Unanswered Tax Questions
CPAs - answer tax questions, and introduce your practice to potential tax clients.
How does it work?
W4 Assistance
Hello, my wife and I intend to file jointly next year. We have a 1yr old son. She is self-employed and I’m a W2. She is the higher earner and makes quarterly payments. To ensure I’m withholding enough on my W4, should I declare our son as a dependent? Or, should I not and let my wife do so in her quarterly tax payments?
Asked Thursday, September 05, 2024 by Christopher L.Sign in to Answer
CPA for LLC
I'm the owner of a digital LLC (foreign single member) in Wyoming, and I'm looking for a CPA who can assist me with documents and taxes. Can you help me find the right CPA for my business?
Asked Saturday, August 31, 2024 by Edoardo G.Sign in to Answer
Business Tax issue for non-us residents
Hi Team, I hope this email finds you well. I am writing to inquire about your free tax consultation and your tax service for setting up an international office for Beijing Drama and Film Culture in the USA. We are a leading distribution company specialising in copyright and original IP operation, with an international arm for animations and films. We offer comprehensive business solutions for producers and IP parties in China and worldwide, including project investment, programme production and distribution, licensing and merchanting. We plan to operate the international business line and to start distributing children’s content via YouTube and ott/iptv/vod platforms through a USA company ( the LLC, or a better business structure). We are thinking about registering the company in CA or WA state and operating it in LA. In the early stages, we are concerned about the general company set-up advice in the US for non-US residents to help us determine the right type of company, the best taxation options for the company owned by non-US residents, business structure, registration and operation location. Later, it might be expanded to general business tax services for our new US company. I normally work from 10:00-19:00 BJT(GMT+8), but I could accommodate your time to talk from 20:30 to 22:30 BJT. Looking forward to talking to you to learn how you could help us. Best, Yixiang Shirley Lin Assistant to CEO, International Distribution Assistant
Asked Monday, August 19, 2024 by YIXIANG L.Sign in to Answer
Sole Prop vs LLC
I'm starting a social media marketing business and want to start out with as little expense as possible. I would like to start as a sole proprietorship until I get off the ground and then convert to an LLC. I see little risk in having sole prop in this industry, but would like to add the protections an LLC provides as I grow and potentially add employees. Is the process of converting difficult? Should it coincide with a certain date, like the start of the next year? For reference I will be operating in Illinois. Thanks!
Asked Friday, August 16, 2024 by Kevin W.Sign in to Answer
Cybertruck qualification for IRS Residential Clean Energy Credit / Inflation Reduction Act Credit
I have a question regarding the IRS Residential Clean Energy Credit which allows for 30% of the costs of new, qualified clean energy property for your home installed anytime from 2022 through 2032. Specifically around "Battery storage technology". I'm not sure if you're familiar with the new Tesla Cybertruck but it has the ability to act as a battery backup for your entire home with the installation of another device called a Powershare. There's an interesting discussion on Reddit here (https://www.reddit.com/r/cybertruck/comments/18uboyv/using_a_cybertruck_for_an_irs_battery_backup_tax/) where people are arguing that due to this, you should be able to deduct 30% of the cost of the Cybertruck under this rule. Some are saying that the line “…other than property primarily used in the transportation of goods or individuals…” might disqualify it, but then others argue because it would be parked and plugged into the house more than it's driven on the road, that this doesn't disqualify it. There was another thread here (https://www.reddit.com/r/cybertruck/comments/1eoc7zi/cpa_agreed_that_cybertruck_is_eligible_for/) today where a few people said their CPA said that it does qualify. Currently the language is vague and I'd like to be able to take advantage of this credit before it's taken advantage of and changed.
Asked Saturday, August 10, 2024 by Nick F.Sign in to Answer
Interest Expense for Oil Investment
Based on my reading, for debt-financed acquisition of an LLC or S-Corp, the interest paid on that debt is deductible to offset any passive income. Link: http://archives.cpajournal.com/2000/0400/Departments/d45500a.htm#:~:text=Passive%20int I’m curious to know if I acquire debt to invest in an oil investment, where I will receive a Schedule K, will I be able to deduct that interest? If so, where would I be able to. Secondly, if I am not a general partner, I’m told that I can’t not take 75% of the investment as intangible drilling costs in Year 1 then it would be distributed through 5 years. I’m trying to find the literature for that. As well as, would that deduction go against active income?
Asked Tuesday, August 06, 2024 by Vishal P.Sign in to Answer
Capital improvements/expenses
Hi, just sold a house in California and am wondering if the items below are considered capital improvements that can be added to the basis, or capital expenses that can be deducted from the gain. If so, should that be done prior to calculating capital gains tax and other affected taxes? As well, is landscaping - perennials, shrubs, trees, irrigation systems - considered a capital improvement? Thank you. Master Bathroom Tiling Roof vents - Pest Control Carpet install - bdrm and media room Door build and install - main bath Door install/hardware Electrical work - interior Electrical work - exterior Electrical work/parts - interior Stair repair Garage door keyless entry install City permit costs Plaster wall repair Misc. Plumbing Misc construction int/ext Lower deck and pergola design Architectural services Media room remodel Architectural services Lower deck and pergola construction
Asked Friday, July 26, 2024 by Sloan F.Sign in to Answer
1099
I am going to be moving to Canada in the next couple of months and in order to continue working with my current US employer, I will likely be moving to a 1099. I am trying to map out and understand how this affects my take home pay/how I need to pay taxes. Can you take a look at this https://we.tl/t-zZtLehkvwN and let me know if you think it is accurate? Any other insights would be greatly appreciated.
Asked Wednesday, July 17, 2024 by Lindsay D.Sign in to Answer
Exchange Real Estate for Company Shares
My 501(c)7 (a "hunting and fishing club") sales shares in the club to raise money to purchase properties for use by the share holders. There are a couple of shareholders or potential shareholders who would like to turn over their real estate holdings to the club in exchange for shares in the club. After such an exchange, the two would control more than 80% of the club. Is such an exchange allowed (perhaps under Section 351?) without tax consequences? If so, Is there a "holding period" during which the two shareholders may *not* sale their shares in whole or in part? In other restrictions or reporting requirements following such an exchange?
Asked Thursday, July 11, 2024 by Greg C.Sign in to Answer
Concerning passing ownership small business to son and then son directly selling the business
So my Father is retiring and is selling his business (a mom and pop Dry Cleaners in California), but he asked me that he wants to pass ownership to me before he sells the business to the buyer. Therefore, I would be the recipient of the money The reason why he wants to do this is because he does not want to lose his and my mothers medicaid as they have a variety of health issues and have heavily relied on it to live. If he sells the business as the owner he believes he would lose their medicaid coverage. Also, they have been ebt (or food stamps). My question is would this considered be legal first of all and if so how much tax would I be looking at. The total amount coming in from selling the business is $100k in total, with the incoming payments being split into 5 years with the first down payment for $20k, and installments of $1,500 every month after that. Plus, I as an individual make about $45k annually from my job. Thank you so much.
Asked Sunday, June 30, 2024 by Thom Y.Sign in to Answer