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The brokerage 1099s where all the person had was interest or dividends have been out for a while. Today I saw my first consolidated 1099s, which include stock sales etc. I noticed that adviser fees are not reported on all of them, likely because they are no longer deductible. Bet the advisors are happy about that.

What are you doing creating an LLC ? Are you an attorney licensed to practice in CA? How are you going to create a customized operating agreement, which most banks require a copy ?

If net s/e income is less than $400 no s/e tax is due. You still have to file the tax return and the pertinent schedules.

For the depreciable basis: In converting a personal residence to a rental, the basis for depreciation is the lower of (1) the adjusted basis on the date of conversion, or (2) the property’s fair market value (FMV) at the time of conversion (Regs. Sec. 1.168(i)-4(b)). Remember to break out the nondepreciable land component from both the total adjusted basis of the property and from the FMV so that the amounts used in #1 and #2 above are only the depreciable components in deciding which is the lower amount. To calculate gain or loss on sale: If a residence converted to rental property is later sold at a gain: the basis in the converted property is the original cost or other basis plus amounts paid for capital improvements, less any depreciation taken. If the sale results in a loss, however, the starting point for basis is the lower of the property’s adjusted cost basis or FMV when it was converted from personal to rental property (Regs. Sec. 1.165-9(b)(2)). This rule is designed to ensure that any decline in value occurring while the property was held as a personal residence does not later become deductible on the sale of the rental property. Taken from a Tax Advisor article

Arm Candy, Baby!

The way to request the waiver is to NOT pay it and properly fill out the 5329 as described in the instructions. If you fill in the 5329 and pay the penalty, then you aren't actually requesting the waiver on that portion of the missed RMD. FWIW, I've never had a waiver denied or penalty assessed if I've properly filled out the 5329 as instructed and attached the statement of reasonable cause with how the TP rectified the problem. As an example, if the RMD was $4,000 and the actual distribution was $0 AND you want to request the waiver on the entire RMD, you would fill those two amounts in on lines 53 and 53. Then on line 54 "RC $4,000" to the left of the box in the text area, line 54 in the amount column itself will print as -0-. That will cause line 55 to calc as -0- and filing this will trigger IRS to review the form and your attached statement.

It's not required. Just the name. Do an error check before entering anything on the Auth Info form and you see what the required fields are on that form.

I would just use the EIN and skip that step - do you get a red warning?

I'm just getting to this return. I'm going to file MFS, paper return with "NRA" handwritten for his SS number because Taxwise doesn't have another way to print it on the form. I will also attach a "preparer notes" form with my statement regarding the spouse, and why the SS isn't required. I am not filing her as HOH with her son who is in college because the husband supports the household from England, his home. He only visits a few times a year. Thanks for all your help.

Unless there are expenses related directly and only to the rental, I would agree with how you are handling both of these. For example, if they hire someone to clean before or after the rentals, and no other times, then maybe you could take that expense. Or in the second case, if you could calculate the exact cost of providing breakfast for the renter only. Love the Arm Candy, Baby! comment, btw.

Thanks for the clarification. So is it safe to say most rentals with one or two houses would not meet the 162 level. Then they must meet the safe harbor rules. Can any of these small rental clients come up with 250 hours? That's over 20 hours a month, 5 hours a week.

I attended this seminar prior to the release of the safe harbor notice. The safe harbor notice has completely flipped my understanding. Now I think that all of my rentals except one do not qualify. The one that might qualify is problematic because of the contemporaneous log requirement, which my client would be very unlikely to maintain.

Are you sure you are being warned to remove Form 8962, or just delete all entries except the actual APTC that they are repaying?

Very interesting article outlining what most of us have posted on the board about QBI and rentals and more importantly the safe harbor election. https://www.accountingtoday.com/news/a-safe-harbor-for-rentals-in-section-199a

Journal of Accountancy article: https://www.journalofaccountancy.com/news/2019/feb/sec-199a-qbi-deduction-form-201920659.html?utm_source=mnl:cpald&utm_medium=email&utm_campaign=18Feb2019 Taxpayers will file QBI deduction computation with IRS next year By Sally P. Schreiber, J.D. February 15, 2019 The IRS on Friday posted a draft of a form that affected taxpayers will submit with their 2019 tax returns showing how they computed their qualified business income (QBI) deduction under Sec. 199A. Taxpayers who have QBI, qualified real estate investment trust (REIT) dividends, or qualified income from a publicly traded partnership (PTP) will use Form 8995, Qualified Business Income Deduction Simplified Computation, to report the computation. The one-page draft form contains the same computation that is found in the “2018 Qualified Business Income Deduction — Simplified Worksheet,” on p. 37 of this year’s instructions to Form 1040, U.S. Individual Income Tax Return. However, the worksheet is retained by the taxpayer, while Form 8995 will be attached to the taxpayer’s return and submitted to the IRS. The form contains lines at the top for listing the name, taxpayer identification number, and QBI or loss for up to five trades or businesses. Note that the form does not help taxpayers compute their QBI. QBI from the taxpayer’s trades or businesses is then totaled and combined with any QBI or loss from the prior year. The form also has separate lines for qualified REIT dividends and PTP income or loss, plus a separate line for the net capital gain limitation calculation. Sec. 199A allows taxpayers to deduct up to 20% of QBI from a domestic business operated as a sole proprietorship or through a partnership, S corporation, trust, or estate and can be taken by individuals and by some estates and trusts. The deduction is not available for wage income or for business income earned through a C corporation. The deduction is generally equal to the lesser of 20% of the taxpayer’s QBI plus 20% of the taxpayer’s qualified REIT dividends and qualified PTP income, or 20% of taxable income minus net capital gains. Deductions for taxpayers with taxable incomes above certain threshold amounts (which are adjusted annually for inflation) may be limited. — Sally P. Schreiber, J.D., ([email protected]) is a JofA senior editor.

More IRS stuff to make us weary. I don't see the problem if we calaulte corrrectly other than taking extra time. And time is usually something we charge the customer for.

Wow, thanks for all your input! I just got back to this. I agree with @Terry D. Clients like this are why I drink. Not really. Fine wine is the reason I drink... I'll prepare the return as is. I'll deal with insolvency on the date the debt was cancelled. And I should get a snapshot of the insolvency on the date of the sale in case that is the date of forgiven debt... if it is forgiven... if the 1099C is ever issued. I feel like a dagger is coming at me. I don't own this. I don't own this. I don't own this. Ok, I'm ok. breathe..... Those worksheets are a beautiful thing, aren't they? Thanks. So. Much.

Yeah, I know the IRA/401/etc. is controversial, but your reply answers my question. Thanks again. P.S. I have a large-scale rentals client who may help solve the three-page debate raging below. He's so tight that if it costs him more than twenty bucks, he'll take it to the Supreme Court.

Correct, capital loss dies with the individual and is NOT available for use by the surviving spouse. Rev. Rul. 74-175 provides that "capital loss carryovers expire upon a taxpayer's death and cannot be used on the estate's income tax return. The decedent cannot transfer a capital loss carryover to the estate because the decedent and estate are separate tax entities. A taxpayer's capital loss carryovers also cannot be transferred to the surviving spouse."

I don't know about extra time, but I have my own Vanguard and Fidelity 1099s. I did get one TD about a week ago, but that's it. I've done 68 returns so far on track for my usual 110 by the end of the month. But surprisingly I've gotten none in the mail Tuesday after the long weekend. I would have expected at least a half dozen.

I didn't follow the script, but did do a 199A supporting worksheet in my own tax return - it works perfectly.

The IRS is very good at catching missed estimated payments because those are already posted to your account. Withholding, however, has to wait for all of your records to be posted to your account, and if matching notices are any indication, the earliest they seem to get around to them is November every year and even as late as the following year.

I have a similar situation, an LLC, two members, holding land. We never filed a 1065 for several years, then Ky contacted them. Since they were an LLC, Ky wanted that $175 fee every year. So I prepare the 1065 which flows to Ky 765. I told them to pay the property tax themselves so not to flow thru 1065. Land, no depreciation, no loss, no change in basis (at least inside basis).