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Yes, Section 1402(e)(1), and form 4361, basically says the objection to public insurance because of religious principles is in respect to his or hers service as a minister. In other words, they are declaring opposition to SS for wages as a minister only. Our Roman Catholic Diocese strongly discourages Priest from taking the exemption. By signing 4361, he states that he is opting out for religious rather than economic reasons. I had a retired farmer in a similar situation, also worked part time as a school bus driver, I explained it and he signed. End of story.

Have you actually tracked E&P each year and know what the accumulated E&P is? Dividends are first paid out of current and accumulated earnings and profits. Current year E&P are considered first and are determined at the close of the current year. Any distribution that exceeds the total of current and accum E&P is a return of capital and reduces shareholder's basis. Anything in excess of that is taxed as cap gain. https://answerconnect.cch.com/topic/46dee5267c6b1000a17990b11c18cbab013/earnings-and-profits-limitation-for-dividends

You are confusing S and C corps. Basis in a C does not change with non taxable or non deducible items. Nor does it change with profits or losses.

I have advised my clients to wait until the fall as well. I am not doing any of their filings, but I suspected there might be some pushback in an election year and there could be a delay in implementation from legislators or the courts. But I did tell them to gather the information needed prior to that so the filing will be smoother. Tom Longview, TX

I have decided to wait until October or November due to the legal challenges. Another legal challenge has been filed in federal courts in Michigan.

I agree. I had a client in this situation but he is now retired from his regular job. Yes, he's receiving SS. I agree that most don't really know what they're signing, just saving money. I recommend they pay and receive it. I have a retired minister who paid thru the years and is now receiving a nice amount from SocSec.

I agree. I did this with the foreign accounts reporting. I'll do the Form 8938 with the return but not the online FinCen reporting. I plan to look into the new FinCen reporting and let my clients know about it but it will up to them to do it.

Not true. Stock could have been purchased, inherited, or gifted. That is important because distributions in excess of E and P are are subject to capital gains and offset by basis. Those statements show a lack of understanding that a basic course would cover. That is correct, I assumed cash basis.

C corp dividends paid out are always taxable in the year where cash payment is made. If beginning equity is 13K, and company is liquidated where did the cash come from to pay out 7.5 dividends and have 9 loss?

There is another piece here, that can be made worse by working for the practice buyers. Some may think they can continue to "request" (i.e., thinly veiled demand) you to work on their returns. I've had several of those instances since I sold of 3/4 of my practice about 7 years ago now. Two of those are going to be told (once their returns are filed for this year; both on on extension for reasons related to events outside their control) this year that for next year they either have to work with the guys who bought my practice, or go elsewhere. Not wanting to let go of me I can understand at some level, but I also want to have fewer, not more, clients. I've been letting it slide not wanting to be hard-nosed about it, but it's time. Yet another issue is that a new owner/practitioner - even if you have trained them! - is going to do some things differently. Checklists instead of organizers. Letters sent out later in January, or only by email, or paper copies of returns only to those who ask. They won't take checks, or Amex, or want payment up front instead of upon delivery. That will feel "wrong" to the retiring practitioner. It's not wrong; it's just different. Don't bad-mouth them for it, don't try to change it, just back off and let them deal. It can be surprisingly hard at first!

A SMLLC owned by a Sub S? I don't think it works that way; a disregarded entity owned by a corporation?

For an ongoing business, this would be true. If the company was liquidated, assets would be zero, liabilities would be zero and different equity accounts would need to net to zero, not a negative amount.

I hope this is not a real client situation you are working on without basic knowledge of corporate income taxation. Dividends are taxable to the extent of E & P, excess is return of capital offset by stock basis. Depending on how the transaction is structured, the entire liquidating distribution could be a payment for shareholder's stock.

How do you convert any those to cash without generating income?

1402(e)4 states: An exemption received pursuant to this subsection shall be irrevocable.

I'd question the lawyer why s/he is recommending this complicated structure. What is the intent - asset separation, asset (personal & business) protection, corporate veil, employee separation, what? The concerns leading to the recommendation may point out the best tax/accounting method. But right now, I can see good reasons to do any of the structure types listed above. Eeny meeny miney moe - get some reasons by their toe!

would be an interesting interview with the IRS after they apply--signing a form (4361) that you are a conscientious objector to receiving Social Security while receiving Social Security.

Since SMLLCs are ignored for tax purposes, why not just transfer one LLC into the other and just have one entity? You can then elect S status for the surviving LLC. Then do departmental accounting if you want to track the two business separately.

When the reporting went from paper forms to fill in and mail, to online only, they also instituted sky-high penalties for preparers who fill out forms, from client documents, in good faith, and completely true so far as they have any knowledge. At that point, I started telling clients - you do it. Not me. Nope. Nuh-uh. Not ever. Someone gives me wrong info and I have to pay? No way, no how, not ever. So yeah, I won't touch them because of possible vicious penalties.