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BHoffman

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About BHoffman

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    ATXaholics Anonymous

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    AZ

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  1. MMLLC to SMLLC with MMLLC as sole member

    Great info! Thanks, Judy
  2. Client is a MMLLC taxed as a partnership (MMLLCP). One member is an individual, the other member is a MMLLC (MMLLCM). The MMLLC partner is going to buy out the individual. After the buy out, do I report the results of operations of MMLLCP on MMLLCM's form 1065? How?
  3. It seems we are getting a new tax bill (Law)

    Tom, do you think the expanded CTC will offset the lower write off for those taxes for your middle income clients? A lot of my middle income clients are eligible for the CTC, and a bunch of them will be taking the standard deduction instead of having to itemize since their mortgage interest isn’t that much. I’m curious about how much my Sch A fees are going to drop. The DPAD is repealed and replaced by the 20% deduction available to pass throughs. Almost all of my business clients will be eligible for it. It’s going to be nice to forego the whole DPAD calculation. No more like kind exchange calculations for vehicles and equipment, just real property. If only they had addressed look back interest, my other bane, this would have approached bliss for me. I think they did raise the revenue requirement for reporting on the accrual basis from ave $10m to ave $25m. So far, so good but it’s too early to tell. I think the real proof isn’t going to be evident until after we are finished with the tax season when this all takes effect.
  4. Pre Tax Information made EZ

    I'm probably a dinosaur, but up until this year I mailed out pre-tax stuff - engagement letter, privacy letter, organizer, etc. This year, I sent that stuff as an attachment for clients who have email. There are only a very few who don't. Big difference, and no paper cuts!
  5. Setting Tax Appointments - Best Practices

    I try to avoid appointments and prefer either scanned or mailed docs. Sitting there listening to all the non tax stuff while they cough and wheeze with the flu, using my bathroom and leaving a mess, bringing the kids who climb my curtains and interrupt every 5 seconds....it’s a gross waste of time. And I have to change out of my comfy jammies and wear shoes. :*
  6. 1099 / W-2 program

    Quickbooks for most W2s and Drake CWU for 1099s and W2s not on QB. I prepare about 100 W2 forms and around 30 1099s.
  7. Prepared by someone else (prior year)

    FDNY - If you and the client have already determined his reasonable salary at a hefty $260k per year, and his hours haven't changed, then why would he need to increase his salary just because his investment in his company is doing well? Unless he is the only one providing goods/services for sale to his customers I'd say that no one is going question his salary. He's already paid taxes on the cash used for his distributions. The whole premise of the S Corp is to pay FICA only on income that is earned, and avoid the double taxation on dividends. I think we get tangled up with the reasonable salary for S Corp shareholders because there is no set calculation. The tax court cases were all about heinously low salaries and huge distributions. The court recharacterized that portion of the distributions to closely meet the SS wage limit in every case. I think it's a relatively safe bet that the SS wage limit would, in most cases, satisfy the reasonable salary requirement.
  8. Prepared by someone else (prior year)

    Tax court cases involving reasonable salary for S Corp officers generally settle on the max Social Security wage cut off. See the above Forbes article for the specific cases.
  9. Prepared by someone else (prior year)

    Here is the IRS fact sheet FS 2008 25 cited in the article: See "What's reasonable compensation?" I am curious about this https://www.irs.gov/pub/irs-news/fs-08-25.pdf
  10. Prepared by someone else (prior year)

    Cbslee, I wholeheartedly agree that the client should take adequate payroll. Sorry to have veered off topic by bringing up the question of whether SCorp salary can be an issue if the shareholder takes no salary, and also takes no distributions.
  11. Prepared by someone else (prior year)

    https://www.forbes.com/sites/anthonynitti/2014/02/04/tax-geek-tuesday-reasonable-compensation-in-the-s-corporation-arena/6/#5cf75f1641a2. See the last paragraph of the article. This is a contentious issue, but if the shareholder received no distributions then perhaps there is nothing to re characterize.
  12. Prepared by someone else (prior year)

    Did the SCorp shareholder take any distributions? A discussion during a CPE class seemed to imply that no distributions means there is nothing for IRS to reclassify as missed reasonable salary.
  13. W-2 Verification Code Expands

    https://www.irs.gov/individuals/w-2-verification-code More info in the above link. I'm hoping if/when it becomes mandatory, payroll software like QB will be able to include the code.
  14. Multi entity confusion

    Update: I got the ownership info for this new client from the AZ Corp Commission website. NOW they are telling me that they intend to change the AZ LLC to a multi member, so it will a 1065 after all. I'm so glad I gave them a high estimate of fees with a retainer up front.
  15. Multi entity confusion

    I have an AZ LLC with its single member being a DE LLC. The single member of the DE LLC is a DE Corporation. The AZ LLC is a construction contractor. The DE LLC does nothing except hold the interest in the AZ LLC. The DE Corp does nothing except hold the interest in the DE LLC. Since the AZ LLC is a single member disregarded entity, what form is used? I'm thinking the operations are reported on the DE Corp 1120 and there are no tax returns filed at all for the LLCs but that seems strange....any advice?
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