cientax

Have a client that received stock from a trust when he turned 31 years of age. Once the stock was distributed, he started selling the shares. Some of the stock was acquired and placed in trust starting in 1992 thru 2000. We have the cost basis when it was acquired and placed in trust. He started selling the shared beginning in 2000 when he turned 31. Q: Does he have any basis in the stock? If so would we use the original cost basis or do we use the FMV of the stock when it was distributed to him. He has not filed for 2000, 2001, and 2002 and IRS has done SFR for each of those years.

I am preparing Texas Franchis Tax Report and I have never seen this before. Line 20a "IRS Form 1120, Sch-C, Special Deductions". There is no such thing on the IRS web site. Has anyone ever seen a Sch-C for form 1120? If so, would you please send me a web site where I can find it. Thanks!

Will her dog have to pay tax on income earned on the $12M she left him. Remeber, his name is Trouble!

I don't understand why they don' claim the 15 year old as dependent if the child is living with them the entire year and they provided his support. The childs ss income is not taxable and even though it's used for his support, it appears that parents still provided more than half his total support. His gross income makes no difference. Why would this child not be their qualifying child?

I have a client that lived in Arkansas for only four months. I'm trying to determine what, if any of the income is taxable for Arkansas tax. Interest income on insurance Policy $ 42 Policy held by insurance company in SC Interest income from Bank in AR $ 7584 Government Pension from OPM $22800 IRA distribution from bank in AR $ 625 Social Security Benefits are not taxable in AR Interest on Government debt bonds are not taxable in AR. I DO NOT have the Arkansas tax return on my ATX program. I do have it for the 2003 program and I put all the income on that program to see if it would help but it does not carry any income to Column C of the AR1000NR only to Column A. Since I am having to make the proration manually, can someone look at the figures above and give me an idea as to what, if any, is amount to carry to Column C. Remember, they only lived there the first four months of the year then moved to Texas. They are 83 years of age. Thanks for your outstanding help.

Another question about the AR4. His Itemized deductions are far more than his income and there is no taxable income. Do I enter the entire amount of his federal and AR income as nontaxable Arkansas income on the AR4 (bottom section) and again on the AR1000NR line 56? He also has some tax exempt income from Bureau of Public Debt and Social Security which is exempt from Arkansas tax . Do I also show this in AR4 as nontaxable AR income and line 56 of AR1000NR?

I don't have the form in my tax program and I'm having to do the proation manually and I don't know if the itemized deductions must also be prorated. I only have three states in my program and Arkansas is not one of them and this is a new client. Thanks again.

I am working on Arkansas tax return and wanting to itemize deductions. This is for a part year resident. Since the income is prorated for the part of year they lived in AR, would the itemized deductions also be prorated for the part of year that they lived in AR? There is no mention of this in the instructions. Thanks for your help.

We are drowning here in Fort Worth and surrounding area.

Would you then suggest that he make the S-Corp election to have it flow back through to the 1040 as ordinary income? He set up the corp so that he could operate his construction business and plans to build houses not only for his personal business purposes but also to build for other individuals and he's wanting to keep the construction business aspect separate from the rental activity.

Thanks KC for your response to the other question. Have another client (TX) that has various rentals, buys and sells houses and also constructs houses then sells them. He has a C-Corp that he set up last year for the construction of houses then to sell them. Last year (2006) there was no activity for constructing houses. Would there be a problem IF he were to hire and pay the C-Corp for making repairs to the rentals and expensing on Sch-E 1040; Pay the C-Corp for improving houses he buys as individual and fix up for resale and show all expenses on Sch-C 1040; and Pay the C-Corp for construction of new houses to sell also Sch-C 1040. Income received from the activities to be reported on the appropriate schedules on 1040, pay the C-Corp for repairs, fix up, and construction then pay salaries/wages from the C-Corp with expenses for materials. He is sole shareholder in C-Corp. Not putting any of the properties in the C-Corp. He's not trying to hide anything, he just wants to pay himself a salary with the employment taxes paid. I think that he should not pay the C-Corp for the Sch-E activity since there may be additional employment taxes where there is no SE Tax from this activity. Any opinions? Thanks

Have new client whose wife passed away last year while living in Arkansas. Husband then moved to Texas to live in nursing home for medical purposes (83 yrs old and ill). They received interest income and a pension from OPM. No other income. He moved to Texas last year around Oct. Q: Is the pension income and interest income received in Texas allocated out of the total so that we only tax the portion received while in Arkansas? 100% of the interest was paid from Arkansas bank while he lived in TX the last two months. Another question on AR itemized deductions. Are the itemized deductions also allocated on the AR itemized deduction schedule? This is my first ever out of state return with itemized deductions for part year resident Client also sold his residence while in AR and qualifies for the 121 exclusion. Do I attach the Federal Sch-D to the AR return or do I prepare the AR Capital Gans/Losses form? This form has no place for the exclusion unless I make the subtraction on the form. Thanks for your help, I hope!!!

Having problem figuring amounts to use on Lines 7 and 13 of Form 8903. These amounts are to be shown on Sck-K1 from S-Corp and flow through to individual. If this is single member, what would the prorated amount be on these two lines. It just doesn't add up to me. If some one could email me with their phone number, I will gladly call you for help on this issue. [email protected]. Thanks. Daniel

Have a client that buys houses, fixes them up and then sells them. many on installment sales where he holds the note. My question is is how is this reported from the Sch-C to the 6252? Or do I start with the 6252 then to Sch-C?