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Recent Federal Tax questions

My sister-in-law who lives in PA and is an RN is opening up

My sister-in-law who lives in PA and is an RN is opening up a Home Health Care business; She and her husband will be the sole employees for the initial start of the business. Should she become an LLC?

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Robin D.

Vocational, Technical or Trade School

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G. It is me again. We spoke about my situation in April or

Hello Stephen G. It is me again. We spoke about my situation in April or so and I have not taken the 401(k) deduction because I am still pondering the tax ramifications. So, I want to run the scenario by you and see if I have an understanding or not.If you remember my husband had a health issue and stopped working this year. He did receive some disability, accrued sick and vacation pay but his total income for 2016 will be substantially lower than years past.I have our taxable income figured close to this: My income $57,000, his $33,000 for a total of $90,000 estimated.I want to take $125,000 out of my 401(k) to get rid of our debt. That would take us to income for the year of $215,000.If I understand correctly, it would go something like this: $215,000 minus $25,000 (the 20% penalty from 401(k) deduction) taking it down to $190,000 minus an additional $6,000 of regular yearly deductions, so taxable income for 2016 being $184,000.That will put us up into the 28% tax bracket so I would multiply $184,000 x 28% and the tax I would have to pay with my 2016 return would be $5,152.00.Hopefully I have given you all of the information for your answer. But am I correct and is this what I can reasonably expect to have to pay with the scenario I have presented?Thank you.

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Mark Taylor

Certified Public Accountant

Masters

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346 satisfied customers
I have a registered LLC in Delaware. In 2016 I have so far

I have a registered LLC in Delaware.In 2016 I have so far lived in NYC, HI, and now looking at moving to either CA, or FL.What state would my tax return be done in?I'm looking at moving to FL in October for the remainder of the year, hoping that would give me the tax benefits from that state.I have a NY drivers licence, and a HI state ID card just for some extra info...Last years tax i filed in HI, even though I didn't move here until February 2016.Really unsure of what I should be doing as I move around so much.Thanks

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Dr. Fiona Chen

President

Ph.D.

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66 satisfied customers
I just amended a clients returns, 14 and 15. I would like to

I just amended a clients returns for 2013, 14 and 15. I would like to work out the interest they owe for each year so they can make an accurate payment. I find it confusing, as IRS wiill give a percentage to add to another rate. I do not find a table anywhere. For that matter, I would accept a workable rule of thumb that would get me close to the correct answer, if that was available. I run into variants of this problem routinely in trying to work out penalties. My computer- Intuit Pro Series--calculates pretty much everything else. What is the solution?

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Dr. Fiona Chen

President

Ph.D.

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66 satisfied customers
I am not sure if I have to file a form 1065 but will do so

I am not sure if I have to file a form 1065 but will do so just in case (I am filing a 8865 for a foreign partnership, but cannot figure out if it is also necessary to file a 1065). I filed an extension for my individual federal tax, but just realized that I needed a different form for the partnership. Can I file the extension form late?JA: The Accountant will know how to help. Is there anything else important you think the Accountant should know?Customer: We started the partnership with less than 1 dollar each in equity-- is this 57 cents of partner equity considered a "partnership item of income, gain, loss, deduction, or credit ... allocable in the aggregate to direct U.S. partners at any time during its tax year," If not, I don't need to file 1065 after all!

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Mark Taylor

Certified Public Accountant

Masters

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346 satisfied customers
My question is pertaining to the sale of my business. I

My question is pertaining to the sale of my business. I operate a retail store structured as a single member LLC in Pennsylvania. For federal tax purposes it is a sole proprietorship, but in PA it is considered a corporation. We are about to execute a purchase agreement with the buyer, and need advice as to the most beneficial way to allocate the exchange of assets. Aside from the physical inventory, the purchase price constitutes store fixtures, display cases and computer equipment, as well as the business name, or good-will.All fixtures and other physical assets have been fully depreciated. The good-will does not appear on the books at all, so I assume the basis there would be zero.Does it make any difference how the proceeds of the sale are allocated (fixtures versus good-will) in terms of how it will be taxed? If so, how should the allocation go?There will be a non-compete clause, which if I am correct, is a key factor.

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Stephen G.

Sr Financial & Tax Consultant

Bachelor's Degree

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I am claiming annuity from my mothers life insurance. The

I am claiming annuity from my mothers life insurance. The form is asking how much tax I would like withheld , for both Mass. And federal, I would like them to with hold so I don't have to worry about it. I am getting 1 check payment . How much am I suppose to claim?

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Robin D.

Vocational, Technical or Trade School

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20,604 satisfied customers
I've been running two small businesses (both LLC/S-Corp)

I've been running two small businesses (both LLC/S-Corp) in CA, USA for several years - one Internet/Media-related and the other selling electronic/gadget accessories thru' online channels (e.g. Amazon) and distributors around the world (with majority of the products manufactured in Guangzhou, China, which is next to Hong Kong). The two companies have a total of 1-2 independent contractors (1099's). I'm considering to relocate both companies to Hong Kong, where I have my roots (with HK Resident ID card). I plan to continue hiring independent contractors in CA, USA to support the two businesses in Hong Kong. I'm aware of FATCA reporting requirements.What are the proper procedures for small companies (like mine) to relocate to foreign countries??In particular, I'm only concerned about USA-side: For example, whether I need to (somehow) officially close down my businesses here in CA first and then reincorporate in Hong Kong (the latter is simple & straightforward and not an issue). If so, what are the “step-by-step” procedures, such as preparing & filing “closing” financial statements & specific tax forms (for Federal & State), etc. Hope my CPA who prepares the annual tax returns for both of my businesses would be able to do it.Are there other alternatives, such as setting up two companies in Hong Kong first, and then buy-out (or merge with) the two companies in CA, USA?? If so, what are the “step-by-step” procedure??

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Mark Taylor

Certified Public Accountant

Masters

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346 satisfied customers
I need to know how much additional funds to withhold if I

I need to know how much additional funds to withhold if I pull money out of my IRA rollover.

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Robin D.

Vocational, Technical or Trade School

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20,604 satisfied customers
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