kcjenkins

I always enjoyed the time I spent with most of my clients, and once the practice grew to the point that our time was full, we ''fired' the ones we did not like. Sure that took a few years, but not all that long, because when you do spend a little time "yapping" with clients, often your referrals go up dramatically. At least that was my experience. And it builds a lot of loyalty when clients know YOU, rather than being just a name to them.

Take it out of service, yes. As for the "sale", does he have anything spelling out the details, especially when the title is to change? What happens if she wants to refi? Or sell? Does he get any share of the proceeds then? I would not report it as a sale without them drawing up at least a simple "Sales Agreement" that spells out answers to those questions. As long as he holds title, he has not sold it, unless there is a signed and notaried contract, in which case there might be an installment sale. Or a gift tax situation?

Scary, but the discount offer is nice.

I agree with you on how you should do it.

Hey, also, even if you never read the Politics forum, check out Cat's latest thread, "Not satisfied with illegal investigations", it's almost unbelievable, yet true. And a scary thing for an agency with so much power and the access to EVERYONE'S data that the IRS has.

Sounds like a great idea. Should be a fivesome tho, Joan, Me, you, Tom and Patty. Lets try to set it up then.

Yes I am. But I'd love to help out a bit, if it were not so far. I'd help, if I could do it by email, tho.

So far they are not taxing it, it is basically just a reduction of the interest that the card company charges.

Yes, Joan, as you know, Don died last year, and then I had cancer surgery, so I decided to move out here where my boys are. One son in Pleasanton, and two here. A good decision all around. I'd love to meet you sometime, Joan, after the season, of course.

Based on that info, sounds like they paid 51K principle ans 19K interest. But there should be some paperwork about the "settlement", so I'd want to see that to determine what the actual agreement says. Since Mom used an attorney for this, I'm sure she will be reporting the income.

If the departing member was not LIABLE for the debt, they are not being RELIEVED of the debt. So no COD issue. The one who had personally guaranteed the corporation debt is in the same position as before.

That is right based on my understanding of the original agreement. It was not cancellation of debt to the shareholder of a loan from the corporation.

That's a great offer, Tom. LJ, you will love both Tom and Patty. They are really nice people, that I am proud to claim as friends.

You can not 'just choose a state with no income tax as their "domicile" so as to avoid state taxes. But you CAN, if you choose, keep the state you were resident in WHEN YOU ENLISTED. Clearly, based on his voting registration, that is what he has chosen.

Yep, use the summary, and move on. The statement should be scanned, though, so that you have backup if asked..

I would want it to be based on FMV, supported to the best of my ability, including appraisals where possible and practical, so that it can withstand an audit. Significant sales of capital assets are one of the primary 'audit flags', in my experience. Goodwill and Non-Compete are for 'what is left over'.

ESPECIALLY APPROPRIATE IN TAX OFFICES THIS TIME OF YEAR.

Sorry, JM, but this guy is not self employed, he is an employee, so he's not under that rule. It would work if he was self employed.

I agree, not a sale, but reduce basis.

Reread my last post. Just because he moved does not mean he changed his SLR, unless he did file the paperwork with the military. And had he done that, they would have started withholding state tax to Kansas.

If his "legal residence" was previously set to Ohio, and he wants to keep it, at least for now, he can. He should think about this carefully, now, before you file. Deduction for military stationed outside Ohio — Military pay earned while on active duty and stationed outside of Ohio is exempt from the Ohio income tax and may be deducted to the extent it is included in federal adjusted gross income. Details on how to take this deduction are found here. http://www.tax.ohio.gov/ohio_individual/individual/military_service_ohio_taxes_deduction.aspx

The other side of it: In the United States Military, there is a difference between the terms "Home of Record," and "Legal Residence." "Home of Record" and "Legal Residence" may, or may not be the same address. One's "Home of Record" is the place one was living when they entered the military (or, re-enlisted in the military, if one chooses). "Home of Record" is used to determine travel entitlements when one separates from the military. It has nothing to do with voting or paying taxes, registering vehicles, nor any of the other priviledges of state residency. "Home of Record" can only be changed if there is a break in service of more than one day, or to correct an error. "Legal Residency," or "domicile", on the other hand refers to the place where a military member intends to return to and live after discharge or retirement, and which they consider their "permanent home." Legal residency determines what local (state) tax laws a military member is subject to, and in which local (city, county, state) elections they may vote in. Because military members may have "legal residence" in one state, but be stationed in a different state, the Servicemembers Civil Relief Act, allows military members to pay taxes, register vehicles, vote, etc., in their "state of legal residence," rather than the state they are stationed in. This can sometimes result in a tax advantage because several states exempt military pay from state taxes. Does that mean a military member can change their "legal residence" anytime they want, and therefore avoid paying state taxes? Not quite. Under the law, "legal residence" is the place that the military member intends to live after they separate or retire from the military. It's the place that they consider their "permament home." Depending on their service, and local polcies, an active duty military member can change their "legal residence" by visiting their local base legal office and/or base finance office and completing a DD Form 2058, State of Legal Residence Certificate. However, the military is required by regulation to ensure that military members are not changing their "legal residence" for the sole purpose of obtaining a tax advantage. Therefore, when changing your "legal residence," military officials at the legal office (or finance office) may require some degree of proof that you consider the new state to be your "permament home." The easist proof is "physical presence in the state." If you are currently stationed in a state, and wish to make it your permament home, it's generally pretty easy. If you are not currently stationed in the state you wish to make your permament home, and have never been stationed there, it become much harder. Generally, you need a specific address, not just the state in general. You can show your intentions to become a legal resident by registering to vote in the new state, by titling and registering your car in the new state (notifying your old state of the change), by getting a driver's license in the new state, or by preparing a new last will and testament (indicating your new state as your legal residence). Buying real property in the new state will also reinforce your claim. Unless you can show such clear intentions, the military will probably not allow you to change your "legal residence." Particular care should be taken to ensure your pay records are up-to-date concerning your state of legal residence. If incorrect, you may wind up paying taxes to the wrong state, or paying taxes and penalties in more than one state. If you have any doubt about your state of legal residence, contact your legal assistance office. You may also be required to complete a W-4 form to determine the amount of withholding, or exemption from withholding state taxes.

http://www.ksrevenue.org/taxnotices/notice09-12.pdf#xml=http://search.ksrevenue.org/texis/search/pdfhi.txt?query=military&pr=KSRevenue&prox=page&rorder=500&rprox=500&rdfreq=500&rwfreq=500&rlead=500&rdepth=0&sufs=0&order=r&cq=&id=53202a3b7b On November 11, 2009, President Obama signed into law the Military Spouses Residency Relief Act (S. 475). This act is effective for taxable years that begin on or after January 1, 2009 and all tax years thereafter. INCOME: Under the new law, the spouse of a military servicemember may be exempt from Kansas Individual Income Tax for Tax Year 2009 and thereafter on income from services performed in Kansas if: 1) the servicemember is serving in Kansas in compliance with military orders, 2) the spouse is residing in Kansas solely to be with the servicemember, and 3) the servicemember and spouse are not residents of Kansas (the servicemember and spouse are legal residents of another state of the United States or a foreign country). Spouses of servicemembers who meet the above requirements and who have had Kansas withholding on 2009 wages or who have made other Kansas tax payments for Tax Year 2009, such as estimated tax payments, may receive a refund of these taxes by filing a Kansas Individual Income Tax return, K-40. The Kansas income tax return can be filed electronically, using KDOR’s free on-line return – www.kswebfile.org – on or after January 1, 2010. The spouse’s nonmilitary Kansas income will be subtracted from Federal Adjusted Gross Income. Only tax payments on 2009 income will be subject to refund. Carry forward of prior years’ tax payments to Tax Year 2009 are not subject to refund. The scope of the income subject to refund is limited to “income for services performed by the spouse of a servicemember” in Kansas. This would include Kansas income from wages, salaries and business income from “service performed by the spouse”. It would not include, for example, income derived from Kansas real estate or a trade or business carried on in Kansas that does constitute “income for services performed by the spouse of a servicemember”. This law does not exempt any nonmilitary income earned by the servicemember in Tax Year 2009 and thereafter from Kansas income tax. Nonresident servicemember’s military compensation continues to be exempt from Kansas Individual Income and is also subtracted from Federal Adjusted Gross Income on line A13 of Schedule S. WITHHOLDING: The spouse of a military servicemember whose wages/salary is exempt from Kansas income tax under the above provisions should file a Kansas Form K-4 with their employer claiming the exemption from Kansas Withholding tax. Kansas employers should request evidence that the military spouse is indeed a legal resident of a state other than Kansas. Employers may also want to inquire with military spouses’ state of residency as to whether the Kansas employer is required to withhold income tax for that state. Spouses claiming an exemption from Kansas Withholding tax may want to consider the impact that exemption will have on their income tax liability in their state of residency. They may be required to make estimated income tax payments to their state of residency in order to avoid penalties for underpayment of their state’s income tax

I thought Rita said it sold for 200K?