Business Activity Before Filing Charter

[RitaB]

I am posting this under a new topic because it really doesn't fit the place I originally put it. Sorta, kinda, but not really:

Old fart has nothing better to do than set up S-Corps, and LLC's (all by himself, mind you) so he can spend his retirement days making my life miserable. He comes in yesterday with two new S-Corps, that bought and sold about 20 lots, "ALL LONG TERM" he tells me about fifteen times.

OK, for starters, you're gonna have to get me dates on all these.

After he leaves, I look at the charter filing date: 12/27/07!

What do I do with THAT?!

[JohnH]

First of all, get an extension filed by Monday on each of the S-corps to save him the new $85 per month per shareholder penalty for a late-filed 1120S.

Prepare a Schedule D for his personal return to report the purchase & sale of the lots (unless a lot sold on 12/27-12/31). Record the net proceeds as a contribution to capital for each S-corp (assuming he deposited some or all of the proceeds into the S-corp checking accounts).

Charge your normal rate for his personal return with the appropriate upcharge for the Schedule D's.

Charge him your minimum of $600 each for two S-corp returns for the period 12/27-12/31. Maybe discount it 10% since there is little or no activity.

Ask him if he has any questions.

[RitaB]

First of all, get an extension filed by Monday on each of the S-corps to save him the new $85 per month per shareholder penalty for a late-filed 1120S.

Prepare a Schedule D for his personal return to report the purchase & sale of the lots (unless a lot sold on 12/27-12/31). Record the net proceeds as a contribution to capital for each S-corp (assuming he deposited some or all of the proceeds into the S-corp checking accounts).

Charge your normal rate for his personal return with the appropriate upcharge for the Schedule D's.

Charge him your minimum of $600 each for two S-corp returns for the period 12/27-12/31. Maybe discount it 10% since there is little or no activity.

Ask him if he has any questions.

1) Got extensions Friday - check! (Saw your post on another forum about the $85. Thanks for the heads-up, BTW.)

2) My first thought, (well, second, I can't share my first), was: "You guys are gonna have to report these on your personal

returns." Further complication: I don't do the personal returns. I asked him to take these to the accountant(s) that

does his/their personal. "No, I want a local preparer." Translation: "You don't charge as much as the CA accountant."

3) Covered in #2.

4) Very good suggestion. I like it!

5) Now we're talkin...