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About cpabsd

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    Scrapbooking, Playing games like Sequence, Spending time with my girls ages 14 and 10

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  1. cpabsd

    S Corp sale or gift

    I have two clients that want to turn ownership of S corps over to children. First scenario - Dad owns the business 100% but son has always run business. Dad wants to turn business ownership over to son. We have a value of the company. Minimal assets, minimal debt and basis is close to zero. What items should be taken into consideration in structuring this transaction? Second scenario - Dad owns the business 100%. Son has become much more involved recently. As parents transition to retirement, they want to turn business ownership over to son. No estate tax issues here but no value of company either. Minimal assets, no debt. Once again, what items needs taken into consideration? They want to transfer of ownership to be effective 1/1/19 with little to no tax consequences. Thanks for helping me navigate both these transactions!!
  2. A statutory employee pays health insurance premiums for himself and family. Are these treated as self employed health insurance premiums or is he stuck deducting on Schedule A? I have looked and do not seem to be able to find the answer. Thanks in advance, Bonnie
  3. cpabsd

    Investment property

    Taxpayer and spouse bought land in 2005 for 160k. During 2017, taxpayer gifts land to child and child's spouse. FMV was $56k. I believe there is no loss to be claimed as the child and child's spouse now have basis in land of $160k. Is this correct? The property that was given had $68,000 on disallowed investment interest accumulated. Since the taxpayer no longer owns the investment property, what happens to that previously disallowed investment interest? Is it able to be deducted or continues to be carried forward? Any sites would be helpful. Thank you in advance.
  4. cpabsd


    I know a SEP IRA can be transferred to another IRA account tax free. Is there any length of time the SEP IRA has to be in existence before such transfer can occur?
  5. Client’s mom died in a house fire in August 2017. The house was insured. My client received the insurance proceeds for the property and the contents of the house. Due to insurance limitations, the amount received was not what the house/contents were worth before the fire. The insurance agent gave tax advice ( ugh) to be sure to take the casualty loss for the difference. How would I calculate the casualty loss? At what point did my client inherit the house? I know in normal circumstances, it’s the value before the casualty loss minus insurance proceeds. How does the death complicate or change this calculation? Does stepped up basis impact anything in this scenario? I believe any casualty loss would be the son’s rather than mom’s. Mom died during the fire not later as a result of the fire. She was trapped in the burning house. Any citations would be most helpful as well. Thanks!!!
  6. cpabsd

    LLC member walks away

    I have an LLC that was owned 51% by my client and 49% by Joe( fake name). Anyway, on 7/13/17, Joe gave my client his 49% ownership just as a gift. Joe was never involved in the business. They filed a 1065. Also on 7/14/17, My client who is now 100% owner, elected S Corp status. I know we need to file a form 1065 for period until 7/13/17 and 1120S for period from 7/14/17 forward. My question – since Joe walked away, does my client just gain basis in the amount of Joe’s basis? Is there an election to make for this? Retained earnings is positive but breakdown between Joe and my client shows Joe equity account as positive and my client's is negative. Please help. Thank you!
  7. cpabsd

    Program Closing

    I'm curious what the fix was for the zip code crash problem. It began happening to me this morning. So frustrating!!
  8. cpabsd

    ATX software search

    Is there any means by which I can pull up all the client files that have a specific form within them? I thought we used to be able to search for that but so far have been unsuccessful in figuring it out. thanks, Bonnie
  9. cpabsd

    ATX software question

    I use ATX tax software. Is there anyway to search the files for ones containing a certain tax form? I thought we used to be able to do that. I'm trying to ascertain a list of all Form 2553's prepared this year and send letters to those clients. Thanks, Bonnie
  10. cpabsd

    SEP contribution S corp owner

    Thanks everyone for the clarification. Have a wonderful day!!! Bonnie
  11. Client operates as an S corp. The only employee is the owner. I believe they can continue contributing to their SEP but where does the deduction show up? Would it be deductible as retirement plan on the Form 1120 S or on the front of Form 1040? I do not believe I've ever run into this for a client but now have it on several.
  12. I have a client that has an S corp that generates a R&D credit. For 2015, the S corp generated taxable income but the credit could not be used at individual level due to AMT limitations. For 2016, the S corp had a loss and the credit is not allowed because of no taxable income from the entity. Both credits are being carried forward. I’m trying to understand what the scenario has to be for him to actually be able to use the credits. The total carry forward amount is $38k. Can you help me better understand this? Would wages from the entity be considered taxable income attributable to the entity? Also, if the taxpayer is no longer an owner of the S corp, does that mean those credits are useless? Any help or guidance is appreciated. Bonnie
  13. cpabsd

    ATX and sorting

    Is there a way to make a list within the software of all clients that contain a certain form, like Schedule C? I thought there was but cannot seem to locate it this morning. Thanks for any help!!
  14. cpabsd

    Payroll software for Mac

    I have a client that is looking to prepare their own payroll. Only two employees and the one is the S corp shareholder. What options are there for a Mac user? I've used and recommended Medlin for years but they are not Mac compatible. Thanks!!
  15. cpabsd

    S Corp Basis with Sect 179 Please help

    I stumbled upon the answer. The Form 4562 was on manual mode( why, i have no clue). Solution - delete Form 4562 then add Form 4562 back to return. Deduction now being allowed.