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Basis at conversion(stock & loan) 147,042 Shareholder has had substantial losses last 3 years
At risk limitation 147,042
Note payable to shareholder 1,627,615
Basis (tax) depr assets 75,871
Basis (tax) intangible assets 56,787
Although the shareholder is active, is the repayment of the loan of $147,042 still capital gains after excess is paid over the basis of $147,042?
Additionally the shareholder owns the building in a LLC (schedule E) and the S corp is accruing the rent liability of $244,000 on the corporate books as expense and set up a payable to the LLC which is recognizing the rental income each year for taxes. Does this add to the shareholders basis since the payable on the S books is actually to him ?
No accrual basis for both
What would tax consequences be(if any) if taxpayer goes from C corp to LLC Partnership ? Same facts
shareholder 100% of s corp, basis of $147 200 @ 12/31/12 and note receivable of uo1,700,000 .attorneys want to switch to LLC
partnership because of trust for the kids and
estate tax consequences
THE S CORP IS TO BE CONVERTED TO A LLC PARTNERSHIP BECAUSE THE SHAREHOLDER WANTS HIS KIDS TRUST TO PARTICIPATE AS PARTNERS @ 40% OWNERSHIP