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I'm retired and on December 28 moved $75,000 from my self

I'm retired and on December 28 moved $75,000 from my self directed IRA to a taxable account. My problem is that my broker did not finalize the transaction until 5 days later which was now 2017. Therefore I did not receive a 1099-R for this transaction and it leaves me with almost no income for filing 2016 taxes. It also throws off my long term tax plan. I have been paying estimated Fed and State taxes every quarter. Can I still report this income as 2016 income and keep my tax plan in tact?

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Robin D.

Vocational, Technical or Trade School

24,042 satisfied customers
I recently started a small business. Is it possible to have

Hello,I recently started a small business. Is it possible to have my business issue me a non-negotiable promissory note for an expected salary for my services, pay me part of that promissory note each month from business earnings and the difference be written off as a loss at the end of the year?

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PDtax

Owner

Master's Degree

7,658 satisfied customers
My 83 year old mother has come to live with me in August of

My 83 year old mother has come to live with me in August of this year (2016). I live in Westminster, CO and my mom owned her home in Arkansas before moving with me. The home is on a lease to own type contract. The home was to be owned by the new buyer when they sold their Texas home. Anyway, my mom has not received the full amount of the house but received monthly payments of $371.00. She is of course retired and gets Federal benefit credit of $1272.00 per month and $88.35 metlife pensions. She has not paid any taxes since she retired. She found out she has diabetes last July is why I have her living with me now. Her medical expenses are quite high but Medicare and United Health help with these. Does she need to pay taxes now? She has quite a bit in moving expenses also. Thank you for your help on where to begin with her tax situation. - BevJA: The Accountant will know how to help. Is there anything else important you think the Accountant should know?Customer: I can't think of anything else.

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Stephen G.

Sr Financial & Tax Consultant

Bachelor's Degree

10,330 satisfied customers
My husband and I are creating an LLC in TX with another

My husband and I are creating an LLC in TX with another couple. The membership would be 27% for myself (sweat equity-no cash), 25% for my husband (sweat equity-no cash), 24% for partner 3 for $37500 & 24% for partner 4 for $37500. I assume my husband & I will be taxed on 27% and 25% of the $75,000 initial capital account plus/minus any income/loss for the first tax year. Correct? Is there a way to limit the 'phantom income' tax liability for my husband and myself for the sweat equity capital? In your response, would you be so kind to include IRS publications that I can reference to for more in depth information

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Stephen G.

Sr Financial & Tax Consultant

Bachelor's Degree

10,330 satisfied customers
I have an offer to join a business as sub contractor (under

Hello-I have an offer to join a business as sub contractor (under contract) as opposed to w-2 employee. Couple questions:- should I form llc or have me personally be the independent contractor- under the new tax plan, 8 understand there are benefits to this structure versus being w2, can you help me understand?

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ABC Accounting Group

Bachelor's Degree

978 satisfied customers
Robin, I will try to give you as much info as I can, I am

Hello Robin,I will try to give you as much info as I can, I am looking for where should I be putting, paying, my post tax dollars. I am married filing jointly I make 180k with a defined retirement at work, my wife makes 10-12k with no retirement. I am coming to the end of my mortgage $1330 for 2 more years, I have a child 24yo in nursing school 2 more years that I am paying thru sallied mae 36k a yr. I have a rental property in FLA that is generating about 1k a month and I am spending at least 1k a month on the rental (property manager, pool ,taxes etc.) I have 28 years left on that mortgage $1150 a month. I have put about 6500 in my wife's IRA this year, I have put about 4500 in church and other donations this year. I am looking to lower my tax obligations or get the most bang for my post tax dollars. any suggestions will be greatly appreciated

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PDtax

Owner

Master's Degree

7,658 satisfied customers
I am a tax professional (EA) and one of my clients sent me

I am a tax professional (EA) and one of my clients sent me the following article. He has an S Corp. Please review it and let me know your view on it. As far as I know, what he is proposing requires the client to pay 15.3 % of all ;profit to Social Security and Medicare. And for a one man S corp I see little advantage in what he is proposing. Am I missing something here? Also, last I knew S corps were way less audited than Sole Props. Not sure about partnerships. And I do not see why he would put things in a format that appears to give no SE tax shielding. Let me know your view. I am dealing with many one and two man S Corps and LLCs filing as S-Corps. Usually it is a step up from Sole Prop to shield profit from SE tax. Is there some advantage to what this guy says, or is he just ranting.LET'S PLEASE PUTS-CORPS COMPLETELY TO REST – DEAD & BURIED!We are in the 21st century, not the 1st century!Despite telling real estate investors and business owners to avoid S-corps in my courses, newsletters and other correspondence, I continue to get questions on using an S-corporation. The “S” in S-corp stands for SUCK! Here is why, which is not based on my opinion, but based on factual data…Major Tax Pitfall Of S-Corporations_More IRS audit profile and audited much more than partnerships. Very high IRS exposure (the most IRS litigated entity where the taxpayer almost always losses)._Highly Taxed W-2 Salaries With Substantial Employment Taxes – The net income of an S-corp is presently exempt from employment taxes*. But, based on numerous and continuing Tax Court cases, IRS requires the S-corp to pay you a significant amount (even 100%) of highly taxed W-2 salaries along with payroll taxes and filings. This amounts to thousands of dollars of “garbage” employment taxes out the window, reducing your business cash flow. (*Pending legislation would make S-corp net income totally subject to employment taxes)._Limits on fully deducting business tax losses because such losses are limited to the shareholder's basis in the S-corp's stock, which does not include third party debt. Termination of an S-corp status freezes the deductibility of unused carryover losses._S-corp distributions of tax-free borrowed money to shareholders could be taxable because of the above basis limitations. What a tax disaster!_Income and losses must be apportioned strictly in accordance with the exact number of shares owned, with no variations of special allocations to different shareholders._Limits on who can be a shareholder. S-corporations cannot have as shareholders – IRA's, corporations, partnerships and non-resident aliens._An S-corp can have only one class of stock ownership. Not being able to treat entity owners differently puts a limit on tax-reduction planning, such as with a special two-tier LLC structure (see below).What To Do > LLC-partnerships do not have the following disadvantages. Therefore if you have an S-corp, for your real estate investments or your small business other than real estate, get RID it.For real estate investments use a properly structured real estate LLC-Partnership per The LLC Master Machine Asset Protection System www.LLCProtectYou.comFor a small business other than real estate, use a properly structured two-tier business LLC-Partnership per The Business Owner's LLC- Protection System www.LLCBIZShield.comKnow Thy Money!SOME HARDCORE FACTS ABOUT MONEYFACT 1: NO body, but NO body. cares more about your money than YOU! And that is the way it should be as you are the owner. When I say “money” I do not just mean cash or bank accounts; there is also the equity in your home, real estate investments and other assets – IRA, 401(k), other retirement plans, stocks, bonds, mutual funds, insurance, annuities, etc. And your taxes (see below).FACT 2: Taxes = Money! Saving taxes is like making money. The wealthy know that taxes are a primary factor in determining whether you get rich or stay poor. Let's say, for example, you're able to save just $2,000 annually on your tax bill. (With a good tax plan it will be much higher). You invest the $2,000 annually in an IRA which earns a tax-free annual return of 10%. After 20 years, you'll have over $114,000! If you can save $10,000 annually on your tax bill and invest it in a Simple IRA for 20 years, you'll end up with almost $573,000! Over a half of million dollars!! (Imagine how much with Mike Warren note buying!) $5,000 in tax savings (which is found money) as a 10% down payment can allow you to buy an additional $50,000 in real estate! Assuming a 20% yearly return you would earn $10,000 which in 5 years would accumulate to $50,000! Get the point? Money makes money, but tax-free money makes a lot more!!

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

21,062 satisfied customers
Would this be a new question or an extension of the old

Would this be a new question or an extension of the old question?JA: The Accountant will know how to help. Please tell me more, so we can help you best.Customer: Well I need to ask a follow up question to my previous questionJA: Is there anything else the Accountant should be aware of?Customer: Yes. I had a personal bankrupcy, and I wanted to make sure I can still take the loss on the shares. The shares were valued at practically nothing in the bankrupcy.

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PDtax

Owner

Master's Degree

7,658 satisfied customers
We have two companies, a service company and a manufacturing

We have two companies, a service company and a manufacturing company. We are considering combining them into one company, but are trying to determine what the tax factors are. Would it be better for us to leave them separate, or would it not make that much difference if we combined them.JA: The Accountant will know how to help. Is there anything else the Accountant should be aware of?Customer: I think that's it. We just want to make the best decision for the company.

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Mark Taylor

Certified Public Accountant

Masters

3,376 satisfied customers
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