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-   -   New Form 8960 for NIIT (3.8%) (http://www.accountantforums.com/new-form-8960-niit-3-8-a-t145890.html)

Pico Rico 07-08-2013 12:22 AM

New Form 8960 for NIIT (3.8%)
 
I can't find a draft form yet. Anyone have it or know when we might expect
it? As well as further regulations?

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Bill Brown 07-09-2013 01:10 PM

Re: New Form 8960 for NIIT (3.8%)
 
On Sunday, July 7, 2013 8:22:24 PM UTC-4, Pico Rico wrote:
> I can't find a draft form yet. Anyone have it or know when we might expect
>
> it? As well as further regulations?
>
>

Most draft forms for tax year 2013 won't be available until later this year. I doubt that Form 8960 will be ready before then. We might have a Rev Proc or a Notice but regulations? Don't hold your breath.

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<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
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Alan 07-09-2013 05:58 PM

Re: New Form 8960 for NIIT (3.8%)
 
On 7/9/13 7:10 AM, Bill Brown wrote:
> On Sunday, July 7, 2013 8:22:24 PM UTC-4, Pico Rico wrote:
>> I can't find a draft form yet. Anyone have it or know when we might expect
>>
>> it? As well as further regulations?
>>
>>

> Most draft forms for tax year 2013 won't be available until later this year. I doubt that Form 8960 will be ready before then. We might have a Rev Proc or a Notice but regulations? Don't hold your breath.
>

The Proposed Regs were published 12/5/12.

http://www.gpo.gov/fdsys/pkg/FR-2012...2012-29238.pdf

The reliance section:

12. Taxpayer Reliance on Proposed Regulations These regulations are
proposed to be effective for taxable years beginning after December 31,
2013, except that 1.14113(c)(2) is proposed to apply to taxable years
beginning after December 31, 2012. The Treasury Department and
IRS intend to finalize regulations under section 1411 in 2013. Taxpayers
are reminded that section 1411 is effective for taxable years beginning
after December 31, 2012. Taxpayers may rely on these proposed
regulations for purposes of compliance with section 1411 until the
effective date of the final regulations. To the extent these proposed
regulations provide taxpayers with the ability to make an election,
taxpayers may make the election, including regroupings described in
1.46911(b)(3)(iv), provided that the election is made in the manner
described in the applicable provision.
Any election made in reliance on these proposed regulations will be in
effect for the year of the election, and will remain in effect for
subsequent taxable years. However, if final regulations provide for
the same or a similar election, taxpayers who opt not to make an
election in reliance on these proposed regulations will not be precluded
from making that election pursuant to the final regulations.


--
Alan
http://taxtopics.net

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<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
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<< >>
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Alan 08-07-2013 10:22 PM

Re: New Form 8960 for NIIT (3.8%)
 
On 7/7/2013 6:22 PM, Pico Rico wrote:
> I can't find a draft form yet. Anyone have it or know when we might expect
> it? As well as further regulations?
>

http://www.irs.gov/pub/irs-dft/f8960--dft.pdf

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<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>

Pico Rico 08-08-2013 05:56 PM

Re: New Form 8960 for NIIT (3.8%)
 

"Alan" <tempuser@vacationmail.com> wrote in message
news:ktuhac$5km$1@dont-email.me...
> On 7/7/2013 6:22 PM, Pico Rico wrote:
>> I can't find a draft form yet. Anyone have it or know when we might
>> expect
>> it? As well as further regulations?
>>

> http://www.irs.gov/pub/irs-dft/f8960--dft.pdf
>


Thanks. Now we wait for the instructions.

Questions: for a real estate professional, who meets the IRS tests, is real
estate income from a trust (not a living trust) considered net income
derived in the ordinary course of a non-section 1411 trade or business?
Does it matter if the taxpayer is a trustee of the trust?

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>

Alan 08-08-2013 06:42 PM

Re: New Form 8960 for NIIT (3.8%)
 
On 8/7/2013 4:22 PM, Alan wrote:
> On 7/7/2013 6:22 PM, Pico Rico wrote:
>> I can't find a draft form yet. Anyone have it or know when we might
>> expect
>> it? As well as further regulations?
>>

> http://www.irs.gov/pub/irs-dft/f8960--dft.pdf
>

Also see page 3 of http://www.irs.gov/pub/irs-dft/i1041sk1--dft.pdf for
a new Code H in Box 14 of the K-1. I believe this relates to
grandfathered dollars that are not subject to the 3.8% tax.

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>

Alan 08-10-2013 08:43 PM

Re: New Form 8960 for NIIT (3.8%)
 
On 8/8/2013 11:56 AM, Pico Rico wrote:
> "Alan" <tempuser@vacationmail.com> wrote in message
> news:ktuhac$5km$1@dont-email.me...
>> On 7/7/2013 6:22 PM, Pico Rico wrote:
>>> I can't find a draft form yet. Anyone have it or know when we might
>>> expect
>>> it? As well as further regulations?
>>>

>> http://www.irs.gov/pub/irs-dft/f8960--dft.pdf
>>

>
> Thanks. Now we wait for the instructions.
>
> Questions: for a real estate professional, who meets the IRS tests, is real
> estate income from a trust (not a living trust) considered net income
> derived in the ordinary course of a non-section 1411 trade or business?
> Does it matter if the taxpayer is a trustee of the trust?
>

You can find the answer in the following Forbes article on NII tax and
net rental income. The relevant part starts on the second page when it
discusses the proposed regulations and the requirement that
professionals have a third test that must be met: each rental activity
must rise to the level of a trade or business. This is followed by
examples. I believe the analysis in the article is correct. As such,
the income from the trust would not be a trade or business and I don't
believe that being a trustee would change that conclusion unless as a
trustee your involvement in the trust renatl activity is regular,
continuous, and substantial. Please read the article.

http://www.forbes.com/sites/anthonyn...-professional/

http://goo.gl/qOSU6G

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>

Pico Rico 08-11-2013 04:32 PM

Re: New Form 8960 for NIIT (3.8%)
 

"Alan" <tempuser@vacationmail.com> wrote in message
news:ku68lb$fuq$1@dont-email.me...
> On 8/8/2013 11:56 AM, Pico Rico wrote:
>> "Alan" <tempuser@vacationmail.com> wrote in message
>> news:ktuhac$5km$1@dont-email.me...
>>> On 7/7/2013 6:22 PM, Pico Rico wrote:
>>>> I can't find a draft form yet. Anyone have it or know when we might
>>>> expect
>>>> it? As well as further regulations?
>>>>
>>> http://www.irs.gov/pub/irs-dft/f8960--dft.pdf
>>>

>>
>> Thanks. Now we wait for the instructions.
>>
>> Questions: for a real estate professional, who meets the IRS tests, is
>> real
>> estate income from a trust (not a living trust) considered net income
>> derived in the ordinary course of a non-section 1411 trade or business?
>> Does it matter if the taxpayer is a trustee of the trust?
>>

> You can find the answer in the following Forbes article on NII tax and net
> rental income. The relevant part starts on the second page when it
> discusses the proposed regulations and the requirement that professionals
> have a third test that must be met: each rental activity must rise to the
> level of a trade or business. This is followed by examples. I believe the
> analysis in the article is correct. As such, the income from the trust
> would not be a trade or business and I don't believe that being a trustee
> would change that conclusion unless as a trustee your involvement in the
> trust renatl activity is regular, continuous, and substantial. Please read
> the article.
>
> http://www.forbes.com/sites/anthonyn...-professional/
>
> http://goo.gl/qOSU6G



I have read that and similar articles, but thanks for the refresher. I
suppose my question should have been: can a taxpayer include property held
in a trust (not his trust and not a living trust) in a real estate
"grouping"? Does it matter if the taxpayer is a trustee of the trust?

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>

Stuart A. Bronstein 08-11-2013 04:50 PM

Re: New Form 8960 for NIIT (3.8%)
 
"Pico Rico" <PicoRico@nonospam.com> wrote:

> I have read that and similar articles, but thanks for the
> refresher. I suppose my question should have been: can a
> taxpayer include property held in a trust (not his trust and not
> a living trust) in a real estate "grouping"? Does it matter if
> the taxpayer is a trustee of the trust?


Trusts are either living trusts or testementary trusts. Trusts are
also either revocable (or otherwise grantor truts) or not.

In addition, the purpose of the trust, who the trustee is in
relationship to who the beneficiary is and perhaps other information
will all be relevant to giving you a reasonable answer to your
question. You have given us none of that information.

I will say that, assuming the trust is a testementary trust set up
for the taxpayer by a parent, and the taxpayer is not the trustee,
then sny income should be classified as investment interest and not
from the active running of a business.

Also, the property belongs to the trust, not the taxpayer, and needs
to be reported on the trust's tax return. So I seriously doubt the
taxpayer can treat the trust as his own in that situation.

--
Stu
http://DownToEarthLawyer.com

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>

Pico Rico 08-11-2013 05:11 PM

Re: New Form 8960 for NIIT (3.8%)
 

"Stuart A. Bronstein" <spamtrap@lexregia.com> wrote in message
news:XnsA21963F8A78F4spamtraplexregiacom@130.133.4 .11...
> "Pico Rico" <PicoRico@nonospam.com> wrote:
>
>> I have read that and similar articles, but thanks for the
>> refresher. I suppose my question should have been: can a
>> taxpayer include property held in a trust (not his trust and not
>> a living trust) in a real estate "grouping"? Does it matter if
>> the taxpayer is a trustee of the trust?

>
> Trusts are either living trusts or testementary trusts. Trusts are
> also either revocable (or otherwise grantor truts) or not.
>
> In addition, the purpose of the trust, who the trustee is in
> relationship to who the beneficiary is and perhaps other information
> will all be relevant to giving you a reasonable answer to your
> question. You have given us none of that information.
>
> I will say that, assuming the trust is a testementary trust set up
> for the taxpayer by a parent, and the taxpayer is not the trustee,
> then sny income should be classified as investment interest and not
> from the active running of a business.
>
> Also, the property belongs to the trust, not the taxpayer, and needs
> to be reported on the trust's tax return. So I seriously doubt the
> taxpayer can treat the trust as his own in that situation.
>
> --



I would tend to agree, but it never hurts to ask.

And, I did provide the information you say I failed to provide: Not a
living trust, not taxpayer's trust, and either yes or no as to taxpayer
being the trustee - does the answer change depending on this item?

Thank you. I will watch for any other opinions as well.

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>


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