying for EIC a Form 8812 b Form WK_ 8812 c WK_EIC d Form 8867 3 In return 400008003 why is there an EIC of 1 193 a Examine the calculations on Form 8812 b Examine the calculations on Form 8867 c You cannot tell from a form produced with the software d Examine WK_EIC 4 In return 400008003 why is there only 1200 of Additional Child Tax Credit and no Child Tax Credit a Examine Form 8812 and WK_ 8812 b Examine the EIC Form and WK EIC c Examine Form 8812 and Form 8867 d Examine Form 2441 and Form 8812 5 What two screens in the software must contain the Child Care expenses a Screen 1 and 2441 Screen b Screen 2 and 2441 Screen c Screen 3 and the MISC Screen d Screen and Screen 2 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Review Questions Part 3 39 ANSWERS PART 3 1 The correct answer is C Examine WK_8812 lines 1 11 View this form to see the Child Tax Credit calculations resulting in 191 A is incorrect Line 13 of the 8812 reads 409 and is the calculation
22. Config 2002 to 2003 View View the forms generated for a return File gt View Returns Void Unused Check Void checks in the system that have not been printed EF gt Check Setup gt Void Unused Check Drake Software Evaluation Guide Copyrighted Material 62 Glossary 2003 DRAKE TAX SOLUTION Glossary Bank Products Enable a taxpayer to receive a refund faster and assists with paying for tax preparation service or any money owed to the IRS CBT Computer Based Tutorial CBTs enable the tax preparer to learn the basics of the soft ware through short instructional videos CCH The US Master Tax Guide Plus from CCH Incorporated is a comprehensive online tax information library available though the Tax Help speed button on the toolbar Data Entry Selection Menu The home base for return preparation Direct State E filed returns that are sent directly from Drake to the State E file Center Only a few states require direct filing CA IL MA ME MN EFIN Electronic Filing Identification Number Preparers new to e filing must apply for an EFIN by preparing and submitting an 8633 to the IRS Email to Drake Used to send and receive email in the Drake program EMonday Email that provides information on important IRS updates and software changes Receive these messages on Monday in the Email to Drake program ERO Electronic Return Originator To become an ERO preparers must apply for
23. Deposit Information d Sends you to Your EF Database on support drakesoftware com 13 How can you access blank federal and state forms within Drake Software a From the Menu Bar choose Tools gt Blank Forms b From the Menu Bar choose Setup gt Options gt Blank Forms c You cannot get blank forms within the software d Open a return and enter no information Drake Software Evaluation Guide Copyrighted Material 66 CPE Exam 2003 DRAKE TAX SOLUTION 14 True or False You can email returns inquiries or information to Drake from within the software 15 Which one of the following is NOT a method for opening a return in Drake Software a Type the SSN or EIN in the top box of the Open a Return window b Press F3 from the Open a Return Window c Select the desired return from those returns displayed in the lower box of the Open a Return window d Type a last name or company name in the entry field of the Open a Return box and press Enter 16 How do you file an amended return with Drake a Print out the blank form complete and mail in to the IRS b Reenter the return Go directly to the X screen Press CTRL X Then enter the changes needed to amend the return Select for EF c Reenter all information into the return and reprint Mail to the IRS d Reenter the return Go directly to the X screen Press CTRL X Then enter the changes needed to amend the return This retu
24. Depreciation Detail and five additional screens offering additional parts of Form 4562 The 4562 is usually the only screen necessary to enter depreciation Screens 6 9 are used only when entering an existing return Screen 10 contains the Bonus Depreciation Elections To create a Form 4797 from within the 4562 select an asset with a mouse click and press F3 Complete the If Sold column on the bottom right The only fields required are the date sold the sales price and the property type For the Carter s return there are three separate depreciable assets The first is the Patty Cakes baking oven and the others are the business vehicles To open the Depreciation data entry screen type 4562 Depreciation Detail on the Income Tab Enter the following information on the 4562 Screen Press PAGE DOWN for the next entry Fields Data For AUTO AUTO C Description Delivery Van Delivery Truck Oven Date Acquired 01 01 2003 05 01 2003 06 30 2003 Cost 15000 25000 7000 Business Percentage 100 100 100 Method M M M Life 5 5 7 ENTERING CHILD amp DEPENDENT CARE EXPENSES FORM 2441 To open the Child amp Dependent Care Expenses Screen Form 2441 type 2441 in the selector field and press Enter Fields Data SSN EIN 587999556 EIN X Provider s Name Short Stuff Academy Address 5788 Elm Street Zip 94010 Amount
25. Manual Copyrighted Material 2003 DRAKE SOFTWARE Program Navigation 13 Open the File Menu After the menu is selected the shortcut keys can be executed by pressing the shortcut key ALT is not necessary To open field specific help during return data entry press SHIFT To open on screen Help instructions press F1 GENERAL FLOW OF COMMANDS Instructions to reference parts of the program are as follows e Menu Bar the list of menu options across the top of the window e Drop Down Menus the list of available actions shown when an option is selected from the menu bar e Speed Buttons or Tool Bar the Tool Bar directly under the Menu Bar in the Windows program only Speed Buttons are used for quick access to commonly used program func tions e Data Entry Selection Menu the home base for return preparation These screens display the data entry options e Tabs the Data Entry Selection Menu displays tabs along the top of the screen Select a tab to display an additional list of data entry screens e Drop Down Box some fields in Windows display a down arrow next to the open box Click the arrow to open a drop down list of available choices e Buttons the Windows program offers additional buttons which can be mouse clicked to perform an action e Selector Field In data entry the entry field located in the bottom left corner of the screen Type corresponding sc
26. Married Filing Separate returns enabling the preparer to easily compare and determine the best option for the taxpayers State Only E filed returns that can be sent through an IRS Service Center to a state by them selves Unlike Piggyback state returns State Only packets are reviewed by the state regard less of the IRS acknowledgement View Mode Enables you to view the actual forms that print with a return Press CTRL V to enter View mode Drake Software Evaluation Guide Copyrighted Material 64 CPE Exam 2003 DRAKE TAX SOLUTION CPE Exam Answer the questions below See CPE Exam Answer Sheet on page 67 for answer sheet and instructions for receiving credit 1 In Drake Setup gt Options which tab would I select to change state options a EF Tab b Optional Items on a Return Tab c Billing Tab d State Tab 2 What operation does CTRL S perform a Splits a Married Filing Joint return into two Married Filing Separate returns b Opens a return c Saves a return d Saves Firm and ERO information 3 What information is provided on WK_EIC a A check list for Additional Child Tax eligibility b A check list for EIC due diligence c Calculation used for determining EIC amounts d Calculation used for determining ACTC amounts 4 Which of the following would not be used when electronic filing with Drake Software a Form 8453 b Form 8879 c The signature lines on the bottom of the 1040 d PIN Scree
27. Setup New Checks Enter check range when new checks are received from bank EF gt Check Setup gt Setup New Transmit Receive Connect and transmit return EF gt Transmit Receive Unlock Client Files If a file has been locked use this option to unlock and edit the return Tools gt File Maintenance gt Unlock Client Files Update 2002 to 2003 Update the previous year s client data Last Year Data gt Update 2002 to 2003 Update Config 2002 2003 Bring forward last year s setup e g firms prepar ers pricing macros etc Last Year Data gt Update Config 2002 to 2003 View View the forms generated for a return File gt View Returns Void Unused Check Void checks in the system that have not been printed EF gt Check Setup gt Void Unused Check Drake Software Evaluation Guide Copyrighted Material 62 Glossary 2003 DRAKE TAX SOLUTION Glossary Bank Products Enable a taxpayer to receive a refund faster and assists with paying for tax preparation service or any money owed to the IRS CBT Computer Based Tutorial CBTs enable the tax preparer to learn the basics of the soft ware through short instructional videos CCH The US Master Tax Guide Plus from CCH Incorporated is a comprehensive online tax information library available though the Tax Help speed button on the toolbar Data Entry Selection Menu The home base for return p
28. State All returns transmitted through Drake are forwarded to the correct IRS Service Center An immediate acknowledgement is sent to indicate a successful transmission After the IRS and or the state receive and process the forwarded return acknowledgements are sent to Drake indicating whether the return was accepted or rejected The acknowledgements are then forwarded to the ERO the next time a connection is made to Drake Although you have the option of transmitting directly to the IRS Drake users are encour aged to transmit returns through Drake There are two advantages to this option e The ability to send all returns in a single transmission IRS Piggyback State Only and State Direct e Drake support is easily accessible Our trained support personnel can access returns for troubleshooting BEGIN THE TRANSMISSION 1 Select EF gt Transmit Receive on the Menu Bar 2 The transmit screen opens providing four possible options Review Send Receive Acks Only Cancel and Help Review Use this option to review the transmission file and remove any returns before con necting to Drake The returns that are selected and highlighted will NOT trans mit The returns that are not selected will transmit 1 To review the manifest click REVIEW To select all click SELECT ALL All returns are highlighted these will be removed from the transmission file To deselect all click DESELECT ALL For single returns click to select
29. View Drake Tutorials Program Setup sssssssssssunnnnnnnnnnnnnnnnnnnnnnnnnnnnn nnne Firm Setup ERO State ERO Information Preparer Setup Printer Setup Optional Program Setup Review Questions Part 1 0 ceceeeeceeeeeeeeees Answers Part 1 Program Navigation ccccceeeseeeeeeeeeseeeeeeeees Drake for Windows General Flow of Commands Features Drake 2003 Hot Keys cccceeeeceeeeeeeeeeeeeeeeeees Review Questions Part 2 ccceeesceceeeeeeeeeees Answers Part 2 Return Preparation ccccceeeseeeeeeeeeseeeeeeeees Open a Return Entering Data Preparing the 1040 Evaluation Return Calculate and Print the Return Return Calculation Print Examining Returns cccccceeeeeeeeeeeeeseeeeeeeees Review Questions Part 3 ccccceesseeeeeeeeees Answers Part 3 Electronically File the Return 008 ERO State ERO Setup State E Filing EF Options in Data Entry Message Pages The EF Menu Test Transmissions Drake Software Evaluation Guide Table of Contents Copyrighted Material Table of Contents 2003 DRAKE SOFTWARE Process Acknowledgements Search EF Database Review Questions Part 4 ccccccececeececeeceecececcececeececeececeeees 48 Answers Part 4 Business Return 2cccccceececeecececcececeececcecececcecescececeececeececeeees 50 Prepare the 1120 Evaluation Return Screen 1 Corporation General Informatio
30. an EFIN FAQ Screen Frequently Asked Questions On any state screen in data entry type FAQ in the selector field to access state specific information Heads Down Data Entry Uses field codes that correspond with interview sheets profor mas Data can be gathered by a tax preparer and entered by a data entry operator Hot Keys Enable the user to perform specific actions quickly and easily using the keyboard For example press CTRL C to calculate a return Menu Bar The list of menu options across the top of the Drake screen Message Page Red pages that appear in View or Print Mode when a return has certain issues that would cause an IRS State rejection You cannot select a return for electronic filing with a red Message page Correct the issue and view the return If the message page is gone the return can be e filed Notes Page The yellow Notes page provides reminders or tips about a tax return and does not prevent e filing PDF PDF format allows Drake manuals and other materials to be viewed and printed directly from the CD PDF Portable Document Format is a file format that captures all the elements of a printed document as an electronic image that can be viewed navigated or printed PDF files are created in Adobe Distiller PDF995 or similar products View the files with the Adobe Reader Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Glossary 63 Piggyback E filed state returns that are
31. answer is B Screen 2 and 2441 Screen Enter child care expenses on Screen 2 the Dependent screen and the 2441 Screen Child and Dependent Care Expenses A is incorrect Screen is the Name and Address screen You would enter Child Care Expenses on the 2441 Screen and the Dependent screen C is incorrect Screen 3 is the Income screen and the MISC screen is used to enter mis cellaneous codes and notes D is incorrect Screen 1 is the Name and Address screen You would enter Child Care expenses on Screen 2 Drake Software Evaluation Guide Copyrighted Material 40 Electronically File the Return 2003 DRAKE TAX SOLUTION Electronically File the Return Drake users can electronically file Federal tax returns either through Drake or directly to an IRS Service Cen ter State returns can be piggybacked on Federal returns or sent directly to the state depending on state requirements In addition the Piggyback states can be sent separately to the IRS as a State Only packet with the exception of Hawaii and Oregon The flexibility in EF options that Drake offers can be useful when filing a multi state return or when the initial State return has been rejected and must be re filed Becoming an Elec tronic Return Originator ERO requires some pre season planning but pays off when tax season arrives ERO STATE ERO SETUP The temporary EFIN assigned by Drake does not enable electronic filing but allows sy
32. balance due These can be selected for EF also complete line 66 of screen 5 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Calculate and Print the Return 35 Calculate and Print the Return RETURN CALCULATION Drake Software automatically saves all data as it s being entered However it does not auto matically calculate the return From anywhere within the return press CTRL C or CTRL V to calculate the return e Press CTRL C to calculate the return and view a calculation summary screen Press CONTINUE to return to the Data Entry Selection Menu e Press CTRL V to calculate the return and enter View mode View mode enables you to view the actual forms that will print for the return The program automatically calculates when you exit a return This ensures that the latest fig ures are calculated and saved To automatically calculate the return when you view or exit go to Setup gt Options gt Calculate View Print Tab and select to turn on Auto Cal culate Return when exiting data entry If the Pause Option for Calculation option has been selected to After view or print only in Setup gt Options gt Calculation amp View Print Tab the calculation summary screen will display after pressing CTRL V Press ESC or the SPACE BAR to continue When the View Mode screen opens use o
33. calculations on Form 8867 c You cannot tell from a form produced with the software d Examine WK_EIC 4 In return 400008003 why is there only 1200 of Additional Child Tax Credit and no Child Tax Credit a Examine Form 8812 and WK_ 8812 b Examine the EIC Form and WK EIC c Examine Form 8812 and Form 8867 d Examine Form 2441 and Form 8812 5 What two screens in the software must contain the Child Care expenses a Screen 1 and 2441 Screen b Screen 2 and 2441 Screen c Screen 3 and the MISC Screen d Screen and Screen 2 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Review Questions Part 3 39 ANSWERS PART 3 1 The correct answer is C Examine WK_8812 lines 1 11 View this form to see the Child Tax Credit calculations resulting in 191 A is incorrect Line 13 of the 8812 reads 409 and is the calculation for the Additional Child Tax Credit B is incorrect This is the line on the 1040 for the CTC but it does not show how it is cal culated D is incorrect View the WK 8812 lines 1 11 to examine the calculations 2 The correct answer is D Form 8867 The Preparer s Earned Income Checklist must be completed for due diligence and saved for each taxpayer qualifying for EIC A is incorrect Examine the 8812 for the Additional Child Tax Credit calculations B is incorrect Examine the WK_ 8812 for the Child Tax Credit calculations C is incorrect Examine the WK_EIC for the Earned Income Credit calculations
34. create preparer schedules make appointments and run reports e Exit Exits the program ESC Press the ESC to exit a screen Information on that screen is saved Press ESC on the Home screen to exit the Drake program THE KEYBOARD The computer keyboard can be used to maneuver through the program See Hot Keys on page 57 of the Appendix for a list of shortcuts keys used during data entry Press ALT to display the underlined shortcut key for each option on the Menu Bar The underlined letter for each option is the shortcut key Example File Press ALT F to Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Program Navigation 13 Open the File Menu After the menu is selected the shortcut keys can be executed by pressing the shortcut key ALT is not necessary To open field specific help during return data entry press SHIFT To open on screen Help instructions press F1 GENERAL FLOW OF COMMANDS Instructions to reference parts of the program are as follows e Menu Bar the list of menu options across the top of the window e Drop Down Menus the list of available actions shown when an option is selected from the menu bar e Speed Buttons or Tool Bar the Tool Bar directly under the Menu Bar in the Windows program only Speed Buttons are used for quick access to commonly used program func tions e Data Entry Selection Menu the home
35. file live returns with the temporary EFIN given to the user by Drake Software 20 Which of the following methods of payment or refunds can be executed with Drake a An automatic withdrawal of funds from taxpayer s bank or savings account on a selected date in the future b A direct deposit into the taxpayer s bank or savings account c A refund check printed in the tax preparer s office d All of the above Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE CPE Exam Answer Sheet 67 CPE Exam Answer Sheet Circle the appropriate response on this answer sheet for each of the questions on the CPE Exam PTA B C D 2 A B C D 3 A B C D 4 A B C D 5 A B C D 6 A B C D 7 True False n a n a 8 A B C D 9 A B C D 10 A B C D ll A B C D 12 A B C D 13 A B C D 14 True False n a n a 15 A B C D 16 A B C D 17 A B D 18 A B C D 19 True False n a n a 20 A B C D Please return completed Exam and Evaluation see 2004 Evaluation Guide on page 68 before January 1 2005 to Education Department Drake Software 235 E Palmer Street Franklin NC 28734 Drake Software Evaluation Guide Copyrighted Material 68 CPE Exam Answer Sheet 2003 DRAKE TAX SOLUTION 2004 EVALUATION GUIDE Please take a moment and let us know what you think We value your input and suggestions and strive to continually improve our educational tools to better suit your needs For CPE credit you must complete your name and
36. for the Additional Child Tax Credit B is incorrect This is the line on the 1040 for the CTC but it does not show how it is cal culated D is incorrect View the WK 8812 lines 1 11 to examine the calculations 2 The correct answer is D Form 8867 The Preparer s Earned Income Checklist must be completed for due diligence and saved for each taxpayer qualifying for EIC A is incorrect Examine the 8812 for the Additional Child Tax Credit calculations B is incorrect Examine the WK_ 8812 for the Child Tax Credit calculations C is incorrect Examine the WK_EIC for the Earned Income Credit calculations 3 The correct answer is D Examine WK_EIC This worksheet shows how EIC was calcu lated A is incorrect Examine the 8812 for the Additional Child Tax Credit calculations B is incorrect The Preparer s Earned Income Checklist only determines EIC eligibility C is incorrect You can view the WK_EIC to examine the calculations 4 The correct answer is A Examine Form 8812 and WK_ 8812 The 8812 calculates the 1200 in Additional Child Tax Credit The WK_8812 calculates zero on line 15 Child Tax Credit B is incorrect The EIC form does not display dollar amounts and the WK_EIC calculates the Earned Income Credit C is incorrect You can view the total Additional Child Tax Credit on the 8812 but the 8867 is and an EIC eligibility checklist D is incorrect The 2441 is used to report Child and Dependent Care expenses 5 The correct
37. last field on the screen END Move to the first field on the screen HOME Create additional Data Entry screens e g W 2 1099 PAGE DOWN or CTRL PAGE DOWN schedules etc Return to previous screen exit ESC Note Use the mouse to position the cursor in a desired field OVERRIDES AND ADJUSTMENTS TO RETURN CALCULATIONS Override Fields Adjustment Fields Data Entry fields that allow overrides are preceded by Data Entry fields that allow adjustments are preceded by a an equal sign An amount entered in these fields plus sign An amount entered in these fields adjusts overrides program calculations program calculations Enter a negative number to subtract an amount Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Appendix 57 HoT KEYS Action Hot Keys Additional Notes Access help text during Data Entry SHIFT With the cursor in the field press Shift for Data Entry information If selections are listed select the desired choice and press ENTER to insert data Exit a Data Entry screen without SHIFT ESC Press ESC to exit and save changes in Data Entry saving changes Verify a valid Social Security Num ALT After the SSN has been entered press Alt for SSN ber verification Insert the current date in any date ALT D CAUTION CTRL D deletes the screen field Calculate a return CTRL C Open the return in Dat
38. of client s depreciable assets Reports gt Depreciation List Directories Paths Set up CD drive letter drive location of current year last years files and shared drive letter for peer to peer networks Setup gt Directories Paths Download Fonts Copy Softfonts which are necessary to print tax forms to the printer This must be run each time the printer is turned off Tools gt Download Fonts Edit EIN Database Edit specific employer information in the EIN Database Tools gt Edit EIN Database EF Set up Electronic Return Originator information Setup gt ERO State ERO Information EF Reports Create standard and custom reports of EF data Reports gt EF Standard or Custom Reports e mail to Drake Send e mail directly to technical support Receive broadcast e mails from Drake including a weekly update on tax changes program tips and more EF gt e mail to Drake Envelopes Print envelopes Tools gt Letters gt Envelopes Export Client Data Exports data to a database file that can be opened and used for generating reports in Access Excel etc Tools gt File Maintenance gt Export Client Data Drake Software Evaluation Guide Copyrighted Material 60 Appendix 2003 DRAKE TAX SOLUTION Task Description Location Export EF Data Export data to a database file that can be opened and used for generating reports in Access Excel
39. or deselect returns Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Electronically File the Return 45 3 Click CONTINUE Send Receive Use this option to connect and transmit the file and to pick up Federal and State acknowledgments bank product acknowledgments check authorizations and ser vice packs needed to update the program if selected in Setup gt Options gt EF 1 Click SEND RECEIVE to continue 2 The Declaration Control Record opens Click PRINT 3 Click CONTINUE 4 The program connects and completes the transmission and automatically dis connects from Drake after the transmission is complete Acks Only Use this option to pick up Federal and State acknowledgements bank product acknowledgements check authorizations and service pack files needed to update the program No files are transmitted to Drake 1 Click ACKS ONLY to continue 2 The program connects and retrieves the acknowledgements and any service packs The program only retrieves the service pack files if the option is selected in Setup gt Option gt EF 3 The program automatically disconnects from Drake after the transmission is complete TEST TRANSMISSIONS Before attempting to transmit any actual tax returns it is recommended that EROs should first transmit test returns Vv CAUTION V Do NOT transmit any test returns that contain social security numbers other than those in the 400 00 and 500 00 serie
40. preferences from the Options screen The software defaults to the most common preferences To change or view the defaults follow the steps below 1 From the Menu Bar go to Setup gt Options 2 Click the tabs to change the options screen that displays After selecting an option press OK to save The following options are available Data Entry Tab e Enlarge Data Entry screens for easier viewing e Use 25 row screen size for 50 row screens Sch C 1099 etc e Use grid Data Entry format for select screens DIV INT 4562 etc e Tab to zip code field skip city state and use zip code database e Language for Data Entry Select English or Spanish e Letter Case for Data Entry Select Upper Case or Lower Case Choose to use either all uppercase or mixed case in Data Entry Calculate and View Tab e Auto calculate tax return when exiting Data Entry e Display client fee on calculation screen e Print only one overflow statement per page e Return to same location in Data Entry CTRL E e Audible Notification of Calculation Error Messages e Layout for Depreciation Schedule Select Portrait or Landscape from the drop down menu e Pause Option for Calculation Always after calculation pauses when the cal culation is complete File gt Calculate After Ctrl View Print will pause only after a Ctrl View or Ctrl Print are used to calculate Only when using File gt Calculate will pau
41. the 2441 and screen 2 of the federal return You must however enter the telephone number for the child care provider Notice that the message page tells you to use the CA 3506 screen Type CA in the Return Selector field to enter the California spe cific data Type 3506 and enter a telephone number for the child care provider in the appropri ate field Now when you view the return it is ready to electronically file to the IRS and to California The Message page has disappeared All the states operate in a similar manner Drake Software Evaluation Guide Copyrighted Material 44 Electronically File the Return 2003 DRAKE TAX SOLUTION THE EF MENU SELECT RETURNS FOR EF After the return has been created and calculated without message pages it is ready for EF From the Menu Bar go to EF gt Select Returns for EF 1 The Return Selector screen displays A selection window opens listing all recently calculated files that are eligible for electronic filing Use the arrow keys to scroll through the list of returns 2 Click the returns to select or deselect the desired returns 3 After selecting the returns click CONTINUE A report listing all returns included in the transmission opens Select the PRINT option to print the report Click EXIT to close TRANSMIT RECEIVE Transmitting tax returns and receiving acknowledgements is a simple process With just a few clicks you are able to electronically file returns to the IRS and
42. the data entry screen select K1 Partnership K1 on the Income Tab Field Data TS IF 561122334 Partnership ID Partnership Name Dynamic Distributing This is a passive activity X This partner is a limited part X ner Make sure to pay attention to the help text Shift to see to where or if information carries Enter the following amounts from the K1 Line Amount 1 2756 4a 65 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 31 ENTERING ESTIMATED TAXES To override the system s automatic calculations and enter the estimated taxes you desire select ES Estimated Taxes on the General Tab This screen is divided into columns and sections 2003 Estimated Taxes Paid and 2004 Estimated Taxes Due ENTERING STATE DATA State returns are easy to generate in Drake Software First either install the state software on the hard drive or simply insert the Evaluation CD into the CD drive see the State Installation instructions at the beginning of this guide for detailed directions State forms automatically generate based on data entered on the Federal return Calcula tion is based on the State entered on the Name amp Address Screen for Resident State as well as the State codes indicated on W 2s Schedule C 1099 Schedule B etc For specific information pertaining to the state State Data Entry
43. the selector field in the bottom left corner of the Data Entry Selection Menu Access installed state forms by typing the state s two letter abbreviation into this box NAVIGATION Move through the data entry fields on any form Drake Software Evaluation Guide Copyrighted Material 22 Return Preparation 2003 DRAKE TAX SOLUTION e Press Tab Enter or the Down arrow key to advance the cursor to the next field e Press Shift Tab or the Up arrow key to move the cursor back one field e Use the Left Right arrow keys to move the cursor within a data entry field e Press ESC to save and close the data entry screen and return to the Data Entry Selection Menu Program Feature In any data entry field you can find field specific explanations by pressing Shift This help is available in any field and often contains selectable options for that field PREPARING THE 1040 EVALUATION RETURN In this section we will enter a practice return and work through various data entry screens to become comfortable with Drake Software The following sections provides step by step instructions for preparing calculating viewing printing and electronic filing a return 1 On the menu bar select File gt Open Returns 2 Inthe Open a Return screen type the following SSN without dashes 400 00 6666 Click OK 3 A message box will prompt you to create a new return Click Yes Next
44. these coupons in Setup gt Letters gt Coupon Enter the number of sheets to print with each return and the amount of the coupon Envelope Address Sheet Select small medium or large Result Letter Select letter 1 9 Customize these letters in Setup gt Letters Optional Items on Return Click the corresponding check box to print an item on the returns Gross Social Security only when required Date on return This date pulls from the date on the computer To change this date enter the required date on the MISC screen Taxpayer phone number Pulls from Screen 1 Third Party Designee Prints on the main form for the tax return Rounding Amounts Select dollar or penny rounding Dollar rounding is required for electronic filing Penny rounding prints penny amounts on all forms Billing Tab Click the corresponding check box to turn a feature on Drake Software Manual Print taxpayer s SSN on bill Print preparer s name on bill Copyrighted Material 2003 DRAKE SOFTWARE Program Setup 9 Show RAL preparer fees as withheld on bill Show bank fees on bill Sales Tax Sales tax percent to add to client statement Enter a number greater than 1 For example 4 5 would represent a sales tax rate of 4 5 Billing Statement Format Select a statement option Show forms form prices and total Show form list and total Bill by time or Do not prepare bill States Tab There are
45. ule A is incorrect CTRL F is used to force an entry in a field in data entry B is incorrect With Drake Software you can use CTRL W in any numeric field to access an unformatted schedule D is incorrect ESC is used to save and exit to the Data Entry Selection Menu 4 The correct answer is C ESC This Hot Key is used to save a data entry screen and return to the Data Entry Selection Menu A is incorrect Use CTRL W in any numeric field to access an unformatted schedule B is incorrect Use CTRL S to split a MFJ return into two MFS returns allowing you to compare the differences D is incorrect Use ALT in any data entry field to view field specific information SHIFT functions the same way 5 The correct answer is D ALT D This enters the current date in any Date field A is incorrect Insert D is not a Hot Key in Drake B is incorrect CTRL D deletes a screen in data entry C is incorrect You can enter the current date using ALT D Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 21 Return Preparation While there are many ways Drake Software simplifies tax preparation the software cannot replace a funda mental understanding of tax laws Your data will be calculated as entered on each screen The screens in almost every instance reflect the corresponding tax form In this section we will review the followi
46. year Return 33 Payment 33 Profit or Losses from Sch C 27 Saving Data 23 State Data 31 Valid City Codes 32 Wages 24 Return Preparation 21 Review Questions Answers Part 1 11 Answers Part 2 20 Answers Part 3 39 Answers Part 4 49 Part 1 10 Part 2 19 Part 3 38 Part 4 48 S Service Center 41 Software Installation State and City Programs 2 Software Installation 2 State 2 State Information EF Service Centers 41 State Only 43 State Only 43 States Tab 9 Support Online State Resource 17 Service Packs 17 website address 17 Copyrighted Material 2003 DRAKE SOFTWARE Index 71 T Transmission Direct State 43 Piggyback 43 State Only 43 y Valid City Codes 32 Drake Software Evaluation Guide Copyrighted Material 72 Index 2003 DRAKE TAX SOLUTION Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE l CopyRight Notice The 2003 Drake Software Evaluation Guide Drake Tax Software and any other related materials are Copy righted Material All rights are reserved by Drake Enterprises LTD including all ownership rights This docu ment associated software and related material are the property of DRAKE ENTERPRISES LTD No part of this document or associated online documentation may be reproduced or transmitted in any form or by any means without the express written permission of DRAKE ENTERPRISES LTD 2004 Drake Enterprises LTD All rights reserved Printed in USA While
47. 03 DRAKE SOFTWARE Program Navigation 17 SPLIT RETURNS Drake Software allows you to easily compare Married Filing Joint MFJ and Married Fil ing Separate MFS From the Data Entry Selection Menu screen on a joint return split their return using CTRL S or use the speed button labeled Split The program splits the return On the resulting Return Selector screen the return dis plays in three ways Married Filing Joint Taxpayer separate and Spouse separate Included on this screen are the following e Summaries of both Federal and State refunds or amounts due e the resulting savings e the option to save any one or all three of the return formats e the ability to print this summary screen press P e exiting without saving the MFS formats If both returns are saved each time you open the return you choose the MFJ or the MFS format In this case either return can have additional data entered SUPPORT DRAKESOFTWARE COM Select the Internet Speed Button from the tool bar to log onto support drakesoftware com for access to 24 hour software information including resource links for tax preparers the Knowledge Base and Your EF database ONLINE STATE RESOURCE The Online State page is available through support drakesoftware com enabling the search of state specific questions including reject codes exclusions state instructions and e fil ing explanations and instructions CCH Go to Tax Help on t
48. 0A EZ Suppress Form 1045 page 2 NOL Select to prepare when needed or only when indi cated in data entry Form 2210 Select to prepare when needed or only when indicated in data entry Optional Documents Tab Check the appropriate boxes to print the following with each return Folder Cover sheet Next Year Depreciation Schedule Preparer Notes page when applicable Prior Year Comparison Privacy Letter Return Summary Optional Worksheets W2 1099 detail list Prints landscape with city amounts Selected by default W2 1099 forms Referral Coupons 3 per sheet Customize the text of these coupons in Setup gt Letters gt Coupon Enter the number of sheets to print with each return and the amount of the coupon Envelope Address Sheet Select small medium or large Result Letter Select letter 1 9 Customize these letters in Setup gt Letters Optional Items on Return Click the corresponding check box to print an item on the returns Gross Social Security only when required Date on return This date pulls from the date on the computer To change this date enter the required date on the MISC screen Taxpayer phone number Pulls from Screen 1 Third Party Designee Prints on the main form for the tax return Rounding Amounts Select dollar or penny rounding Dollar rounding is required for electronic filing Penny rounding prints penny amounts on all forms Billing Tab Click the
49. 1 Schedule M1 Reconciliation of Income 55 Screen Corporate General 50 Screen 2 State General 50 Business Return 50 C Calculate and Print the Return Calculation 35 Print Files 36 Print 36 Calculate and Print the Return 35 Calculate and View Tab 7 CBT Computer Based Training 4 CCH Master Tax Guide 17 Corporation General Information 50 CPE Exam 64 CPE 1 Customize Security Setup 6 Drake Software Evaluation Guide Index 69 D Data Entry Navigation 21 Data Entry 7 Depreciation 4562 53 Drake Hot Keys 18 Tutorials 4 Drake Reference Guides 3 E EF Options 42 EF Tab Select returns for EF 9 EF Tab 9 Electronically File the Return EF Options in Data Entry 42 ERO State ERO Setup 40 Message Pages 43 Process Acknowledgements 46 Search EF Database 47 State E filing 41 Test Transmission 45 The EF Menu 44 Transmission 44 Transmit Receive 44 Electronically File the return 40 Emailing e mail to Drake 16 ERO State ERO Setup 40 Examining Returns 37 Extension 34 F Form and Schedule Option Tab 7 Frequently Used Codes for Date Entry 58 G Glossary of Menu Items 58 Glossary 62 H Hot Keys 18 56 K Keyboard Keys 56 Copyrighted Material 70 Index L Loss 55 M Message Pages 43 N Navigate Return Data Entry 57 O Online Service Packs 17 Override Screens 43 Overrides and Adjustments to Return Calcula tions 56 P Pop up Calculator 57 Preparing a ret
50. 2003 DRAKE SOFTWARE l CopyRight Notice The 2003 Drake Software Evaluation Guide Drake Tax Software and any other related materials are Copy righted Material All rights are reserved by Drake Enterprises LTD including all ownership rights This docu ment associated software and related material are the property of DRAKE ENTERPRISES LTD No part of this document or associated online documentation may be reproduced or transmitted in any form or by any means without the express written permission of DRAKE ENTERPRISES LTD 2004 Drake Enterprises LTD All rights reserved Printed in USA While every attempt has been made to produce an accurate and complete manual there is no warranty expressed or implied to that effect DRAKE ENTERPRISES LTD assumes no liability for damages or claims resulting from the use of the information contained herein TRADEMARKS The Drake Software Logo and Drake Software are registered trademarks of Drake Enterprises LTD Other product names mentioned in this manual may be trademarks or registered trademarks of their respective companies Drake Software Evaluation Guide Copyrighted Material 2003 DRAKE SOFTWARE Drake Software Evaluation Guide Copyrighted Material 2003 DRAKE SOFTWARE Table of Contents Welcome xesceses cecececcccte edd oven dcsceeesscccczsveceas Software Installation cccececececcecseecececeeeeeees State and City Program Installation Other Drake Reference Guides
51. 5 of Form 1040 line 42 of Form 1040A There are two forms in Drake Software for Earned Income Credit The calculation is performed automat ically To examine the calculations for line 63 of Form 1040 line 41 of Form 1040A view WK_EIC EIC cannot be generated for a Form 1040EZ Form 8867 provides a checklist for EIC due diligence The IRS examines these forms during audits Complete and save Form 8867 for each taxpayer qualifying for EIC To qualify for Child Care Credit both parents must have earned income be full time students or disabled In Drake Software fill out the dependent information on screen 2 including any child care expenses and then fill out Form 2441 completely including child care expenses again Drake Software Evaluation Guide Copyrighted Material 38 Review Questions Part 3 2003 DRAKE TAX SOLUTION Review Questions Part 3 Answer the questions below See Answers Part 3 on page 39 for explanations of answers 1 In return 400008001 why have we calculated a Child Tax Credit of 191 a Examine Form 8812 calculations line 13 reads 191 b Examine Form 1040 line 49 c Examine WK_ 8812 lines 1 11 d You cannot tell why from the forms produced 2 What form must be completed for due diligence and saved for each taxpayer qualifying for EIC a Form 8812 b Form WK_ 8812 c WK_EIC d Form 8867 3 In return 400008003 why is there an EIC of 1 193 a Examine the calculations on Form 8812 b Examine the
52. Business Return 53 Fields Data 6 Did Corp pay dividends gt cur No rent accumulated earnings and profits 7 Did one foreign person during No the tax year own at least 25 10 The number of shareholders at 2 the end of the year 11 If the corp has an NOL and elects X to forego carryback enter X FORM 4562 DEPRECIATION The items in the tables below are 100 for business use so leave that field blank The date placed in service is 06 04 1986 The cost and depreciation basis are the same amounts Type 4562 to access Depreciation Enter the following information and press ESC when complete Prior Depreciation Description Cost Method Life Fed State Glass Building 8914 90 ARP 19 7996 67 7996 67 Tiling 8150 ARP 19 7310 55 7310 55 Roofing 6183 ARP 19 5546 15 5546 15 Air Cond 6000 ARP 19 5382 00 5382 00 Leasehold 49682 22 ARP 19 44564 95 44564 95 Leasehold 1330 45 ARP 19 1193 41 1193 41 Gas Range 5000 M 5 5000 00 5000 00 Deep Fry 2984 40 M 5 2984 40 2984 40 Exhaust Fan 4631 12 M 5 4631 12 4631 12 Refrigerator 17058 38 M 5 17058 38 17058 38 Equipment 669 25 M 5 669 25 669 25 Equipment 670 91 M 5 670 91 670 91 Drake Software Evaluation Guide Copyrighted Material 54 Business Return 2003 DRAKE TAX SOLUTION Prior Depreciation Description Cost Method Life Fed State Equipment 152 88 M 5 152 88 152 88 Equipment 181 20 M 5 181 20 181 20 O
53. Cond 6000 ARP 19 5382 00 5382 00 Leasehold 49682 22 ARP 19 44564 95 44564 95 Leasehold 1330 45 ARP 19 1193 41 1193 41 Gas Range 5000 M 5 5000 00 5000 00 Deep Fry 2984 40 M 5 2984 40 2984 40 Exhaust Fan 4631 12 M 5 4631 12 4631 12 Refrigerator 17058 38 M 5 17058 38 17058 38 Equipment 669 25 M 5 669 25 669 25 Equipment 670 91 M 5 670 91 670 91 Drake Software Evaluation Guide Copyrighted Material 54 Business Return 2003 DRAKE TAX SOLUTION Prior Depreciation Description Cost Method Life Fed State Equipment 152 88 M 5 152 88 152 88 Equipment 181 20 M 5 181 20 181 20 Oven 5142 29 M 5 5142 29 5142 29 Equipment 1452 38 M 5 1452 38 1452 38 Cabinets 2553 20 M 5 2553 20 2553 20 The items below should be entered Prior Depreciation Description Date Acquired Cost Method Life Fed State Ice 02281991 2626 00 M 7 2626 00 2626 00 Machine Printer 03211994 2904 40 M 5 2904 40 2904 40 Cash Reg 04301994 1865 60 M 5 1865 60 1865 60 ister Blizzard 06301994 589 89 M T 589 89 589 89 Machine HVAC 08141997 7171 00 M 1 6210 99 6210 99 Unit Toaster 03301995 716 98 M 5 716 98 716 98 Cash Reg 04301995 493 98 M 5 493 98 493 98 ister HVAC 09151997 5971 00 M 7 5171 00 5171 00 Unit Office 05311998 404 90 M 5 381 58 381 58 Equip ment Misty 02011998 2000 00 M 5 1884 80 1884 80 Mch Computer 06261999 5383 M 5 3683 65 3683 65 Drake Software Manual C
54. D 17 A B D 18 A B C D 19 True False n a n a 20 A B C D Please return completed Exam and Evaluation see 2004 Evaluation Guide on page 68 before January 1 2005 to Education Department Drake Software 235 E Palmer Street Franklin NC 28734 Drake Software Evaluation Guide Copyrighted Material 68 CPE Exam Answer Sheet 2003 DRAKE TAX SOLUTION 2004 EVALUATION GUIDE Please take a moment and let us know what you think We value your input and suggestions and strive to continually improve our educational tools to better suit your needs For CPE credit you must complete your name and address along with your evaluation of the course material You must also include your signature on the form Hours are based on a 100 minute hour Credit is awarded to a score of 70 or better Your CPE certificate will be mailed to you Please Print All Information Clearly Circle the designation that applies to you CPA PA Enrolled Agent Tax Practitioner Attorney Other Your Name Mr Mrs Miss Ms EFIN E mail Firm Name Phone Address City ST Zip Regarding Content and Media please circle one e Were the stated learning objects met Yes or No e Were program materials accurate and did they contribute to the achievement of the learn ing objectives Yes or No e Were the Eval Guide amp Software appropriate Yes or No e Were prerequisite requirements appropriate Yes or No Comments To receive
55. F Menu 44 Transmission 44 Transmit Receive 44 Electronically File the return 40 Emailing e mail to Drake 16 ERO State ERO Setup 40 Examining Returns 37 Extension 34 F Form and Schedule Option Tab 7 Frequently Used Codes for Date Entry 58 G Glossary of Menu Items 58 Glossary 62 H Hot Keys 18 56 K Keyboard Keys 56 Copyrighted Material 70 Index L Loss 55 M Message Pages 43 N Navigate Return Data Entry 57 O Online Service Packs 17 Override Screens 43 Overrides and Adjustments to Return Calcula tions 56 P Pop up Calculator 57 Preparing a return 1040 Evaluation Return 22 Process acks 46 Program Navigation Emailing 16 Features 16 General Flow of Commands 13 Menu drop down options 14 Split Returns 17 Tool Bar 12 Program Navigation 12 Program Setup Firm ERO State ERO Preparer 5 Options 7 Printer 6 Setup Wizard 6 Program setup Preparer Security Settings 6 Program Setup 5 R Reconciliation of Income 55 Return Preparation Amended Returns 33 Auto Mileage for Sch C 30 Bank Products 33 Child and Dependant Care Expenses 28 Depreciation 28 Direct Deposit 33 Drake Software Evaluation Guide 2003 DRAKE SOFTWARE Entering Data 21 Entering Dependant Information 24 Estimated Taxes 31 Extension 34 FAQ Screen 32 Interest Income 26 Itemized Deductions 26 Moving Expenses 29 Office In Home 29 Open a Return 21 Partnership Information 30 Part
56. File F2 Clear BBS Files F3 Export Client Data F4 Export EF Data F5 Password Protect Files F6 Unlock Client Files F7 Delete Print Files F8 Delete Client Files F9 Change File Type F10 Quick Books Import F11 Letters F6 Letters F1 Mailing Labels F2 Envelopes F3 Postcards F4 Amortization F7 Edit EIN Database F8 Stock Search F9 Scheduler F10 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Program Navigation 15 REPORTS F4 LAST YEAR DATA F5 SETUP F6 e Depreciation List F1 e All Client Reports F2 e Standard F1 e Custom F2 e Review F3 e EF Reports F3 e Standard F1 e Custom F2 e Review F3 e Fixed Asset Manager F4 e Filled in Screens F5 e Hash Totals F6 Organizers F1 Proformas F2 e Update 2002 to 2003 F3 e Build EINs from 2002 F4 e Update Config 2002 to 2003 F5 Options F1 Firm Information F2 ERO State ERO Information F3 Preparers F4 Pay Per Return F5 Directories Paths F6 Pricing F7 Macros F8 Letterhead F9 Letters F10 Colors F11 Equipment F12 e Printer Setup F1 e Modem Setup F2 e PDF Printer F3 HELP F7 e Check Installation F1 e Version Info F2 e Copyright Notice F3 e Support F4 e Drake 2003 Help Topics F5 e Show Setup Admin F6 Tutorial F7 e CCH Tax Research F8 e Show Users F9
57. File Type Changes the Return Type Individual Partner ship Corporate Sub S Corp Fiduciary Tax Exempt Tools gt File Management gt Change File Type Calculate Calculate single or batches of returns File gt Calculate Returns Change SSNs on File Correct file name when changing a social security number Tools gt File Maintenance gt Change SSNs on File Check Register Prints a check register as a record EF gt Check Register Check Print Print new checks or reprint damaged checks EF gt Check Print Clear BBS files Delete BBS files after they are installed Tools gt File Maintenance gt Clear BBS Files Client Reports Generate reports based on default or user identi fied criteria Reports gt Client Reports Colors Edit default colors displayed on screen Setup gt Colors Copy EF Returns to Disk Copy print files of calculated returns from the hard drive to a disk EF gt Copy EF Returns to Disk Copy EF Returns from Disk Copy print files of calculated returns from a disk to the hard drive EF gt Copy EF Returns to Disk Delete Client Files Permanently delete client files Tools gt File Maintenance gt Delete Client Files Delete Print Files Delete the temporary print files that are created when returns are calculated Tools gt File Maintenance gt Delete Print Files Depreciation List Print a list
58. File the Return 43 e Direct State returns are sent directly from Drake to the state E file Service Center Only a few states require direct filing CA IL MA ME MN e State Only packets can be sent the same time the Federal return is sent Unlike Piggyback returns State Only packets are reviewed by the state regardless of the IRS acknowledge ment e Piggyback state returns are sent with the Federal return to the IRS If the Federal return is Rejected the state return is not sent A total of five states may be sent electronically each year per SSN Only one Piggyback state is allowed In Data Entry type EF in the selector field to access the EF Override screen The pro gram automatically sends the federal and piggyback state unless an override is entered Enter X to select which forms and states are to be sent Only returns entered here will be filed elec tronically Some state have established mandates This year California Minnesota Michigan and Okla homa have published electronic filing mandates These are explained in Taxing Subjects Vol ume 4 Issue 1 www taxingsubjects com as well as documented on our support site in the Knowledgebase MESSAGE PAGES When you view a return a red Message Page may be present These pages are created when a return has certain issues that would cause an IRS State Rejection Each page lists the Drake error code and a brief description to help you resolve the code When these i
59. INSTALLATION Installing state and city programs is optional as states and cities do not have to be installed on the hard drive in order to process state tax returns State and city returns will calculate directly from the CD if it remains in the CD drive at the time of calculation ACCESS STATE AND CITY PROGRAMS DIRECTLY FROM THE CD l 2i 3 Insert the 2003 Drake CD in the CD drive Open the Drake program Go to Setup gt Directories Paths In the Drive Letter for CD field select the CD drive letter from the drop down menu Click OK Access the state screens by typing the two digit state code in the selector field at the bottom of the Data Entry Selection menu in data entry Cities are found on the City tab within the appropriate state INSTALL STATE AND CITY PROGRAMS Insert the 2003 Drake CD into your CD drive Open the Drake Program Go to Setup gt Directories Paths Inthe Drive Letter for CD field select the CD drive letter from the drop down menu Click OK From the Menu Bar select Tools gt Install Updates 5 Inthe blank field enter 4 for States from CD 7 8 A listing of all available state and city programs displays Click the corresponding box to select states and or cities to install or click Select All to select all the states and cities You must select Michigan s cities individually if you install MI the corre sponding cities will not automatically install th
60. IRS within 3 business days of the receipt of an acknowledgement from the IRS B is incorrect A third party designee is not a necessity when filing an 8453 A third party designee allows a third party to discuss the return with the IRS D is incorrect If a PIN is provides a Form 8879 is produced and must be signed and kept in the tax preparer s office for three years 5 The correct answer is D The piggyback return is not processed and may be sent again with the corrected federal return If the return is rejected it does not go on to the state A is incorrect The state return is not processed It does not go on to the state B is incorrect The state return is not sent on to the state C is incorrect Many state returns can be sent with the federal return as piggyback or state only Illinois New York California Massachusetts Maine and Minnesota may be sent directly to the state Drake Software Evaluation Guide Copyrighted Material 50 Business Return 2003 DRAKE TAX SOLUTION Business Return PREPARE THE 1120 EVALUATION RETURN To begin entering data in the Corporation Evaluation return you need to create a new client 1 From the Tool Bar click OPEN 2 In the available field type the following EIN for our Evaluation Return 400 00 2222 and click OK to view the completed return open 400 00 2223 3 Click YES to create a new return 4 Select the return TYPE In this case select C Corp an
61. L BALANCE SHEETS ASSETS Type L and press Enter to access the Schedule L Enter the following data and press ESC Press PAGE DOWN to access more of the screen or to access a new screen Fields Beginning Beginning End of Year End of Year a b c d Cash 6712 44576 Trade Notes amp Accounts 0 123 356 Receivable Other current assets 2860 1421 Loans to shareholders 19163 19163 Payable less than 1 year 2200 2200 Capital Stock Common 15000 15000 Retained Earnings 49863 134123 unappropriated Less cost of Treasury 56375 56375 Stock SCHEDULE A COST OF GOODS SOLD Type A and press Enter Enter the following data and press ESC when finished Fields Data Inventory at the beginning 4000 of the year Purchases less cost of items 238190 withdrawn for personal use Cost of labor 6000 Inventory at end of year 4000 9A Cost Do the rules of section 263A No apply to the corporation Drake Software Evaluation Guide Copyrighted Material 52 Business Return 2003 DRAKE TAX SOLUTION Fields SCHEDULE E COMPENSATION OF OFFICERS Type E and press ENTER to access the Sch E Enter the following data and then press ESC Name Ownership amp Percent of Corp Stock Owned of SSN Participation Compensation Officer Time Common Preferred Jane 400005999 100 100 0 2100 Doe SCHEDULE K OTHER INFORMATION
62. Notes Page The yellow Notes page provides reminders or tips about a tax return and does not prevent e filing PDF PDF format allows Drake manuals and other materials to be viewed and printed directly from the CD PDF Portable Document Format is a file format that captures all the elements of a printed document as an electronic image that can be viewed navigated or printed PDF files are created in Adobe Distiller PDF995 or similar products View the files with the Adobe Reader Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Glossary 63 Piggyback E filed state returns that are sent with the Federal return to the IRS If the Federal return is rejected the state return is not sent Print mode Enables the printing of the forms associated with a return Press CTRL P to enter Print mode Selector Field In data entry the entry field located in the bottom left corner of the screen Type corresponding screen codes in the field and press ENTER to access data entry screens Service Packs Program updates that can be installed through an internet connection From the menu bar go to Tools gt Install Updates and choose the Online Service Pack Federal Update or State Service Pack Speed Button Used for quick access to commonly used program function Speed Buttons are located on the tool bar directly under the menu bar Split Return Press CTRL S to split a MFJ Married Filing Joint return into two MFS
63. Preparation AUTO MILEAGE FOR SCHEDULE C 2003 DRAKE TAX SOLUTION Enter mileage information on the AUTO screen Type AUTO Fields Delivery Van Delivery Truck Description Delivery Van Delivery Truck Date Placed in 01 01 2003 05 01 2003 Service Business Miles 12357 22335 Commuting Miles 0 0 Both vehicles were used primarily by the owner and neither was available for personal use Amelia maintains a policy prohibiting personal use of the vehicles However because there are no commuting miles on either vehicle policies regarding commuting are not nec essary Make sure to answer the Vehicle questions at the bottom of the screen to ensure accep tance by the IRS These fields are required ENTERING PARTNERSHIP INFORMATION SCHEDULE K 1 Partnership information is entered on the Schedule K 1 To open the data entry screen select K1 Partnership K1 on the Income Tab Field Data TS IF 561122334 Partnership ID Partnership Name Dynamic Distributing This is a passive activity X This partner is a limited part X ner Make sure to pay attention to the help text Shift to see to where or if information carries Enter the following amounts from the K1 Line Amount 1 2756 4a 65 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 31 ENTERING ESTIMATED TAXES To override the system s
64. Require Ready for EF Indicator on EF screen and Lock Client Data File after EF Acceptance 4 The correct answer is D Billing Enter the amount of tax to charge in the Sales Tax field A is incorrect The Optional Documents Tab is used to select specific items to print with returns or select the result letter to print B is incorrect The States Tab contains customization options for each state C is incorrect Select the EF Tab to receive Service Packs during the EF transmission You can also select to download email when you e file on the EF Tab 5 The correct answer is A Optional Items on the Return Check the corresponding box to turn this feature ON B is incorrect The States Tab contains customization options for each state C is incorrect Go here and select to receive Service Packs during the EF transmission You can also select to download email when you e file on the EF Tab D is incorrect Options associated with the client s bill are found on the Billing Tab Drake Software Evaluation Guide Copyrighted Material 12 Program Navigation 2003 DRAKE TAX SOLUTION Program Navigation Learning to navigate the program before tax season saves time and frustration Use this section to become acquainted with Drake Softwares menu structure DRAKE FOR WINDOWS The navigation choices when using Windows include the mouse Tool Bar and the computer keyboard THE MOUSE Left mouse button Move the point
65. Run In the Open field type D PDF READER ARSOOENU EXE substitute correct CD drive letter if not D Click OK and follow the instructions An icon is created for the Acrobat Reader after installation is complete OPEN DOCUMENTS IN ADOBE ACROBAT READER Once the reader has been installed PDF files can be opened from the CD 1 2 3 Insert the 2003 Drake Evaluation CD into the CD drive Go to Start gt Run In the Open field type D PDF MANUAL substitute correct CD drive letter if not D Double click a PDF to view the Drake User s Manual Quick Start Manual or the Business Manual Program Features The Drake User s Manual pages are updated in PDF format throughout tax season allowing you to easily print and replace the outdated pages Drake Software Evaluation Guide Copyrighted Material 4 Software Installation 2003 DRAKE TAX SOLUTION VIEW DRAKE TUTORIALS Drake Computer Based Tutorials CBT can be run directly from the Evaluation CD They enable you to learn the basics of the software by watching a short video e Amortization e Batch Letters e E file e Envelopes e Introduction to Data Entry e Letters e Macros e Mailing Labels e Organizers and Proformas e Print Sets e Reports Scheduler e State Database To access the tutorials from the CD complete the steps below Insert the 2003 Drake Evaluation CD into the CD drive Open the Drake progra
66. TH RETURNS Enter M1 in the selector field for data entry of the following information Line 5 in this screen has a blank field for description entries In the example below you would enter Penal ties in that box and 1184 in the amount field next to it Table 1 Fields Data Line 5 Expense Item Box Penalties Line 5 Amount Field 1184 Drake Software Evaluation Guide Copyrighted Material 56 Appendix 2003 DRAKE TAX SOLUTION Appendix DATA ENTRY NAVIGATION Action Keyboard Keys Move cursor forward one field ENTER TAB or use the down Arrow Move cursor back one field SHIFT TAB or UP Arrow Move cursor within a field RIGHT LEFT Arrows Delete character behind the cursor BACKSPACE Delete character before the cursor DELETE Insert character within existing text INSERT on Move to the last field on the screen END Move to the first field on the screen HOME Create additional Data Entry screens e g W 2 1099 PAGE DOWN or CTRL PAGE DOWN schedules etc Return to previous screen exit ESC Note Use the mouse to position the cursor in a desired field OVERRIDES AND ADJUSTMENTS TO RETURN CALCULATIONS Override Fields Adjustment Fields Data Entry fields that allow overrides are preceded by Data Entry fields that allow adjustments are preceded by a an equal sign An amount entered in these fields plus sign An amount entered in these fields adjusts overrides p
67. a Entry and press CTRL C View a return CTRL V Open the return in Data Entry and press CTRL V Print a return CTRL P Open the return in Data Entry and press CTRL P Split MFJ return to MFS return CTRL S Open the joint return in Data Entry and press CTRL S Populate the Amended or X CTRL X Use CTRL X to update the Amended screen This screen with data from the last calcu screen corresponds with Column A on the 1040X After lation the X screen is populated make changes to the other screens in the return Screens other than the X will be used to calculate Column B on the 1040X Change or return to Data Entry CTRL E Toggles pre prepared and full screen Data Entry Also returns to Data Entry from view mode or print mode Undo the most recent unsaved CTRL U Available in Data Entry change Open an unformatted schedule CTRL W Place the cursor in the desired field and press CTRL W for a detail worksheet Note If all data has been removed from a data entry screen the screen must be deleted to prevent e filing errors Toggles heads down and standard CTRL N In Data Entry use CTRL N to turn on the Deita Enry numbers that correlate with the Proformas Delete a Data Entry screen CTRL D With cursor in any field press CTRL D to perma nently remove the screen Note If all data has been removed from a Data Entry screen the screen must be deleted to pre vent e filing errors Activate the pop
68. a method for opening a return in Drake Software a Type the SSN or EIN in the top box of the Open a Return window b Press F3 from the Open a Return Window c Select the desired return from those returns displayed in the lower box of the Open a Return window d Type a last name or company name in the entry field of the Open a Return box and press Enter 16 How do you file an amended return with Drake a Print out the blank form complete and mail in to the IRS b Reenter the return Go directly to the X screen Press CTRL X Then enter the changes needed to amend the return Select for EF c Reenter all information into the return and reprint Mail to the IRS d Reenter the return Go directly to the X screen Press CTRL X Then enter the changes needed to amend the return This return must be paper filed to the IRS 17 Is it possible to create a Part Year Return with Drake Software a Yes enter PY as the resident state on screen 1 b Yes Type PY in the return selector field and fill out the screen c Yes create two separate returns d No 18 Which of the following does not calculate a return a Press CTRL C b Click CALC button on the Tool Bar c Exit the return After selecting Auto Calculate Return when exiting data entry from Setup gt Options gt Calculate View Print Tab d Press CTRL E 19 True or False You can electronically
69. ackup Restore Back up and restore Client files EF Database Tools gt File Maintenance gt Setup and Pricing Files Backup Restore Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Appendix 59 Task Description Location Blank Forms Comprehensive list of Drake calculated Forms and Forms not available in the software to print or view Blank Proformas and Organizers are available in Blank Forms Tools gt Blank Forms Build EINs from 2002 Update EIN database from the prior year Last Year Data gt Build EINs from 2002 Change File Type Changes the Return Type Individual Partner ship Corporate Sub S Corp Fiduciary Tax Exempt Tools gt File Management gt Change File Type Calculate Calculate single or batches of returns File gt Calculate Returns Change SSNs on File Correct file name when changing a social security number Tools gt File Maintenance gt Change SSNs on File Check Register Prints a check register as a record EF gt Check Register Check Print Print new checks or reprint damaged checks EF gt Check Print Clear BBS files Delete BBS files after they are installed Tools gt File Maintenance gt Clear BBS Files Client Reports Generate reports based on default or user identi fied criteria Reports gt Client Reports Colors Edit default colors displayed on screen
70. address along with your evaluation of the course material You must also include your signature on the form Hours are based on a 100 minute hour Credit is awarded to a score of 70 or better Your CPE certificate will be mailed to you Please Print All Information Clearly Circle the designation that applies to you CPA PA Enrolled Agent Tax Practitioner Attorney Other Your Name Mr Mrs Miss Ms EFIN E mail Firm Name Phone Address City ST Zip Regarding Content and Media please circle one e Were the stated learning objects met Yes or No e Were program materials accurate and did they contribute to the achievement of the learn ing objectives Yes or No e Were the Eval Guide amp Software appropriate Yes or No e Were prerequisite requirements appropriate Yes or No Comments To receive your CPE certificate you must sign this form Your signature Your Name please print Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Index Numerics 1040 Evaluation Return Name and Address Screen 22 A Adobe Acrobat Reader Installation 3 Amended Returns 33 Appendix 56 B Bank Products 33 Billing Tab 8 Business Return 1120 preparation 50 Form 4562 Depreciation 53 Income 50 Loss Carry Forward 55 Per Books with Returns 55 Schedule A Cost of Goods Sold 51 Schedule E Compensation of Officers 52 Schedule K Other Info 52 Schedule L Balance Sheet 5
71. al Tax Withheld 4575 State CA State ID 341115679 StateTax Withheld 1534 This populates taxpayer information fields Once this employee ID is entered it is saved in the EIN data base Next time this number is entered in data entry the employer s city and state information will populate mation The bottom portion of the W 2 screen allows input of State wage infor Enter the information for the second W 2 Fields Data TS Field T Federal ID 759988777 Employer s Name Catalyst Corporation Employer Address 5877 Hurst Square Employer ZIP 94061 Federal Tax Withheld 5677 Wages 25450 State CA Drake Software Evaluation Guide Copyrighted Material 26 Return Preparation 2003 DRAKE TAX SOLUTION Fields Data State ID 462333465 State Tax Withheld 1340 Press ESC to return to the Data Entry Selection Menu ENTERING ITEMIZED DEDUCTIONS SCHEDULE A To enter Itemized Deductions for a Schedule A type A in the selector field then Enter This form mirrors the IRS Schedule A form Enter the information shown below for the Carter s itemized deductions Fields Data TSJ Field J Medical Dental Expenses 8777 State Local Taxes 624 Real Estate 1567 Personal Property Taxes 245 Mortgage Interest from 1098 6788 Cash Check Charitab
72. am Some of the benefits of using this utility include e Receive EMonday emails from Drake These emails provide information on important IRS updates and software changes e The Drake support staff sends important program files via this connection e Easily attach client files to emails and send them to Drake Support e Use the built in Drake Address Book to quickly and easily send support related emails to Drake To access the email function go to the Menu Bar select EF gt Email to Drake The email interface displays e mail messages and the available options The Check Mail option retrieves waiting messages Your Drake email address is YourEFIN 1040 com You must have your EFIN and password entered in Setup gt ERO ERO State Information to use this utility Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Program Navigation 17 SPLIT RETURNS Drake Software allows you to easily compare Married Filing Joint MFJ and Married Fil ing Separate MFS From the Data Entry Selection Menu screen on a joint return split their return using CTRL S or use the speed button labeled Split The program splits the return On the resulting Return Selector screen the return dis plays in three ways Married Filing Joint Taxpayer separate and Spouse separate Included on this screen are the following e Summaries of both Federal and State refunds or amounts due e the resulting s
73. aring the 1040 Evaluation Return Calculate and Print the Return Return Calculation Print Examining Returns cccccceeeeeeeeeeeeeseeeeeeeees Review Questions Part 3 ccccceesseeeeeeeeees Answers Part 3 Electronically File the Return 008 ERO State ERO Setup State E Filing EF Options in Data Entry Message Pages The EF Menu Test Transmissions Drake Software Evaluation Guide Table of Contents Copyrighted Material Table of Contents 2003 DRAKE SOFTWARE Process Acknowledgements Search EF Database Review Questions Part 4 ccccccececeececeeceecececcececeececeececeeees 48 Answers Part 4 Business Return 2cccccceececeecececcececeececcecececcecescececeececeececeeees 50 Prepare the 1120 Evaluation Return Screen 1 Corporation General Information Screen 2 State General Information Income Schedule L Balance Sheets Assets Schedule A Cost of Goods Sold Schedule E Compensation of Officers Schedule K Other Information Form 4562 Depreciation LOSS Loss Carry forwards from Prior Years Schedule M1 Reconciliation of Income Per Books with Returns PADD ONIX siiin eaaa i ccccadesssvcbvtuassusevereuversanasacesttaaeedt 56 Glossary of Menu Items Glossary codar rarapa arap O eaea auaa aada EiL cts ewe 62 CPE Ey AU a E T A T 64 CPE Exam Answer Sheet cccccssseeceeseeeeeseseeeeeaeeeesseeneeees 67 2004 Evaluati
74. atabase from EF gt Search EF F10 Database Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Review Questions Part 2 19 Review Questions Part 2 Answer the questions below See Answers Part 2 on page 20 for the correct answers 1 How do I delete a screen in Drake a CTRL F b CTRL D c CTRL S d CTRL N 2 Can you split a joint return into two married filing separate returns How a No b Yes CTRL F c Yes CTRL W d Yes CTRL S 3 How can I create a detailed worksheet for a particular line item on a return a With your cursor in the data entry field on a Drake Screen press CTRL F b You cannot c With your cursor in the data entry field on a Drake Screen press CTRL W d With your cursor in the data entry field on a Drake Screen press ESC 4 How do I save screen information in a return a CTRL W b CTRL S c ESC d ALT 5 Is it possible to insert the current date into a data entry field How a Yes press Insert D b Yes press CTRL D c No d Yes press ALT D Drake Software Evaluation Guide Copyrighted Material 20 Review Questions Part 2 2003 DRAKE TAX SOLUTION ANSWERS PART 2 1 The correct answer is B CTRL D This Hot Key deletes the current screen A is incorrect CTRL F is used to force an entry in a field in data entry C is incorrect
75. ate code in the selector field at the bottom of the Data Entry Selection menu in data entry Cities are found on the City tab within the appropriate state INSTALL STATE AND CITY PROGRAMS Insert the 2003 Drake CD into your CD drive Open the Drake Program Go to Setup gt Directories Paths Inthe Drive Letter for CD field select the CD drive letter from the drop down menu Click OK From the Menu Bar select Tools gt Install Updates 5 Inthe blank field enter 4 for States from CD 7 8 A listing of all available state and city programs displays Click the corresponding box to select states and or cities to install or click Select All to select all the states and cities You must select Michigan s cities individually if you install MI the corre sponding cities will not automatically install this is not the case for NY MO PA DE or OR Click OK to install state and city updates Once the installation is complete click EXIT States and cities automatically calculate with the Federal return if indicated on the Federal data entry screens For example if you indicate that the W2 is for NY in the State field the New York return generates along with the Federal Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Software Installation 3 OTHER DRAKE REFERENCE GUIDES The following manuals are available in PDF format on this CD e 2003 Quick Start Manual D
76. ates e States Online Select specific states and download the latest full version of the state program Drake Software Evaluation Guide Copyrighted Material 18 Drake 2003 Hot Keys Drake 2003 Hot Keys Hot Keys enable you to perform specific actions quickly and easily Knowing when and where to use these keys can save you valuable time during tax season Data Entry 2003 DRAKE TAX SOLUTION Produce field specific help information in data entry or to verify a valid Social Security Number SHIFT or ALT Insert today s date into any field ALT D Delete a screen CTRL D Reset a screen CTRL U Exit and save a screen ESC Exit without saving SHIFT ESC Force an entry CTRL F Open an unformatted schedule CTRL W Toggle heads down in standard data entry CTRL N Open the Online Help screen F1 View the Pop Up Calculator F10 Carry data to an amended return CTRL X Calculate View and Print Calculate a return CTRL C View a return CTRL V Print a return CTRL P Split MFJ return to MFS return CTRL S Return to data entry CTRL E Electronic Filing Look up reject codes in EF gt Search EF Database F4 Return to data entry from EF gt Search EF Database F5 Check your online EF d
77. atically accepted Andover Virginia All EROs are automatically accepted Andover Washington No tax Philadelphia West Virginia EROs must send a copy of IRS application and or Kansas City acceptance letter Wisconsin EROs must send a copy of IRS application and or Austin acceptance letter Wyoming No tax Philadelphia EF OPTIONS IN DATA ENTRY In Data Entry the EF screen overrides items entered in Setup gt Options Use this screen to send the Federal alone or a state in any of the following ways Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Electronically File the Return 43 e Direct State returns are sent directly from Drake to the state E file Service Center Only a few states require direct filing CA IL MA ME MN e State Only packets can be sent the same time the Federal return is sent Unlike Piggyback returns State Only packets are reviewed by the state regardless of the IRS acknowledge ment e Piggyback state returns are sent with the Federal return to the IRS If the Federal return is Rejected the state return is not sent A total of five states may be sent electronically each year per SSN Only one Piggyback state is allowed In Data Entry type EF in the selector field to access the EF Override screen The pro gram automatically sends the federal and piggyback state unless an override is entered Enter X to select which forms and states are to be sent Only retu
78. automatic calculations and enter the estimated taxes you desire select ES Estimated Taxes on the General Tab This screen is divided into columns and sections 2003 Estimated Taxes Paid and 2004 Estimated Taxes Due ENTERING STATE DATA State returns are easy to generate in Drake Software First either install the state software on the hard drive or simply insert the Evaluation CD into the CD drive see the State Installation instructions at the beginning of this guide for detailed directions State forms automatically generate based on data entered on the Federal return Calcula tion is based on the State entered on the Name amp Address Screen for Resident State as well as the State codes indicated on W 2s Schedule C 1099 Schedule B etc For specific information pertaining to the state State Data Entry screens are available On the Data Entry Selection Menu type the two letter state code for the desired state and press Enter Screens of available state forms appear Drake Software Evaluation Guide Copyrighted Material 32 Return Preparation VALID City CODES 2003 DRAKE TAX SOLUTION DT Detroit FT Flint GR Grand Rapids HC Hamtramck HP Highland Park IC Ionia City JC Jackson LN Lansing MC Muskegon MH Muskegon Heights PH Port Huron PT Pontiac SG Saginaw WL Walker DE NY MI MO e WM Wilmington NY New York City BC Battle Cr
79. avings e the option to save any one or all three of the return formats e the ability to print this summary screen press P e exiting without saving the MFS formats If both returns are saved each time you open the return you choose the MFJ or the MFS format In this case either return can have additional data entered SUPPORT DRAKESOFTWARE COM Select the Internet Speed Button from the tool bar to log onto support drakesoftware com for access to 24 hour software information including resource links for tax preparers the Knowledge Base and Your EF database ONLINE STATE RESOURCE The Online State page is available through support drakesoftware com enabling the search of state specific questions including reject codes exclusions state instructions and e fil ing explanations and instructions CCH Go to Tax Help on the tool bar to access CCH All Drake clients receive access to the online U S Master Tax Guide Plus from CCH Incorporated This product features a com prehensive online tax information library which includes the following U S Master Tax Guide Internal Revenue Code Revenue Rulings IRS Publications IRS Announcements IRS Notices and U S Tax Cases SERVICE PACKS Install software updates from within the program through your internet connection From the menu bar go to Tools gt Install Updates and choose from the following options e Online Service Pack Downloads the latest federal software upd
80. base for return preparation These screens display the data entry options e Tabs the Data Entry Selection Menu displays tabs along the top of the screen Select a tab to display an additional list of data entry screens e Drop Down Box some fields in Windows display a down arrow next to the open box Click the arrow to open a drop down list of available choices e Buttons the Windows program offers additional buttons which can be mouse clicked to perform an action e Selector Field In data entry the entry field located in the bottom left corner of the screen Type corresponding screen codes and press ENTER to access data entry screens When instructions are given to perform an action the flow of commands is as follows 1 Select the Menu Bar option to show the Drop Down Menus e g Tools 2 Select the action form the Drop Down Menus e g File Maintenance 3 Ifthe action displays gt to the right another list will open 4 Select the action from that list e g Backup Restore To shorten the commands in the instructions the flow of commands is given with arrows between each function Tools gt File Maintenance gt Backup Restore Use the keyboard or the mouse to select the menu options Drake Software Evaluation Guide Copyrighted Material 14 Program Navigation 2003 DRAKE TAX SOLUTION Refer to the following lists for the Menu drop down options and related function keys FILE F1 EF F2
81. ck NEXT to continue The first page of the 1040 is sent as a test page to the printer Check the printer for the test page Answer the questions that follow by clicking the appropriate YES or NO button Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Program Setup 7 8 The next window prompts Apply this printer to the following sections Click the check boxes to select 9 Click FINISH to complete the wizard Different printers can be selected to print reports letters forms checks etc OPTIONAL PROGRAM SETUP OPTIONS Select program preferences from the Options screen The software defaults to the most common preferences To change or view the defaults follow the steps below 1 From the Menu Bar go to Setup gt Options 2 Click the tabs to change the options screen that displays After selecting an option press OK to save The following options are available Data Entry Tab e Enlarge Data Entry screens for easier viewing e Use 25 row screen size for 50 row screens Sch C 1099 etc e Use grid Data Entry format for select screens DIV INT 4562 etc e Tab to zip code field skip city state and use zip code database e Language for Data Entry Select English or Spanish e Letter Case for Data Entry Select Upper Case or Lower Case Choose to use either all uppercase or mixed case in Data Entry Calculate and View Tab e Auto calculat
82. corresponding check box to turn a feature on Drake Software Manual Print taxpayer s SSN on bill Print preparer s name on bill Copyrighted Material 2003 DRAKE SOFTWARE Program Setup 9 Show RAL preparer fees as withheld on bill Show bank fees on bill Sales Tax Sales tax percent to add to client statement Enter a number greater than 1 For example 4 5 would represent a sales tax rate of 4 5 Billing Statement Format Select a statement option Show forms form prices and total Show form list and total Bill by time or Do not prepare bill States Tab There are specific options available for some states Select the state from the drop down list and select the options that apply Set up each desired state separately EF Tab Click the corresponding check box to turn a feature on Print 8453 or 8879 8878 if using PIN when eligible for EF Require Ready for EF indicator on EF screen Lock client data file after EF acceptance Log in as ADMIN to edit unlock a file that has been transmitted and accepted Allow preparers the same ability by giving them access to Tools gt File Maintenance gt Unlock Client Files in their security settings Print bank application when keyed on a return Print 9325 when eligible for EF Suppress Federal EF Combine EF steps Select Transmit Post Acks If this option is selected the only screen that needs to be opened on the EF menu is Sele
83. ct Expenses Indirect Expenses Insurance 250 Utilities 500 Other Expenses 250 ENTERING MOVING EXPENSES FORM 3903 During the last year the Carter s moved to a new location because Bill changed jobs To open the Moving Expenses screen type 3903 Moving Expenses on the Adjustments Tab Enter the following moving expenses on the 3903 Screen Fields Data Miles from Old to New 125 Miles from Old to Old 14 Transportation amp Storage 5400 Travel amp Lodging 58 Amount Reimbursed 95 Drake Software Evaluation Guide Copyrighted Material Return Preparation AUTO MILEAGE FOR SCHEDULE C 2003 DRAKE TAX SOLUTION Enter mileage information on the AUTO screen Type AUTO Fields Delivery Van Delivery Truck Description Delivery Van Delivery Truck Date Placed in 01 01 2003 05 01 2003 Service Business Miles 12357 22335 Commuting Miles 0 0 Both vehicles were used primarily by the owner and neither was available for personal use Amelia maintains a policy prohibiting personal use of the vehicles However because there are no commuting miles on either vehicle policies regarding commuting are not nec essary Make sure to answer the Vehicle questions at the bottom of the screen to ensure accep tance by the IRS These fields are required ENTERING PARTNERSHIP INFORMATION SCHEDULE K 1 Partnership information is entered on the Schedule K 1 To open
84. ct Returns for EF After the returns are selected click OK to start the remainder of the EF routine No further steps are necessary EF Status Page Print the EF Status page State EF Suppress ERO SSN Indicator Choose from preparer 1 9 paid preparer or blank This field will tell the preparer who to use as the ERO on the return The default can be overridden in Data Entry Check for service pack during EF transmit receive Prompt before downloading service pack If this option is selected a prompt will give the estimated download time and size of the file instead of automati cally starting the download Advanced option Passive FTP Facilitates firewalls by using a defined port range Check for email during the EF Transmit Receive Drake Software Evaluation Guide Copyrighted Material 10 Review Questions Part 1 2003 DRAKE TAX SOLUTION Review Questions Part 1 Answer the questions below See Answers Part 1 on page 11 for explanations of answers 1 In Drake Software Setup gt Options what tab would you choose to select a third party des ignee for all your returns a Optional Items on a Return b States c EF d Billing 2 In Drake Software Setup gt Options which tab would you select to check for Service Pack updates during electronic filing a Optional Documents b States c EF d Billing 3 In Drake Software Setup gt Options which tab would you select to bill by time a Opti
85. cts from Drake after the transmission is complete Acks Only Use this option to pick up Federal and State acknowledgements bank product acknowledgements check authorizations and service pack files needed to update the program No files are transmitted to Drake 1 Click ACKS ONLY to continue 2 The program connects and retrieves the acknowledgements and any service packs The program only retrieves the service pack files if the option is selected in Setup gt Option gt EF 3 The program automatically disconnects from Drake after the transmission is complete TEST TRANSMISSIONS Before attempting to transmit any actual tax returns it is recommended that EROs should first transmit test returns Vv CAUTION V Do NOT transmit any test returns that contain social security numbers other than those in the 400 00 and 500 00 series included in the software Any other returns are processed as actual tax returns and the ERO could be charged with filing fraudulent tax returns TEST TRANSMIT THROUGH DRAKE 1 A preparer with a new IRS EFIN must contact Drake Accounting to update his her client information Call 828 349 5900 2 Goto SETUP on the Menu Bar and complete the following screens Firm Information e Preparer Drake Software Evaluation Guide Copyrighted Material 46 Electronically File the Return 2003 DRAKE TAX SOLUTION e ERO State ERO Information Make sure the current year Password
86. d Data Advertising 480 Inventory Valuation Method Cost Insurance 400 Beginning Inventory 2578 Rent Other 7200 Purchases Less Personal 889 Taxes amp Licenses 54 Cost of Labor 7000 Utilities 2734 Materials Supplies 34255 Drake Software Evaluation Guide Copyrighted Material 28 Return Preparation 2003 DRAKE TAX SOLUTION ENTERING DEPRECIATION Drake Software provides six data entry screens for Depreciation On the Income Tab of the Forms Menu the six screens are grouped together in a box labeled Depreciable Assets Selection options are clearly marked and include Form 4562 Depreciation Detail and five additional screens offering additional parts of Form 4562 The 4562 is usually the only screen necessary to enter depreciation Screens 6 9 are used only when entering an existing return Screen 10 contains the Bonus Depreciation Elections To create a Form 4797 from within the 4562 select an asset with a mouse click and press F3 Complete the If Sold column on the bottom right The only fields required are the date sold the sales price and the property type For the Carter s return there are three separate depreciable assets The first is the Patty Cakes baking oven and the others are the business vehicles To open the Depreciation data entry screen type 4562 Depreciation Detail on the Income Tab Enter the following information on the 4562 Screen Press PAGE DOWN for the next entry
87. d close the data entry screen and return to the Data Entry Selection Menu Program Feature In any data entry field you can find field specific explanations by pressing Shift This help is available in any field and often contains selectable options for that field PREPARING THE 1040 EVALUATION RETURN In this section we will enter a practice return and work through various data entry screens to become comfortable with Drake Software The following sections provides step by step instructions for preparing calculating viewing printing and electronic filing a return 1 On the menu bar select File gt Open Returns 2 Inthe Open a Return screen type the following SSN without dashes 400 00 6666 Click OK 3 A message box will prompt you to create a new return Click Yes Next select the type of return to create Our sample is an Individual return Since this is the default press Enter NAME AND ADDRESS SCREEN Each time you create a new client the Name and Address Screen opens initially The information provided on this screen flows to each of the forms for this client Our Evaluation Taxpayers are William and Amelia Carter from Burlingame CA e They are filing a joint return e They have two children Richard Carolyn e William receives a salary from two computer jobs e Amelia owns a bakery of which she is a sole proprietor
88. d press OK Screen 1 dis plays SCREEN 1 CORPORATION GENERAL INFORMATION The Corporation Evaluation client is Best Foods Inc which was incorporated in GA on 1 01 1986 The calendar year for the corporation ends 12 31 2003 Type all numbers without dashes unless the number is negative slashes dollar signs or commas Enter the following fields and press ESC Fields Data Address 4554 Middle Road Zip 30525 SCREEN 2 STATE GENERAL INFORMATION Enter the following data on Screen 2 and press ESC when finished W H Tax AC 417 02 00012222 Sales Tax 0754474 38 INCOME Enter the following data on Screen 3 and press ESC when finished Fields Gross Receipts or Sales 538920 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Business Return 51 SCHEDULE L BALANCE SHEETS ASSETS Type L and press Enter to access the Schedule L Enter the following data and press ESC Press PAGE DOWN to access more of the screen or to access a new screen Fields Beginning Beginning End of Year End of Year a b c d Cash 6712 44576 Trade Notes amp Accounts 0 123 356 Receivable Other current assets 2860 1421 Loans to shareholders 19163 19163 Payable less than 1 year 2200 2200 Capital Stock Common 15000 15000 Retained Earnings 49863 134123 unappropriated Less cost of Treasury 56375 56375 Stock
89. differences D is incorrect Use ALT in any data entry field to view field specific information SHIFT functions the same way 5 The correct answer is D ALT D This enters the current date in any Date field A is incorrect Insert D is not a Hot Key in Drake B is incorrect CTRL D deletes a screen in data entry C is incorrect You can enter the current date using ALT D Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 21 Return Preparation While there are many ways Drake Software simplifies tax preparation the software cannot replace a funda mental understanding of tax laws Your data will be calculated as entered on each screen The screens in almost every instance reflect the corresponding tax form In this section we will review the following e Opening Returns e Navigating Fields and Forms e Preparing a Return Returns are identified by either a Social Security Number SSN or an Employer Identification Number EIN in the case of business returns The program accepts only numbers in the SSN or EIN fields NO dashes spaces or other char acters OPEN A RETURN On the menu bar go to File gt Open Returns The Open a Return window appears There are several options e Type the SSN or EIN in the top box Click OK or press Enter e Select the desired return from those returns displayed in the lower bo
90. dress 5877 Hurst Square Employer ZIP 94061 Federal Tax Withheld 5677 Wages 25450 State CA Drake Software Evaluation Guide Copyrighted Material 26 Return Preparation 2003 DRAKE TAX SOLUTION Fields Data State ID 462333465 State Tax Withheld 1340 Press ESC to return to the Data Entry Selection Menu ENTERING ITEMIZED DEDUCTIONS SCHEDULE A To enter Itemized Deductions for a Schedule A type A in the selector field then Enter This form mirrors the IRS Schedule A form Enter the information shown below for the Carter s itemized deductions Fields Data TSJ Field J Medical Dental Expenses 8777 State Local Taxes 624 Real Estate 1567 Personal Property Taxes 245 Mortgage Interest from 1098 6788 Cash Check Charitable Contributions 275 Other Charitable Contributions 190 Tax Prep Fees 125 ENTERING INTEREST INCOME SCHEDULE B 1099 INT The Schedule B Interest Income screen is on the General Tab Type INT in the selector field then press Enter Enter the following account interest for the Carter s return Fields Data TSJ Field J Name of Payer CCB Interest Income 657 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 27 Press ESC to return to the Data Entry Selection Menu Dividend Income is ente
91. e Business Manual Program Features The Drake User s Manual pages are updated in PDF format throughout tax season allowing you to easily print and replace the outdated pages Drake Software Evaluation Guide Copyrighted Material 4 Software Installation 2003 DRAKE TAX SOLUTION VIEW DRAKE TUTORIALS Drake Computer Based Tutorials CBT can be run directly from the Evaluation CD They enable you to learn the basics of the software by watching a short video e Amortization e Batch Letters e E file e Envelopes e Introduction to Data Entry e Letters e Macros e Mailing Labels e Organizers and Proformas e Print Sets e Reports Scheduler e State Database To access the tutorials from the CD complete the steps below Insert the 2003 Drake Evaluation CD into the CD drive Open the Drake program Go to Help gt Tutorial Select the drive letter of your CD drive from the drop down box Double click a CBT from the list to begin SDE RE OD NOE To exit the tutorial any time during the presentation press ESC Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Program Setup 5 Program Setup The following screens must be completed before beginning tax preparation and electronic filing FIRM SETUP Enter and edit information about a specific firm on the Firm screen There is no default firm information in the program This information must be created individually for
92. e Software Evaluation Guide Copyrighted Material 48 Review Questions Part 4 2003 DRAKE TAX SOLUTION Review Questions Part 4 Answer the following questions See Answers Part 4 on page 49 for explanations of answers 1 To become an ERO which of the following is NOT true a Contact the IRS at 1 866 255 0654 and ask to be added to the ERO list b Request and complete a fingerprint card c Send a completed 8633 to the IRS d Send the fingerprint card to the IRS 2 To electronically file returns to the state of Wisconsin what must an ERO do a Nothing b Fill out the Wisconsin application and submit to the state c Send the ERO acceptance letter from the IRS to the state of Wisconsin d Call the Wisconsin DOR and request to be placed on their ERO approved list 3 True or False When a PIN screen is completed a Form 8879 is generated and signed by all parties and sent to the applicable IRS Service Center within three business days of the IRS acknowledgement 4 If a return is electronically filed without a PIN what must happen a You cannot electronically file a return without a PIN b A third party designee must be chosen c A Form 8453 is produced and signed and sent to the applicable IRS Service Center within three business days of the IRS acknowledgement d A Form 8453 is produced that must be signed and kept in the business office for 1 year 5 Ifa state is sent as a piggyback return with the fed
93. e tax return when exiting Data Entry e Display client fee on calculation screen e Print only one overflow statement per page e Return to same location in Data Entry CTRL E e Audible Notification of Calculation Error Messages e Layout for Depreciation Schedule Select Portrait or Landscape from the drop down menu e Pause Option for Calculation Always after calculation pauses when the cal culation is complete File gt Calculate After Ctrl View Print will pause only after a Ctrl View or Ctrl Print are used to calculate Only when using File gt Calculate will pause only when calculating from the main menu e Display Forms in View Mode Forms display the same as printed forms or in text mode Text Mode is a computer generated mode with larger text e Days to keep print file If the return is needed after the software removes the Print file recalculating the return will recreate the print file Form and Schedule Options Tab e Print Schedule A only when required Drake Software Evaluation Guide Copyrighted Material 8 Program Setup 2003 DRAKE TAX SOLUTION Print Schedule B only when required Print Form 1116 for Alt Min tax worksheet Print 4562 only when required Print 6251 only when required Form 8867 EIC Worksheet The form 8867 is the IRS form for EIC verifica tion The VER_EIC is a form designed in house that preparers prefer Use this option to indicate your choice 104
94. each firm From the Menu Bar go to Setup gt Firm Select NEW FIRM The bottom half of the screen becomes active Enter the firm information Click SAVE to save the information Click CANCEL to exit without saving changes en ERO STATE ERO INFORMATION Electronic Return Originator ERO Setup is required only if you plan to do one or all of the following in the software e E file a return e Use the E mail to Drake function e Download service packs using Tools gt Install Updates e Access Your EF Database from EF gt Search EF Database gt F10 The temporary EFIN Electronic Filing Identification Number assigned by Drake does not enable electronic filing but allows system testing and access to Drake Internet utilities Pre parers who are new to e filing must apply to the IRS for an EFIN To enter ERO information in the software complete the following steps 1 From the Menu Bar go to Setup gt ERO State ERO Information 2 Enter ERO information 3 Click OK to save and exit PREPARER SETUP Each preparer must be entered on the Preparers screen Enter preparers in the program to assign them a preparer number The preparer number is then used to display the preparer information on letters and returns Data entry DE operators may be listed along with paid preparers in Preparers Entering the DE number on returns is used primarily for tracking purposes To enter a new preparer in the
95. ect deposit After completing the screen press PAGE DOWN to rekey account number information Use the SDD screen to arrange a direct deposit of state refunds The account informa tion on this screen is transmitted After completing the screen press PAGE DOWN to rekey the information Direct deposit policies differ from state to state Check with the specific state for more information PAYMENT Use the PMT screen to pay the tax due amount through automatic withdrawal from the taxpayer s bank account Enter the taxpayer s electronic funds withdrawal information After completing the screen press PAGE DOWN to rekey the information Do not use this screen unless the return will be filed electronically Use the SPMT screen for the following states only AZ CA CT DC DE IL KS LA MA MD ME MN MT NE NJ NM NY OH OK PA SC and WV Not all states allow electronic payments for taxes due BANK PRODUCTS Bank products are available through Bank One and Household Tax Masters Enter bank information on the B1 or HTM screen FILING AN AMENDED RETURN Form 1040X can be accessed from the Other Tab This form cannot be e filed but can be populated with data from the original form Enter X in the selector field to open the form When you are prompted click YES to auto fill the 1040X with the original return s information Then change the data in the origina
96. ects to Drake whether transmitting files or not To process and print acknowledgements select EF gt Process Acks on the Menu Bar The acknowledgement report displays e Social Security Number of primary taxpayer e Document Control Number DCN of the transmitted return e Refund due on the return e Acceptance rejection code e Number of errors recorded Two letter state code for the state return When the acknowledgements are processed they move to the EF Database for future refer ence The EF Reports utility can pull information from this database Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Electronically File the Return 47 SEARCH EF DATABASE The EF Database contains information about all returns that have been electronically filed A return that has been filed more than once has more than one record OPEN A RECORD IN THE EF DATABASE Select EF gt Search EF Database on the Menu Bar 1 2 Type the SSN of the primary taxpayer without spaces dashes or additional characters 3 Press ENTER or click OK in Windows 4 Use PAGE UP and PAGE DOWN to access additional records for a taxpayer The Main screen of the record opens There are six separate screens available for viewing with the following information on each screen 1 mi Main screen F1 e Taxpayer information e Federal and State acknowledgement codes e Acknowledgement dates e Transaction date e Filing stat
97. eek e KC Kansas City e YO Yonkers e BR Big Rapids e SL St Louis PY Part Year use only on Screen 1 in Resident State field New York city codes are entered NY or YO with the exception of W2 locality codes when they should be entered NYC or YONKERS On each of the forms screens you will notice several symbols If the field is marked Override indicated by an symbol an entry in the field overrides any calculations or Federal data normally associated with that item If the field is marked Adjust indicated by a symbol any data entered in that field will be added to the calculated amount of Federal data normally associated with that field To reduce an amount in an adjust field enter a negative figure All other entries are direct no entry made means nothing appears on the form FAQ SCREEN The FAQ Screen for each state is a great resource for state specific information Once on the Forms Menu for the state the FAQ Screen should be the last listing on the page Place your cursor in the desired field and press Shift to access the information Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 33 PART YEAR RETURN In the Resident State field of the Name amp Address Screen enter PY for a Part Year return If questions arise about what options are available for a specific field pr
98. ekly update on tax changes program tips and more EF gt e mail to Drake Envelopes Print envelopes Tools gt Letters gt Envelopes Export Client Data Exports data to a database file that can be opened and used for generating reports in Access Excel etc Tools gt File Maintenance gt Export Client Data Drake Software Evaluation Guide Copyrighted Material 60 Appendix 2003 DRAKE TAX SOLUTION Task Description Location Export EF Data Export data to a database file that can be opened and used for generating reports in Access Excel etc Tools gt File Maintenance gt Export EF Data Filled In Screens Print the Data Entry screens for a return Reports gt Filled in Screens Firm Set up the preparer s firm information This is the information that prints on the bottom of 1040s Setup gt Firm Fixed Asset Manager Print various asset reports Reports gt Fixed Asset Man ager Hash Totals Print a report showing the number of screens fields and keystrokes used on one return Reports gt Hash Totals Install Updates Install update disks CDs or Service Pack files Tools gt Install Updates Letters Edit the coupon estimate pre season after sea Setup gt Letters son and result letters for clients Letterhead Activate or remove graphic letterhead for letters Setup gt Letterhead and bills Macros Se
99. eparation packages e Electronic Filing e Bank Products e Blank Federal and State Forms for viewing and printing e CCH Online Master Tax Guide e Many other features Drake is a pioneer in the Tax Software and Electronic Filing Industry This year alone Drake filed over 3 5 mil lion IRS accepted electronic returns If you are not already e filing your client s returns let us help you Elec tronic Filing is FREE for Federal and State returns in Drake Software Thank you for reviewing our product Drake Software Evaluation Guide Copyrighted Material 2 Software Installation 2003 DRAKE TAX SOLUTION Software Installation Install the 2003 Drake Software Evaluation CD using the instructions located on the back of the CD cover Additional installation may be necessary Please read the topics below for details STATE AND CITY PROGRAM INSTALLATION Installing state and city programs is optional as states and cities do not have to be installed on the hard drive in order to process state tax returns State and city returns will calculate directly from the CD if it remains in the CD drive at the time of calculation ACCESS STATE AND CITY PROGRAMS DIRECTLY FROM THE CD l 2i 3 Insert the 2003 Drake CD in the CD drive Open the Drake program Go to Setup gt Directories Paths In the Drive Letter for CD field select the CD drive letter from the drop down menu Click OK Access the state screens by typing the two digit st
100. er over an item and click the left mouse button to select that item Right mouse button During data entry right click the mouse in any grey area to display a menu of common program functions or right click in a data entry field to cut copy view help or paste TooL BAR Speed Buttons are located under the Menu Bar on the Tool Bar Speed Buttons are short cuts to maneuver the program quickly Different areas of the program are associated with different Speed Buttons e Open Open or create a new return e Calculate Perform a batch calculation e Print Print a return from the return selector e View View a return from the return selector e Internet Launch your internet browser to support drakesoftware com e Tax Help Launch CCH Online Resource e Scheduler Opens the Scheduler utility which enables you to create preparer schedules make appointments and run reports e Exit Exits the program ESC Press the ESC to exit a screen Information on that screen is saved Press ESC on the Home screen to exit the Drake program THE KEYBOARD The computer keyboard can be used to maneuver through the program See Hot Keys on page 57 of the Appendix for a list of shortcuts keys used during data entry Press ALT to display the underlined shortcut key for each option on the Menu Bar The underlined letter for each option is the shortcut key Example File Press ALT F to Drake Software
101. er state code postal service abbreviation If the field is left blank the program defaults to the resident state ST 0 zero To exclude data from any State return ST PY When preparing multi state returns use PY as the resident state code on Screen 1 Do NOT use PY on any other screen C City Code When preparing city returns enter the appropriate city code to indicate the source of income Multiple Form Code 1 99 When preparing Form 4562 depreciation indicate the appropriate schedule for the depreciated item and indicate where the information should be carried when there are mul tiple schedules GLOSSARY OF MENU ITEMS Task Description Location Amortization Prepare and print an amortization schedule using Tools gt Amortization information furnished by the user Amortize assets 4562 in areturn Backup Restore Back up and restore Client files EF Database Tools gt File Maintenance gt Setup and Pricing Files Backup Restore Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Appendix 59 Task Description Location Blank Forms Comprehensive list of Drake calculated Forms and Forms not available in the software to print or view Blank Proformas and Organizers are available in Blank Forms Tools gt Blank Forms Build EINs from 2002 Update EIN database from the prior year Last Year Data gt Build EINs from 2002 Change
102. eral return what happens to that state return if the IRS rejects the federal return a The piggyback state return goes on to the state and is rejected by the state b The piggyback return goes on to the state and is accepted by the state c You cannot send a state return with a federal return They must all be sent directly to the state DOR d The piggyback return is not processed and may be sent again with the corrected federal return Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Review Questions Part 4 49 ANSWERS PART 4 1 The correct answer is A Contact the IRS at 1 866 255 0654 and asked to be added to the ERO list This statement is false because a taxpayer must fill out an 8633 ERO Application and fingerprint card and submit it to the IRS to be considered B is incorrect This statement is true Call the IRS or Drake Support to request a finger print card C is incorrect This statement is true Print and 8633 from Tools gt Blank Forms gt Select 1040 gt 8633 and 8633 PG2 D is incorrect This statement is true Send a fingerprint card along with the completed 8633 to the IRS to apply 2 The correct answer is C Send the ERO acceptance letter from the IRS to the state of Wisconsin Wisconsin does not have it s own state specific ERO application A is incorrect You must send the ERO acceptance letter from the IRS to Wisconsin B is incorrect Wisconsin does not have its o
103. esigned to aid in pre season software preparation High lights installation steps set up procedures and the basics of navigating the software e 2003 Drake User s Manual A comprehensive resource for all your software questions e Drake Business Manual Walk step by step through the fields required to enter a busi ness return in the software Packages include 1120 1120S 1065 990 and 706 PDF format allows the manuals to be viewed and printed directly from the CD Use the Adobe Acrobat Reader to read the PDF files practice returns and IRS forms and publications If Acrobat Reader is not installed use the following instructions ADOBE ACROBAT READER INSTALLATION If Acrobat Reader is not installed complete the following installation steps l 2 3 4 Insert the 2003 Drake Evaluation CD into the CD drive Click Start gt Run In the Open field type D PDF READER ARSOOENU EXE substitute correct CD drive letter if not D Click OK and follow the instructions An icon is created for the Acrobat Reader after installation is complete OPEN DOCUMENTS IN ADOBE ACROBAT READER Once the reader has been installed PDF files can be opened from the CD 1 2 3 Insert the 2003 Drake Evaluation CD into the CD drive Go to Start gt Run In the Open field type D PDF MANUAL substitute correct CD drive letter if not D Double click a PDF to view the Drake User s Manual Quick Start Manual or th
104. ess Shift For those forms corresponding to a particular state 2106 2441 W2 etc enter the neces sary state in the ST field at the top of the screen This prints the state information on the appropriate state form DIRECT DEPOSIT Use the DD screen to elect direct deposit of the IRS refund to the taxpayer s checking or savings account Generally direct deposit refunds are received one week earlier than paper checks The direct deposit account must be in the taxpayer s name and cannot include the name of another person If married filing joint the account can be in either the taxpayer s or the spouse s name or both If married filing separate the account can be a joint account or in the name of the taxpayer but not only in the name of the other spouse Payable through accounts are not acceptable for direct deposit After completing the screen press PAGE DOWN to rekey account number information Use the SDD screen to arrange a direct deposit of state refunds The account informa tion on this screen is transmitted After completing the screen press PAGE DOWN to rekey the information Direct deposit policies differ from state to state Check with the specific state for more information PAYMENT Use the PMT screen to pay the tax due amount through automatic withdrawal from the taxpayer s bank account Enter the taxpayer s electronic funds withdrawal information After completing the
105. eturn 2003 DRAKE TAX SOLUTION THE EF MENU SELECT RETURNS FOR EF After the return has been created and calculated without message pages it is ready for EF From the Menu Bar go to EF gt Select Returns for EF 1 The Return Selector screen displays A selection window opens listing all recently calculated files that are eligible for electronic filing Use the arrow keys to scroll through the list of returns 2 Click the returns to select or deselect the desired returns 3 After selecting the returns click CONTINUE A report listing all returns included in the transmission opens Select the PRINT option to print the report Click EXIT to close TRANSMIT RECEIVE Transmitting tax returns and receiving acknowledgements is a simple process With just a few clicks you are able to electronically file returns to the IRS and State All returns transmitted through Drake are forwarded to the correct IRS Service Center An immediate acknowledgement is sent to indicate a successful transmission After the IRS and or the state receive and process the forwarded return acknowledgements are sent to Drake indicating whether the return was accepted or rejected The acknowledgements are then forwarded to the ERO the next time a connection is made to Drake Although you have the option of transmitting directly to the IRS Drake users are encour aged to transmit returns through Drake There are two advantages to this option e The abi
106. every attempt has been made to produce an accurate and complete manual there is no warranty expressed or implied to that effect DRAKE ENTERPRISES LTD assumes no liability for damages or claims resulting from the use of the information contained herein TRADEMARKS The Drake Software Logo and Drake Software are registered trademarks of Drake Enterprises LTD Other product names mentioned in this manual may be trademarks or registered trademarks of their respective companies Drake Software Evaluation Guide Copyrighted Material 2003 DRAKE SOFTWARE Drake Software Evaluation Guide Copyrighted Material 2003 DRAKE SOFTWARE Table of Contents Welcome xesceses cecececcccte edd oven dcsceeesscccczsveceas Software Installation cccececececcecseecececeeeeeees State and City Program Installation Other Drake Reference Guides View Drake Tutorials Program Setup sssssssssssunnnnnnnnnnnnnnnnnnnnnnnnnnnnn nnne Firm Setup ERO State ERO Information Preparer Setup Printer Setup Optional Program Setup Review Questions Part 1 0 ceceeeeceeeeeeeeees Answers Part 1 Program Navigation ccccceeeseeeeeeeeeseeeeeeeees Drake for Windows General Flow of Commands Features Drake 2003 Hot Keys cccceeeeceeeeeeeeeeeeeeeeeees Review Questions Part 2 ccceeesceceeeeeeeeeees Answers Part 2 Return Preparation ccccceeeseeeeeeeeeseeeeeeeees Open a Return Entering Data Prep
107. gnee drop down box to select which preparer will be the third party designee for all returns An override is available on screen 5 B is incorrect The States Tab contains customization options for each state C is incorrect The EF Tab contains options available for electronic filing You can select to suppress individual states combine the EF steps and several other EF related options D is incorrect Enter sales tax amount choose a billing format select to show bank fees on bill and other billing related options on the Billing Tab 2 The correct answer is C EF Use this tab to select to receive Service Packs during the EF transmission You can also select to download email when you e file on the EF Tab A is incorrect The Optional Documents Tab is used to select specific items to print with returns or select the result letter to print B is incorrect The States Tab contains customization options for each state D is incorrect Options associated with the client s bill are found on the Billing Tab 3 The correct answer is D Billing Use the Billing Statement Format drop down box to select Bill by Time from the list of billing options A is incorrect Use the Optional Documents Tab to setup the referral coupon dollar amounts and the quantity to print per return B is incorrect The States Tab contains customization options for each state C is incorrect Select to turn on various EF features on the EF Tab including
108. he calculator To turn off the calculator ESC To deactivate the calculator without inserting data in a field press ESC on the keyboard or the ESC Quit tab on the screen FREQUENTLY USED CODES FOR DATA ENTRY Field Code Application TS or TSJ T Data is assigned to the primary taxpayer TS or TSJ S Data is assigned to the spouse TS or TSJ J Data is assigned to both the taxpayer and spouse F Blank or 0 zero To exclude data from the Federal return enter 0 zero ST State Code If a State return is being prepared enter the appropriate two letter state code postal service abbreviation If the field is left blank the program defaults to the resident state ST 0 zero To exclude data from any State return ST PY When preparing multi state returns use PY as the resident state code on Screen 1 Do NOT use PY on any other screen C City Code When preparing city returns enter the appropriate city code to indicate the source of income Multiple Form Code 1 99 When preparing Form 4562 depreciation indicate the appropriate schedule for the depreciated item and indicate where the information should be carried when there are mul tiple schedules GLOSSARY OF MENU ITEMS Task Description Location Amortization Prepare and print an amortization schedule using Tools gt Amortization information furnished by the user Amortize assets 4562 in areturn B
109. he latest fig ures are calculated and saved To automatically calculate the return when you view or exit go to Setup gt Options gt Calculate View Print Tab and select to turn on Auto Cal culate Return when exiting data entry If the Pause Option for Calculation option has been selected to After view or print only in Setup gt Options gt Calculation amp View Print Tab the calculation summary screen will display after pressing CTRL V Press ESC or the SPACE BAR to continue When the View Mode screen opens use one of these methods to select a form 1 Double click the form to view 2 Use the up down arrow keys to move through the list Press ENTER when the desired form is highlighted In the open form use PAGE UP or PAGE DOWN or the up down arrow keys to scroll Press ESC to close the form and return to the list To return to data entry click DATA ENTRY in Windows or press CTRL E in the con sole version When you view a return a red Message Page or yellow Notes Page may be present See Message Pages on page 43 for information about this feature Drake Software Evaluation Guide Copyrighted Material 36 Calculate and Print the Return 2003 DRAKE TAX SOLUTION PRINT FILES When the return is calculated a print file is created A print file must exist before the return ca
110. he tool bar to access CCH All Drake clients receive access to the online U S Master Tax Guide Plus from CCH Incorporated This product features a com prehensive online tax information library which includes the following U S Master Tax Guide Internal Revenue Code Revenue Rulings IRS Publications IRS Announcements IRS Notices and U S Tax Cases SERVICE PACKS Install software updates from within the program through your internet connection From the menu bar go to Tools gt Install Updates and choose from the following options e Online Service Pack Downloads the latest federal software updates e States Online Select specific states and download the latest full version of the state program Drake Software Evaluation Guide Copyrighted Material 18 Drake 2003 Hot Keys Drake 2003 Hot Keys Hot Keys enable you to perform specific actions quickly and easily Knowing when and where to use these keys can save you valuable time during tax season Data Entry 2003 DRAKE TAX SOLUTION Produce field specific help information in data entry or to verify a valid Social Security Number SHIFT or ALT Insert today s date into any field ALT D Delete a screen CTRL D Reset a screen CTRL U Exit and save a screen ESC Exit without saving SHIFT ESC Force an entry CTRL F Open an unformatted schedule CTRL W T
111. ice data entry Solutions are found in solutions pdf in the same folder Things to note when examining the completed practice returns Additional Child Tax Credit is calculated using Form 8812 Since the software generates the Child Tax Credit automatically you may need to refer to WK_8812 to examine the calculations used for line 49 of Form 1040 line 33 of Form 1040A To view this form check the Optional Worksheet box in the left col umn of Setup gt Options gt Optional Documents The Additional Child Tax Credit is also calculated auto matically Examine Form 8812 to check the calculations for line 65 of Form 1040 line 42 of Form 1040A There are two forms in Drake Software for Earned Income Credit The calculation is performed automat ically To examine the calculations for line 63 of Form 1040 line 41 of Form 1040A view WK_EIC EIC cannot be generated for a Form 1040EZ Form 8867 provides a checklist for EIC due diligence The IRS examines these forms during audits Complete and save Form 8867 for each taxpayer qualifying for EIC To qualify for Child Care Credit both parents must have earned income be full time students or disabled In Drake Software fill out the dependent information on screen 2 including any child care expenses and then fill out Form 2441 completely including child care expenses again Drake Software Evaluation Guide Copyrighted Material 38 Review Questions Part 3 2003 DRAKE TAX SOLUTION Review Questions Part
112. is correct from the Drake packing slip Clients evaluating Drake may call 828 349 5900 to receive a password 3 Open and calculate the first five test returns provided in the software 400 00 1001 through 400 00 1005 View the returns for Messages If there is a message cor rect the error before calculating the return again 4 Select EF gt Select Returns for EF on the Menu Bar Choose the test returns to transmit 5 Transmit the file to Drake by selecting EF gt Transmit Receive on the Menu Bar Drake posts test acknowledgements T when the transmission is received 6 Select EF gt Process Acks on the Menu Bar Print the acknowledgements if desired See Process Acknowledgements below for instructions Test transmissions through Drake do not receive an additional IRS acknowledgement The T acknowledgement indicates the transmission was successful PROCESS ACKNOWLEDGEMENTS Every successfully transmitted tax return receives acknowledgements EROs transmitting through Drake receive e Processed acknowledgements to indicate the transmission was received T for test transmissions P for live transmissions e Federal acceptance or rejection acknowledgements e State acceptance or rejection acknowledgements when a State return is electronically filed e Bank acknowledgements to indicate when a bank product has been accepted or rejected Any available acknowledgements are received when the ERO conn
113. is is not the case for NY MO PA DE or OR Click OK to install state and city updates Once the installation is complete click EXIT States and cities automatically calculate with the Federal return if indicated on the Federal data entry screens For example if you indicate that the W2 is for NY in the State field the New York return generates along with the Federal Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Software Installation 3 OTHER DRAKE REFERENCE GUIDES The following manuals are available in PDF format on this CD e 2003 Quick Start Manual Designed to aid in pre season software preparation High lights installation steps set up procedures and the basics of navigating the software e 2003 Drake User s Manual A comprehensive resource for all your software questions e Drake Business Manual Walk step by step through the fields required to enter a busi ness return in the software Packages include 1120 1120S 1065 990 and 706 PDF format allows the manuals to be viewed and printed directly from the CD Use the Adobe Acrobat Reader to read the PDF files practice returns and IRS forms and publications If Acrobat Reader is not installed use the following instructions ADOBE ACROBAT READER INSTALLATION If Acrobat Reader is not installed complete the following installation steps l 2 3 4 Insert the 2003 Drake Evaluation CD into the CD drive Click Start gt
114. ke Screen press ESC 4 How do I save screen information in a return a CTRL W b CTRL S c ESC d ALT 5 Is it possible to insert the current date into a data entry field How a Yes press Insert D b Yes press CTRL D c No d Yes press ALT D Drake Software Evaluation Guide Copyrighted Material 20 Review Questions Part 2 2003 DRAKE TAX SOLUTION ANSWERS PART 2 1 The correct answer is B CTRL D This Hot Key deletes the current screen A is incorrect CTRL F is used to force an entry in a field in data entry C is incorrect CTRL S is used to split a MFJ return into two MFS returns allowing you to compare the differences D is incorrect CTRL N enables the Heads Down Method The Heads Down Method uses field codes that correspond with Proformas you can prepare during an interview 2 The correct answer is D CTRL S Use this Hot Key to split a MFJ return into two MFS returns allowing you to compare the differences A is incorrect With Drake Software CTRL S enables you to split the MFJ return B is incorrect CTRL F is used to force an entry in a field in data entry C is incorrect Use CTRL W in any numeric field to access an unformatted schedule 3 The correct answer is C With your cursor in the data entry field on a Drake Screen press CTRL W Key this short cut in any numeric field to access an unformatted sched
115. l return to reflect your amend ments to the return Drake Software Evaluation Guide Copyrighted Material 34 Return Preparation 2003 DRAKE TAX SOLUTION Print out the return and check for accuracy An amended return must be mailed to the IRS FILING AN EXTENSION Use the EXT screen to file an extension Only one extension can be generated at a time If Form 4868 is filed in April remove the X from that field and place it in the 2688 field to generate a later extension A PIN2 screen must accompany a 4868 with a Payment PMT screen A payment must accompany all 4868s with a balance due These can be selected for EF also complete line 66 of screen 5 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Calculate and Print the Return 35 Calculate and Print the Return RETURN CALCULATION Drake Software automatically saves all data as it s being entered However it does not auto matically calculate the return From anywhere within the return press CTRL C or CTRL V to calculate the return e Press CTRL C to calculate the return and view a calculation summary screen Press CONTINUE to return to the Data Entry Selection Menu e Press CTRL V to calculate the return and enter View mode View mode enables you to view the actual forms that will print for the return The program automatically calculates when you exit a return This ensures that t
116. laska No tax Philadelphia Arizona EROs must send a copy of IRS application and or Philadelphia acceptance letter Arkansas All EROs are automatically accepted Memphis California EROs must complete state application Yes Philadelphia Colorado All EROs are automatically accepted Philadelphia Connecticut All EROs are automatically accepted Andover Delaware All EROs are automatically accepted Andover DC All EROs are automatically accepted Andover Florida No tax Kansas City Georgia All EROs are automatically accepted Memphis Hawaii All EROs are automatically accepted Philadelphia Idaho EROs must send a copy of IRS application and or Philadelphia acceptance letter Illinois EROs must complete state application Yes Austin Indiana All EROs are automatically accepted Kansas City lowa All EROs are automatically accepted Austin Kansas All EROs are automatically accepted Austin Kentucky All EROs are automatically accepted Kansas City Louisiana EROs must send a copy of IRS application and or Yes Memphis acceptance letter Call 225 922 0366 for more information Maine All EROs are automatically accepted Andover Maryland All EROs are automatically accepted Andover Massachusetts EROs must complete state application Yes Andover Michigan EROs must complete state application Yes Kansas City Minnesota All EROs are automatically accepted Austin Mississippi All EROs are automatically accepted Yes Memphis Drake Software Evaluatio
117. ld Press Shift to access detailed information for individual fields Program Feature Drake Software offers an Employer Identification Number Database Each time a recognized EIN is entered on a W 2 1099 or a 2441 the business name and address populates When entering wages notice Drake Software populates box 3 6 and 16 based on the wages entered in box 1 Because there are two W 2s included in this return press PAGE DOWN for a blank W 2 screen Enter the information on the next page for the W 2s Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 25 Fields Data TS Field We Federal ID 751122333 Employer s Name Avalon Software Employer s Address 458 Spring Ave Employer ZIP 94404 Wages 27850 Federal Tax Withheld 4575 State CA State ID 341115679 StateTax Withheld 1534 This populates taxpayer information fields Once this employee ID is entered it is saved in the EIN data base Next time this number is entered in data entry the employer s city and state information will populate mation The bottom portion of the W 2 screen allows input of State wage infor Enter the information for the second W 2 Fields Data TS Field T Federal ID 759988777 Employer s Name Catalyst Corporation Employer Ad
118. le Contributions 275 Other Charitable Contributions 190 Tax Prep Fees 125 ENTERING INTEREST INCOME SCHEDULE B 1099 INT The Schedule B Interest Income screen is on the General Tab Type INT in the selector field then press Enter Enter the following account interest for the Carter s return Fields Data TSJ Field J Name of Payer CCB Interest Income 657 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 27 Press ESC to return to the Data Entry Selection Menu Dividend Income is entered in the same manner as Interest To open the Schedule B Dividend Screen select DIV Divi dend Income on the General Tab or enter DIV in the selec tor field ENTERING PROFITS OR LOSSES FROM BUSINESS SCHEDULE C Although C Self Employed Income is found on the Income Tab to open type C then press Enter Use the scroll bar on the right side of the screen or press Page Up Page Down to view more of the form Fields Data TS S Patty Cakes 311800 Business Name Business Code Street Address 2579 W Oak Street Zip 94010 Accounting Method Cash Materially partici Yes pated in 2003 Gross receipts or 78 657 sales Enter the following additional information on Schedule C for Patty Cakes Expenses Data Cost of Goods Sol
119. lity to send all returns in a single transmission IRS Piggyback State Only and State Direct e Drake support is easily accessible Our trained support personnel can access returns for troubleshooting BEGIN THE TRANSMISSION 1 Select EF gt Transmit Receive on the Menu Bar 2 The transmit screen opens providing four possible options Review Send Receive Acks Only Cancel and Help Review Use this option to review the transmission file and remove any returns before con necting to Drake The returns that are selected and highlighted will NOT trans mit The returns that are not selected will transmit 1 To review the manifest click REVIEW To select all click SELECT ALL All returns are highlighted these will be removed from the transmission file To deselect all click DESELECT ALL For single returns click to select or deselect returns Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Electronically File the Return 45 3 Click CONTINUE Send Receive Use this option to connect and transmit the file and to pick up Federal and State acknowledgments bank product acknowledgments check authorizations and ser vice packs needed to update the program if selected in Setup gt Options gt EF 1 Click SEND RECEIVE to continue 2 The Declaration Control Record opens Click PRINT 3 Click CONTINUE 4 The program connects and completes the transmission and automatically dis conne
120. ly starting the download Advanced option Passive FTP Facilitates firewalls by using a defined port range Check for email during the EF Transmit Receive Drake Software Evaluation Guide Copyrighted Material 10 Review Questions Part 1 2003 DRAKE TAX SOLUTION Review Questions Part 1 Answer the questions below See Answers Part 1 on page 11 for explanations of answers 1 In Drake Software Setup gt Options what tab would you choose to select a third party des ignee for all your returns a Optional Items on a Return b States c EF d Billing 2 In Drake Software Setup gt Options which tab would you select to check for Service Pack updates during electronic filing a Optional Documents b States c EF d Billing 3 In Drake Software Setup gt Options which tab would you select to bill by time a Optional Documents b States c EF d Billing 4 In Drake Software Setup gt Options which tab would you select to adjust the sales tax on your bill a Optional Documents b States c EF d Billing 5 In Drake Software Setup gt Options which tab would you select to print the taxpayer s phone number and or the current date on tax return a Optional Items on the Return b States c EF d Billing Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Review Questions Part 1 11 ANSWERS PART 1 1 The correct answer is A Optional Items on a Return Use the Third Party Desi
121. m Go to Help gt Tutorial Select the drive letter of your CD drive from the drop down box Double click a CBT from the list to begin SDE RE OD NOE To exit the tutorial any time during the presentation press ESC Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Program Setup 5 Program Setup The following screens must be completed before beginning tax preparation and electronic filing FIRM SETUP Enter and edit information about a specific firm on the Firm screen There is no default firm information in the program This information must be created individually for each firm From the Menu Bar go to Setup gt Firm Select NEW FIRM The bottom half of the screen becomes active Enter the firm information Click SAVE to save the information Click CANCEL to exit without saving changes en ERO STATE ERO INFORMATION Electronic Return Originator ERO Setup is required only if you plan to do one or all of the following in the software e E file a return e Use the E mail to Drake function e Download service packs using Tools gt Install Updates e Access Your EF Database from EF gt Search EF Database gt F10 The temporary EFIN Electronic Filing Identification Number assigned by Drake does not enable electronic filing but allows system testing and access to Drake Internet utilities Pre parers who are new to e filing must apply to the IRS for an EFIN To enter ERO inf
122. n You can also select to download email when you e file on the EF Tab D is incorrect Options associated with the client s bill are found on the Billing Tab Drake Software Evaluation Guide Copyrighted Material 12 Program Navigation 2003 DRAKE TAX SOLUTION Program Navigation Learning to navigate the program before tax season saves time and frustration Use this section to become acquainted with Drake Softwares menu structure DRAKE FOR WINDOWS The navigation choices when using Windows include the mouse Tool Bar and the computer keyboard THE MOUSE Left mouse button Move the pointer over an item and click the left mouse button to select that item Right mouse button During data entry right click the mouse in any grey area to display a menu of common program functions or right click in a data entry field to cut copy view help or paste TooL BAR Speed Buttons are located under the Menu Bar on the Tool Bar Speed Buttons are short cuts to maneuver the program quickly Different areas of the program are associated with different Speed Buttons e Open Open or create a new return e Calculate Perform a batch calculation e Print Print a return from the return selector e View View a return from the return selector e Internet Launch your internet browser to support drakesoftware com e Tax Help Launch CCH Online Resource e Scheduler Opens the Scheduler utility which enables you to
123. n 5 Which pages in view mode of Drake Software would prevent electronic filing a Notes Pages b Form 8879 c Form 8453 d Messages Pages 6 Which key combination inserts the current date into a data entry field with Drake Software a CTRL D b CTRL F c ALT D d SHIFT D Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE CPE Exam 65 7 True or False A Form 4797 can be created by filling out the date sold the selling price and the property type on the 4562 screen 8 Automobile expenses are created from what screen in Drake a 4562 d 4797 c AUTO d C 9 Once a W 2 has been entered in Drake how can you create another blank form for a second W 2 a Press Insert b Press Page Down c Press F3 d Press ESC 10 What information is found on WK_ 8812 a Due diligence information for the Child Tax Credit b Due diligence information for the EIC c Calculation for the Advanced Child tax Credit d Calculations for the Child Tax Credit 11 Within Drake Software on the C screen how can I find the business code a You cannot You must check the Schedule C instructions b In the business code field Press Shift c You cannot The client will know the appropriate code d In the business code field press ESC 12 Press F4 from EF gt Search EF Database This give you access to what information a Taxpayer demographics b Federal Reject Codes c Bank or Direct
124. n New York State requires separate application for new partici Yes Andover pants only North Carolina Special application is no longer required Memphis North Dakota EROs must complete state application Yes Philadelphia Ohio All EROs are automatically accepted Kansas City Oklahoma EROs must send a copy of IRS application and or Austin acceptance letter Oregon All EROs are automatically accepted Yes Philadelphia Call 503 378 4140 for more information Pennsylvania EROs must send a copy of IRS application and or Andover acceptance letter Rhode Island All EROs are automatically accepted Andover South Carolina All EROs are automatically accepted Kansas City South Dakota No tax Philadelphia Tennessee No tax Memphis Texas No tax Austin Utah EROs must send a copy of IRS application and or Austin acceptance letter Vermont All EROs are automatically accepted Andover Virginia All EROs are automatically accepted Andover Washington No tax Philadelphia West Virginia EROs must send a copy of IRS application and or Kansas City acceptance letter Wisconsin EROs must send a copy of IRS application and or Austin acceptance letter Wyoming No tax Philadelphia EF OPTIONS IN DATA ENTRY In Data Entry the EF screen overrides items entered in Setup gt Options Use this screen to send the Federal alone or a state in any of the following ways Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Electronically
125. n Screen 2 State General Information Income Schedule L Balance Sheets Assets Schedule A Cost of Goods Sold Schedule E Compensation of Officers Schedule K Other Information Form 4562 Depreciation LOSS Loss Carry forwards from Prior Years Schedule M1 Reconciliation of Income Per Books with Returns PADD ONIX siiin eaaa i ccccadesssvcbvtuassusevereuversanasacesttaaeedt 56 Glossary of Menu Items Glossary codar rarapa arap O eaea auaa aada EiL cts ewe 62 CPE Ey AU a E T A T 64 CPE Exam Answer Sheet cccccssseeceeseeeeeseseeeeeaeeeesseeneeees 67 2004 Evaluation Guide NAG XG E ET 69 Drake Software Evaluation Guide Copyrighted Material 2003 DRAKE SOFTWARE Welcome 1 Welcome Thank you for taking the time to review the 2003 Drake Software and Evaluation Guide We appreciate this opportunity to familiarize you with our software and its capabilities This guide is designed to assist you with program setup navigation and preparation of tax returns You may also review the materials and receive CPE credits Answer the review questions throughout the guide and submit the completed exam to receive a maxi mum of 4 CPE credits Upon completion of this Evaluation Guide you will be able to e Navigate Drake Software e Prepare a basic 1040 and 1120 return e Examine returns e E file returns If you have any questions about the 2003 Drake Software please feel free to contact your salesperson at
126. n Guide Copyrighted Material 42 Electronically File the Return 2003 DRAKE TAX SOLUTION Bank Products State State EF Application Required Applications EF Center Required Missouri All EROs are automatically accepted Austin Montana All EROs are automatically accepted Philadelphia Nebraska Acceptance is automatic with Federal acceptance Philadelphia Nevada No tax Philadelphia New Hampshire No tax Andover New Jersey All EROs are automatically accepted Andover New Mexico All EROs are automatically accepted Austin New York State requires separate application for new partici Yes Andover pants only North Carolina Special application is no longer required Memphis North Dakota EROs must complete state application Yes Philadelphia Ohio All EROs are automatically accepted Kansas City Oklahoma EROs must send a copy of IRS application and or Austin acceptance letter Oregon All EROs are automatically accepted Yes Philadelphia Call 503 378 4140 for more information Pennsylvania EROs must send a copy of IRS application and or Andover acceptance letter Rhode Island All EROs are automatically accepted Andover South Carolina All EROs are automatically accepted Kansas City South Dakota No tax Philadelphia Tennessee No tax Memphis Texas No tax Austin Utah EROs must send a copy of IRS application and or Austin acceptance letter Vermont All EROs are autom
127. n be selected for electronic transmission From the Menu Bar go to Setup gt Options gt Calculation amp View Print Tab and select the Number of Days to Store Print Files PRINT When satisfied with the return press CTRL P to open the Print Mode screen Similar to View Mode a list of forms displays From this point choose to print single or multiple copies of one or more forms including the entire return and sets e Double click to select a form e Use the up down arrow keys and SPACE BAR to select multiple forms to print When the desired forms are highlighted click PRINT or press ENTER e Click PRINT THE ENTIRE RETURN e Click PRINT SETS to open the Print Sets dialog box Select the sets to print by check ing or unchecking the Print Set boxes with a mouse click When the correct sets have been checked click PRINT or press ALT P e Use the Classic Mode check box to select the number of each form to print using the and keys The number chosen for each form is saved Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Examining Returns 37 Examining Returns Now that you have completed a return try entering a few more In the PDF folder on this CD open the docu ment practice pdf See Adobe Acrobat Reader Installation on page 3 for installation instructions for the PDF Reader This document contains 7 returns for pract
128. ndex 71 T Transmission Direct State 43 Piggyback 43 State Only 43 y Valid City Codes 32 Drake Software Evaluation Guide Copyrighted Material 72 Index 2003 DRAKE TAX SOLUTION Drake Software Manual Copyrighted Material
129. ndicates the transmission was successful PROCESS ACKNOWLEDGEMENTS Every successfully transmitted tax return receives acknowledgements EROs transmitting through Drake receive e Processed acknowledgements to indicate the transmission was received T for test transmissions P for live transmissions e Federal acceptance or rejection acknowledgements e State acceptance or rejection acknowledgements when a State return is electronically filed e Bank acknowledgements to indicate when a bank product has been accepted or rejected Any available acknowledgements are received when the ERO connects to Drake whether transmitting files or not To process and print acknowledgements select EF gt Process Acks on the Menu Bar The acknowledgement report displays e Social Security Number of primary taxpayer e Document Control Number DCN of the transmitted return e Refund due on the return e Acceptance rejection code e Number of errors recorded Two letter state code for the state return When the acknowledgements are processed they move to the EF Database for future refer ence The EF Reports utility can pull information from this database Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Electronically File the Return 47 SEARCH EF DATABASE The EF Database contains information about all returns that have been electronically filed A return that has been filed more than once has more than one record
130. ne of these methods to select a form 1 Double click the form to view 2 Use the up down arrow keys to move through the list Press ENTER when the desired form is highlighted In the open form use PAGE UP or PAGE DOWN or the up down arrow keys to scroll Press ESC to close the form and return to the list To return to data entry click DATA ENTRY in Windows or press CTRL E in the con sole version When you view a return a red Message Page or yellow Notes Page may be present See Message Pages on page 43 for information about this feature Drake Software Evaluation Guide Copyrighted Material 36 Calculate and Print the Return 2003 DRAKE TAX SOLUTION PRINT FILES When the return is calculated a print file is created A print file must exist before the return can be selected for electronic transmission From the Menu Bar go to Setup gt Options gt Calculation amp View Print Tab and select the Number of Days to Store Print Files PRINT When satisfied with the return press CTRL P to open the Print Mode screen Similar to View Mode a list of forms displays From this point choose to print single or multiple copies of one or more forms including the entire return and sets e Double click to select a form e Use the up down arrow keys and SPACE BAR to select multiple forms to print When the desired fo
131. ng e Opening Returns e Navigating Fields and Forms e Preparing a Return Returns are identified by either a Social Security Number SSN or an Employer Identification Number EIN in the case of business returns The program accepts only numbers in the SSN or EIN fields NO dashes spaces or other char acters OPEN A RETURN On the menu bar go to File gt Open Returns The Open a Return window appears There are several options e Type the SSN or EIN in the top box Click OK or press Enter e Select the desired return from those returns displayed in the lower box Use the return selector buttons to the right to narrow your search e Empty the top field and press Enter Scroll through the resulting list to select a return e Type a last name or company name in the entry field and press Enter For a sample return type the following SSN into the top field without dashes 400 00 6665 This is a completed version of our practice return You will see that the Data Entry Selection Menu is organized into six different pages marked by Tabs General Income Adjustments Credits Taxes and Other You can navigate to each page by either clicking on the actual tab or using the arrow keys If a SSN or EIN is not in the database you are asked to cre ate a new file ENTERING DATA Access a form for data entry by selecting the form description or by typing the form code into
132. nic filing otherwise Form 8453 is produced To complete the PIN screen the taxpayer and spouse must choose a 5 digit number to serve as their signature This may be entered by the preparer The preparer must also enter a 5 digit number on the PIN screen This number is self selected but must be used for the entire season STATE E FILING Each state has its own application requirements for Electronic Return Originators ERO and users of bank products Refer to the following table to determine if a state application is needed to electronically file returns to that state or if an application is required to offer bank products Bank Products State State EF Application Required Applications EF Center Required Alabama All EROs are automatically accepted Memphis Alaska No tax Philadelphia Arizona EROs must send a copy of IRS application and or Philadelphia acceptance letter Arkansas All EROs are automatically accepted Memphis California EROs must complete state application Yes Philadelphia Colorado All EROs are automatically accepted Philadelphia Connecticut All EROs are automatically accepted Andover Delaware All EROs are automatically accepted Andover DC All EROs are automatically accepted Andover Florida No tax Kansas City Georgia All EROs are automatically accepted Memphis Hawaii All EROs are automatically accepted Philadelphia Idaho EROs must send a c
133. nt B is incorrect The States Tab contains customization options for each state D is incorrect Options associated with the client s bill are found on the Billing Tab 3 The correct answer is D Billing Use the Billing Statement Format drop down box to select Bill by Time from the list of billing options A is incorrect Use the Optional Documents Tab to setup the referral coupon dollar amounts and the quantity to print per return B is incorrect The States Tab contains customization options for each state C is incorrect Select to turn on various EF features on the EF Tab including Require Ready for EF Indicator on EF screen and Lock Client Data File after EF Acceptance 4 The correct answer is D Billing Enter the amount of tax to charge in the Sales Tax field A is incorrect The Optional Documents Tab is used to select specific items to print with returns or select the result letter to print B is incorrect The States Tab contains customization options for each state C is incorrect Select the EF Tab to receive Service Packs during the EF transmission You can also select to download email when you e file on the EF Tab 5 The correct answer is A Optional Items on the Return Check the corresponding box to turn this feature ON B is incorrect The States Tab contains customization options for each state C is incorrect Go here and select to receive Service Packs during the EF transmissio
134. ntact the IRS at 1 866 255 0654 and asked to be added to the ERO list This statement is false because a taxpayer must fill out an 8633 ERO Application and fingerprint card and submit it to the IRS to be considered B is incorrect This statement is true Call the IRS or Drake Support to request a finger print card C is incorrect This statement is true Print and 8633 from Tools gt Blank Forms gt Select 1040 gt 8633 and 8633 PG2 D is incorrect This statement is true Send a fingerprint card along with the completed 8633 to the IRS to apply 2 The correct answer is C Send the ERO acceptance letter from the IRS to the state of Wisconsin Wisconsin does not have it s own state specific ERO application A is incorrect You must send the ERO acceptance letter from the IRS to Wisconsin B is incorrect Wisconsin does not have its own state specific ERO application D is incorrect You must send Wisconsin the ERO acceptance letter form IRS A phone call is insufficient 3 The correct answer is FALSE The 8879 is signed by the taxpayer and is retained by the tax preparer s office for three years 4 The correct answer is C A Form 8453 is produced and signed and sent to the applicable IRS Service Center within three business days of the IRS acknowledgement When e fil ing a return if an 8879 is not produced an 8453 must be used A is incorrect You can e file a return with an 8453 without a PIN The 8453 must be sent to the
135. nter the number to be subtracted and press Multiplication 5 Enter the first number in the equation and press Then enter the second on the screen to complete the calcula tion Division Enter the number divide and press Then enter the num ber that divides the first number Press ENTER on the keyboard or on the screen to complete the calculation Clear a number NUM LOCK Press the NUM LOCK key on the keyboard to clear the current calculation Insert calculation total in F1 or F1 Insert With the desired total in the summary field press F1 on Data Entry field Result Tab the keyboard or the F1 Insert Result Tab on the screen The calculator disappears and the calculation total trans fers to the Data Entry field where the cursor is located To turn on the calculator F10 Press F10 to activate the calculator To turn off the calculator ESC To deactivate the calculator without inserting data in a field press ESC on the keyboard or the ESC Quit tab on the screen FREQUENTLY USED CODES FOR DATA ENTRY Field Code Application TS or TSJ T Data is assigned to the primary taxpayer TS or TSJ S Data is assigned to the spouse TS or TSJ J Data is assigned to both the taxpayer and spouse F Blank or 0 zero To exclude data from the Federal return enter 0 zero ST State Code If a State return is being prepared enter the appropriate two lett
136. oggle heads down in standard data entry CTRL N Open the Online Help screen F1 View the Pop Up Calculator F10 Carry data to an amended return CTRL X Calculate View and Print Calculate a return CTRL C View a return CTRL V Print a return CTRL P Split MFJ return to MFS return CTRL S Return to data entry CTRL E Electronic Filing Look up reject codes in EF gt Search EF Database F4 Return to data entry from EF gt Search EF Database F5 Check your online EF database from EF gt Search EF F10 Database Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Review Questions Part 2 19 Review Questions Part 2 Answer the questions below See Answers Part 2 on page 20 for the correct answers 1 How do I delete a screen in Drake a CTRL F b CTRL D c CTRL S d CTRL N 2 Can you split a joint return into two married filing separate returns How a No b Yes CTRL F c Yes CTRL W d Yes CTRL S 3 How can I create a detailed worksheet for a particular line item on a return a With your cursor in the data entry field on a Drake Screen press CTRL F b You cannot c With your cursor in the data entry field on a Drake Screen press CTRL W d With your cursor in the data entry field on a Dra
137. on Guide NAG XG E ET 69 Drake Software Evaluation Guide Copyrighted Material 2003 DRAKE SOFTWARE Welcome 1 Welcome Thank you for taking the time to review the 2003 Drake Software and Evaluation Guide We appreciate this opportunity to familiarize you with our software and its capabilities This guide is designed to assist you with program setup navigation and preparation of tax returns You may also review the materials and receive CPE credits Answer the review questions throughout the guide and submit the completed exam to receive a maxi mum of 4 CPE credits Upon completion of this Evaluation Guide you will be able to e Navigate Drake Software e Prepare a basic 1040 and 1120 return e Examine returns e E file returns If you have any questions about the 2003 Drake Software please feel free to contact your salesperson at 1 800 890 5900 or our courteous and knowledgeable support staff at 1 828 524 8020 This Evaluation CD contains e A complete copy of the 2003 Drake Software e All State Programs e Computer Based Tutorials e Practice Returns and Solutions in PDF format e 2003 Drake User s Manual in PDF format e 2003 Drake Business Package Manual in PDF format e 2003 Client Write Up and CWU Manual in PDF format We are proud to offer our tax preparation software as one complete suite e Tax preparation software for Forms 1040 1065 1120 1120S 990 706 709 and 1041 e All State Personal and Business tax pr
138. on and submit to the state c Send the ERO acceptance letter from the IRS to the state of Wisconsin d Call the Wisconsin DOR and request to be placed on their ERO approved list 3 True or False When a PIN screen is completed a Form 8879 is generated and signed by all parties and sent to the applicable IRS Service Center within three business days of the IRS acknowledgement 4 If a return is electronically filed without a PIN what must happen a You cannot electronically file a return without a PIN b A third party designee must be chosen c A Form 8453 is produced and signed and sent to the applicable IRS Service Center within three business days of the IRS acknowledgement d A Form 8453 is produced that must be signed and kept in the business office for 1 year 5 Ifa state is sent as a piggyback return with the federal return what happens to that state return if the IRS rejects the federal return a The piggyback state return goes on to the state and is rejected by the state b The piggyback return goes on to the state and is accepted by the state c You cannot send a state return with a federal return They must all be sent directly to the state DOR d The piggyback return is not processed and may be sent again with the corrected federal return Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Review Questions Part 4 49 ANSWERS PART 4 1 The correct answer is A Co
139. on the 1040X Change or return to Data Entry CTRL E Toggles pre prepared and full screen Data Entry Also returns to Data Entry from view mode or print mode Undo the most recent unsaved CTRL U Available in Data Entry change Open an unformatted schedule CTRL W Place the cursor in the desired field and press CTRL W for a detail worksheet Note If all data has been removed from a data entry screen the screen must be deleted to prevent e filing errors Toggles heads down and standard CTRL N In Data Entry use CTRL N to turn on the Deita Enry numbers that correlate with the Proformas Delete a Data Entry screen CTRL D With cursor in any field press CTRL D to perma nently remove the screen Note If all data has been removed from a Data Entry screen the screen must be deleted to pre vent e filing errors Activate the pop up calculator F10 Available in Data Entry POP UP CALCULATOR FUNCTION There are three ways to enter numbers and their operators 1 using the numeric keypad on the keyboard 2 using the numbers on the typewriter keyboard or 3 using the mouse to click the numbers and operators Function Operator Instructions Addition Enter the number to be added and press Drake Software Evaluation Guide Copyrighted Material 58 Appendix 2003 DRAKE TAX SOLUTION Function Operator Instructions Subtraction E
140. onal Documents b States c EF d Billing 4 In Drake Software Setup gt Options which tab would you select to adjust the sales tax on your bill a Optional Documents b States c EF d Billing 5 In Drake Software Setup gt Options which tab would you select to print the taxpayer s phone number and or the current date on tax return a Optional Items on the Return b States c EF d Billing Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Review Questions Part 1 11 ANSWERS PART 1 1 The correct answer is A Optional Items on a Return Use the Third Party Designee drop down box to select which preparer will be the third party designee for all returns An override is available on screen 5 B is incorrect The States Tab contains customization options for each state C is incorrect The EF Tab contains options available for electronic filing You can select to suppress individual states combine the EF steps and several other EF related options D is incorrect Enter sales tax amount choose a billing format select to show bank fees on bill and other billing related options on the Billing Tab 2 The correct answer is C EF Use this tab to select to receive Service Packs during the EF transmission You can also select to download email when you e file on the EF Tab A is incorrect The Optional Documents Tab is used to select specific items to print with returns or select the result letter to pri
141. opy of IRS application and or Philadelphia acceptance letter Illinois EROs must complete state application Yes Austin Indiana All EROs are automatically accepted Kansas City lowa All EROs are automatically accepted Austin Kansas All EROs are automatically accepted Austin Kentucky All EROs are automatically accepted Kansas City Louisiana EROs must send a copy of IRS application and or Yes Memphis acceptance letter Call 225 922 0366 for more information Maine All EROs are automatically accepted Andover Maryland All EROs are automatically accepted Andover Massachusetts EROs must complete state application Yes Andover Michigan EROs must complete state application Yes Kansas City Minnesota All EROs are automatically accepted Austin Mississippi All EROs are automatically accepted Yes Memphis Drake Software Evaluation Guide Copyrighted Material 42 Electronically File the Return 2003 DRAKE TAX SOLUTION Bank Products State State EF Application Required Applications EF Center Required Missouri All EROs are automatically accepted Austin Montana All EROs are automatically accepted Philadelphia Nebraska Acceptance is automatic with Federal acceptance Philadelphia Nevada No tax Philadelphia New Hampshire No tax Andover New Jersey All EROs are automatically accepted Andover New Mexico All EROs are automatically accepted Austi
142. opyrighted Material 2003 DRAKE SOFTWARE Business Return 55 Prior Depreciation Description Date Acquired Cost Method Life Fed State Booths 05041988 9089 63 M 5 9089 63 9089 63 Paving 06041988 15695 87 ARP 5 15698 87 15698 87 Franchise 07022000 6000 AMT 15 600 600 Ice Maker 11282002 2560 M 7 91 39 91 39 LOSS Loss CARRY FORWARDS FROM PRIOR YEARS Enter LOSS in the selector field to enter the information below Fields Data NOL Unused for Year 2002 13603 NOL Unused for Year 2001 0 SCHEDULE M1 RECONCILIATION OF INCOME PER BOOKS WITH RETURNS Enter M1 in the selector field for data entry of the following information Line 5 in this screen has a blank field for description entries In the example below you would enter Penal ties in that box and 1184 in the amount field next to it Table 1 Fields Data Line 5 Expense Item Box Penalties Line 5 Amount Field 1184 Drake Software Evaluation Guide Copyrighted Material 56 Appendix 2003 DRAKE TAX SOLUTION Appendix DATA ENTRY NAVIGATION Action Keyboard Keys Move cursor forward one field ENTER TAB or use the down Arrow Move cursor back one field SHIFT TAB or UP Arrow Move cursor within a field RIGHT LEFT Arrows Delete character behind the cursor BACKSPACE Delete character before the cursor DELETE Insert character within existing text INSERT on Move to the
143. or search Drake s stock index from within the Tools section of the Menu Bar HEADS DOWN DATA ENTRY Drake Software enables users to enter data by keying it directly into screens or using the Heads Down Method The Heads Down Method uses field codes that correspond with Proformas your clients can prepare during an interview This option is a great time saver as it allows data to be gathered by a tax professional and entered by a data entry operator Toggle between data entry methods by pressing CTRL N EMAILING Use Email to Drake to send and receive emails from within the Drake Software program Some of the benefits of using this utility include e Receive EMonday emails from Drake These emails provide information on important IRS updates and software changes e The Drake support staff sends important program files via this connection e Easily attach client files to emails and send them to Drake Support e Use the built in Drake Address Book to quickly and easily send support related emails to Drake To access the email function go to the Menu Bar select EF gt Email to Drake The email interface displays e mail messages and the available options The Check Mail option retrieves waiting messages Your Drake email address is YourEFIN 1040 com You must have your EFIN and password entered in Setup gt ERO ERO State Information to use this utility Drake Software Manual Copyrighted Material 20
144. ormation in the software complete the following steps 1 From the Menu Bar go to Setup gt ERO State ERO Information 2 Enter ERO information 3 Click OK to save and exit PREPARER SETUP Each preparer must be entered on the Preparers screen Enter preparers in the program to assign them a preparer number The preparer number is then used to display the preparer information on letters and returns Data entry DE operators may be listed along with paid preparers in Preparers Entering the DE number on returns is used primarily for tracking purposes To enter a new preparer in the software complete the following steps On the Menu Bar go to Setup gt Preparers Click NEW PREPARER The bottom half of the setup screen becomes active Enter preparer information ae cae ale es Create security rights see next section Preparer Security Settings Drake Software Evaluation Guide Copyrighted Material 6 Program Setup 2003 DRAKE TAX SOLUTION 5 Click SAVE to save changes Notice that the preparer is now saved with a preparer number 6 Click EXIT PREPARER SECURITY SETTINGS The Security Setup information defines what a preparer can do in the program When the program opens the preparer is prompted to enter his her login name and password Menu options not accessible to the preparer are greyed out Choose from two types of security options CUSTOMIZE SECURITY SETUP Determine what areas of the p
145. program File gt Pre Prepared Entry Pricing Set prices per form or per item Setup gt Pricing Print Print single or batch returns File gt Print Printer Setup Select printers to use in program Setup gt Equipment gt Printer Setup Process Acks Print and post IRS State and Bank acknowledge ments EF gt Process Acks Proformas Print a summary of the prior year s return on an interview sheet Last Year Data gt Proformas Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Appendix 61 Task Description Location Quick Estimator Prepare a quick estimate of the tax return with minimal data entry Save information for later tax preparation File gt Quick Estimator Quickbooks Import Import a client file created in Quickbooks Tools gt File Maintenance gt Quickbooks Import Repair Index Files Re index all database and client files Tools gt Repair Index Files Reprint Damaged Check Reprint damaged checks EF gt Check Print Search EF Database View client e file status EF information reject code and reject code description EF gt Search EF Database Security Administrator can set security levels for each pre parer Setup gt Preparers Select Returns for EF Select from a list of calculated returns to create an electronic transmission file EF gt Select Returns for EF
146. red in the same manner as Interest To open the Schedule B Dividend Screen select DIV Divi dend Income on the General Tab or enter DIV in the selec tor field ENTERING PROFITS OR LOSSES FROM BUSINESS SCHEDULE C Although C Self Employed Income is found on the Income Tab to open type C then press Enter Use the scroll bar on the right side of the screen or press Page Up Page Down to view more of the form Fields Data TS S Patty Cakes 311800 Business Name Business Code Street Address 2579 W Oak Street Zip 94010 Accounting Method Cash Materially partici Yes pated in 2003 Gross receipts or 78 657 sales Enter the following additional information on Schedule C for Patty Cakes Expenses Data Cost of Goods Sold Data Advertising 480 Inventory Valuation Method Cost Insurance 400 Beginning Inventory 2578 Rent Other 7200 Purchases Less Personal 889 Taxes amp Licenses 54 Cost of Labor 7000 Utilities 2734 Materials Supplies 34255 Drake Software Evaluation Guide Copyrighted Material 28 Return Preparation 2003 DRAKE TAX SOLUTION ENTERING DEPRECIATION Drake Software provides six data entry screens for Depreciation On the Income Tab of the Forms Menu the six screens are grouped together in a box labeled Depreciable Assets Selection options are clearly marked and include Form 4562
147. reen codes and press ENTER to access data entry screens When instructions are given to perform an action the flow of commands is as follows 1 Select the Menu Bar option to show the Drop Down Menus e g Tools 2 Select the action form the Drop Down Menus e g File Maintenance 3 Ifthe action displays gt to the right another list will open 4 Select the action from that list e g Backup Restore To shorten the commands in the instructions the flow of commands is given with arrows between each function Tools gt File Maintenance gt Backup Restore Use the keyboard or the mouse to select the menu options Drake Software Evaluation Guide Copyrighted Material 14 Program Navigation 2003 DRAKE TAX SOLUTION Refer to the following lists for the Menu drop down options and related function keys FILE F1 EF F2 TOOLS F3 e Open Return F1 e Calculate F2 e Print F3 e View F4 e Pre Prepared Entry F5 e Quick Estimator F6 Exit F7 e Logout Preparer Select Returns for EF F1 Transmit Receive F2 Process Acks F3 Check Print F4 Check Setup F5 e Setup New F1 Void Unused F2 Check Register F6 Search EF Database F7 Copy EF Returns to Disk F8 Copy EF Returns from Disk F9 e mail to Drake F10 Install Updates F1 Download Fonts F2 Blank Forms F3 Repair Index Files F4 File Maintenance F5 Backup Restore F1 Change SSNs on
148. reparation Direct State E filed returns that are sent directly from Drake to the State E file Center Only a few states require direct filing CA IL MA ME MN EFIN Electronic Filing Identification Number Preparers new to e filing must apply for an EFIN by preparing and submitting an 8633 to the IRS Email to Drake Used to send and receive email in the Drake program EMonday Email that provides information on important IRS updates and software changes Receive these messages on Monday in the Email to Drake program ERO Electronic Return Originator To become an ERO preparers must apply for an EFIN FAQ Screen Frequently Asked Questions On any state screen in data entry type FAQ in the selector field to access state specific information Heads Down Data Entry Uses field codes that correspond with interview sheets profor mas Data can be gathered by a tax preparer and entered by a data entry operator Hot Keys Enable the user to perform specific actions quickly and easily using the keyboard For example press CTRL C to calculate a return Menu Bar The list of menu options across the top of the Drake screen Message Page Red pages that appear in View or Print Mode when a return has certain issues that would cause an IRS State rejection You cannot select a return for electronic filing with a red Message page Correct the issue and view the return If the message page is gone the return can be e filed
149. rms are highlighted click PRINT or press ENTER e Click PRINT THE ENTIRE RETURN e Click PRINT SETS to open the Print Sets dialog box Select the sets to print by check ing or unchecking the Print Set boxes with a mouse click When the correct sets have been checked click PRINT or press ALT P e Use the Classic Mode check box to select the number of each form to print using the and keys The number chosen for each form is saved Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Examining Returns 37 Examining Returns Now that you have completed a return try entering a few more In the PDF folder on this CD open the docu ment practice pdf See Adobe Acrobat Reader Installation on page 3 for installation instructions for the PDF Reader This document contains 7 returns for practice data entry Solutions are found in solutions pdf in the same folder Things to note when examining the completed practice returns Additional Child Tax Credit is calculated using Form 8812 Since the software generates the Child Tax Credit automatically you may need to refer to WK_8812 to examine the calculations used for line 49 of Form 1040 line 33 of Form 1040A To view this form check the Optional Worksheet box in the left col umn of Setup gt Options gt Optional Documents The Additional Child Tax Credit is also calculated auto matically Examine Form 8812 to check the calculations for line 6
150. rn must be paper filed to the IRS 17 Is it possible to create a Part Year Return with Drake Software a Yes enter PY as the resident state on screen 1 b Yes Type PY in the return selector field and fill out the screen c Yes create two separate returns d No 18 Which of the following does not calculate a return a Press CTRL C b Click CALC button on the Tool Bar c Exit the return After selecting Auto Calculate Return when exiting data entry from Setup gt Options gt Calculate View Print Tab d Press CTRL E 19 True or False You can electronically file live returns with the temporary EFIN given to the user by Drake Software 20 Which of the following methods of payment or refunds can be executed with Drake a An automatic withdrawal of funds from taxpayer s bank or savings account on a selected date in the future b A direct deposit into the taxpayer s bank or savings account c A refund check printed in the tax preparer s office d All of the above Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE CPE Exam Answer Sheet 67 CPE Exam Answer Sheet Circle the appropriate response on this answer sheet for each of the questions on the CPE Exam PTA B C D 2 A B C D 3 A B C D 4 A B C D 5 A B C D 6 A B C D 7 True False n a n a 8 A B C D 9 A B C D 10 A B C D ll A B C D 12 A B C D 13 A B C D 14 True False n a n a 15 A B C D 16 A B C
151. rns entered here will be filed elec tronically Some state have established mandates This year California Minnesota Michigan and Okla homa have published electronic filing mandates These are explained in Taxing Subjects Vol ume 4 Issue 1 www taxingsubjects com as well as documented on our support site in the Knowledgebase MESSAGE PAGES When you view a return a red Message Page may be present These pages are created when a return has certain issues that would cause an IRS State Rejection Each page lists the Drake error code and a brief description to help you resolve the code When these issues are resolved the return is ready for EF You cannot select a return for electronic filing with a red message page Similarly the yellow Notes Page provides reminders or tips about the tax return Please read the Notes Pages for pertinent information but the appearance of this page does not prevent electronic filing For example examine the practice return you entered during Return Preparation on page 21 Click OPEN from the tool bar and enter 400 00 6666 in the SSN field without dashes Click OK and then press CTRL V to view the return Double click with your mouse to view the red CA Message Page The complete California return is prepared except for the California Child Care The CA Mes sage page informs you of all of the criteria necessary to complete the credit Most of this infor mation you have entered on
152. rogram a preparer can access 1 With the preparer selected and in edit mode click to select the Customize Secu rity radio button Click CUSTOMIZE 2 Click the menu items to display the drop down menus Click to select or deselect menu items for accessibility Checked boxes indicate access is permitted 3 Click SAVE SETTINGS When prompted click OK 4 Click SAVE to save the preparer settings Click EXIT OTHER SECURITY OPTIONS With a preparer selected and in edit mode click the radio button to select one of the following options e Set Security to equal Preparer Select this option and enter a preparer number in the box This sets the current preparer s security rights to match the preparer entered e Set Security to Allow No Options The preparer cannot access any items in the program e Set Security to Allow All Options The preparer has rights to access all areas of the program PRINTER SETUP Run the Setup Wizard to set up printers quickly and easily The Printer Setup allows more then one printer to be accessed in the program SETUP WIZARD 1 2 3 4 Next select the type of printer from the drop down list This field may be auto filled On the Menu Bar go to Setup gt Equipment gt Printer Setup Click RUN SETUP WIZARD from the menu at the bottom of the screen Select the printer from the drop down list in the window that appears If so do not change the setting Cli
153. rogram calculations program calculations Enter a negative number to subtract an amount Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Appendix 57 HoT KEYS Action Hot Keys Additional Notes Access help text during Data Entry SHIFT With the cursor in the field press Shift for Data Entry information If selections are listed select the desired choice and press ENTER to insert data Exit a Data Entry screen without SHIFT ESC Press ESC to exit and save changes in Data Entry saving changes Verify a valid Social Security Num ALT After the SSN has been entered press Alt for SSN ber verification Insert the current date in any date ALT D CAUTION CTRL D deletes the screen field Calculate a return CTRL C Open the return in Data Entry and press CTRL C View a return CTRL V Open the return in Data Entry and press CTRL V Print a return CTRL P Open the return in Data Entry and press CTRL P Split MFJ return to MFS return CTRL S Open the joint return in Data Entry and press CTRL S Populate the Amended or X CTRL X Use CTRL X to update the Amended screen This screen with data from the last calcu screen corresponds with Column A on the 1040X After lation the X screen is populated make changes to the other screens in the return Screens other than the X will be used to calculate Column B
154. s included in the software Any other returns are processed as actual tax returns and the ERO could be charged with filing fraudulent tax returns TEST TRANSMIT THROUGH DRAKE 1 A preparer with a new IRS EFIN must contact Drake Accounting to update his her client information Call 828 349 5900 2 Goto SETUP on the Menu Bar and complete the following screens Firm Information e Preparer Drake Software Evaluation Guide Copyrighted Material 46 Electronically File the Return 2003 DRAKE TAX SOLUTION e ERO State ERO Information Make sure the current year Password is correct from the Drake packing slip Clients evaluating Drake may call 828 349 5900 to receive a password 3 Open and calculate the first five test returns provided in the software 400 00 1001 through 400 00 1005 View the returns for Messages If there is a message cor rect the error before calculating the return again 4 Select EF gt Select Returns for EF on the Menu Bar Choose the test returns to transmit 5 Transmit the file to Drake by selecting EF gt Transmit Receive on the Menu Bar Drake posts test acknowledgements T when the transmission is received 6 Select EF gt Process Acks on the Menu Bar Print the acknowledgements if desired See Process Acknowledgements below for instructions Test transmissions through Drake do not receive an additional IRS acknowledgement The T acknowledgement i
155. s nothing appears on the form FAQ SCREEN The FAQ Screen for each state is a great resource for state specific information Once on the Forms Menu for the state the FAQ Screen should be the last listing on the page Place your cursor in the desired field and press Shift to access the information Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 33 PART YEAR RETURN In the Resident State field of the Name amp Address Screen enter PY for a Part Year return If questions arise about what options are available for a specific field press Shift For those forms corresponding to a particular state 2106 2441 W2 etc enter the neces sary state in the ST field at the top of the screen This prints the state information on the appropriate state form DIRECT DEPOSIT Use the DD screen to elect direct deposit of the IRS refund to the taxpayer s checking or savings account Generally direct deposit refunds are received one week earlier than paper checks The direct deposit account must be in the taxpayer s name and cannot include the name of another person If married filing joint the account can be in either the taxpayer s or the spouse s name or both If married filing separate the account can be a joint account or in the name of the taxpayer but not only in the name of the other spouse Payable through accounts are not acceptable for dir
156. sachusetts Maine and Minnesota may be sent directly to the state Drake Software Evaluation Guide Copyrighted Material 50 Business Return 2003 DRAKE TAX SOLUTION Business Return PREPARE THE 1120 EVALUATION RETURN To begin entering data in the Corporation Evaluation return you need to create a new client 1 From the Tool Bar click OPEN 2 In the available field type the following EIN for our Evaluation Return 400 00 2222 and click OK to view the completed return open 400 00 2223 3 Click YES to create a new return 4 Select the return TYPE In this case select C Corp and press OK Screen 1 dis plays SCREEN 1 CORPORATION GENERAL INFORMATION The Corporation Evaluation client is Best Foods Inc which was incorporated in GA on 1 01 1986 The calendar year for the corporation ends 12 31 2003 Type all numbers without dashes unless the number is negative slashes dollar signs or commas Enter the following fields and press ESC Fields Data Address 4554 Middle Road Zip 30525 SCREEN 2 STATE GENERAL INFORMATION Enter the following data on Screen 2 and press ESC when finished W H Tax AC 417 02 00012222 Sales Tax 0754474 38 INCOME Enter the following data on Screen 3 and press ESC when finished Fields Gross Receipts or Sales 538920 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Business Return 51 SCHEDULE
157. screen press PAGE DOWN to rekey the information Do not use this screen unless the return will be filed electronically Use the SPMT screen for the following states only AZ CA CT DC DE IL KS LA MA MD ME MN MT NE NJ NM NY OH OK PA SC and WV Not all states allow electronic payments for taxes due BANK PRODUCTS Bank products are available through Bank One and Household Tax Masters Enter bank information on the B1 or HTM screen FILING AN AMENDED RETURN Form 1040X can be accessed from the Other Tab This form cannot be e filed but can be populated with data from the original form Enter X in the selector field to open the form When you are prompted click YES to auto fill the 1040X with the original return s information Then change the data in the original return to reflect your amend ments to the return Drake Software Evaluation Guide Copyrighted Material 34 Return Preparation 2003 DRAKE TAX SOLUTION Print out the return and check for accuracy An amended return must be mailed to the IRS FILING AN EXTENSION Use the EXT screen to file an extension Only one extension can be generated at a time If Form 4868 is filed in April remove the X from that field and place it in the 2688 field to generate a later extension A PIN2 screen must accompany a 4868 with a Payment PMT screen A payment must accompany all 4868s with a
158. screens are available On the Data Entry Selection Menu type the two letter state code for the desired state and press Enter Screens of available state forms appear Drake Software Evaluation Guide Copyrighted Material 32 Return Preparation VALID City CODES 2003 DRAKE TAX SOLUTION DT Detroit FT Flint GR Grand Rapids HC Hamtramck HP Highland Park IC Ionia City JC Jackson LN Lansing MC Muskegon MH Muskegon Heights PH Port Huron PT Pontiac SG Saginaw WL Walker DE NY MI MO e WM Wilmington NY New York City BC Battle Creek e KC Kansas City e YO Yonkers e BR Big Rapids e SL St Louis PY Part Year use only on Screen 1 in Resident State field New York city codes are entered NY or YO with the exception of W2 locality codes when they should be entered NYC or YONKERS On each of the forms screens you will notice several symbols If the field is marked Override indicated by an symbol an entry in the field overrides any calculations or Federal data normally associated with that item If the field is marked Adjust indicated by a symbol any data entered in that field will be added to the calculated amount of Federal data normally associated with that field To reduce an amount in an adjust field enter a negative figure All other entries are direct no entry made mean
159. se only when calculating from the main menu e Display Forms in View Mode Forms display the same as printed forms or in text mode Text Mode is a computer generated mode with larger text e Days to keep print file If the return is needed after the software removes the Print file recalculating the return will recreate the print file Form and Schedule Options Tab e Print Schedule A only when required Drake Software Evaluation Guide Copyrighted Material 8 Program Setup 2003 DRAKE TAX SOLUTION Print Schedule B only when required Print Form 1116 for Alt Min tax worksheet Print 4562 only when required Print 6251 only when required Form 8867 EIC Worksheet The form 8867 is the IRS form for EIC verifica tion The VER_EIC is a form designed in house that preparers prefer Use this option to indicate your choice 1040A EZ Suppress Form 1045 page 2 NOL Select to prepare when needed or only when indi cated in data entry Form 2210 Select to prepare when needed or only when indicated in data entry Optional Documents Tab Check the appropriate boxes to print the following with each return Folder Cover sheet Next Year Depreciation Schedule Preparer Notes page when applicable Prior Year Comparison Privacy Letter Return Summary Optional Worksheets W2 1099 detail list Prints landscape with city amounts Selected by default W2 1099 forms Referral Coupons 3 per sheet Customize the text of
160. sent with the Federal return to the IRS If the Federal return is rejected the state return is not sent Print mode Enables the printing of the forms associated with a return Press CTRL P to enter Print mode Selector Field In data entry the entry field located in the bottom left corner of the screen Type corresponding screen codes in the field and press ENTER to access data entry screens Service Packs Program updates that can be installed through an internet connection From the menu bar go to Tools gt Install Updates and choose the Online Service Pack Federal Update or State Service Pack Speed Button Used for quick access to commonly used program function Speed Buttons are located on the tool bar directly under the menu bar Split Return Press CTRL S to split a MFJ Married Filing Joint return into two MFS Married Filing Separate returns enabling the preparer to easily compare and determine the best option for the taxpayers State Only E filed returns that can be sent through an IRS Service Center to a state by them selves Unlike Piggyback state returns State Only packets are reviewed by the state regard less of the IRS acknowledgement View Mode Enables you to view the actual forms that print with a return Press CTRL V to enter View mode Drake Software Evaluation Guide Copyrighted Material 64 CPE Exam 2003 DRAKE TAX SOLUTION CPE Exam Answer the questions below See CPE Exam An
161. software complete the following steps On the Menu Bar go to Setup gt Preparers Click NEW PREPARER The bottom half of the setup screen becomes active Enter preparer information ae cae ale es Create security rights see next section Preparer Security Settings Drake Software Evaluation Guide Copyrighted Material 6 Program Setup 2003 DRAKE TAX SOLUTION 5 Click SAVE to save changes Notice that the preparer is now saved with a preparer number 6 Click EXIT PREPARER SECURITY SETTINGS The Security Setup information defines what a preparer can do in the program When the program opens the preparer is prompted to enter his her login name and password Menu options not accessible to the preparer are greyed out Choose from two types of security options CUSTOMIZE SECURITY SETUP Determine what areas of the program a preparer can access 1 With the preparer selected and in edit mode click to select the Customize Secu rity radio button Click CUSTOMIZE 2 Click the menu items to display the drop down menus Click to select or deselect menu items for accessibility Checked boxes indicate access is permitted 3 Click SAVE SETTINGS When prompted click OK 4 Click SAVE to save the preparer settings Click EXIT OTHER SECURITY OPTIONS With a preparer selected and in edit mode click the radio button to select one of the following options e Set Security to equal Preparer Select
162. specific options available for some states Select the state from the drop down list and select the options that apply Set up each desired state separately EF Tab Click the corresponding check box to turn a feature on Print 8453 or 8879 8878 if using PIN when eligible for EF Require Ready for EF indicator on EF screen Lock client data file after EF acceptance Log in as ADMIN to edit unlock a file that has been transmitted and accepted Allow preparers the same ability by giving them access to Tools gt File Maintenance gt Unlock Client Files in their security settings Print bank application when keyed on a return Print 9325 when eligible for EF Suppress Federal EF Combine EF steps Select Transmit Post Acks If this option is selected the only screen that needs to be opened on the EF menu is Select Returns for EF After the returns are selected click OK to start the remainder of the EF routine No further steps are necessary EF Status Page Print the EF Status page State EF Suppress ERO SSN Indicator Choose from preparer 1 9 paid preparer or blank This field will tell the preparer who to use as the ERO on the return The default can be overridden in Data Entry Check for service pack during EF transmit receive Prompt before downloading service pack If this option is selected a prompt will give the estimated download time and size of the file instead of automati cal
163. ssues are resolved the return is ready for EF You cannot select a return for electronic filing with a red message page Similarly the yellow Notes Page provides reminders or tips about the tax return Please read the Notes Pages for pertinent information but the appearance of this page does not prevent electronic filing For example examine the practice return you entered during Return Preparation on page 21 Click OPEN from the tool bar and enter 400 00 6666 in the SSN field without dashes Click OK and then press CTRL V to view the return Double click with your mouse to view the red CA Message Page The complete California return is prepared except for the California Child Care The CA Mes sage page informs you of all of the criteria necessary to complete the credit Most of this infor mation you have entered on the 2441 and screen 2 of the federal return You must however enter the telephone number for the child care provider Notice that the message page tells you to use the CA 3506 screen Type CA in the Return Selector field to enter the California spe cific data Type 3506 and enter a telephone number for the child care provider in the appropri ate field Now when you view the return it is ready to electronically file to the IRS and to California The Message page has disappeared All the states operate in a similar manner Drake Software Evaluation Guide Copyrighted Material 44 Electronically File the R
164. stem testing Preparers who are new to E filing must apply to the IRS for an EFIN ERO information MUST be entered before attempting to elec tronically file live returns 1 On the Menu Bar go to Setup gt ERO State ERO Information 2 Enter or edit the information 3 Click OK or press ESC to save and exit If the preparer is filing through Drake and has returns for more than one IRS Service Center all the returns can be filed in the same batch without changing the processing site Drake sep arates the returns and sends them to the correct IRS Service Center Returns with bank products multiple state returns to different IRS Service Centers and Direct State returns must be E filed through Drake To apply to the IRS to become an ERO file form 8633 Found in the software Tools gt Blank Forms gt Select 1040 gt 8633 and 8633 PG2 Mail this completed form with a fingerprint card to the Internal Revenue Service Andover Campus Attention EFU Acceptance Testing Stop 983 PO Box 4099 Woburn MA 01888 4099 Call the IRS 1 866 255 0654 or Drake Support 1 828 524 8020 to obtain a Fingerprint Card In addition some states require the IRS acceptance letter or a special application before you electronically file to their state Please refer to the chart below for state application require ments The taxpayer does not sign the bottom of page 2 of the 1040 when electronic filing the return
165. swer Sheet on page 67 for answer sheet and instructions for receiving credit 1 In Drake Setup gt Options which tab would I select to change state options a EF Tab b Optional Items on a Return Tab c Billing Tab d State Tab 2 What operation does CTRL S perform a Splits a Married Filing Joint return into two Married Filing Separate returns b Opens a return c Saves a return d Saves Firm and ERO information 3 What information is provided on WK_EIC a A check list for Additional Child Tax eligibility b A check list for EIC due diligence c Calculation used for determining EIC amounts d Calculation used for determining ACTC amounts 4 Which of the following would not be used when electronic filing with Drake Software a Form 8453 b Form 8879 c The signature lines on the bottom of the 1040 d PIN Screen 5 Which pages in view mode of Drake Software would prevent electronic filing a Notes Pages b Form 8879 c Form 8453 d Messages Pages 6 Which key combination inserts the current date into a data entry field with Drake Software a CTRL D b CTRL F c ALT D d SHIFT D Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE CPE Exam 65 7 True or False A Form 4797 can be created by filling out the date sold the selling price and the property type on the 4562 screen 8 Automobile expenses are created from what screen in Drake a 4562 d 4797 c AUTO
166. t Dependent Data Second Dependent Data First Name Carolyn Richard SSN 239 21 1123 245 62 2235 Relationship Daughter Son Months in home 12 12 Date of Birth 07 11 1995 12 18 1984 Qualifying Child Care 3450 Expenses Hope Credit Expenses 4200 If Over 18 amp a Student X Press ESC to return to the Data Entry Selection Menu ENTERING WAGES W 2 In the first field of the W 2 screen enter T for taxpayer or S for spouse The corre sponding taxpayer or spouse information is populated in the Employee Name Address fields Remember help is available in each data entry field Press Shift to access detailed information for individual fields Program Feature Drake Software offers an Employer Identification Number Database Each time a recognized EIN is entered on a W 2 1099 or a 2441 the business name and address populates When entering wages notice Drake Software populates box 3 6 and 16 based on the wages entered in box 1 Because there are two W 2s included in this return press PAGE DOWN for a blank W 2 screen Enter the information on the next page for the W 2s Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Return Preparation 25 Fields Data TS Field We Federal ID 751122333 Employer s Name Avalon Software Employer s Address 458 Spring Ave Employer ZIP 94404 Wages 27850 Feder
167. t up shortcut keys for commonly used words Setup gt Macros phrases addresses etc Samples are pre pro grammed to show examples of input Mailing Labels Generate mailing labels for clients service cen Tools gt Letters gt Mailing ters DORs etc Labels Open Returns Open an existing return or create a new one File gt Open Returns Options Set user preferences that affect viewing printing Setup gt Options calculation optional documents EF etc Organizers Print client information and preseason sheets for Last Year Data gt Organizers gathering tax data based on last year s informa tion Password Protect Files Lock a file with a Password The preparer must remember or write down the password There is no way to open the file without the correct password Drake Support does not have access to the password Tools gt File Maintenance gt Password Protect Files Pay Per Return Activate order and view availability of returns for Pay Per Return clients Setup gt Pay Per Return Postcards Addresses post cards to a selected group of cli Tools gt Letters gt Post Cards ents Preparers Set up Preparer information and level of security Setup gt Preparers Also set up hourly rates password and PIN Pre Prepared Entry Enter data from a return that has been previously prepared This utility allows direct data entry to IRS forms returns are not calculated through the
168. tate county and resident state fields Fields Data Address 14998 New Heights Road Zip 94010 Daytime Phone 415 344 3443 Evening Phone 415 645 6456 Occupation Computer Technician Presidential Campaign Fund No Enter number without dots or dashes To avoid IRS rejection of electronically filed returns use only the characters allowed in addresses letters numbers ampersand amp hyphen and forward slash SAVING DATA When the Name and Address screen is complete press ESC to return to the Data Entry Selection Menu The information entered is saved automatically as it is typed When you return to the Data Entry Selection Menu screen notice the Name and Address selection is highlighted indicating that data is entered on this screen If a screen is highlighted but contains no data the screen must be deleted or it can cause E filing errors Press CTRL D to delete the current data entry form Drake Software Evaluation Guide Copyrighted Material 24 Return Preparation 2003 DRAKE TAX SOLUTION ENTERING DEPENDENT INFORMATION William and Amelia have two dependents Press PAGE DOWN on the keyboard to pro duce an additional Dependent screen for the second child s information Enter the following information Fields Firs
169. this option and enter a preparer number in the box This sets the current preparer s security rights to match the preparer entered e Set Security to Allow No Options The preparer cannot access any items in the program e Set Security to Allow All Options The preparer has rights to access all areas of the program PRINTER SETUP Run the Setup Wizard to set up printers quickly and easily The Printer Setup allows more then one printer to be accessed in the program SETUP WIZARD 1 2 3 4 Next select the type of printer from the drop down list This field may be auto filled On the Menu Bar go to Setup gt Equipment gt Printer Setup Click RUN SETUP WIZARD from the menu at the bottom of the screen Select the printer from the drop down list in the window that appears If so do not change the setting Click NEXT to continue The first page of the 1040 is sent as a test page to the printer Check the printer for the test page Answer the questions that follow by clicking the appropriate YES or NO button Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Program Setup 7 8 The next window prompts Apply this printer to the following sections Click the check boxes to select 9 Click FINISH to complete the wizard Different printers can be selected to print reports letters forms checks etc OPTIONAL PROGRAM SETUP OPTIONS Select program
170. up calculator F10 Available in Data Entry POP UP CALCULATOR FUNCTION There are three ways to enter numbers and their operators 1 using the numeric keypad on the keyboard 2 using the numbers on the typewriter keyboard or 3 using the mouse to click the numbers and operators Function Operator Instructions Addition Enter the number to be added and press Drake Software Evaluation Guide Copyrighted Material 58 Appendix 2003 DRAKE TAX SOLUTION Function Operator Instructions Subtraction Enter the number to be subtracted and press Multiplication 5 Enter the first number in the equation and press Then enter the second on the screen to complete the calcula tion Division Enter the number divide and press Then enter the num ber that divides the first number Press ENTER on the keyboard or on the screen to complete the calculation Clear a number NUM LOCK Press the NUM LOCK key on the keyboard to clear the current calculation Insert calculation total in F1 or F1 Insert With the desired total in the summary field press F1 on Data Entry field Result Tab the keyboard or the F1 Insert Result Tab on the screen The calculator disappears and the calculation total trans fers to the Data Entry field where the cursor is located To turn on the calculator F10 Press F10 to activate t
171. urn 1040 Evaluation Return 22 Process acks 46 Program Navigation Emailing 16 Features 16 General Flow of Commands 13 Menu drop down options 14 Split Returns 17 Tool Bar 12 Program Navigation 12 Program Setup Firm ERO State ERO Preparer 5 Options 7 Printer 6 Setup Wizard 6 Program setup Preparer Security Settings 6 Program Setup 5 R Reconciliation of Income 55 Return Preparation Amended Returns 33 Auto Mileage for Sch C 30 Bank Products 33 Child and Dependant Care Expenses 28 Depreciation 28 Direct Deposit 33 Drake Software Evaluation Guide 2003 DRAKE SOFTWARE Entering Data 21 Entering Dependant Information 24 Estimated Taxes 31 Extension 34 FAQ Screen 32 Interest Income 26 Itemized Deductions 26 Moving Expenses 29 Office In Home 29 Open a Return 21 Partnership Information 30 Part year Return 33 Payment 33 Profit or Losses from Sch C 27 Saving Data 23 State Data 31 Valid City Codes 32 Wages 24 Return Preparation 21 Review Questions Answers Part 1 11 Answers Part 2 20 Answers Part 3 39 Answers Part 4 49 Part 1 10 Part 2 19 Part 3 38 Part 4 48 S Service Center 41 Software Installation State and City Programs 2 Software Installation 2 State 2 State Information EF Service Centers 41 State Only 43 State Only 43 States Tab 9 Support Online State Resource 17 Service Packs 17 website address 17 Copyrighted Material 2003 DRAKE SOFTWARE I
172. urns with bank products multiple state returns to different IRS Service Centers and Direct State returns must be E filed through Drake To apply to the IRS to become an ERO file form 8633 Found in the software Tools gt Blank Forms gt Select 1040 gt 8633 and 8633 PG2 Mail this completed form with a fingerprint card to the Internal Revenue Service Andover Campus Attention EFU Acceptance Testing Stop 983 PO Box 4099 Woburn MA 01888 4099 Call the IRS 1 866 255 0654 or Drake Support 1 828 524 8020 to obtain a Fingerprint Card In addition some states require the IRS acceptance letter or a special application before you electronically file to their state Please refer to the chart below for state application require ments The taxpayer does not sign the bottom of page 2 of the 1040 when electronic filing the return The Signature page for electronic filing is either the 8879 to send an electronic signature or the 8453 which must be mailed to the applicable IRS Service Center within 3 business days after the ERO has received acknowledgement from the IRS that the return has been accepted The 8879 must be signed by the taxpayer BEFORE the electronic return is transmitted and then is retained in the tax preparer s office for 3 years Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Electronically File the Return 41 If the PIN screen is completed within the software Form 8879 is produced when electro
173. us e Refund amount or balance due e Reject codes Bank codes and loan status e Bank check information Bank DD Info F2 e Detailed loan information e Direct deposit information e Document Control Number Fees Errors Miscellaneous F3 e Earned Income Credit EIC e Adjusted Gross Income AGI e PINs firm number preparer number ERO number e Bank distribution fees Reject F4 Enter and view the reject code description and solution DE F5 Open the first screen of return data entry for the SSN EIN displayed WEB F10 e Connect to Your online EF Database to check the most current information avail able from the Service Centers e View pending Bank State and Federal Information about one or multiple clients e View reports of your EF information for the current tax season Drake Software Evaluation Guide Copyrighted Material 48 Review Questions Part 4 2003 DRAKE TAX SOLUTION Review Questions Part 4 Answer the following questions See Answers Part 4 on page 49 for explanations of answers 1 To become an ERO which of the following is NOT true a Contact the IRS at 1 866 255 0654 and ask to be added to the ERO list b Request and complete a fingerprint card c Send a completed 8633 to the IRS d Send the fingerprint card to the IRS 2 To electronically file returns to the state of Wisconsin what must an ERO do a Nothing b Fill out the Wisconsin applicati
174. ven 5142 29 M 5 5142 29 5142 29 Equipment 1452 38 M 5 1452 38 1452 38 Cabinets 2553 20 M 5 2553 20 2553 20 The items below should be entered Prior Depreciation Description Date Acquired Cost Method Life Fed State Ice 02281991 2626 00 M 7 2626 00 2626 00 Machine Printer 03211994 2904 40 M 5 2904 40 2904 40 Cash Reg 04301994 1865 60 M 5 1865 60 1865 60 ister Blizzard 06301994 589 89 M T 589 89 589 89 Machine HVAC 08141997 7171 00 M 1 6210 99 6210 99 Unit Toaster 03301995 716 98 M 5 716 98 716 98 Cash Reg 04301995 493 98 M 5 493 98 493 98 ister HVAC 09151997 5971 00 M 7 5171 00 5171 00 Unit Office 05311998 404 90 M 5 381 58 381 58 Equip ment Misty 02011998 2000 00 M 5 1884 80 1884 80 Mch Computer 06261999 5383 M 5 3683 65 3683 65 Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Business Return 55 Prior Depreciation Description Date Acquired Cost Method Life Fed State Booths 05041988 9089 63 M 5 9089 63 9089 63 Paving 06041988 15695 87 ARP 5 15698 87 15698 87 Franchise 07022000 6000 AMT 15 600 600 Ice Maker 11282002 2560 M 7 91 39 91 39 LOSS Loss CARRY FORWARDS FROM PRIOR YEARS Enter LOSS in the selector field to enter the information below Fields Data NOL Unused for Year 2002 13603 NOL Unused for Year 2001 0 SCHEDULE M1 RECONCILIATION OF INCOME PER BOOKS WI
175. wn state specific ERO application D is incorrect You must send Wisconsin the ERO acceptance letter form IRS A phone call is insufficient 3 The correct answer is FALSE The 8879 is signed by the taxpayer and is retained by the tax preparer s office for three years 4 The correct answer is C A Form 8453 is produced and signed and sent to the applicable IRS Service Center within three business days of the IRS acknowledgement When e fil ing a return if an 8879 is not produced an 8453 must be used A is incorrect You can e file a return with an 8453 without a PIN The 8453 must be sent to the IRS within 3 business days of the receipt of an acknowledgement from the IRS B is incorrect A third party designee is not a necessity when filing an 8453 A third party designee allows a third party to discuss the return with the IRS D is incorrect If a PIN is provides a Form 8879 is produced and must be signed and kept in the tax preparer s office for three years 5 The correct answer is D The piggyback return is not processed and may be sent again with the corrected federal return If the return is rejected it does not go on to the state A is incorrect The state return is not processed It does not go on to the state B is incorrect The state return is not sent on to the state C is incorrect Many state returns can be sent with the federal return as piggyback or state only Illinois New York California Mas
176. x Use the return selector buttons to the right to narrow your search e Empty the top field and press Enter Scroll through the resulting list to select a return e Type a last name or company name in the entry field and press Enter For a sample return type the following SSN into the top field without dashes 400 00 6665 This is a completed version of our practice return You will see that the Data Entry Selection Menu is organized into six different pages marked by Tabs General Income Adjustments Credits Taxes and Other You can navigate to each page by either clicking on the actual tab or using the arrow keys If a SSN or EIN is not in the database you are asked to cre ate a new file ENTERING DATA Access a form for data entry by selecting the form description or by typing the form code into the selector field in the bottom left corner of the Data Entry Selection Menu Access installed state forms by typing the state s two letter abbreviation into this box NAVIGATION Move through the data entry fields on any form Drake Software Evaluation Guide Copyrighted Material 22 Return Preparation 2003 DRAKE TAX SOLUTION e Press Tab Enter or the Down arrow key to advance the cursor to the next field e Press Shift Tab or the Up arrow key to move the cursor back one field e Use the Left Right arrow keys to move the cursor within a data entry field e Press ESC to save an
177. year s informa tion Password Protect Files Lock a file with a Password The preparer must remember or write down the password There is no way to open the file without the correct password Drake Support does not have access to the password Tools gt File Maintenance gt Password Protect Files Pay Per Return Activate order and view availability of returns for Pay Per Return clients Setup gt Pay Per Return Postcards Addresses post cards to a selected group of cli Tools gt Letters gt Post Cards ents Preparers Set up Preparer information and level of security Setup gt Preparers Also set up hourly rates password and PIN Pre Prepared Entry Enter data from a return that has been previously prepared This utility allows direct data entry to IRS forms returns are not calculated through the program File gt Pre Prepared Entry Pricing Set prices per form or per item Setup gt Pricing Print Print single or batch returns File gt Print Printer Setup Select printers to use in program Setup gt Equipment gt Printer Setup Process Acks Print and post IRS State and Bank acknowledge ments EF gt Process Acks Proformas Print a summary of the prior year s return on an interview sheet Last Year Data gt Proformas Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Appendix 61 Task Description Location
178. your CPE certificate you must sign this form Your signature Your Name please print Drake Software Manual Copyrighted Material 2003 DRAKE SOFTWARE Index Numerics 1040 Evaluation Return Name and Address Screen 22 A Adobe Acrobat Reader Installation 3 Amended Returns 33 Appendix 56 B Bank Products 33 Billing Tab 8 Business Return 1120 preparation 50 Form 4562 Depreciation 53 Income 50 Loss Carry Forward 55 Per Books with Returns 55 Schedule A Cost of Goods Sold 51 Schedule E Compensation of Officers 52 Schedule K Other Info 52 Schedule L Balance Sheet 51 Schedule M1 Reconciliation of Income 55 Screen Corporate General 50 Screen 2 State General 50 Business Return 50 C Calculate and Print the Return Calculation 35 Print Files 36 Print 36 Calculate and Print the Return 35 Calculate and View Tab 7 CBT Computer Based Training 4 CCH Master Tax Guide 17 Corporation General Information 50 CPE Exam 64 CPE 1 Customize Security Setup 6 Drake Software Evaluation Guide Index 69 D Data Entry Navigation 21 Data Entry 7 Depreciation 4562 53 Drake Hot Keys 18 Tutorials 4 Drake Reference Guides 3 E EF Options 42 EF Tab Select returns for EF 9 EF Tab 9 Electronically File the Return EF Options in Data Entry 42 ERO State ERO Setup 40 Message Pages 43 Process Acknowledgements 46 Search EF Database 47 State E filing 41 Test Transmission 45 The E

CopyRight Notice

Contents

Download Pdf Manuals

Related Search

Related Contents