ILLMAS

TP is in construction and in late 2021 they received $100K for work to begin January 2022, under cash basis can this money be classified as a client deposit or advance and reverse it 2022?

Thanks

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16 minutes ago, Terry D EA said:

ILLMAS, check out pub 4681. I put a link here if you want to use it. Seems that page 4 & 6 may be of help to you. 

2021 Publication 4681 (irs.gov)

Thank you.

TP received two 1099-C, one was for a foreclosure on a rental property and the other one was for deceased spouse debt and because of the foreclosure, they now have a capital gain on the disposal of the property.  I know the foreclosed property is treated as a sale (Form 1099-A was not issued, but sales closing statement was provided),  but can the gain be excluded on form 982?   TP is insolvent and not in bankruptcy. 

42 minutes ago, cbslee said:

Are you saying that the value building now with the new roof is less than the value of the building

with the old leaking roof with rafters that were failing?

TP said way less now after new roof and rafters because there are so many empty spaces and buildings for sale in the area, (like in many different places, businesses didn't re-open after COVID) they can ask for $200K or more if they want to sell it, but what ever is selling is going for 20-30% less than the asking price.  TP also mentioned that in a refinance appraisal, the new roof might increase the value, but not if they wanted to sell it.  I know the area and have other clients with businesses on the strip.

The new roof does make my client better off in case they wanted to sell the building, the building's value did not change and more likely the value of the building is less than it was worth last year.  The building is located on a one-mile strip of nothing but retail businesses, high vacancy rate, high property taxes and very low rents.  I see it as they were made whole, not better off knowing their circumstances. 

TP commercial building roof was leaking and a claim was made with their insurance, insurance company denied the claim because the roof rafters had sagged due to age.   The whole roof top had to be torn down and rebuilt at a cost of $25K, plus the insurance company was ready to drop them if they didn't get it fixed, does this sound like a major repair or improvement?   

Thanks

Thank you

Look up the companies annual report in your home state website (secretary of state) and send them a copy of the annual report. 

Can someone confirm if PTC excess amount has to be repaid for 2021?  

Thanks

EIC should automatically populate first, then form 8867, have you entered the new data that would qualify the client for EIC?

Gets your hands on a older version of QB, I have client that is still using 2010 version.

I kind of remember a story about a CPA firm that sent a voice to text message to a accounting department "Send the documents to the Feds" and it was transcribed as "Sent the documents to shreds", I think they are no longer in business.  

Have you asked if the production goals are duties under his/her supervisor roll?  

TP developed land and many years later the county reassigned a new address, is there special form to let the IRS know the rental property address changed or would it be okay to just to change it and continue as is?

Thanks 

Do you think businesses  should sue their banks because they only focused on their large clients and could not help their smaller clients  (+ PPP money ran out)?  

I would not ever come back from lunch 

Funny, when a client comments about how much they pay in credit card processing fees, I normally remind them that is part of the cost of doing business but I rarely share that I also have cost of doing business.

I believe police and correction officer in my city feel the same way as the agents.

I am reviewing a prior year tax return and the prior preparer used Sch C for some miscellaneous expenses and home office use for the partner, zero income.  Partner uses home to do office work and to fulfill online order to be shipped, first time seeing something like and just want to make sure this is allowable, I will be amending the partners tax return for changes in the K-1.

Thanks

That will be me next week but in a Speedo  

Not In NY but I have had two clients recently handled back sales taxes themselves for IL, both are on payment plans.

18 minutes ago, jklcpa said:

Purchaser doesn't. His concern is only that he paid $10K and how to allocate that for the assets acquired.

Does the bill of sale break down the sales price between the inventory and F&F?  Was a form 8594 prepared?  That allocation is what you need to know.  Seller also needs to know that allocation for reporting his side of the transaction too.

How I listed in the scenario is exactly as it appears on the bill of sale, the widgets just has that note.  I am representing the buyer and the prior preparer did not prepare the form, I am redoing the books for the prior tax year since the client records needs major cleanup.  

Scenario

TP bought an established business for $10K, bill of sale states the following:

Widgets $25K estimated retail value of inventory

Furniture & Equipment $10K

Total sales price $10K

So the TP paid $10K for a business that is worth $35K, how does one account for the $25K?

Thanks