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I bought out my business partner and gave m "clear blue sky"

I bought out my business partner and gave him "clear blue sky" (which I sent him a 1099 for), then I gifted him a shop and pickup (which I sent him a 1099 for). Then I bought all the rest of the equipment from him (I did not send him a 1099 for this because a tax preparer said he will pay taxes on the gains when we do the final return--is this correct?). I am preparing my final tax return for the company and I am not sure how do handle the assets. Do I put in the purchase price? If I do that then I will also have to pay gains on the sale of the equipment. I have started my own LLC so I know I can turn around and put all that equipment on my new return but I don't feel that I should have to pay the gains on the equipment from the original partnership. I need help! One last thing...I gifted him my share of the shop and pickup what do I do with those assets on the final return?

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

17,772 satisfied customers
Hi Lane - I am about to exercise a stock option on Dec 12.

Hi Lane -I am about to exercise a stock option on Dec 12. The value will be reported on my W2. Will the amount be taxed at a different rate? Are there write offs that can be applied?

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

17,772 satisfied customers
My wife is trustee of a irrevocable trust which owns a one-third

My wife is trustee of a irrevocable trust which owns a one-third interest in a residence in California. The beneficiaries of the trust are our two adult children. My wife's brother has offered to purchase the trust's one-third interest in the California residence for $500,000. The sale will create capital gains of $384,333 for the trust in 2014, which will result in the trust having to pay federal capital gains taxes of $69,667, and California capital gains taxes (taxed as ordinary income) of $32,395. Under the lifetime gift exemption of $5,340,000, my understanding is that my wife's brother can give the trust $500,000, with no tax liability to him or to the trust. The $486,000 gift left over after the $14,000 annual gift exemption will be classified as a taxable gift, but no federal or state taxes will be paid, either by the trust or by my wife's brother, due to the lifetime gift exemption limit of $5,340,000. The only potential tax consequence will be that my wife's brother's lifetime gift exemption will be reduced from $5,340,000 to $4,854,000. My first question is: If my wife's brother can make the $500,000 gift without having to gift pay tax, or the trust having to pay capital gains tax, can the trust give my wife's brother its one-third interest in the Californian residence under the same exclusion, without creating a taxable event? My second question is: If the trust can make the gift to my wife's brother without paying tax, or forcing my wife's brother to pay tax, does my brother inherit the trust's cost basis in the one-third share of the property, and thereby avoid paying property tax on the one-third interest re-valued at $500,000, as it would valued after a sale? Thank you for your reply.

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Megan C

Master's Degree

29,966 satisfied customers
My mother condo was sold . She passed in August last year .

My mother condo was sold . She passed in August last year . Her estate went thru pobrate and was put in my sister name , my name , an niece name. We sold april 15 2013 and closing was June 5 2013. Dont know to much on taxes was told when filing something about a 1099-s will be filed . We sold condo 119,900.00 after ever thing taken out it was 109000.00 . The did cut three checks at 36420.00 . My question to you is filing a 1099-s what would be the taxes owed on that. I am married i file jointly my husband and i income is 70,000,00 together. I just need a estimate amount , so i can set that a side to pay. so no surprizes when tax time comes. or what do you think i should set a side. i realize could be more or less. thank you for your time.Kay

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

17,772 satisfied customers
My mother passed away in 2009. The are just now filing for

My mother passed away in 2009. The are just now filing for succession with her estate. She has stocks which will be inherited. The question is, if I decide to take the value of the stock now instead of holding the stock....do I have to pay capital gain tax for the tax year 2013?

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70 satisfied customers
My fiance in Canada lost her Dad - the last will shows that

My fiance in Canada lost her Dad - the last will shows that everything whats left is a 50/50 split with her brother - she is the executor of the last will - when she sells the house - is there anything she should watch out - right now the hous is in probate ? I understand the canadian goverment wants 1,5% - from which amount - selling price or does the goverment estemate the house ?Thx in advancecheersPeter

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

17,772 satisfied customers
I am in the process of a Refi on my home. Going with the present

I am in the process of a Refi on my home. Going with the present Mortgage Co. doing a HARP refi. I also want to pay down the amount I own on the present loan $360K vs $310K should I use money from IRA or sell off stock? I'm 66 and want to lower my monthly mortgage. At present I pay $2400. with Prop. Taxes and Ins sep. With the new mortgage I'll be paying $1900.00 incl. Prop.Tax and Ins at a rate of 3.75% vs my present rate of 5.876%. This year I have had large med. expenses and believe that will offset my cap.gains on my stock. I don't know using my IRA is better. One thing I do know refi is best for me I can't make 2% on my present money. Need a good sounding board.. Bobbie

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

17,772 satisfied customers
My 76 yr old mother and I are selling the house for 229,900

My 76 yr old mother and I are selling the house for 229,900 that was put into a life estate deed (in my name) in Feb 2008. My father passed away in March 2009. The house was purchased in 1966 for $19000 and $71000 has been spent in home improvements over the years. We are trying to decide if it would be more beneficial to reverse the life estate deed back to my mother for the sale so that she will pay no tax on the proceeds OR to sell it as is (about 85% mine) and I'll have to pay capital gain tax. The tax may be minimal (less than $5000 perhaps due to the stepped up cost basis), but the funds would be protected from Medicaid by Feb 2013 should mom require nursing home care. If it is transferred back to mom and she buys a condo and we create a new life estate deed, the 5 yr clock starts ticking again. Can you help me think of the pertinent questions we need to consider in order to make the best decision? Everyone seems to be split. I should add that the proceeds from the sale that would go to me (if we keep deed as is) would exclusively go towards caring for my mother and buying a condo she can live in, but the condo and bank account would not have her name on it.

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Stephen G.

Sr Financial & Tax Consultant

Bachelor's Degree

9,026 satisfied customers
My wife and I are Florida Residents. My inquiry is as follows:

My wife and I are Florida Residents. My inquiry is as follows: My wife owns a house in New Jersey (title in her name alone). We both own a house in Florida (title in both names). My wife wishes to sell the house in NJ. We are concerned about the Capital Gains taxes on the Sale. If she becomes a resident of NJ will there be a waiting period (years) in order to avoid Capital Gains? What is necessary to declare the house as her primary residence? Also, what will result in the Real Estate tax rebates (discounts) that are associated both in NJ and FL.

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Lev

Retired

Bachelor's Degree Equivalent

24,192 satisfied customers
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