DANRVAN

That is correct. form 8832 was from Bulldog's post. A state issue, minor detail.

Fix it now with a form 8832 and a 1120-S. Very little extra effort or cost to client than filing an inaccurate 1065.

I believe so for S-Corp, as I recall from something I have either read or learned from CPE. There is also abatement for reasonable cause due to "ignorance of the law" which might be a possibility in this case.

I believe the nondeductible amounts should be disclosed before hand. The amounts should be based on fmv using any reasonable method per reg 1.6115-1. It is the entity's responsibility for making the estimates, but I would ask about the reasonableness. For example, what would the speaker normally charge per person and did the attendee's really receive a benefit? Same with music and dancing.

I see issues with compliance and professional standards regardless of the dollar amounts involved and whether the net result is basically the same. RR 69-184 clearly states that a partner cannot be treated as an employee. Sec. 6664 prohibits taking a position on tax returns unless there is substantial authority for the tax treatment of an item. AICPA SSTS#1 requires members to adhere to the above statements. Looks to me like they can and that is probably how I would handle this situation. Most likely the simplest way to straighten it out. I thing an abatement is possible and they should be informed of that.

Probably not even a raffle by definition since participants are only making pledges and not $$ for tickets, and the pledges might be for time or talent instead of dollars.

Out of curiosity per Oregon DOJ division of charity: Who may conduct bingo, raffle and Monte Carlo events in Oregon? Only organizations exempt from paying federal income taxes may conduct charitable gaming events in Oregon. This includes public agencies and public schools. Private organizations qualify if they are active nonprofits. An organization must have held tax-exempt status for at least one year and been engaged in its charitable, fraternal or religious purpose during that time. ======= Do all bingo, raffle, and Monte Carlo gaming operations require licenses? Generally, all nonprofit organizations wishing to operate bingo, raffle and Monte Carlo events are required to have licenses issued by the Oregon DOJ. Following are the only three exceptions: Nonprofit organizations operating bingo games with a handle of no more than $2,000 per session and with a total handle of no more than $5,000 per calendar year. Nonprofit organizations holding raffles with a cumulative handle of no more than $10,000 per calendar year. Nonprofit organizations holding Monte Carlo events with a handle of no more than $2,000 per Monte Carlo event and a total handle of no more than $5,000 per calendar year. === For Oregon, it does not look like a good idea for an individual to conduct a raffle.

I don't see where any legal advice was given. Just potential tax and reporting issues.

I think you are referring to a crop share lease which is not a partnership.

It is a combination of 7 year and 15 year. The above ground pivot is movable while the well and underground pipe are permanently attached to the land. A separate appraisal might be needed for the pivot by an equipment appraiser. A RE appraisal might not include the details. I don't see where it would matter.

Sounds to me like an award based on the actions of the shopper, not a gift.

Technically it is income to the winner of the drawing per sec 74(a) at fmv. Determining fmv is a gray area, case law points to the value to the recipient. She might need to file a 1099 but I would not hold her to it as income tax preparer.

What do you mean by "apply the 743 for this partnership until 2014"? Did you file a timely 754 election? But that would not effect the shares of partner that died in 2012; and they would not have received any benefit from an increase in depreciation. The partnership is not "revalued"; only the inside basis of the inherited shares. I will be straight forward. Sounds to me like you have been practicing in an area you are not qualified in. That would be an ethical conduct violation if you were a CPA. For partner who was entitled to 743(b) but did not receive it, the disparity between inside and outside basis usually equalizes when assets are sold and the partnership is dissolved in the same year.

No, only the heirs of the final deceased partner. Nothing changed for the rest.

and it can now only be filed directly from IRS website.

The wording is not clear, but after reading it again it appears you are correct Judy.

Why would partners who were not a part of the estate of deceased partner get a a step up in basis? Seems to me you do not understand the difference between inside and outside basis and why section 743(b) is used to equalize. What makes it out of proportion to reality?

Depends. Did company pay with cash or making payments? If it has only been two years I would consider amending to properly account for during that time period. Those two statements do not line up.

Sounds like there was a possibility this was separate instead of marital property for husband's estate, with full step up in basis.

Maybe they need to take a look at the big picture here. Are they better of pouring money into the pit, or generating cash by selling the property and paying taxes?

From what I understand you to say, they would sell the other property, take cash and invest in existing property. Not a tax free exchange.

I agree. Go forward with correct numbers for 2022.

So they have not yet filed for 2022? That might change my answer from above. But have the partners been taking draws or GPs instead of salaries?

If they have been filing as a partnership, then I believe the answer is no. On the other hand, if they had been filing 1120-S and had "reasonable cause" for failure to file a timely election then they should be good. Your research should turn up a rev. proc. with details.