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Lion EA

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  1. Telling clients to keep calling, or to be patient, depending on the urgency of their issue with the IRS. That I will work on it after 15 October. Very frustrated with the client calls/emails/texts during these last 3 or so months when I'm trying to prepare returns before 15 October. Very time-consuming at my busiest time of year! The IRS is broken. Why does the buck stop in my lap?!
  2. If she's truly a resident of both states, there might not be "any way around it." I run into that with NY and CT from time to time. Follow the money AND follow the timeline.
  3. If an S-Corp owns a C-Corp, the C-Corp would report dividends on a Form 1099-DIV that the C-Corp issues to the S-Corp. Then the S-Corp issues From K-1 to the shareholders. (This is a more complex transaction than my corporate clients have! I have only a few corporations.)
  4. And, cbslee goes right to the heart of the matter! Perfect answer. So, your clients have legal questions but no tax questions at this time.
  5. Did you read, including links, the responses you've already received? Have you discussed with your client their goals, short- and long-term? Have you discussed with their lawyer? An MMLLC defaults to a partnership in non-community-property states. If NOT an LLC, husband and wife can have a QJV and file on their joint Form 1040, but that doesn't give them the protection of a separate entity that you say they want/need. They can still get good insurance for any option. Are they expecting their children to inherit the LLC? Ask the lawyer how that works in IL. (Do they get a step-up in basis or not?) Or, do they want to gift it over time, maybe a % each year? Ask your clients what their goals are. Then discuss with the lawyer how to achieve those goals.
  6. I don't know, but doesn't the S-corporation report on its 2020 1120 all the activity reported on the LLC's 2020 K-1 to its parent company?
  7. I regret taking on new clients this season; have way too many to finish by 15 October. (Only one more partnership by 15 September, though.) I may send a couple of them elsewhere or offer them November preparation, maybe with a discount if they look like keepers after I dig into them. And, a couple of them have had two different preparers in the last two years and SE side gigs; those may get kicked to the curb if I find any funny stuff as I get into their details. As you say, shoppers!
  8. What do you mean by reinvest? Take the former retirement distribution and invest in a fully-taxable account? Really no savings unless he can and wants to rollover into another retirement account. Anything else is a taxable distributions and then a new investment or purchase or savings or... Have him get you a copy of the plan so you can see what you're dealing with.
  9. Were the businesses SMLLCs/disregarded entities? And, now the trusts want them to incorporate? What are they trying to accomplish?
  10. If it was really a 401(k), then why can't he roll it over? Perhaps it was a nonqualified plan. If so, I don't think he can do a. B and c would depend on if he's affected by Covid and if that exception is renewed for 2021. He can pay the taxes on the disbursement. He can contribute more to his existing retirement plan(s), because he has the disbursement to live off of. He can buy a rental property or spend his disbursement any way he wants. Tell him what percentage to save to cover his federal and state taxes. Make sure you have the paperwork describing the government money in a 401(k)-type fund over the years for helping out through a special government program. Part of his compensation package? Seriously, where do you get clients with these complex financial situations?!
  11. Where do you get these clients?! They're much more complex than my clients. I have no idea why a trust or an estate would form an 1120-S unless one already existed/was owned by the deceased. Some of the great minds here will jump in Saturday...
  12. A year or so ago, I had to recreate basis for a couple partnerships that weren't always my clients. Luckily, they had all the partnership returns. Money in + income - losses -distributions etc. https://www.irs.gov/pub/irs-pdf/i1065sk1.pdf https://www.irs.gov/pub/irs-utl/partners-outside-basis.pdf If you use CCH's AnswerConnect: https://answerconnect.cch.com/intradoctoc-document/tpz0209013e2c84a68b88
  13. Lion EA


    In general, retirement income is taxed by the state of residence. TP was an AZ PY resident and FL PY. If he had no AZ-sourced income after he moved out of AZ, then the AZ PY return will be his only state return.
  14. Can she do it online? Tell her to keep trying and to be patient.
  15. I have taken courses from the author of the AnswerConnect article. But neither the author nor AnswerConnect are authoritative sources for IRS purposes. If you're using CCH's AnswerConnect as one of your research tools, you can search for authoritative cites. But as Abby says, for understandable sites, you might want to start with other than the IRS.
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