rfassett

No deductible loss. It is a personal asset. But now as I sit here and think about it, how did he sell it at a loss? What was his investment in the boat? I would believe that he may have sold the boat for less than what the organization raffling (if that was the case) valued the boat. But unless he spent enough on tickets to exceed what he received for the boat, he did not even have an economic loss.

Look to what the lease says. In situations as this, you can get into what's called single net leases, double net leases or triple net leases. https://42floors.com/edu/basics/types-of-commercial-real-estate-leases

First of all, you should be aware, if it matters, that ATX is discontinuing their separately standing Fixed Asset Manager after this year. If you are using Thompson's Fixed Asset program, this may be a concern for you. We made the switch, with similar numbers to yours, back at the end of 2009. I do not remember the experience being traumatic, so it must have went relatively smoothly. I do remember backing up files before the conversion and then comparing the ATX trial balance to the CSA trial balance. And again, I do not recall any issues. So it must have gone smoothly. You might want to see if ATX will let you try a conversion with a demo copy of the program.

The son's estate will be responsible for the paying of his debts. If there are no assets in the estate, then the creditors will not be paid. That is not to say that they will not try to coerce Mom into paying, but unless she was a co-signor on his debts, she has no obligation to pay them. The life insurance proceeds, naming her as beneficiary, are not part of his estate. Life insurance proceeds are only part of the estate if a beneficiary is not designated.

I would suggest reducing the loans to writing before contemplating any further strategy. Without that, you are wasting your time. The construction company may have an investment loss. But, to me, the more important issue may be the debt forgiveness income that the car dealer will be taxed on. Since it is a family member you also have related party issues. Did I mention how important it is to get the loans reduced to writing?

Just installed it. No issues. Working on a server with workstations system.

Here is the IRS's take on the question. http://www.irs.gov/publications/p334/ch06.html

Yardley, Yours is a good question. If you are attempting to prepare a return pursuant to GAAP and/or Section 263A, you would allocate those expenses that are directly attributable to the production of income as COGS - and wages is one of those items that would be allocated. The reality, in the big scheme of things for most Schedule C type businesses, it is six of one; half dozen of the other - in my humble opinion.

You might be able to get a penalty abatement based on first time offense if that is the case. http://www.journalofaccountancy.com/issues/2013/jul/20137885.html You might get an abatement based on reasonable cause if you can formulate a plausible argument. I always take the approach of sending the CP2000 back to the IRS with the request for abatement attached and without payment. I request the IRS to send the client a corrected billing should the abatement request be approved and I tell the IRS that payment will be made post haste upon receipt of the corrected billing. Don't know if I am batting 1.000 with this approach, but very, very close to it for sure. Good luck!

Look back periods for State inheritance/estate tax purposes will differ from State to State and State to Federal. My State uses a strict 1 year look back period for gifts made prior to death. There is a $3,000 exemption per year. But the fact remains, in my State, the transfer by ILLMAS's client would be pulled back into the estate for inheritance tax purposes. Check your State law. If it follows anything close to my State law, you may be able to formulate an argument that the transfers were never made. Might be a stretch. But worth investigating.

It might be a moot issue. Death bed transfers like this are usually reversed due to the look back period. I would be surprised if the properties were not pulled back into the mother's estate for estate and/ or inheritance tax purposes thereby subjecting the properties to inheritance rules.

Probably. For an entity to be granted 501(c)(3) status it must be a corporation or sometimes a trust or association. If the entity was never legally formed, I would think the 501(c)(3) was granted under fraudulent precepts. The problems might be deeper than just removing the status. Part II of Form 1023 deals with the organizational structure. Under each of the iterated entity forms, the applicant is instructed to attach the underlying document(s) showing the formation of the entity. The signature for Form 1023 has the usual "under penalties of perjury" dialog. If the entity was never incorporated, the applicant either submitted an incomplete form or submitted bogus paperwork. Either way, it might be time to enlist the aid of an attorney.

I have never hid my personal feelings about my personal experiences with ATX support. The few times I have had to use them, they have gone way beyond the call of duty and never made me feel stupid when they had the perfect opportunity to do so. I give them a 10+ on a scale of ten. Thanks for sharing!

I just opened a 941 and it appears there is no problem here. Silly question, but, have you done all of the requisite program and forms updates?

Really? I don't believe we are talking about proper mailing protocol. My clients have received those notices simply because an apostrophe is where one used to not be or is not where one used to be. What does the postal addressing standards have to say about this? For example, rfassetts cpa firm vs. rfassett's cpa firm. And as I previously alluded. It is easier to control those things when you are just dealing with rolled over tax returns. Throw in an eftps and a quarterly payroll report and an annual payroll report, none of which "roll over" from the tax return and there is opportunity for a change of address notice when no address has changed. I do not even want to calculate how many tax returns I and the firms I have worked for over the years have done over the last 31 years I have been practicing. Not sure why that is important.

That's nice if we live in a perfect world. I do not think anyone expects the IRS to have computers with AI, but having a little bit of acceptable error in the program might work for some of us that do not just do tax returns that roll over the address. I can count as many as 48 different instances where we communicate with different governmental offices during the course of a year on our clients behalf - and through as many as 10 different software applications. Yes, in a perfect world, we would have a system to cross check all of those addresses - but we do not live in a perfect world.

Looks like the period of the SOL. http://www.irs.gov/uac/ERO-Duties-After-Submitting-the-Return-to-the-IRS We store our digitally and have not really thought about purging them; so we have many more than the three years required.

Late to the party here, but it sounds to me as if the franchisor captured the $50,000 when he did his grab and lock routine. Thus the franchisor is holding money that rightfully belongs to the Lottery. Most of the time franchisor will not do a grab and lock unless there is good reason. It sounds like this client gave them good reason. If your guy is personally liable for making the lottery whole, then I suppose there should be some sort of write off - but not before he has made legitimate efforts to retrieve the money from the franchisor. And I do not think you can look at this as an isolated issue. It sounds like your client was also relieved of some debt. Is he also willing to pick that up as debt forgiveness income?

We have had about a dozen clients get these - and in some cases client's have received multiples, like Catherine's scenario. I determined that we must have been making changes on returns without recognizing it and the IRS's system picked it up as an address change. For example, we may have put 123 Main St., 123 Main St, 123 Main Street, or123 Main Str for various filings we have done for the client and each of those would have triggered a change of address. Notice - the only difference between the first and second is the "." after St - we actually received a change of address for that. Your tax dollars - hard at work.

Option 1 is viable as long as it was intended to be a loan and loan documents were drawn up. Option 2 is viable if taking the money was disguised wages. Option 3 is viable since that is what it probably really is. No deduction to the corp for this. Not sure I understand option 4. The corp would pay tax on the money under option 1 and 3 anyway. Absent loan docs, I would probably opt for a combination of options 2 and 3 unless the shareholder is already taking a fair wage; or unless the shareholder is not entitled to a wage, I,e, he did not work for the corp.

There will be a lot more than this that goes into the evaluation of a commercial building loan purchase and financing. I would suggest they talk to the banker. And you should give some serious thought to counseling your client to NOT put the building in the corporation. It may look appealing now, but if the S-Corp rules go south and you end up busting the S-Election for some reason, you have a very bad situation with the real estate setting in the C Corp. There was just a question recently, here or on another listserv I subscribe to, wherein the primary shareholder had passed on, I believe, leaving the beneficiaries owning the stock of a C-corp that primarily held highly inflated real estate. Some of the benes wanted to cash out which meant selling the real estate and paying a ridiculous amount of tax, Be careful here.

Not sure I am following your dilemma. Section 179 is simply accelerated depreciation which is an expense on the schedule k of the s corp return as a pass through. The offset goes to accumulated depreciation account. Because it is an expense, it DOES affect retained earnings. Section 179 has nothing to do with liabilities.

​And business entity type. If it is a sole proprietor occupying a building owned by the sole proprietor, he is not permitted to rent from himself and therefore, indirectly the rent would be subject to self employment tax because he would not be permitted to deduct the rent on Schedule C.

With so many things going on with that, I would call the priority line and explain to them that you would like some guidance or a conference with an IRS person to take the returns and see that they are properly processed and posted. If she is on a payment plan, this may require defaulting the payment plan and getting the whole thing back to collections (not automated collections, but a real person collections). I know with the current state of the IRS, that all sound like a pipe dream, but if you and your client have the waiting time, it might work. If that does not fly, you might want to file Form 911. I think your problem is bigger than just deciding whether to send the returns together or separately.

Here is a link to the field offices information. http://www.revenue.pa.gov/GetAssistance/RegionalandDistrictOffices/Pages/default.aspx#.VWyDqM9VhBc