Received my clients 2022 1120 & 1040 Sch F farming activity info for 2022 last night. Historically they report sawmill inc & exp under a corporation on 1120. They also have farming activity (chickens & livestock) that historically has been reported on 1040 Sch F. They have always kept/provided separate inc/exp records for these entities.

In there email explanation the say that it's become "increasingly more difficult to keep non-farm and farm business items separate" and are "needing to bring the farm business under the umbrella (of the corp). 

I don't think this is a reasonable request and not even sure it's in their best interest or proper to do this - no time to research this for sure. What's troubling is that I should have heard on Jan 1 2022 that their bookkeeping was becoming difficult...not 1 year and 10 months later.

I am leaning towards telling them this and also since they did not meet my 09/20/23 doc request deadline their return will be late and to go back through their 2 business bank statements for 2022 to sort out what is what.

Please help! What are your thoughts on how to handle?