Gail in Virginia

Margaret, I am not really sure what your question is. It should not matter whether the return or the money is received first, but I would probably, like you, prefer to e-file, wait for the ack, and then have them do the credit card bit. In fact, if it were me, I would recommend paying whatever amount they can by check or direct debit, and only charging the balance. The fees for this service are based on a percentage of the amount paid. I have had clients use it simply because they charge everything to build up credit on their reward program, but I really don't believe they came out ahead. If you have any specific questions about this, I will try to help if someone doesn't beat me to it.

The IRS will be looking for the partnership return because of the EIN that they filed for. That told the IRS that the partnership existed. Until you file the return and mark it final, they won't know that the business tanked.

Just do be careful about state rules. VA allows a deduction for amounts contributed to its 529 plan of $2000 per year per beneficiary (unless tp is over 70 years old, when they can take it all.)

Are they still sending 1040 ES coupons to people whose tax returns show a paid preparer? I thought that they had stopped.

I don't know that you can rely on the tax assessment to actually look at the value of the lumber, but I don't know that you can't. It obviously had value at the time it was purchased. Could any of the people in the area who work with timber give you an estimate of how much timber has grown in the last two years to let you back into a number from what it is worth now?

Since this thread was posted, I have gotten a return in that had settlement checks from several different funds in varying amounts, not necessarily Merrill Lynch. The accompanying paperwork says they are part of a settlement from the fair funds established by the Securities and Exchange Commission in connection with the administrative proceeding referenced. Apparently, this settlement relates to mutual fund market timing activity. The clearest accompanying documentation is from Putnam, which breaks the settlement checks down into an amount for advisory fees, interest on the judgment and the share of losses due to the shareholder. The web-site referenced by MFS for the Massachusetts INvestors Growth Stock Fund A goes into great detail about the tax treatment of the distribution, and mentions that funds in an IRA should be deposited back to the IRA or rolled over. If they are not, they could be subject to early distribution penalties. The notices I have from Bank of AMerica and Franklin are less detailed, and the web sites are less helpful, but it appears that unless the underlying instrument has been sold, these can be treated as basis adjustments rather than taxable events. But if your taxpayer is under 59 1/2 they may be subject to the early withdrawal penalty if it is an IRA investment and they do not deposit it to the IRA account or roll it over; however, the funds are excused from issuing 1099's for these amounts. This is probably not very clear because I am still not clear in my mind about these settlements. But since it seemed so similar to the situation that Lion originally referenced, I wanted to add a post suggesting further research if you get a check for this settlement amount. The websites I reviewed were www.rust-mfssettlement.com, www.BankofAmericaFairFund.com and www.franklinfairfundsettlement.com Just what I needed this far into tax season - more research :spaz:

I have not had one of these so far, so please enlighten me. How do you show the recapture on the personal return if it turned out they sold at a profit? Say they had depreciated it out, and sold it for $1500, more than the section 179 expense they had taken.

Why can't the S-corp pay rent to the individual as property owner?

I don't have a lot of experience with this, but sine no one else has responded I will say that the difference between a regular NOL and an AMT NOL is any adjusments that have to be made for AMT purposes. For example, if the NOL includes depreciation at a faster rate than allowed for AMT purposes, you would have to add back the difference in depreciation in determining the AMT NOL. There are other adjustments possible, but that is probably the most common.

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Is enzyte the stuff smiling Bob sells? He frightens me... :huh:

I think even if owner has SIMPLE, if managment fees for all employees eligible are paid by the business and not out of the accounts, they should be deductible. However, $2000 seems a bit excessive for a fiduciary fee. That seems to be more of an investment management fee. The fiduciary fees for SIMPLEs using mutual funds tend to run around $35 per year here.

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But isn't an LLC a disregarded entity? They did not transfer the property to a corporation or sell it to another party, they merely restructured their own ownership of the property. If the parents gave the property to more than one child, the parents created a de facto partnership. The children merely formalized this into an LLC. I don't know enough law to really be sure, but this is how it seems to me.

I thought he was trying to convince her to look for a new husband. :lol:

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What a beautiful child! My son will be 18 in a few months, and it seems like such a very short time ago that he was a toddler. I hope you are as blessed as I have been.

I do it the same way KC does, and I have never had a problem with changing the information on one tab changing the information on another tab. Of course, that doesn't mean I won't, just that I have not so far. :scratch_head:

And being a hobby does not mean that you don't have to report the income - it only limits the expenses that you can deduct and how you deduct them. All income, whether cash or barter, is reportable.