Randall

For the sake of the topic, what depreciable property? Is he talking about reducing his basis in the 'stock' (LP units costs? I wouldn't thing that's depreciable property.

ATX has a good worksheet for KY if you need to take another state tax credit. You have to enter some income info but once the income is entered, the appropriate tax credit is calculated. I don't recall any add-on for this and the worksheet has been there several years.

LLC wants to dissolve and file final return for short year in 2016. Should they officially dissolve with the Ky Secretary of State first, then I prepare the final return or should they choose a month, file final return, then dissolve with Sec of State? I'm not sure which comes first, the chicken or the egg.

Seems there should have been an additional statement to explain that box entry. Sometimes the statements are much help though.

I do this too.

I've finished mine. Or at least emailed the ones who will probably owe. It's up to them to make a payment. The real pain is the local govts want their own extensions with a payment for the businesses. I've got them emailed.

Client emailed me and said he got thru to someone at IRS and it's all clear now. Not sure what happened but I assume he gave him the info from the 9325 and they were able to track it down. Good for me to not have to make a call in the morning to efile help desk.

Jack, what do you do? Does the IRS have the return? Can they track it with the submission id? Is there another IRS department (IT or whatever) who can track it to IRS system? Does the client have to send in a paper return with Form 9325?

I checked with ATX. They show the return accepted. I'll call the efile help number Monday morning.

I had one AL return. OH is requiring an email address, client or preparer. I expect all states will eventually be doing this.

Thanks. Jack, is that number a FAFSA number? Grandmabee, is this number for tax professionals to call, not the client?

Client trying to apply for FAFSA. Return filed in Feb, acknowledgement received. IRS rep telling client return not on their file. Is there a telephone number or contact at IRS to check the submission number? Where does client go with IRS to get this resolved?

Thanks. It's a moot point now. They've decided to file jointly. Save almost $3k with the dependent child care credit. Were concerned with the student loan payback schedule. But I guess the difference for filing separately helped them decide.

Can we divide up the dependents any way in MFS? If 2 children, do we have to put one child on each parent's return or can we claim both children on one or the other returns?

Yes. And apparently these PTPs are considered stand alone passive activities. So income or loss from the PTP can only be used against income or loss from that same PTP. Losses suspended until that PTP is disposed. So to answer my own question in my original post, I won't be able to offset the cancellation of debt income against his suspended rental losses.

I agree Rita. Doesn't make sense to me. I have a couple of local university profs who recently came in with their new Phd and a mountain of student loan debt. Whew.

That would be the reason for the S election, not a C. It will increase his basis. If he needs to retain the money in the business, he can distribute only enough to cover the tax, 'retaining' the rest. He's in good shape having profit and not losses.

Friday's WSJ had an article about this very thing, MLPs. They specifically mentioned Linn Energy LP, which is the one my client had. A billion dollar debt restructure, reported as cancellation of debt income on K-1. My client's share was $29k. Ouch. Another $8k to be reported as ordinary income. Ouch again. He sold units at a big loss, reported as capital loss, limited to $3k. Ouch a 3rd time.

Canceled debt income of $29k showing on a K-1 from a publicly traded partnership. Wow, how much was the total if my client's share is $29k. Has anyone had this before? The partner instructions say if he did not materially participate, it would be treated as passive income. That's good because he has a lot of suspended rental losses he could use against it. In ATX K-1 input sheet, if I enter it on the appropriate line, it automatically goes to 1040 page 1, line 21. How do I get it to go to Sch E, page 2 as passive?

Has anyone heard about the student loan repayment schedules that will be lower based on MFS income being lower for the one with the loans? New client couple tell me they need to file separately regardless of higher tax because their loan repayment will be much lower. And they say they have to file separately every year because the repayment schedule will be reviewed every year.

Thanks. I agree but was racking my brain to find where it actually says so.

Two brothers owned rentals, reported half each on Sch E. Formed an LLC, transferred property to LLC. My understanding is that the assets and depreciation just continue from their original depreciation schedules. But I can't 'quickly' find verification of that. I don't think the LLC starts over with previous NBV. Just looking for some reference.

Two brothers owned rentals, reported half each on Sch E. Formed an LLC, transferred property to LLC. My understanding is that the assets and depreciation just continue from their original depreciation schedules. But I can't 'quickly' find verification of that. I don't think the LLC starts over with previous NBV. Just looking for some reference.

I agree. Rollover the SEP-IRA to a traditional IRA. Then it's classified properly for new contributions. May be too late now but this is the proper way.

You might also request a copy of the member agreement. If she was told she had to invest and has no management decision input, there should be something in the member agreement. It might help support your position if you go the 8275 route.