DANRVAN

Thanks for your responses Kea and Jack. Dan

Can anyone tell me if it is possible to E-FILE Form 511-NR? (My ATX program does not create an e-file) Thanks Dan

Well for starters, it depends on what type of trust you are dealing with. Dan

That’s a million dollar question Dan. The IRS is taking the position that all CRP income is subject to SE Tax, see CCA 200325002 and Notice 2006-108, 2006-51 IRB. The IRS no longer says in Pub 225 that inactive farmers and landlord can report CRP income on form 4835. There is supposed to be a provision in the Farm Bill that retired farmers are exempt from SE tax in regards to CRP. Last I heard, congress is still wrestling with the current farm bill.

You have to be kidding. Why would it take two hours to read a simple trust document?

And you certainty would not commingle those activities.

A lease-hold is an intangible per Reg § 1.162-11. The buyer will amortize it, your client will treat the sale of it the same as goodwill, capital gains.

Why would a trade-in trigger recapture if he is paying boot?

All you need to know is the volume of the timber cut and the timber market price on the date the property was purchased. Since this was a recent purchase, there is probably no growth factor to consider.

I can't seem to find a 1041 payment voucher to use when e-filing 1041 with payment due. Can anybody point me in the right direction? Thanks, Dan

Pub 225 discusses putting it on Schedule F in certain situations. It usually goes on Schedule D.

After all that, did you finish your nap?

Farm income also includes gain from the sale or other disposition of property (other than land) used regularly for farming. As KC mentioned you have to play with it to find the right amount to include; a job made easy by software!

Dan I thought you might find your answer in Code Sec. 451(d) or Reg § 1.451-6. I believe it is all or none. Here is a quote from Prof. Neil Harl, author of the Farm Income Tax Manual and co-editor of the Agricultural Law Digest:” It is not possible to defer only a portion of crop insurance or disaster payments.” Merry Christmas! Dan

I would skip the creative accounting, look at the facts and apply the law. You can’t pull a number out of the hat and call it Goodwill. Look at Rev. Rul. 99-6, 1999-1 CB 432 -- IRC Sec(s). 708, 1/15/1999, it will refer you to various code sections and analysis of various situations where a two man partnership is liquidated and one partner continues the business. The partner who continues the business ends up with two sets of assets: first those attributable to his partnership interest (basis being his partnership interest); and secondly, the assets he bought from his partner, the basis being the consideration he gave for them. My impression is that the 80% P purchased the remaining 20% of the assets by assuming his partner’s 20% share of the liabilities. He obtained 80% of the assets through a liquidating distribution; those assets are allocated according to his basis in the partnership interest and his holding period includes the holding period of the partnership. The basis of the other 20% of the assets is the consideration he gave for them; the 20% share of the liabilities he assumed. A new holding period starts for these assets. The 20% guy has a deemed distribution equal to his share of the liabilities assumed by his partner, and figures gain or loss accordingly. You should also look at Rev Rul 93-80, 1993-2 CB 239 which discusses character of gain or loss upon abandonment of partnership interest. Good luck Dan ps when you book the entry for the sole proprietor you credit his capital account instead of retained earnings.

Merry Christmas to all. and a happy New Year! Dan

I agree with KC, there is a distinction between “travel” expenses and “transportation” expenses in the case of the itinerant worker, but had to take time to research. Also found an itinerant taxpayer might be able to deduct the extra cost of meals and lodging while traveling. The “itinerant rule” found in Rev Rul 73-529 is specific to meals and lodging: “the taxpayer in Situation 2, not having satisfied any of the objective factors set forth herein, is an itinerant having his “home” wherever he happens to work. Thus, since he is not “away from home,” the cost of his meals and lodging are not deductible as traveling expenses under section 162(a)(2).” The issue with meals and lodging is duplicating of expenses; they would not have occurred if the taxpayer had been at home. Transportation is a matter of getting from point A to point B for business purposes. If a sales rep or business consultant has to fly from Boston to Seattle, why would it make any difference if he has a tax home or not in deducting the actual transportation expenses? Why would it matter if he chose to travel by car or motor home? There are many court cases out there, but I found none which match the facts and circumstances here. MCNEIL was a truck driver trying to deduct travel expenses and meals. Certainly transportation expense was not an issue. The case of HENDERSON which also focuses on meals and lodging, refers to Barone v. Commissioner: “The duplication of expenses is a primary raison d'être for the deduction under section 162(a)(2).” HENDERSON, in a footnote, also refers to James v. United States: “taxpayer (without a tax home) might be able to deduct that portion of his traveling expenses attributable to the increase cost of meals and lodging associated with travel”. JOHNSON has nothing to do with this situation; his issue was incidental travel expneses. The issue in FLOWERS was living expenses. I found nothing to prevent itinerant taxpayers from deducting ordinary and necessary business transportation expenses. Also, per James v U.S., they might be able to deduct the “extra cost” of living on the road for business travel.

Dan, take a look at Code Sec. 451(d) and Reg § 1.451-6. Good Luck Dan

I paid $1,018.50 for MAX in 2006 and $1,027.50 in 2007, both after the 10% discount.