Recent content by Angie

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    USA Return of capital investment subject to 60/40 approach for S-Corp?

    Thanks for your response Tyson. I agree that the requirement of the reasonable salary is really the official rule the IRS is looking at here. I think focusing on that with my clients would really resolve any perceived issue. As far as the reasonable salary goes, do you think that as a...
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    USA Return of capital investment subject to 60/40 approach for S-Corp?

    I know as a general rule of thumb S-Corporation officers want to have salaries and distributions in a 60/40 ratio, with the idea that they don't avoid payroll taxes by distributing funds and not taking an adequate salary. I have clients who have had profits for a few years but always left the...
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    USA Transition from Multi-Member LLC (Partnership) to Single-Member LLC

    I have a client who transitioned was one of two members of an LLC that was taxed as a partnership. She ended up buying the other partner out earlier this year, and filed the appropriate paperwork with the state to reflect single-owner LLC status. She did not file a form 8832 with the IRS as...
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    USA Issuing 1099s for LLC that newly converted to one-member

    I've actually got an update on this which makes it a bit less complicated. I've reviewed the books and all 1099s that need to be issued are related to the time period after the change to the single-member disregarded entity. So, only one set of 1099s needs to be issued. My questions is...
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    USA Vendor will give all W9 info, but won't fill out/sign W9

    I have a client who is gathering last minute W9s for 1099s. They have a vendor who will happily text them their name, address, and SSN, but will not fill out a W9. It strikes me as suspicious. They say that they are a CPA and that the rules clearly state that as long you provide the...
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    USA Issuing 1099s for LLC that newly converted to one-member

    I have a client with an LLC that converted from two-member to one-member in the middle of the year. So, they will be filing a partial-year tax return on form 1065, and a partial year tax return as a disregarded entity/Schedule C on the remaining member's personal tax return. We are getting...
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    USA 1099 when bill paid by someone else?

    Thanks Tyson. That's what I was thinking, but I was hoping someone else followed my line of thinking. I'm also assuming that since when the company pays someone via CC it doesn't need to issue a 1099, that if the employee acting on behalf of the corporation paid someone via CC the same rules...
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    USA 1099 when bill paid by someone else?

    The business is a law firm (Professional corporation). We classified the amounts paid by the owners as loans to the firm, and paid them back to the owners. My question is, if the owner paid the rent for 2 months on behalf of the business, should the business still include those 2 months of...
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    USA 1099 when bill paid by someone else?

    I have some clients who started up a company last year. In the first few months, the owners paid some of the business bills (primarily rent) out of their personal bank accounts because they didn't have blank business account checks yet. We've documented all the expenditures and paid the owners...
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    USA Real estate professional with rental in own name

    I have clients who are owners in several real estate LLCs (some with rental activity (they own property and have a management company provide services), and some where they act as brokers/relators and take commissions on sales.) Last year, as individuals, they bought a home they intended to...
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    USA Accelerated auto depreciation for disregarded entity

    Perfect. Thanks so much Stephen! You've been an immense help.
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    USA Accelerated auto depreciation for disregarded entity

    Thanks Stephen, we're exactly on the same page. Already tested in my software and it supports our understanding. Only other question I have, but believe I know the answer. Let's say the Schedule C business is in one spouse's name, and all income to offset the Section 179 is in the other...
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    USA Accelerated auto depreciation for disregarded entity

    Hi Stephen - glad you agree about the bonus depreciation being allowed for the SUV - I was concerned I had mis-read the PATH act. I understand that the Section 179 depreciation has to have other income (self-employment/active trade business W2) to offset it on the return (or it needs to be...
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    USA Accelerated auto depreciation for disregarded entity

    Hi Stephen - why wouldn't the SUV be considered qualified property for bonus depreciation? It is a business use vehicle, and would be purchased new. I don't see any reason it would be excepted property, and the PATH act kept bonus depreciation at 50% for 2016. The $12.5K for MACRS was...
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    USA Accelerated auto depreciation for disregarded entity

    Thanks Stephen. In re-reading Pub 946 I agree regarding the W2 wages being potentially includable/not-includable in business income. You're right, it is a bit complicated. Fortunately, this client has other self-employment income from K1s in which they actively manage the companies, so we...
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