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• Knowledge Base

• 1099 Income as Other Income, No Self-Employment (SE) Taxes

• 1099-NEC Issued to Your SSN

• 185 Business Deductions You Cannot Take

• 185 Reasons NOT to S-Corp, Downsides to S-Corp Election

• 3 out of 5 Test

• 401k Loans and Life Insurance

• 401k Plan Safe Harbor Provision

• 401k Plans and Roth IRA Conversions

• Roth 401k Plans

• 5 Year Rule

• About the Author

• Accountable Plan Expense Reimbursements

• Accountable Plan Requirements

• Accounting Method

• Adding Your Spouse to Payroll

• Additional Accounting Costs

• Additional Payroll Taxes

• Additional S Corp Salary Considerations

• Additional Section 199A Reporting on K-1

• Aggregation of Multiple Businesses

• Allocation and Throwback

• Ancillary Benefits with S Corporations

• Another Employee Ownership Situation

• Another Option, Dormant S Corp
• Are Educational Savings Accounts Worth It
• Are rental activities always passive activities?
• Are there any downsides to claiming the foreign earned income exclusion?
• Are there downsides to the real estate professional designation?
• Are there exceptions to the bona fide residence or physical presence tests?
• Are there specific material participation tests for real estate professionals?
• Are there specific records I need to keep?
• Are There Tax Breaks for Going to College
• Are There Tax Savings When My Employer Pays for My Education
• Are there ways to earmark money for an individual?
• As an ExPat, do I need to file a State tax return?
• As a one-person show, should I still form an LLC? An S-Corp?
• Assembled Workforce or Developed Process Effect
• Audit Rates and Risks with an S-Corp
• Automobile Decision Tree
• Automobiles and LLCs, S Corps
• Automobiles and LLCs, S Corps (superseded)
• Avoiding or Reducing Self-Employment SE Taxes
• Bad Loans to the S Corp
• Basic Business Entities
• Behavioral Control
• Being a Passive Business Owner
• Being Considered a Passive Business Owner
• Book Introduction
• Business Owned Automobile
• Business Tax Return Preparation
• Business Travel Deduction
• Business Valuation Techniques
• Buy-Sell Agreements
• Calculating the Qualified Business Income Deduction
• California Multi-Member LLC S Corp Twist
• Can I call my 1099 other income which avoids employment taxes?
• Can I claim my residence as a rental, sell it for a loss and deduct the loss?
• Can I deduct a bad debt on my tax return?
• Can I deduct country club dues as a business expense?
• Can I deduct internet expenses?
• Can I deduct mortgage interest paid on my foreign home?
• Can I deduct my cell phone charges?
• Can I deduct the cost of sports, games or hobbies while in college?
• Can I deduct the loss on my primary residence?
• Can I deduct the taxes associated with public improvements?
• Can I exclude the gain on my home sale?
• Can I ignore an IRS notice or claim I never received it?
• Can I rent out half a duplex or a room in my house?
• Capital Leases versus Operating Leases
• C Corporation as Mothership
• C Corporations
• C Corp to S Corp Problems
• Chap 10 – Comingling of Money
• Chapter 10 Introduction
• Chapter 11 Introduction
• Chapter 4 Introduction
• Chapter 5 Disclaimer
• Chapter 5 Introduction
• Chapter 9 Introduction
• Charging Orders
• Cohan Rule
• Colorado’s Criteria for Contractor Status
• Comingling of Money
• Constitutional and Legislative Standards
• Consultative Approach
• Controlled Groups
• Core Competencies
• Cost of Increasing Shareholder Salary
• Costs of Operating an S Corp
• Costs of Performance, Market-Based Approach
• Deal Structure
• Debt Service
• Deducting Business Meals
• Deducting Losses, Trapped Cash
• Deductions the IRS Cannot Stand
• Depreciation
• Determining the S-Corp Payroll Amount
• Disclosure and Updates
• Distributed Assets
• Distributing Profits, Multiple Owners
• Distributions in Excess of Basis
• Distributions in Excess of Shareholder Basis
• Does deducting charitable contributions cause an audit?
• Does voting through an absentee ballot mess up my bona fide foreign residency?
• Do I have to pass the same test each year?
• Do I need receipts for my donations?
• Do I need receipts for my expenses?
• Do I need receipts for my rental expenses?
• Do I need to group my rental activities together?
• Do rental properties offer good tax sheltering?
• Economic versus Equity Interests
• Educational Assistance with an S-Corp – Section 127
• Electing S-Corp Filing Status, Retroactive for 2023
• Employee or Independent Contractor
• Employee or Independent Contractor Status
• ESOPs and S Corporations
• Estimated Tax Payments, Withholdings Issues for an S-Corp
• Exit Plans, Business Succession
• Exit Plans, Succession
• Exotic Stuff
• Expatriates or Expat Tax Deferral Planning
• Expectations of Our Clients
• Family Partners
• FBA, Drop Shipments, Trailing Nexus Revisited
• Final Words
• Financial Control
• Fleischer Tax Court Case
• Formation (Election) of an S-Corp
• Formation of an LLC or S Corp
• Four Basics to Warm Up To
• Gaming the HSA System
• Going Concern
• Growing Business, Debt Service
• Having Staff with a Solo 401k Plan
• Health Care Expenses, Premiums, HRAs, HSAs – Section 105
• Health Care Summary
• Health Savings Accounts (HSAs)
• Hobby Versus Business Article
• Hobby Versus Business Testing
• Real Estate Holding Company and Operating Company
• Holding Company versus Management Company
• Home Office Deduction
• How are repairs and improvements different?
• How can I avoid or reduce Self-Employment (SE) taxes?
• How can I pay my taxes or my notice of deficiency?
• How can I prepare for my face to face or interview field audit?
• How does a Federal Disaster affect my casualty loss?
• How does a joint return get handled during an audit?
• How does an LLC or S-Corp’s income affect my taxes?
• How does bankruptcy affect my unpaid taxes?
• How does proper recordkeeping affect my audit results?
• How does the foreign housing exclusion or deduction work?
• How do fluctuating currency values affect my taxes?
• How do I appeal the collections of unpaid taxes?
• How do I convert my LLC to an S-Corp?
• How do I determine the value of my donation?
• How do I handle my foreign rental property?
• How do I qualify for the foreign earned income exclusion?
• How do I record the hours spent as a real estate professional?
• How do moving expenses affect my exclusion?
• How do partial years work with the foreign earned income exclusion?
• How do passive loss limitations affect me?
• How do tax treaties affect my ExPat situation?
• How long do I have to keep records?
• How much is interest and penalty on taxes owed?
• How should I maintain my tax records?
• How should I respond to an IRS notice or letter?
• If I am a self-employed ExPat, what taxes am I responsible for?
• If I don’t have any rental income can I still claim a loss?
• If I don’t qualify for the housing deduction, can I still deduct expenses?
• If I meet the 750-hour test, do I also meet the 500-hour material participation test?
• If I move back into my rental, how does that work?
• If my employer provides a cell phone, is that income?
• If the S-Corp taxation is what I ultimately want, should I form an LLC or C-Corp?
• Ineffective S Corp Elections
• Introduction Disclaimer
• I purchased a rental property last year. What closing costs can I deduct?
• IRAs and Savings Bonds To Help With Higher Education Costs
• IRS Determination, Form SS-8
• IRS Revenue Rulings and Fact Sheet 2008-25
• IRS S Corp Stats
• Is cancellation of debt always taxable?
• Is depreciating my rental a good thing?
• Is there a way to avoid Self-Employment tax?
• Joint Ventures
• Liability Protection Fallacy of an LLC
• Life Cycle of an S Corporation
• LLC Popularity (Hype)
• LLCs and S-Corps
• Loans or Capital Injections
• Long-Term Care
• May I still make contributions to my IRA as an ExPat?
• Medical C Corp
• Mid-Year Payroll
• Minimize Tax or Maximize Value (Economic Benefit)
• Minimum Payroll with December Bonus
• Misclassified Workers Can File Social Security Tax Form
• Missing Payroll, Now What
• More About WCG
• Multi-Member Limited Liability Company
• Multi-Member LLC That Issues Invoices
• Multiple Employees
• Multiple Shareholders Payroll Split
• My home was destroyed- what deduction can I take? How do casualty losses work?
• My rental sale was a huge loss. What can I do?
• Negative Qualified Business Income
• Net Investment Income, Medicare Surtax and S Corps
• Nevada Fallacy of an LLC (or Delaware or Wyoming!)
• Nexus Theory
• No BS
• Non-Qualified Deferred Compensation Plan
• Nuts and Bolts of the S Corp Election
• Officer Compensation with Solo 401k Plan Deferral
• One Person Show or Husband-Wife Team, S Corporation
• Operating Agreements
• Other Tricks of the Trade with S Corps
• Other W-2 Income
• Owner Only 401k Plans in MMLLC Environment
• Parent-Child Arrangement (Income Flows “Down”)
• Parent-Child Arrangement (Income Flows “Up”)
• Partnerships
• Payroll Taxes on Children
• Personal Service Corporation
• Philosophy of Business Losses
• Physical and Economic Presence, Nexus Attached
• Private Track Coach Deducts Business Losses for Eight Years, Court Says OK
• Processing S Corp Payroll
• Professional Corporations and LLCs
• Progressive Updates
• Purchase Price Allocation
• Putting Your Kids on the Payroll
• Qualified Property Anti-Abuse
• Quick Reference 2023
• Quick Reference 2024
• RCReports
• Reasonable Salary Labor Data
• Reasonable Salary Recap
• Reasonable S Corp Salary Theory
• Recap of Benefits with Multiple Entities
• Recap of S Corp Downsides
• Recap of S-Corps
• Recap of State Tax Issues
• Reclassify Shareholder Distributions
• Reducing Taxes
• Rental Losses with an S-Corp
• Rental Partnerships
• Rentals Owned by an LLC Fallacy
• Small Business Retirement Planning Recap
• Retirement Planning within an S-Corp
• Retirement Planning Within Your Small Business
• Retirement Questions to Ask
• Risk Analysis to Reasonable Shareholder Salary
• Rolling Old 401k Plans or IRAs into Your Small Business 401k Plan
• Roth 401k Versus Traditional 401k Considerations
• Sales and Use Tax, Income Tax
• Salespeople As Contractors
• Sample Response to CO Unemployment Claim
• S Corp Equity Section
• S-Corp Hard Money Facts, Net Savings
• S Corp Hard Money Facts, Net Savings
• S Corporations
• New S Corp Puppy, What Do I Do Now
• S Corp Salary Starting Point
• S Corp Section 199A Deduction Examples
• S Corp Tax Return Preparation
• S Corp Versus LLC
• Section 105 Health Reimbursement Arrangement (HRA)
• Section 125 Cafeteria Plans and Flex Spending (FSA)
• Section 179 and Bonus Depreciation
• Section 199A 200k Comparison
• Section 199A 250k Comparison
• Section 199A Actual Tax Returns Comparison
• Section 199A Basic Comparisons
• Section 199A Deduction Decision Tree
• Section 199A Deductions – Pass Through Tax Breaks
• Section 199A Defining Terms
• Section 199A Frequently Asked Questions
• Section 199A Health Insurance Comparison
• Section 199A Pass-Thru Salary Optimization
• Section 199A Phaseout
• Section 199A Qualified Business Income Tax Deduction
• Section 199A Reasonable Compensation
• Section 199A Recap
• Section 199A Rental Property Deduction
• Section 199A S Corp Considerations
• Section 199A Side by Side Comparisons
• Section 199A Specified Service Business Comparison Part 1
• Section 199A Specified Service Business Comparison Part 2
• Section 199A W-2 Safe Harbors
• Self-Directed 401k Plans
• Self Employed Retirement Plan Basics
• SEP IRA
• SEP IRA Limitations
• SEP IRA, Roth IRAs and the Roth Conversion
• Services and Tangible Personal Property (TPP)
• Services or Property Provided to an SSTB
• Shameless Self-Promotion
• Shareholder Distributions as Reimbursements
• Should I convert my LLC to an S-Corp (Sub-S Election)?
• Should I form an LLC with my spouse?
• SIMPLE 401k
• Single Member Limited Liability Company
• Small Business Tax Deductions Themes
• Social Security Basis
• Sole Proprietors and Single Member LLCs
• Sole Proprietorship
• Specified Service Trade or Business (SSTB) Definitions
• Spousal Attribution and Controlled Groups
• State Apportionment with Multiple Entities
• State Business Taxes (Not Just Income Taxes)
• State Tax Issues and Nexus
• Statutory Employee and NonEmployees
• Stock Classes
• Structuring Deals with Angel Investors
• Summary of Small Business Tax Deductions
• Sutter Rule
• Take Money Out of the S Corp
• Taking Shareholder Distributions
• Tax Brackets Misconceptions- Should I earn more money?
• Tax Court Cases for Reasonable Salary
• Tax Court’s Checklist
• Tax-Free Rental of Your Home
• Tax Home
• Tax Savings and Tax Deferrals
• Tax Savings with Health Insurance
• Terminating S Corp Election
• The Mortgage Forgiveness Debt Relief Act and Debt Cancellation
• The Owners-Only 401k Plan
• The S-Corp Grind, Operational Hassles
• The Zero Dollar Paycheck
• Things to Work Through with Multiple Entities
• Three Types of Income
• Tracking Fringe Benefits
• Trade or Business of Performing Services as an Employee
• Company-Sponsored 401k Plan
• Trapped Assets
• Turbo Charged 401k Plans
• Turn Your Vacation Into a Tax Write Off
• Two 401k Plans
• Type of Relationship
• Using a 401k in Your Small Business Retirement Options
• Using a Self-Directed IRA to Buy a Rental, Start A Business
• Using a Trust in Your Formation Considerations
• Value of a Business Tax Deduction
• Vesting and Expanding Ownership
• W-2 Converted to 1099
• W-2 Converted to 1099 Reasonable Salary
• W-2 or 1099-MISC That Is The Question
• WCG Fee Structure
• WCG (formerly Watson CPA Group) Philosophy on Hobby Losses
• Wayfair Case Part 1
• Wayfair Case Part 2
• What activities count and don’t count?
• What amount can I deduct for foreign earned income exclusion?
• What are my chances of being audited?
• What are qualified medical expenses?
• What are some of the donations I can deduct?
• What are some of the IRS tricks to deny my real estate professional designation?
• What are some of the tax court cases for real estate professionals?
• What are some of the types of IRS notices and letters?
• What are some other charitable deductions?
• What are tax issues with an LLC owning a rental property?
• What are the exceptions to rental activities?
• What are the general tests for material participation?
• What are the limits of my donations?
• What are the operational hassles of an S-Corp LLC?
• What are the requirements for mileage records?
• What are the rules on a home office deduction?
• What business or corporate expenses can I deduct?
• What can the IRS do if I don’t pay my taxes- what is the collections process?
• What causes or triggers an IRS audit?
• What College Expenses Can I Deduct From My Income
• What constitutes a full-time student for tax purposes?
• What do I do with a 1099-K?
• What happens if my host country has a form of social security?
• What if I cannot pay my taxes?
• What IRS publications deal with audits?
• What is active participation versus material participation?
• What is an Accountable Plan?
• What is a tax home or abode, and how do they relate to each other?
• What is Cancellation of Debt? Is it taxable income?
• What is considered foreign earned income?
• What is considered rental income?
• What is foreign earned income exclusion?
• What is the appeals process?
• What is the bona fide residence test?
• What is the definition of real estate professional?
• What is the difference between a hobby and a business?
• What is the difference between an LLC, S-Corp and a C-Corp?
• What is the difference between foreign tax credit and deduction?
• What is the marriage penalty and how does it affect our tax returns?
• What is the period of limitations for an audit?
• What is the physical presence test?
• What rental property expenses can I deduct?
• What types of audits could I face?
• Who can be with me at my IRS audit or conference?
• Who qualifies as a charity?
• Why can’t I deduct health insurance premiums?
• Why designate myself as a real estate professional?
• Why give to charities?
• Why should I keep tax records?
• You Own the Automobile, Get Reimbursed By The Mile
• You Own the Automobile, Lease Back to Your Company
• You Own the Automobile, Take Mileage Deduction
• Your Spouse as a Partner (Happy Happy Joy Joy)

Rental Property KB

• 1031 Like-Kind Exchange
• About the Author
• Accelerated Depreciation and Section 179 Deduction
• Allowed Versus Allowable Depreciation
• Basic Business Entities For Real Estate Investment
• Book Introduction
• Buying Out Your Real Estate Partner
• C Corporations
• Changing Depreciation Between 27.5 and 39.0 Years
• Chapter Introduction
• Charging Orders
• Converting Primary Residence To A Rental
• Cost Segregation Study
• Economic versus Equity Interests
• Fallacy Of A Nevada LLC (or Delaware, or Wyoming, or wherever!)
• Five Basics to Warm Up To
• Getting The Rental Property Ready
• Glossary
• Improvement Versus Repairs
• Introduction Disclaimer
• Liability Protection Fallacy Of An LLC
• Limited Liability Partnerships (LLP) and General Partnerships (GP)
• LLC Benefits For Rental Properties
• Loans or Capital Injections
• Material Participation Rules
• Moving Your Rental Property Into An LLC
• Multi-Entity Rental Property Tiered Structure
• Multi-Member Limited Liability Company (MMLLC)
• Operating Agreements For Real Estate Partnerships
• Owning A Rental Property With Others
• Partial Asset Disposition (PAD)
• Passive Activity Loss Limits
• Passive Income Generators (PIG)
• Pass-Through Versus Disregarded Entity Taxation
• Progressive Updates
• Qualified Improvement Property (QIP)
• Quick Reference 2023
• Quick Reference 2024
• Real Estate and Rental Properties as a Business
• Real Estate Asset Setup On Your Tax Returns
• Real Estate Holding Company and Operating Company
• Real Estate Investing With Family Partners
• Real Estate Professional Status (REPS)
• Real Estate Succession Planning
• Rental Property Acquisition Costs
• Rental Property In C Corporations
• Rental Property In Partnership Entities
• Rental Property Meals
• Rental Property Renovations (Rehab)
• Rental Property Repairs Safe Harbors
• Rental Property Tax Deductions Themes
• S Corporations
• Section 199A Rental Property Deduction
• Selling Your Rental Property
• Shameless Self-Promotion
• Short-Term Rental (STR) Loophole
• Single-Member Limited Liability Company (SMLLC)
• Sole Proprietorship
• State Problems With Your Rental Property
• Structuring Real Estate Deals with Angel Investors
• Taking The Rental Out of Service
• Three Types of Income
• Trapped Rental Assets In An S Corporation
• Using A Self-Directed IRA Or 401k To Buy A Rental Property
• Using a Trust In Your Real Estate Holding Company
• Vacation Home Rules
• Value of a Rental Property Tax Deduction
• What Time Counts For Material Participation
• Your Small Business As A Passive Income Activity
• Your Spouse As A Business Partner (Happy Happy Joy Joy)