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What your client should do to comply and substantiate the S Corp(s) interest deductions and maintain basis: 1. Take out the HELOC with proceeds deposited in his personal checking account 2. Loan the HELOC proceeds to the S Corp(s) 3. Document the loans with the proper interest rates, repayment schedules etc. 4. Make sure that the S Corp(s) repay your client every month on schedule, issuing 1099INTs at the end of the year. 5. Your client should make all the HELOC repayments from his personal checking account. Clients usually want to create shortcuts i.e., make it up as they go along ,which in your clients situation is a recipe for lost deductions etc., etc ! I will leave it to others to mention cites, case law etc.

I did not see a lock, but a robot check. This might stop an automated attack, but not an individual hacker, who by SQL injection, or other method, could capture the names and emails entered on the contact page, selling the info and preventing Tom from receiving them. As more and more people become security conscious they are going to avoid unsecured websites. I was incorrecct about the portal if there is no connection to the site.

The portal requires a separate login and DOES have the lock on the address line; I just checked. I don't see how the portal and contact page can be used to "penetrate" his computer, when neither reside on his computer. They're in the cloud. Ditto for the portal, but it also has all the encryption and login security.

I did not really buy it to get more customers, I bought it to get the secure portal. I think that the IRS is going to mandate higher data security in the next couple of years and I think email of client documents is going to go by the wayside. So I am preparing for what I think is on the horizon. My plan is to ease all my clients who email me their docs to start using the portal on my website. I will request they do so this year, and require it in future years. I will also start putting all my correspondence to my clients on the website. My client letter that I mail out every year will go on the website only and in each of their portal folders. Whenever I drop something into their portal folder, it pushes an email to them to look for what I dropped in there. But, since I have to have a website for the portal to reside at, I thought I would put it together as professionally as I could. I saw this vendor at the CSTC seminar in Las Vegas. The product looked good and it was affordable. They have been very good to work with so far. What I am really concerned about is the same thing we have on this board, DIY taxpayers asking questions on how to do their taxes on TT. Tom Modesto, CA

Client's father knew of his impending death (passed 6 months after) and transferred 3 properties to one of his three sons, recorded the deed(s) in the son's name etc. All legit. The son who received the properties wants to honor the dad's will and "GIVE" each brother their portion. I think I know the answer but just want to bounce it around to be sure. When the property for each brother is deeded in each of their names and no funds change hands, their basis is the brother's basis who transferred the property. The brother's basis who transferred the property is their father's basis plus any improvements at the time the dad transferred the property. So basically, if dad paid 40K for the property in 2009, then the brother who receives the property now has 40K as their basis. No inheritance here and no step up as I see it. The only reason the dad did this cause he thought he was protecting the property from Medicaid should that come into play. It may sound cold but it is best things happened the way they did. In this situation had Medicaid gotten involved they would have had a much bigger mess to clean up.

If the loan documentation/ substantiation isn't done then two more potential basis problems may arise. 1. Additional loan basis will not be created potentially limiting future deduction of losses. 2. If then client dumps the HELOC proceeds directly into the S Corp(s) without documentation and makes the HELOC repayments from the S Corp(s) then the HELOC repayments will be considered distribution of profits which will further reduce basis potentially limiting future deduction of losses. The only way these S Corp(s) get a free and clear interest deduction is if the SCorp(s) are the borrowers.

I find the very large header picture annoying. I have to scroll down on every page to see anything. Perhaps doing it as a background wash if you have that capability.

Terry, I agree

Just copy and paste to address bar, mwrightea...or click on this. http://trctax-ea.com/profile/

Tom, your web site is not secure. It doesn't have the little lock on the address line. Both your portal and your contact page can be used to penetrate your computer. BTW, I aslo use Getnetset with the same GG Bridge.