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About David

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    ATXaholics Anonymous
  • Birthday June 15

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  1. Thanks, Max. I see that in pub. 544 but does that qualify as ownership that meets the sec. 121 gain exclusion? Thanks.
  2. TPs leased their primary residence from 2010 until they purchased the house in 2013. They sold the house in 2014. I can't find any cites or information that says that the lease to own time period counts as qualified use for the gain exclusion. I want to make sure that the TPs don't qualify for the gain exclusion before making the assumption that the qualified use begins on the date they purchased the house. Thanks.
  3. Thanks. Is the lowest bronze plan premium for each child also considered in the calculation? I would think so even if they are covered by a government plan since they are counted in the household size. The links for the lowest bronze plan premium point to Colorado Health Connect. When I go to their site, the web page no longer exists. I found another site that gave the bronze plan premium for Colorado but it only asked the age of the head of the household and gave a $249 per month premium. It didn't ask how many family members. Is it reasonable that that would be the monthly premium for a family of 6? Thanks for your help.
  4. Parents don't have health insurance coverage but the 4 kids are covered by a government program. I am trying to determine if the TPs qualify for the affordability exemption. The instructions aren't clear (at least to me) whether the household size includes the kids or not since they are covered by a government health insurance program. The TPs AGI is $88K. If the household size is 6 for the affordability exemption calculation then the income is 275% above the poverty level. If the calculation should be based on a household size of 2 since the kids are already covered, then the income is well above the poverty level. It seems as though the affordabiltty calculation should be based on the household size of the number of people not covered when all other family members are covered by a government program. However, I don't see any clear instructions regarding this in any of the ACA material. Can anyone clarify this for me? Thanks.
  5. OK. Thanks for your help.
  6. Yes, the TP also had wages from employment before she started her LLC business. Judy, yes it appears all of the input is correct and complete. This is a H&W LLC and they both have enough basis to absorb the full sec 179 deduction. The LLC is their only business. So even though the TP wages on their 1040 and the profit from the business are more than the amount of the sec 179 deduction are they still limited to the profit from the business and that is why they aren't able to take the full sec 179 deduction? In other words, the first hurdle is the business profit and if the profit isn't enough to cover the sec 179 deduction the deduction is limited to the profit and it doesn't matter that the TP has W-2 wages. Is my understanding correct on this? Or should the W-2 wages also be considered when applying the sec 179 limitation? Thanks.
  7. Multi-member LLC has $80K sec 179 deductions and only $20K profit allocated to a member. The TP has over $80K wages on his 1040. However, the program is limiting the sec 179 to the LLC's profit and isn't considering the TP's wages. I must have misunderstood the limitations for partners/LLC members. Is the sec 179 deduction fro the TP limited to the LLC's profit? If so, why do the instructions always say the partner's earnings are considered when applying the sec 179 deduction on form 1040? Thanks.
  8. No, it wasn't a franchise. Thanks for confirming my thinking on this.
  9. Client used a ROBS to start his C Corp. The company has NOLs most years of operation. The owner is considering dissolving the corporation. Of course the company stock in the 401K account has no value. It appears from my research that when the corporation is dissolved there are no tax ramifications for use of the the 401K funds used to start the business - the owner was able to use 401K funds tax free. Is my understanding correct regarding this or am I missing something. Thanks.
  10. Rich, Even though the only income is rental real estate income on line 2 of the K-1?
  11. Thanks so much for your help Judy. I just wanted to make sure I was handling this correctly since nothing I did would subject it to SE tax like the 2015 tax return did.
  12. Thanks Rita and Judy, The K-1 for the one amount that was subjected to the SE tax indicated that he is a general partner or LLC manager. This is probably why the CPA subjected it to SE tax on the 2015 tax return. My program isn't subjecting it to SE tax, even with the LLC manager box marked. So that is correct since he is a real estate professional? Thanks for your help.
  13. New client has several K-1s from rental activites. A few of the K-1 rental income amounts are subject to the SE tax on his 2015 tax return. Others aren't. The K-1s listed as real estate professional aren't subject to the SE tax. The properties listed as not passive are subject to the SE tax. The client is a real estate professional and I'm not sure why some K-1 income is subject to SE tax and others aren't. Aren't real estate professionals subject to the SE tax? I thought that was one of the draw backs to electing real estate professional. Thanks for your help.
  14. Thanks for taking the time to respond. I know you're slammed like I am.
  15. I have two retirees who received a W-2 with an amount only in box 12a with code DD. No other boxes have amounts. Of course, this is for health insurance benefits they received. I am getting an error message saying that the return can't be e-filed because there is no amount in box 1 or other W-2 information. I am thinking that I don't really need to include the W-2 in the client's tax return and then I can e-file. Has anyone ran into this situation and do you see a problem if I leave out the W-2? Thanks.