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Recent tax questions

My friend is living in my house why I help my dad they are

My friend is living in my house why I help my dad they are paying rent but it doesn't cover the whole payment for the assessments for so sewer. When it comes to filing taxes do I have to claim the rent their are paying me ?

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Robin D.

Vocational, Technical or Trade School

 
20,226 satisfied customers
I have a client that was a C Corp that elected S Corp status

I have a client that was a C Corp that elected S Corp status in 2013. They are now looking to sell the S Corp. Basis was never tracked, so now I have to go back and do so. I am having a problem (brain dead today) on calculating the begging stock basis. Any assistance would be appreciated

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

 
16,242 satisfied customers
I have a client who left CA in April 2012 and is being

I have a client who left CA in April 2012 and is being assessed taxes plus interest,collection fees and ;penalties on a 1099 income.. He was out of state when many of the payments were received in his new home in Texas. The added costs are almost as great as the original tax.. CA FTB is threatening to file a lien or levy. My client did not realize he had any tax liability to CA. The Payer is from Calif. Do I simply take the amount he was paid when in CA and file a CA return pay tax based on that? No CA return was filed, as client only had this small CA income. How much CA 1099 income must he make to be subject to CA tax.? Any ideas or tips?

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Barbara

Enrolled Agent, Paralegal

 
4,682 satisfied customers
WE gifted residential property worth $448,300 to our son and

WE gifted residential property worth $448,300 to our son and filed a IRS Form 709. We wanted to use our Unified Tax Credit, but somehow the IRS wrote to us that we owe $139,116 in taxes. What can we do?

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PDtax

Owner

Master's Degree

 
6,654 satisfied customers
I got a letter from the IRS concerning m 2013 tax returns.

I got a letter from the IRS concerning m 2013 tax returns. They want proof of my deductions for medical, home office, and contributions. I don't have any of that. We had a tornado touch down two weeks ago and there is water damage in my attic. My father-in-law (who lives with us) accidentally threw away all of our records. Worse case scenario, what can I expect?JA: The Accountant will know how to help. Is there anything else the Accountant should be aware of?Customer: Will I have to worry about my other returns being audited? I lost everything to prove my expenses.JA: It's hard to know for sure. The Accountant will figure it out. OK. Got it. I'm sending you to a secure page on JustAnswer so you can place the $5 fully-refundable deposit now. While you're filling out that form, I'll tell the Accountant about your situation and then connect you two.

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Lev

Retired

Bachelor's Degree Equivalent

 
24,188 satisfied customers
I changed my principal residence property to a rental income

I changed my principal residence property to a rental income in 2013 in province of British Columbia Canada. My work transferred me to Ontario. I have never claimed CCA on the property on my taxes and have claimed rental income since the change. I recently found out about Section 45 (2) about an election deemed not to have made the change. (I do not own any other property, been renting myself since 2013.) The FMV of my townhouse at time of change to rental was $360,000. I submitted an election to Revenue Canada under subsection 45(2) not realizing subject to a $100 per month penalty due to late filing. I filed March 2016 and asked to be effective from 2013. As such, I have been assessed a $2200 penalty for late filing of the election. My question is, should I sell my rental property WITHOUT having the election in place...will there be a capital gain that I would have to pay? Let's say the townhouse sells this year for $400,000. Will I be subject to capital gains with no election in place? I am trying to decide if I should pay the penalty or not to allow the election to be effective. Thanks.

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Robin D.

Vocational, Technical or Trade School

 
20,226 satisfied customers
I filed an 1120 with a 0 taxable income the IRS send a

I filed an 1120 for 2015 with a 0 taxable income the IRS send a letterthat they adjusted the return and we owe them some $6000. do you thinkthat you can help

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Lev

Retired

Bachelor's Degree Equivalent

 
24,188 satisfied customers
I have been receiving SSDI benefits since late 2005. I was

I have been receiving SSDI benefits since late 2005. I was 51 years old when a determination of full disability was made, two years after I first applied for benefits. I turned 59 1/2 years old in March 2014, but have had to draw on my retirement annuity since 2006 to supplement my SSDI.I a penalty for early withdrawal was deducted by the firm managing the retirement fund. That penalty was initially 10% of each withdrawal. I also paid federal and state income taxes on the withdrawals. I often received back most of those taxes paid because of my low adjusted income and associated tax rate.As my age approached 59 1/2 the penalty paid to the fund management firm was reduced by 1% with each passing year. Again, I withheld amounts for Federal and State taxes on each withdrawal, though after the initial years I withheld a smaller % since most of it was coming back to me as a refund. I used tax software (typically TurboTax or TaxCut) to determine my taxes, always indicating that I was disabled and receiving SSDI as my primary income.In 2011 I moved from Minnesota to Wisconsin but the tax implications were minimal other than a loss of certain tax credits that had been available in Minnesota. (Homestead Property tax rebate/refund due to significantly lower income limits in Wisconsin.)In 2012 I purchased a home and withdrew a larger than typical amount from my retirement account to apply toward the down payment on the purchase. I also applied some funds from my IRA toward necessary repairs and energy-saving improvements. Again, I used TurboTax to prepare my tax return, and after applying various credits for energy saving improvements, and deductions for mortgage, property taxes and real-estate transaction fees from the purchase of the house. I paid several hundred dollars in federal and state taxes due.Now in 2016 I have received a letter from the State of Wisconsin Dept of Revenue saying that I owe a 10% federal tax penalty (and an additional 1/3 of the Federal amount for state tax penalties) on the early withdrawals from my IRA in 2012. This surprised me because I hadn't had to pay any additional penalties in previous years (to my knowledge) and I had paid the 2% penalty deducted at time of withdrawal by the fund management firm. I assumed that this was due to my disabled status.I am receiving conflicting information as to whether my disability status eliminates the tax penalty on early withdrawals. The fund management firm tells me that I may have to do so, though they aren't privy to the specifics of my tax return. If so, I don't understand why this liability only arose in my 2012 tax year. I also made a larger lump some withdrawal in 2008 to purchase a used vehicle, and no additional tax penalty was assessed (though I did pay a 6% early withdrawal penalty was deducted from the withdrawal by the fund management firm.)I was/am still confused about this early withdrawal penalty deducted by the fund management firm. I assumed this was related to any federal/state tax obligations, particularly since the tax preparation software didn't indicate any taxes due as an additional tax penalty.Recap: Key Questions1) Does my (full) disability status eliminate my liability for the additional tax penalty on early withdrawals?2) Am I likely to be liable for similar taxes in prior and subsequent tax years until I turned 59 1/2?The amount that I owe for the early withdrawal tax penalty, the late payment penalty and the associated interest is roughly 3x the amount of my total tax liability in any other year since my disability eligibility was determined. How many other "shoes" are likely to drop?

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Lev

Retired

Bachelor's Degree Equivalent

 
24,188 satisfied customers
I have an investment property which I purchased above the

I have an investment property which I purchased above the appraised value. I am trying to find out what the depreciable value is. However, different methods yield very different values. If I use the land as % of total assessed value and apply it to the purchase value I get $150,000 as the depreciable value. However, my insurer has suggested that I insure the property for $200,000 as the insured value. My insurer said that that was the value that the insurance company suggested.Am I able to use the $200,000 as the depreciable value for tax purposes if that is the value I am paying my insurance premiums on? Or do I have to use the lower value of $150,000? Thank you.

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

 
16,242 satisfied customers
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