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ShawnA
ShawnA, CPA, Professor, CFP. CGMA, Business Consultant, Professor, PFS I have decades of experience answering these questions.
Category: Tax
Satisfied Customers: 2884
Experience:  CPA, Professor, CFP. CGMA, Business Consultant, Professor, PFS I have decades of experience answering these questions.
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I want to see if I need to make an election to group my properties

Customer Question

I want to see if I need to make an election to group my properties together under section 469 for FAFSA on my taxes to exclude them? And if I do make the election WHAT is the downside? For eg someone suggested the properties would be harder to separate for gains upon sale? ( i have no idea to what they even means)
I found this research: he small business exclusion was established by section 8019(c) of the Higher Education Reconciliation Act of 2005 (HERA 2005) as part of the Deficit Reduction Act of 2005 (P.L. 109-171, February 8, 2006). The specific amendment is as follows: (c) TREATMENT OF FAMILY OWNERSHIP OF SMALL BUSINESSES. -- Section 480(f)(2) (20 U.S.C. 1087vv(f)(2)) is amended -- in subparagraph (A), by striking "or"; in subparagraph (B), by striking the period at the end and inserting "; or"; and by adding at the end the following new subparagraph: "(C) a small business with not more than 100 full-time or full-time equivalent employees (or any part of such a small business) that is owned and controlled by the family.". After this amendment is applied to section 480(f)(2) of the Higher Education Act of 1965, the legislative language becomes: With respect to determinations of need under this title, other than for subpart 4 of part A, the term "assets" shall not include the net value of -- the family's principal place of residence; or a family farm on which the family resides. a small business with not more than 100 full-time or full-time equivalent employees (or any part of such a small business) that is owned and controlled by the family. and If the family owns multiple rental properties and materially participates in the management of the properties, they are more likely to be considered business assets.
Submitted: 9 months ago.
Category: Tax
Expert:  ShawnA replied 9 months ago.
These properties should be reported on the FAFSA form.
Expert:  ShawnA replied 9 months ago.
For eg someone suggested the properties would be harder to separate for gains upon sale? That makes no sense.
Customer: replied 9 months ago.

I have gotten conflicting advice on the Fafsa as a real estate professional and having separate eins for those properties income. I still want to know what the cons are of filing the election (and no I don't have losses).

Expert:  ShawnA replied 9 months ago.
I will opt out. Best wishes.