ILLMAS

I personally received one, I do some consulting work and I request for all my earnings to be sent to my federal withholding, COVID hit and the irs never processed the 2019 1099s, I resolved it by sending in a copy.

We have no problem at the 1120S and 1065 level for ABC, the books are separate already.  
 

The issue is at XYZ level:

The goal is do the following 

ABC Inc will get a k-1 for 9 months 

ABC LLC will reflect 3 months 

Right now  XYZ K-1 to ABC is for the whole year and here is where I need help splitting the k-1s to 9/12 Inc and 3/12 LLC.

thanks

ABC Inc is a 80% member of XYZ LLC, in September 2021 ABC Inc became an LLC (granted by the IRS, same FEIN, still 80% member of XYZ etc…), so now two K-1 have to be issued one for  ABC Inc and another to ABC LLC for the respective months.  
 

ABC Inc will file a final  1120S for the first 9 months 

ABC LLC will file an initial 1065 for last 3 months

How does one go about splitting the K-1’s?

Thanks

Does anyone one have a questionnaire to give to clients to see if they meet the requirements to file K-2 and K-3's?

Thanks

32 minutes ago, kathyc2 said:

I thought your question was why the "purchases" account was different than the BI + P  - EI = COS equation?  Now you are saying you don't believe the ending inventory amount?????

I am rounding numbers, but the 12M purchases includes the (40K) inventory adjustment, gross profit on tax return is close to 1M less vs financial statements, so something is definitely wrong with purchases or inventory.

35 minutes ago, kathyc2 said:

To further clarify, if set up correctly, inventory purchases should be  debit Inventory asset and credit A/P

When sold it would be a debit to purchases and credit to inventory.  

Even though it's being called purchases in QB, it's actually a COS account.  

What I do on tax return is have the add change of inventory to QB purchases account.  

 

We are going to ask if any bills or invoices were deleted.

51 minutes ago, kathyc2 said:

The change of inventory is likely already reflected in the "purchases" account.  

IOW actual purchases were likely 14M, with 13M being used and 1M increasing inventory.

Agree, their inventory adjustment entry is like 40K, not the 1M

1 hour ago, jklcpa said:

Were QB balance sheets and P&L statements both printed using the same basis of accounting AND on the same basis as used for the tax return?

Yes accrual basis for both.

1 hour ago, BHoffman said:

I’ve found QB inventory module to be heinously inaccurate if there is any WIP (work in progress) involved at all. Also, the data entry has to spot on as far as units, costs, etc.  Does the client ever do a physical count?  That’s a very significant difference. I agree that clients lump a lot of stuff into Purchases. 

Will ask, I don't think they manufacture any products, but will ask, thanks.

Facts

Beg. Inv 4,000,000 12/31/20 BS

End Inv 5,000,000 12/31/31 BS

 Purchases on P&L 13,000,000 12/31/21

COGS on tax return 4M + 13M - 5M = 12M

Questions 

Maybe this is accounting 101, but I cannot figure out why the purchases are overstated if inventory is being track in QB, can someone think of why I’m getting this difference?

I will ask the client if maybe a non inventory item was posted as inventory.

Thanks

Potential new client was born in the US, as a child moved to a foreign country and worked and paid taxes as an adult to the different country they lived in, in 2021 they moved back to US, got married to a foreigner (tourist visa) and would like to file a 2021 tax return.  Unfortunately they never filed US tax returns and the last country they lived in filing tax season doesn't start until September 2022 and they also made so little in 2021 that they are not required to file (foreign country and US).    As one's duty, the person was made aware of their tax obligation as a US Citizen.... and so forth, besides charging them a consultation fee what do you recommend I should file:

A.  Wait until they prepare their 2021 in XYZ country?

B.  File with US income only and apply for an ITIN for the spouse?

C. A and B

D. Eject myself

Thanks

TP:  Prior year balances were taken care of with the vouchers you gave me.

Me:  okay then you should get this year refund 

TP: Nice

Three week later

TP:  my refund as not arrived

Me: are you sure you didn’t have outstanding penalties and interest, because the vouchers I gave you only covered the tax….

TP:  I never received anything 

Me: checks where is my refund and boom TP refund was applied to a collections….

TP:  mmm, so no refund, you said I would get it

Don’t forget to ask them also if they had to take time off to take care of a family member related to COVID-19.  

6 hours ago, Pacun said:

If you received $3,300 that's the amount you should receive on 1040 on top of withholding and EIC. That's true when the client didn't refused any advanced payments and when the number of children are the same.

Knowing that will help you know if the program is calculating correctly. 

This is what I would do in this return if I have doubts. I would save the return, delete the K1 with the loss, and then check if $3,300 shows as child tax credit on line 28 1040.  If it looks correct, I would close the return without saving, reopen it and see where the issue is. 

Yes that pretty much worked, TP would get $3,300 back additionally, TP AGI went down $21K compared to 2020.

Can someone double check this scenario:

HOH

W-2 wages 13,000

K-1 loss 6,000

AGI 7,000

Fed/W 1,140

Child 1 age 8

Child 2 age 4

3,300 of child tax credit received 

Excess child tax credit of approx. 1,600, does this seem right?

EIC is fine

Thanks

2 hours ago, BulldogTom said:

I am going to if they don't finalize it soon.

Tom
Longview, TX

Form was ready in ATX yesterday as of 5pm central time.

21 hours ago, cbslee said:

And what Form is that?

Why do you always have to be snarky with your replies, there is no need to be a JERK. 

Has anyone seen a good YouTube video showing all the steps?  I seen a couple but they only talk about the exempt-income, k-1 and not really get into the details of reconciling the M-1, M-2 etc….

thanks 

And here is example of the statement:  https://ttlc.intuit.com/community/business-taxes/discussion/re-2020-schedule-c-self-employed-how-to-report-ppp-received/01/2478497/highlight/true

Thanks, here is the link from the IRS:  https://www.irs.gov/pub/irs-pdf/i1040gi.pdf  

Instructions are on page 23

I have a client that had the 1st (2021) and 2nd(2022) loan forgiven, from the research I did it seems nothing has to reported on the 1040 or Sch C, anyone know of something different?

Thanks

Has anybody submitted a return with a draft copy of form 7203?

Scenario 

XYZ Inc is to pay shareholder a monthly fixed amount  for personal use of Auto and another fixed amount for rent etc….

Is this even possible without submitting receipts?

Thanks

If you listen to any online postcast or YouTube videos today, a good percent are about couples breaking up, why marriage is different from our parents time or people preferring pets over kids.  I guess the pandemic made people dislike each other