OldJack

I have a new computer with Windows 7 Pro 64 bit, 6GB ram 640GB-HD. It has 2 directories for programs, one as "Program Files" the other as "Program Files (x86)". I installed the ATX 2008 MAX program and by default it installed in "Program Files (x86)". ATX 2008 runs just fine on the new computer. I imported my client returns and all but one transferred and opened. The problem with the one was a spreadsheet form not installed. I am still trying to get that one figured out.

That does not sound like what a CPA would say. It sound more like what the CPA's client would say about his non-CPA accountant. It might be an unlicensed accountant working for a CPA. In fact, it is hard to believe that a CPA would prepare a S-corp tax return from just a spreadsheet provided by the client. It is common for a CPA to make adjustments to the business numbers as they are seldom, if ever, correct. Correcting them usually requires details from examination of the business records.

Well... I am certainly not an attorney. I am sometimes pretty stupid but not that stupid. I would say if you want us to discuss this situation further you should post us a list of exactly what the facts of the case are. Who owns what and how did they get it. Who is using what and how much of it.

Thanks KC, that makes perfect sense. I don't know why I had not thought of doing it that way.

The fact that the real estate is "titled" in the name of the LLC indicates that it is "owned" by the individuals and would imply to me that the S-corp should not be paying the real estate taxes and possible other expense items. If the S-corp is paying personal items, such expenses should be charged as distributions to the shareholders and not an expense to the business. If the LLC did not actually purchase (pay for) the property but received a deed for the same, then there is a legal problem that the stupid attorney needs to correct or the LLC should sue him for malpractice on the real estate closing.

I have the last 3 years of ATX on a desktop computer that I plan to quit using. This year I bought a laptop and plan to use ATX on the laptop. Is there no way to transfer those desktop computer program and files to the laptop and them work? I know how to copy them with a crossover cable, I just don't know if ATX will let the programs run on the laptop.

Of course further facts could have a bearing on the situation. However, as the question was posted it appears that, for tax purposes, the "individuals" own the real estate as a qualified residence. I operate a business from my personal residence and do not charge the business rent. Having the real estate in a LLC for liability protection associated with the business operating on or near the premise does not mean there is tax cheating going on. This is just cheap insurance. We should not take the position of the IRS and automatically assume there is something wrong in this case.

>>To complicate things, there is no "mortgage" on the property<< >>but the bottom line is that the cost of personal housing is being paid with corporate funds.<< I disagree that the cost of housing is being paid by the corporation. There is no evidence that the corp loan is a substitute for a mortgage. It is common that a small business loan has to have security of personal assets.

As I see it you are the only one that thinks there is a problem. The property is owned by an LLC that is ignored for purposes of the real estate and income taxes. I don't understand the Sch-C filing as you have not mentioned any source of income from a real estate activity that would need to file a Sch-C. There is no requirement that the owners of personal real estate charge rent to a related company or unrelated company. Rent is usually only a problem when too much is being paid. The commercial loan appears to just have personal assets for security. That is a common requirement for most S-corp loans. I think you are just over analyzing the situation.

They cannot claim the credit as they are related.

It may not be the case for this client, but when a taxpayer asks me after not file their taxes on time for several years I take the position that it is too late. You should make sure you are not making a false statement just to save the taxpayer on their tax.

Before you decide to carry back a net operating loss more than 2 years (under the new law) be sure and check with your state to see if they allow the net operating loss for more than 2 years. My state of Missouri requires you to file an amended return for federal adjustments due to any carrybacks, but disallows the NOL loss if more than 2 years, thereby not allowing any refunds for those prior years. A carryback for refund could actually result in you owing more state taxes in certain situations. Although my current corporate client could have carried back 5 years federal we elected to only go 2 years since the result was more overall tax refund with a state refund.

Where does one elect the CleanCut theme?

Well... I will be honest and say I liked the old style better. The icons on the left edge of topics are too dark and the color of everything else is to pale. I'll admit the member pictures stand out better. But who am I to complain.

>>Depending on the circumstances << The facts may be clear to you but not to members of this board, or at least not to me. Who owned the land and who spent the money to develop structures that were later destroyed? If your client spent money to develop land that was not legally his that makes a difference. If the facts are that he bought the land to build later may be irrelevant.

So far everything resulting with Obama has been somewhat of a joke. The credit was beneficial to taxpayers, but the method has resulting in problems for taxpayers that will be Obama's problem when election time rolls around.

>>She did not retain life estate. << Did mother continue to live in the home? If so, she probably has an unwritten life estate situation. Selling to family for "less than $100" is probably a gift situation rather than a sale. In such case the tax basis would be what parents purchased in 1974 plus improvements.

You did good girl!

So far he is not willing to doing much whaking!

Great!!!

I am proud to say that as a young man I served my country in a foreign nation. It did not seem an honor at the time, but age makes one more aware of what is important in this life.

Thanks you Jainen! You have made my point!! Only you, a very experienced tax person challenged my statement. The point here is that you want the IRS agent challenged and he is going to be not sure if it is a requirement in this case. All the quick resources the Agent has talks about recording business verses personal use. Nothing is said about recording all business use and in fact most business that do not allow personal use do not bother recording mileage use. You can use a gray area like this to argue and get an agent to think twice and be more reasonable.

>>maybe it's time for me to work at Wal-Mart<< Nonsense!! You are a CPA and the rookie agent does not know anything that you don't. In fact he probably knows a lot less. On a vehicle mileage tell him to show you where mileage records are required when the vehicle is not used for personal purposes other than de minimis use. In other words, throw the ball back in his court when he asks questions.

>>He asked him how he paid me? My client said that I gave him a bill and he paid me. Then he said that the guy said "very interesting". WTH is different about that? << I would guess the agent was questioning if you were really the paid preparer as he thinks the taxpayer has done the tax return or made changes after you prepared. Very interesting means there is something the agent thinks should be different on the tax return such as unreported income or deduction for a vehicle that is not justified. Most of the other things you mention is just remarks by a dumb inexperienced agent. They are the most dangerous but his supervisor will usually have more common sense. I have found that these inexperienced agents can be bluffed if you keep calm and let them make mistakes. You really must know what the agent wants before sitting down, call him and ask for a copy of what was sent to the client or get a copy of the notice from the client. Of course you are concerned but you should not show it.

The 401k has the same basis as was the deceased and is taxable to the beneficiary the same as would have been the deceased.