I tried to tag onto another post that discussed this topic but I got a Bad Request response. A 2020 NOL carryforward of $613K is being allowed on the client's 2021 tax return. The answer in the post...
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I tried to tag onto another post that discussed this topic but I got a Bad Request response. A 2020 NOL carryforward of $613K is being allowed on the client's 2021 tax return. The answer in the post said that PS does the calculation and you can see that in the NOL carryforward for 2021 in the Carryover Worksheet. The carryover worksheet is showing zero in the far right column for 2021, therefore, allowing all of the NOL carryover to be deducted. The 2021 taxable income is $(8,103) after the $613K NOL carryover. If I add back the $613K NOL carryover then taxable income before the NOL carryover is $605K. Shouldn't the NOL carryover be limited to $484K ($605K x 80%)? Or am I not calculating this correctly and PS knows better? If the NOL carryover is limited to $484K then how do I adjust that in PS? Thanks for your help.
The instructions say that the OH SD100 will automatically be e-filed with the OH return. However, I don't see any indication that the SD100 is set up for e-filing. Is there a checkbox I'm not seeing...
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The instructions say that the OH SD100 will automatically be e-filed with the OH return. However, I don't see any indication that the SD100 is set up for e-filing. Is there a checkbox I'm not seeing or is PS smart enough to include the SD100 when it e-files the return? The letter doesn't mention the SD100 either. That's why I'm wondering if I still have to indicate that it is to be e-filed. Thanks.
A minister receives a W-2 reporting salary and housing allowance in box 14. SE tax is calculated based on the W-2 information. The minister told me he contributed to a 403(b) plan. Of course, it isn...
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A minister receives a W-2 reporting salary and housing allowance in box 14. SE tax is calculated based on the W-2 information. The minister told me he contributed to a 403(b) plan. Of course, it isn't reported on his W-2. The IRS instructions say that this is reported on Sch 1, ln 16. This is the SEP/SIMPLE/401(K) line. The contribution worksheet doesn't include a 403(b) plan. Furthermore, I don't see how to tie the contribution to the W-2 wages and housing allowance. Where and how is this reported? Thank you.
I'm preparing a 1041 for a trust that has rental property that hasn't been rented since August 2021. The property was sold in March 2022. I know that I can enter the August 2021 date as the disposit...
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I'm preparing a 1041 for a trust that has rental property that hasn't been rented since August 2021. The property was sold in March 2022. I know that I can enter the August 2021 date as the disposition date on the Asset Entry Worksheet and not include a sales price. However, the instructions say that the asset won't transfer to 2022. If the asset doesn't transfer to 2022 then how will PS report the sale of the property on the 2022 tax return? Also, there are suspended losses on the property. How will the sale and the suspended losses be handled when preparing the 2022 1041 in PS? Thank you.
Thank you. Yes, I receive the IRS e-newsletter and I knew about the relief for K-2s and K-3s. I was asking about the requirement to list the number of shares outstanding for S Corps.
One of the 2021 new requirements for an 1120-S was that total shares outstanding needed to be reported. Last month PS required that we complete that information. However, now the total shares outsta...
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One of the 2021 new requirements for an 1120-S was that total shares outstanding needed to be reported. Last month PS required that we complete that information. However, now the total shares outstanding isn't required. Did the IRS change that requirement when they changed the K-2 and K-3 requirement and I somehow missed that? I can't find the answer anywhere. I have filed some 1120-S returns and didn't enter the total shares since it didn't pop up as an error. I didn't even think of the new requirement until now. Hope that won't be a problem for those returns already filed. Thanks.
Thanks @sjrcpa. I understand that you don't reduce APIC for distributions. That's why I am saying that the amount paid back to the shareholder for his additional cash paid into the business is not r...
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Thanks @sjrcpa. I understand that you don't reduce APIC for distributions. That's why I am saying that the amount paid back to the shareholder for his additional cash paid into the business is not reported as a distribution but is reported as a reduction of APIC. No distribution, just paying back the additional cash the owner had to put into the business. Are you saying that the APIC can't be paid back and that any money paid back to the shareholder is still reported as a distribution against RE? And even if RE goes negative from distributions that the shareholder still has basis since there is an APIC balance? Sorry to drag this out. I really appreciate your help.
Ok, maybe I'm confusing things with semantics. I know you don't reduce APIC with distributions. When the company pays back the shareholder for his contributions that were reported as APIC, can that...
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Ok, maybe I'm confusing things with semantics. I know you don't reduce APIC with distributions. When the company pays back the shareholder for his contributions that were reported as APIC, can that amount be reported, not as a distribution, but as a reduction in the shareholder's APIC account without raising red flags? The $200K amount the shareholder contributed in 2021 would be reported on the Basis Info Wks as Stock/loan contributions under the Stock Basis column. Accordingly, this amount would increase APIC on the Schedule L balance sheet since it isn't reported on Sch M-2. As Jeff pointed out, this would increase the shareholder's basis. Is this the correct way to handle this situation? Thank you.
Sorry, Jeff. I didn't see your last post before I sent my last post. OK, so the shareholder will get basis for his contributions in excess of distributions. Is the correct way to handle this still t...
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Sorry, Jeff. I didn't see your last post before I sent my last post. OK, so the shareholder will get basis for his contributions in excess of distributions. Is the correct way to handle this still to record it as APIC? Then, as my last post addresses, when the company pays back the APIC, it will be reported as reducing APIC and basis. It will not be recorded as Distributions. My concern is that if the tax return balance sheet shows a reduction in APIC, does the IRS expect to see a deemed sale of stock holder shares? Thank you.
Yeah, I haven't ran into this before. That's why I want to make sure I handle this correctly. I can't find anything that seems to address this situation. Research on APIC seems to indicate that dist...
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Yeah, I haven't ran into this before. That's why I want to make sure I handle this correctly. I can't find anything that seems to address this situation. Research on APIC seems to indicate that distributions don't reduce APIC but can only be reported against RE. However, in future year(s) as the shareholder is paid back, if the distributions are reported against RE and the "pay back of additional contributions" originally reported on the balance sheet as APIC are reported as reducing APIC, wouldn't that be acceptable? Is there any reg that says APIC can't be paid back to a 100% S Corp shareholder? Is the expectation that if there is a reduction in APIC that there is a deemed sale of stock to the shareholder? I don't want the reduction in APIC to cause an IRS red flag in the future. Thanks for your help.
So he can take future distributions in excess of retained earnings (to pay himself back) against APIC? I thought distributions could not be reported against APIC and could only be reported against RE...
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So he can take future distributions in excess of retained earnings (to pay himself back) against APIC? I thought distributions could not be reported against APIC and could only be reported against RE. If this is the case, then APIC is the best solution. Please confirm that I'm not misreading or misunderstanding your answer. Thank you.
S Corp 100% owner contributed $200K+ more into his business than the amount of distributions taken. He incurred a huge loss in 2021 due to legal expenses related to an ongoing lawsuit. This is the re...
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S Corp 100% owner contributed $200K+ more into his business than the amount of distributions taken. He incurred a huge loss in 2021 due to legal expenses related to an ongoing lawsuit. This is the reason for his additional contribution. For banking and other purposes he would like this additional amount to be shown in the equity section of the balance sheet. How do most of you handle this situation? I know a lot of tax preparers report this as a shareholder loan to the corporation. However, with these small S Corps there never is a loan agreement and no interest is charged. If it is reported as "Due to Shareholder" then it is reported as a current liability on the balance sheet and no basis is reported either. I don't think it should be reported as Additional Paid in Capital since the owner intends to get the money back as soon as possible. For instance, if the owner takes more distributions than he has basis the next year or the following year then he can't reduce APIC for the excess distributions. I want to check to see if any of you know a way to handle this that will give the taxpayer basis and show the additional contributions in equity. Thank you.
Is a signed statement from each partner/shareholder required that states each does not require form 1116 to be filed for 2021? Or is a verbal acknowledgement from the managing partner/shareholder eno...
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Is a signed statement from each partner/shareholder required that states each does not require form 1116 to be filed for 2021? Or is a verbal acknowledgement from the managing partner/shareholder enough? I have reviewed the IRS updated instructions and they don't seem to address if knowledge is good enough or if a signed statement from each partner/shareholder is required - unless I'm missing something. Thanks.
I've never used the import client pdf tax data until recently. It seems like a great time saver but wanted to get input from those of you who use it. I tried it on my first tax return which was only...
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I've never used the import client pdf tax data until recently. It seems like a great time saver but wanted to get input from those of you who use it. I tried it on my first tax return which was only a W-2. It worked great, but that was only for one pdf. Also, before I imported the data a message said I have 50 imports remaining. Do we get 50 free imports with the purchase of the software? Is there any way to get around having to combine all pdfs into one file? Our clients upload to Link or email separate pdf files for each document, or may only combine a few documents into one pdf. If there's no work around, have you found an easy way to combine all pdf files into one file? I'd like to know if you guys love this feature or if it just creates headaches and wasted time? Thanks.
I finally found the answer. No need to waste anybody's time with this. My apologies. I thought there would be an entry for a partner's date of death so that the program would calculate the profit %....
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I finally found the answer. No need to waste anybody's time with this. My apologies. I thought there would be an entry for a partner's date of death so that the program would calculate the profit %. I didn't realize that we need to manually calculate the % and enter it in the special allocations ratio section. That would be a nice feature.
I searched PS support for this question and nothing appeared that addresses my question. Only questions related to 1099-R, 1099-A, all other nonrelated information. Very frustrating that a straight f...
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I searched PS support for this question and nothing appeared that addresses my question. Only questions related to 1099-R, 1099-A, all other nonrelated information. Very frustrating that a straight forward question gives a lot of unrelated questions. Client is a 4 member LLC - two sets of spouses. One of the spouses passed away during the year. It has been a long time since I had to allocate profits and ownership interest for a situation like this and I don't remember how that is done in PS. This is also the last year of the LLC - the rental property was sold. If I enter zero as the ending profit, loss, own % for the deceased member, then no profit is allocated to him for the year. I can't find out how to accomplish this in any instructions. How do I get this done? Thank you.