Join the 9 million people who found a smarter way to get Expert help

Recent tax questions

I live in an owner-occupied duplex and rent out the second

I live in an owner-occupied duplex and rent out the second unit. I am considering installing solar panels on the property. I met with a solar energy consultant and we determined that my unit is not eligible to be hooked up to the solar system for low electricity usage, but the rental unit is.My question: Can I claim the solar investment tax credit given that the solar panels will be for the use of the rental unit only?

Read more

Lev

Retired

Bachelor's Degree Equivalent

 
24,192 satisfied customers
An LLC is created. This LLC is purchasing a property

An LLC is created. This LLC is purchasing a property renovating it, using some of it as an office and then renting the rest out. The owner is considering having his single member S-Corp own the LLC. I know the LLC is a disregarded entity and the income and expenses of the LLC will be on the 1120-S of the S-Corp. Is it still required to keep separate books for the LLC and have the income and expenses listed separately on the 1120-S? If neither the S-Corp or the sole member are real estate professionals will any losses resulting from the LLC rental property business be deductible on the member;s individual return or is it the same passive income limitations that apply as if it where owned directly by the individual?

Read more

Lane

JD, MBA, CFP, CRPS

Doctoral Degree

 
16,320 satisfied customers
Please explain in what case and how passive income loss in

Hello, Please explain in what case and how passive income loss in Form 8582 line 16 works. I see the loss is allowed, but it does not go to sch E page 2 (line 29) Passive loss in my software. Thank you

Read more

Lane

JD, MBA, CFP, CRPS

Doctoral Degree

 
16,320 satisfied customers
I am a physician and most of my income is salary and bonus

I am a physician and most of my income is salary and bonus from the PC that I am 100% owner. I also have income from reading tests that comes into an separate LLC that I am sole member. I also have significant rental income that I run through another separate LLC that I am sole member. I want to buy a boat for $435,000 and use it for charter. I will form a new LLC and start a separate Charter Company. I doubt the charter revenue will be more than $50,000 per year. So the charter company may not make any profit. Can I take the entire $435,000 from the Section 179 deduction for my charter business and use it against w-2 income and other LLC income (including passive income). The total deduction may exceed my total 1040 income.

Read more

Megan C

Master's Degree

 
29,942 satisfied customers
My wife owns transferred cash to a partnership (LLP) in

Hi! My wife owns transferred cash to a partnership (LLP) in India and became a partner of 33%What are our filing requirements? She is a resident and does not have any US income. The partnership is a Limited Liability Partnership and all the partners have limited liability.Which forms do we need to submit?

Read more

Robin D.

Vocational, Technical or Trade School

 
20,266 satisfied customers
We have accumulated a carryover passive activity loss while

We have accumulated a carryover passive activity loss while owning the rental properties. Our income is over $150k and we are not real estate professionals so we kept rolling over the passive activity loss which is now around $150,000. Now that we have disposed of our entire interest in the passive activity (the rentals), what happens to our carryover loss? It is pretty clear that the passive loss can now be fully deducted as described in Tax Topic 425 but the question is fully deducted against what? Only passive income such as the gain from the sale of the properties or against other income such as ordinary income? Or both?

Read more

Lane

JD, MBA, CFP, CRPS

Doctoral Degree

 
16,320 satisfied customers
Here is the scenario: A single active member LLC files as an

Here is the scenario:A single active member LLC files as an S-Corp. It reported $10K loss for 2014 on 1120S and the individual's K-1. The individual did not perform basis limitation calculations (TurboTax does not guide through this). Company equity 100% attributable to the member at the end of 2014, including all single member contributions, income, losses, and distributions was $8K. The company reports a $9K loss for 2015 (taxes have not been filed yet), and is closing up shop in 2016 with no assets or liabilities (all assets depleted or written off with no gain).Questions:1) Is it correct that even though the member covered the losses out of their own pocket through contributions, their basis is measured after the loss? This seems illogical but it is how the basis limitation worksheet instructs.2) If the individual amends prior tax return to suspend the $2K of loss and shows practically ZERO basis for 2015, therefore additional $9K loss to suspend, will they be able to unsuspend the losses on their tax return for the year that the company is dissolved?3) Are unreimbursed expenses reported on Schedule A also limited by basis or do they come into play some other way?

Read more

Lane

JD, MBA, CFP, CRPS

Doctoral Degree

 
16,320 satisfied customers
I have a home we moved out of 2 years ago and we've been

Hi, I have a home we moved out of 2 years ago and we've been renting it for the last 18 months. I paid $250k for the house in 2009 but at best would probably get $220k for it. I overpaid...long story. Fair market rental value comparable houses in the neighborhood is probably in the $1100 to $1250 range. I am getting $750 but tenant pays all utilities, lawn maintenance, etc. HR Block did our taxes and told us the following:1) have to sell within 3 years of moving out to avoid paying capital gains (moot point for us I think)2) if we want to continue to rent the house and claim any losses we have to rent it at fair market value.I'm trying to figure out 1) what type of losses would we be able to claim? 2) if raise the rent to $1100 and I pay the utilities and such would that still be considered getting fair market value and can I deduct the utilities and such that I pay?Thank you!

Read more

Lane

JD, MBA, CFP, CRPS

Doctoral Degree

 
16,320 satisfied customers
Question regarding converting investment property to business

Question regarding converting investment property to business use. I have a tract of real estate (with open land, no house) that I purchased three years ago. I purchased the property as in investment with the intent to hold for price appreciation with the thought of selling it in a few years with a nice gain. I got a mortgage loan to purchase the property and I pay interest on that loan. I'm quite sure I understand correctly that because I have no other investment/portfolio income, I am rolling the interest over and will eventually deduct it against the gain once I sell it. However, I recently decided instead to change the use of the property. I've decided to purchase cattle, and basically start a little cattle farm on the property. The cattle farm should be profitable, and I assume income from the farming business will be active/business/earned income (rather than passive income) as I plan to actively manage the farm myself. However, my questions are about the property use now. If I essentially convert it to business use (rather than investment/portfolio use), can I begin to deduct the rolled over interest that I had been rolling over with it being investment/portfolio property against the current income of the cattle farm business? Or must I wait and only be able to deduct the rolled over interest if and when I ever sell the property? Also, I'm assuming that with it being converted, I can begin deducting current interest payments against cattle income? Also, would the basis in the property remain the same? Any help would be greatly appreciated.Shannon

Read more

Lev

Retired

Bachelor's Degree Equivalent

 
24,192 satisfied customers
View more tax questions

How JustAnswer Works

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Pay nothing to your Expert if you're not satisfied.

In The News