schirallicpa

If they actually plan to repay, then Loan might work. Don't forget to have the loan agreement in writing with explicit terms and INTEREST. They should be taking at least a small salary. The loss on the corp would offset the W-2 - well....if they have basis....which it sounds like they don't. It may even work to their advantage to have small W-2 to show low earnings and take EIC. I have a client who has a s-corp in that situation. Gets almost half his salary back in EIC refund! He's putting the refund back into the business to build his basis back up!

I have a sticky note from a former colleage that has been posted on by board forever that says "fix depreciation under Rev Proc 2002-9." In fact, I have slid this description in on a return or 2. However, when googling Rev Proc 2002-9 it says something about change in acctg method. Not sure if this is the least bit helpful.......And your numbers are bigger than my little fixes.

Usually your mortgage is attributable to your house, or other buildings, not land. Additionally, property tax is usually mostly on the house, not the land. Our county has a website that lists real property values, as well as tax. On the listing it will indicate value of land vs. value of house. I don't know if your county lists this info so handily, but I would make an allocation based on that. Or sometimes, you're lucky and the lot is taxed separately. But generally, I don't think he should get too much 8829 deduction on real estate tax and mortgage just for a lot where he parks his trucks. Thats my 2 cents anyway.....

I had not run into this term before: BVO Buyer Value Option. From what I am finding on the internet, this is when the realty company, or some other middle man, takes care of commissions and closing costs on an old home when a employer is relocating an employee. Now, it is also my understanding that those types of costs work into the basis calcs of homes, but usually do not make there way to the tax return when the home is non-business. Ok = this guy has a "moving expense report" from his employer. It lists among other things BVO backup Payment of $16990. It is listed as a taxable item. It is subtotaled with other items and then grossed up. He says this amount is included in his W2. However, there is no amount in box 12 and no code P. So if this amount is paid to someone for something, and he's taxed on it, does he get to deduct it anywhere? I'm deducting some of the other items on this list, such as storage and moving expense. But I'm new with BVO, and just looking for someone elses input on it. I guess I would think that if this amount was used by the employer to help sell the guy's house and get him out here, it wouldn't be taxable. From what I was reading, it was supposed to be a benefit to entice moving, not something to hit the guy with later. The gross up on the report on this amount (16990) is $11352! So it appears that this amount is adding $28342 to his W2. I guess I'm confused. anyone got 2 cents out there today?

I think you need to see the originating documents of the trust to determine whether it is complex or not. I think the deciding point is whether or not corpus may be distributed.

I just did one and could not efile with court-apptd rep.

ATX is correct. Deferred comp is subject to the FICA portion, but not the HI (medicare) portion of tax.

I believe a corp must issue a least one share of stock per stockholder regardless of valuation.

Ok - maybe this is dumb question. LLC is a state designation. A partnership is paperwork filed at the county office. Why is the IRS looking for anything? A partnership agreement can be created and dissolved with no activity and certainly no tax info reporting. The state - depending on what state - may have sucked up an extra fee to dissolve to LLC designation. What does the IRS care of that any more than they care if you got married and turned around and got divorced - especially if there is no income.

I have used your method numerous times. Obviously he paid extra for the timber because it had value. And recorded assessed values - regardless of how accurate they seem to be - are made by town govt. So, therefore must be of some creed.

Taxpayer died in March 08. In Dec 08 credit card company canceled debt and issued 1099C. credit card company reported in deceased's ID #. (In fact, I don't believe an estate ID exists.) Does the 1099C simply get reported on the taxpayers return, even though it was after her death. Or is this an "estate" item. Afterall - the debt was incurred before she died...... Any 2 cents would be appreciated. thanks

HV Ken: Thank you! Why didn't ATX know this morning! I have cooled off a little since then. I guess I was just really ticked because it was efiled over the weekend and today I got the notice. Fed was accepted without any problem. I had already efiled a number of corp returns, and they went thru fine. So I didn't think twice about efiling the extension. thanks again

I am so mad right now I could just explode. I received this morning - THIS MORNING - a rejection error on 2 NYS corp extentions. Oh - not just any old error.....an error with NO EXPLANATION! So I call ATX and sit on hold for 1/2 hour to be told - "Oh, we don't have an explanation for that error." UnFrickin' Believable! I don't think Paterson is going to back down on penalties when I tell NYS that we tried to file on time, but my lame software company doesn't know what happened. (Toss in the shoulder shrug.) And - of course - one is a brand new client. I am just beside myself. To top it off, she (ATX) wants me to send the return/extension to them so they can see what is wrong and what to do. What good is that going to do me now? Let alone - don't we have some client privacy issues when I just send info off to someone in Georgia in a tech dept. Oh - I am so mad. Never, never again will I efile anything within 5 days of a deadline. Thanks alot ATX.

Can a decedent's estate make a non-cash contribution of an auto? If so, does it have to be reported on form 8283 (or similar) or does it simply go straight to Form 1041 schedule A? Thanks for any input

Can I add to the list the agent I had the other day who insisted that the 1099-R distribution was a capital gain and that there would be no cap gains tax on it this year. So the 90K+ that the client drew under his direction was supposed to be tax free. My client was not happy.

'tis the season to be punchy...... I'd like my punch with a little nip in it right now. This coffee probably isn't helping.

Ha - my 9 year old just called because no one showed up to pick her up after the after school event...... That changed my whole day. Now I have to run and get her!!!!

Yes - I have access to the publication. However, I'm not really finding an answer to my question in the publication, hence my posting here. Additionally, regardless of whether or not there is a "written modification" - which I honestly don't know if there is or not - I believe the IRS would prefer substance over form in most transactions. Furthermore, he is not repo-ing.

I suspect "amend" is somewhere in the answer, but I'm hoping not:) Client sold bus. property in 2006 for $50,000 with $21351 gain. Took payments. Reported portion of gain and related interest in 2006 and 2007. Total gain reported is $4502 on 6252. Now - client just wants to get rid of thing when buyer was about to default. Told him to pay 15000 and be done with it - take it or leave it. Rec'd 5000 of that in 2008. (Still waiting on remaining 10K and unsure about that!) So - I'm thinking my reduced price is the 15000 plus the 4502 already received. But this puts me at a loss on the property. Do I need to go back and amend 2006 and 2007, or does this get reported in 2008 as a loss now. And the stinger is - they may be defaulting in 2009 after all. Any direction or thoughts would be appreciated! Thanks.

You'd think by now they would have a way to end the "waiting for server" message or at least stop it from preventing you to go back to work. Boy that erks me!

Had one just a few days ago - Efile must match social security - not W-2. Use the name she has with social security. Mine went thru.

I think that's the NY governor's new anthem!

I have a client that receives 1065 K-1. Then gets NY K-1 and PA k-1, which basically splits the income between the 2 states. PA has its own handy K-1 input sheet. NYS does not. PA just taxes it's own income. NYS does not. Initially, I figured the difference between the state K-1s would go on the NYS return on line 31 with other NYS subtractions. However, looking back at last years return, the previous accountant did not do that. They, instead, took a resident credit for the tax paid on that amount in PA. The tax difference in treating it that way is quite a bit. I'm stumped as to the correct treatment. I'm thinking now that the previous tax prepr was correct, because NY taxes all income unless specifically excluded. BUT - then why different amounts on the NYS K-1 - why wouldn't that just be the same as Fed. ANY NYS people out there today?

It's snowing here in WNY today too. We had 2 days with 40ish degree weather. People were wearing shorts and flip flops! Now - were back to 13 and snow flakes in the air. My girlfriend just sent me this poem this morning: IT'S WINTER IN NEW YORK AND THE GENTLE BREEZES BLOW SEVENTY MILES PER HOUR AT THIRTY FIVE BELOW. OH, HOW I LOVE NEW YORK WHEN THE SNOW'S UP TO YOUR BUTT YOU TAKE A BREATH OF WINTER AND YOUR NOSE GETS FROZEN SHUT YES, THE WEATHER HERE IS WONDERFUL SO I GUESS I'LL HANG AROUND I COULD NEVER LEAVE NEW YORK MY BUTT IS FROZEN TO THE GROUND

Client had annuities thru Prudential and transferred all to another agency. Most of the 1099's simply have a code 6. First question: One of the 1099s was an endowment and is coded as normal distribution. Total dist. $59717; taxable dist. $43221, Emple contrb $16497. He received a check for $27072. (No withholding tax.) Prudential says he was paying premiums from loans from his policy - which accts for the difference. He has no record of said loans. Can I do anything more with this? Or it is what it is. Second question: On 3 of these other 1099s with code 6, the employee contribution exceeds the distributions to the tune of $5253. Perhaps again this is a case of loans paying premiums. Again - anything to do on this? I've never run across this situation before, although I am aware that a loan not repaid would be taxable. It just strikes me odd that he isn't aware of any of these "loans" and Prudential will not provide any more info. And then I've got the agent telling me he's got capital gains tax on the differences.............And his figures are totally different than the 1099. Perhaps I'm chasing my tail? Any thoughts would be appreciated. thanks