kcjenkins

http://www.aicpa.org/Magazines+and+Newslet...identifying.htm Good reading.

The American Recovery and Reinvestment Act of 2009 has increased the exclusion for gain on the sale of qualified small business stock (QSBS). The increased exclusion of 75% of the gain, within limits, makes this Section 1202 exclusion for QSBS acquired after February 17, 2009 and before 2011 an attractive option compared to the current capital gain tax rates, and an even more attractive option compared to the increased capital gain rates that are scheduled to apply starting in 2011. Imposition of the built-in gains tax has been suspended for 2009 and 2010 for certain corporations. Sales of stock to ESOPs. Small business owners have another option to avoiding immediate tax on the sale of their stock. If you (or your executor) sell your stock to an ESOP (Employee Stock Ownership Plan) and purchase qualified replacement property within 3 months prior to, or 12 months after, the sale of your stock to the ESOP you can roll over the gain on your original shares. Thus, any gain will not be taxable until you sell the replacement property. Qualified replacement property is defined as securities of a corporation that does not have passive investment income in excess of 25% of its gross receipts and where more than 50% of the assets are used in the active conduct of a trade or business. Other than these two requirements, you're not limited to any type of corporation. It could be stock in another small business, or shares of a New York Stock Exchange traded company. There are several other important requirements. One, after the sale to the ESOP, it must hold at least 30% of the total value of the employer securities outstanding at that time. That may be a difficult test to meet if there are a number of owners, and only one wants to cash out. Two, the benefits only apply to C, not S, corporations. Three, you must have owned the stock for at least 3 years before the date of sale. The eventual sale of the replacement property will trigger any gain that's unrecognized because of these roll over rules.

From Pub 550: Sales of Stock to ESOPs or Certain Cooperatives If you sold qualified securities held for at least 3 years to an employee stock ownership plan (ESOP) or eligible worker-owned cooperative, you may be able to elect to postpone all or part of the gain on the sale if you bought qualified replacement property (certain securities) within the period that began 3 months before the sale and ended 12 months after the sale. If you make the election, you must recognize gain on the sale only to the extent the proceeds from the sale exceed the cost of the qualified replacement property. You must reduce the basis of the replacement property by any postponed gain. If you dispose of any replacement property, you may have to recognize all of the postponed gain. Generally, to qualify for the election the ESOP or cooperative must own at least 30% of the outstanding stock of the corporation that issued the qualified securities. Also, the qualified replacement property must have been issued by a domestic operating corporation. How to make the election. You must make the election no later than the due date (including extensions) for filing your tax return for the year in which you sold the stock. If your original return was filed on time, you may make the election on an amended return filed no later than 6 months after the due date of your return (excluding extensions). Enter “Filed pursuant to section 301.9100-2” at the top of the amended return, and file it at the same address you used for your original return. How to report and postpone gain. Report the entire gain realized on line 8 of Schedule D. To make the choice to postpone gain, enter “Section 1042 election” in column (a) of the line directly below the line on which you reported the gain. Enter in column (f) the amount of the gain you are postponing or expecting to postpone. Enter it as a loss (in parentheses). If the actual postponed gain is different from the amount you report, file an amended return. Also attach the following statements. A “statement of election” that indicates you are making an election under section 1042(a) of the Internal Revenue Code and that includes the following information. A description of the securities sold, the date of the sale, the amount realized on the sale, and the adjusted basis of the securities. The name of the ESOP or cooperative to which the qualified securities were sold. For a sale that was part of a single, interrelated transaction under a prearranged agreement between taxpayers involving other sales of qualified securities, the names and identifying numbers of the other taxpayers under the agreement and the number of shares sold by the other taxpayers. A notarized “statement of purchase” describing the qualified replacement property, date of purchase, and the cost of the property and declaring the property to be qualified replacement property for the qualified stock you sold. The statement must have been notarized no later than 30 days after the purchase. If you have not yet purchased the qualified replacement property, you must attach the notarized “statement of purchase” to your income tax return for the year following the election year (or the election will not be valid). A verified written statement of the domestic corporation whose employees are covered by the ESOP acquiring the securities, or of any authorized officer of the cooperative, consenting to the taxes under sections 4978 and 4979A of the Internal Revenue Code on certain dispositions, and prohibited allocations of the stock purchased by the ESOP or cooperative. More information. For details, see section 1042 of the Internal Revenue Code and Regulations section 1.1042-1T.

One thing I got out of watching that was a reminder of how majestic those towers were, before they went down. It's ironic I guess, that that day was such a perfect day, weather wise, that they looked their awesome best right before the attack. I was watching TV at the time, so I saw the second plane actually hit. What terrible things people can do in the name of religion, usually with the true motive being political power.

Yes, you can use the disposition function, and I'd certainly do it that way. It effectively adjusts the basis, and it all goes to the 4797. Resist the temptation to put it as an operating expense on the 8825.

Have a very :bday:

A very :bday:

Yes, that is what I meant. He can not sell what he does not own, and he has no part in the sale, so he should just back off and leave it to the bank.

Sounds like, if I understood properly, that you have a liquidating distribution situation, for both partners. Both of them should get a copy of the final 1065s.

The client is no longer the owner, if it was given up in the bankruptcy, the bank is. Even if they have dragged their feet on making the title changes, they know they own the property, which is why they are paying the taxes. If he should get a 1099C at some later date, you can cancel it out using bankruptcy as the reason, in complete honesty. Regardless of the timing, that is what happened. Should the IRS have questions, you would just refer them to the Bankruptcy court case file number.

No, standard mileage rate is not allowed for 'OTR' trucks, only for automobiles and light trucks. Nor would it make sense, because the operating costs on 18-wheelers are much higher than the operating costs on passenger cars and trucks.

Absolutely 62 deserves a whole week!

Wishing you a very :bday:

First question is: Are you getting enough fees to justify the time to spend on this? 2nd : Assuming the answer to 1st is 'Yes', would B use an excel spreadsheet that A provided, if you build one for them that is more self-calculating? Because if they won't use it, there is no sense spending time building it.

You are welcome. I learned of it from another board member, years ago, myself. I believe it was Brian Levy, but it's been so long I'm not sure.

So what was the price for the 1000?

You're welcome. Once in a while the Code does make sense.

Let me just add that some of the insights here would apply directly to the common issue of allocation of purchase price between various parts of purchase of land, building and equipment. So even if you never do a single cost segregation study, reading this relatively short guide will still help you to know how to organize and document how you arrived at the asset values, when a client comes in having bought a new property. This is something we almost ALL see every year, at least a time or two. And since any challenge to that allocation will be several years later, following this advice will put you in a good position to protect and represent your client, if and when that is questioned.

http://www.irs.gov/businesses/article/0,,id=134180,00.html I found CHAPTER 4 - PRINCIPAL ELEMENTS OF A QUALITY COST SEGREGATION STUDY AND REPORT especially valuable reading. As discussed in the last chapter, there are no standards for cost segregation studies. Thus, examiners will encounter a wide variety of studies and reports, as well as documentation. For example, some studies will be very brief. Other studies may be quite voluminous and complex. Regardless of the length of a study or the methodology used, a cost segregation study and report should always: classify assets into property classes (e.g., land, land improvements, building, equipment, furniture and fixtures); explain the rationale (including legal citations) for classifying assets as either § 1245 or § 1250 property; and, substantiate the cost basis of each asset and reconcile total allocated costs to total actual costs. WHAT IS A "QUALITY" COST SEGREGATION STUDY? A "quality" cost segregation study is a study that is both accurate and well-documented with regard to the three points above. Quality studies greatly expedite the Service’s review, thereby minimizing audit burden on all parties. A quality study contains a number of characteristics, which are set forth below.

IRS Issues Rev. Proc. 2009-41 The IRS issued new rules for eligible entities that do not timely file classification elections under I.R.C. section 7701. The new rules extend late entity classification relief to both initial classification elections and changes in classification elections, and extend the time for filing late entity classification elections to within 3 years and 75 days of the requested effective date of the eligible entity's classification. An entity that does not satisfy the requirements for relief under this revenue procedure may request relief by applying for a letter ruling. Eligibility for Relief An entity is eligible for relief under the revenue procedure if the following requirements are met: (1)(a) the entity failed to obtain its requested classification as of the date of its formation solely because Form 8832 was not filed timely; or ( the entity failed to obtain its requested change in classification solely because Form 8832 was not filed timely); and (2)(a) the eligible entity seeking an extension of time to make an entity classification election has not filed a federal tax or information return for the first year in which the election was intended because the due date has not passed for that year's federal tax or information return; or ( the eligible entity seeking an extension of time to make an entity classification election timely filed all required federal tax returns and information returns consistent with its requested classification for all of the years the entity intended the requested election to be effective and no inconsistent tax or information returns have been filed by or with respect to the entity during any of the taxable years; and (3) the eligible entity has reasonable cause for its failure to timely make the entity classification election; and (4) 3 years and 75 days from the requested effective date of the eligible entity's classification election have not passed. Effective Date The effective date of the new revenue procedure is September 28, 2009; however it applies to requests pending with the IRS on September 28, 2009. If an entity has filed a request for a letter ruling seeking relief for a late entity classification election and that letter ruling request is pending in the national office on September 28, 2009, the entity may rely on this revenue procedure, withdraw that letter ruling request and receive a refund of its user fee. However, the national office will process letter ruling requests pending on September 28, 2009, unless, prior to the earlier of November 12, 2009, or the issuance of the letter ruling, the entity notifies the national office that it will rely on this revenue procedure and withdraw its letter ruling request.

I'd still want to be darned sure that the S corp salary was at least a significant portion of that payment, unless I had some really really solid reason why it was a payment related to use of assets and not to personal service. Given that this is a true 'target' area for the IRS right now.

I went to them when ATX stopped selling them, but then found that the CFS ones were almost identical but slightly cheaper, and they ship them really fast. Both Tenenz and CFS are excellent sources, IMHO.

Sam. I agree with you about the lack of customer service. It's a case of too big, in my opinion. By the way, ATX no longer sells them, they show them on their product list, but then direct you to Nelco to buy them. I don't like Nelco, so I buy mine from CFS.

The fact that it talks about "your PC and dial-up modem" gives a pretty good hint that it is an old app. Also, found this in the FAQs. · Can I use PhoneBot with my ASDL (Alcatel SpeedTouch connection USB modem? If you have a DSL modem or a cable modem, you must also have an analog voice modem for use with The PhoneBOT. Select the analog modem from the modem selection pane. · Can the PC automatically wake up answer the caller (record message), send a text message & go back to sleep? No, The PhoneBOT requires the computer to be active, out of hybernate or suspend mode to function properly. The time required by Windows to "wake up" is to long to accomodate the speed needed for a telephone answering machine. · I only have SMS and no email on my mobile phone. Can PhoneBot send a SMS instead of email? The PhoneBOT currently o nly supports email messages sent to mobile phones. Future versions will support true SMS text messages. · Is PhoneBot right for me if I need calling parties to be able to leave a voicemail even when I am o n another call? Do I accomplish that with call-waiting or some similar service, or can I o nly get that through my local voice provider? PhoneBOT acts as a standard answering machine and does not allow callers to leave messages if you are on the phone using your dial-up internet connection or otherwise. You should seek an alternate product for this functionality. On the other hand, it's cheap, and you can test it before you buy. The PhoneBOT retails for only $19.95! You can purchase The PhoneBOT only after installing the software. ThePhoneBOT will work in a limited functionality mode until purchased. You will be able to test your modem and computer setup without actually purchasing the product until satisfied it will meet your needs. Once you are sure ThePhoneBOT will work for you, right click on the PhoneBOT icon and choose Purchase to connect with out secure purchasing agent.

http://oldbluejacket.com/9_11_2001.htm