Unanswered Tax Questions

Small Business

Form 4562 required?

I own a travel trailer camper that I use for my carpentry business more than 50% of the time. I have always documented my depreciation on Form 4562, part v, line 26 for listed property. I opted to use a straight line half year depreciation over a five-year depreciation period. It’s a 2015 model that I bought new for personal use in 2015 and put the camper in service for business use in 2018. Recently I engaged a CPA to review and electronically file my belated 2020 tax return for me. I had already filled out the forms which I provided to her. I am a super neurotic engineer, so I don’t think she found any math errors on my forms. The first draft of my return that she provided as ‘ready for filing’ contained nine corrections that I identified, five of which were careless errors on her part, and two of which were incorrect assumptions she made without asking me to clarify. I lost a lot of faith in her based on all the careless errors because she did not backcheck what her software output compared to my forms. After she made the corrections, the second version did not include form 4562. I asked about it, and she said it’s not necessary. I stated that I believe my camper is listed property as it lends itself to recreational use and in fact, I do use it some recreationally. She said it has to do with the depreciation method that since we’re not taking accelerated depreciation form 4562 is not required. I am skeptical. Please advise.

Family Issues

Can I claim my spouse if they are not a Canadian resident?

My husband currently has his application in for permanent residence but is not officially a Canadian resident, nor does he have a SIN. He is a US citizen. Can I still claim him as a spousal dependent since he is unable to work in Canada and I am financially supporting him? He has been living with me for all of 2022 and has not earned any income for that year.

Miscellaneous

Profit sharing, salaries, and draws

We are a 2 person 50/50 split S-corp. We take relatively low salaries ($70K) and draws over $200K. We would like to offer an employee profit sharing of 5%. However, with our salaries so low, the profit is skewed. If we were to increase our salaries to $200K and make our draws $70K (that becomes the profit), what would the tax implications be? I believe we would pay more in taxes up front for anything below $147K but would that be offset by lower draws. Also that would mean much lower profit payments that would also offset our higher payroll taxes. Thank you for your help.

Personal Taxes

Is 1099 NEC taxable?

Received a 1099 NEC from my realtor for giving me a portion of his commission. He says it's not taxable. A CPA told me it is taxable Is this true?

Nonresident Tax Issues

Nonresidential or Partial-Year?

I lived in Maryland the entirety of 2022, but I had lived in Pennsylvania previously. My employer did not complete everything for the transfer in time, so on my W2 I have PA and MD income. I was confused as whether to put a nonresidential income, since I did not live in PA, or a partial-year resident, since according to the W2, I "lived" in PA.

Deductions and Write-Offs

Bad Debt Qualified Deduction?

Hello, I sold a business as owner financed which then went sideways after 6 months or so due to inactivity. The buyer admitted he was at fault, couldn't repay under any reasonable circumstance, and I received the business back. The business has clearly lost valuation, though still profitable. The remaining debt could be reasonably estimated at 80k after factoring their payments and the lowered business valuation upon return. All equipment/inventory was fully deducted long prior to the sale. I don't know if the entire remaining balance of the payment terms would be considered bad debt, or if only the months he did not pay prior to defaulting? Perhaps the lost valuation is considered bad debt? I think this situation is slightly uncommon, so I haven't been able figure this out on my own. Thank you

Personal Taxes

1099c

I got this from from bank and there no way I can pay back 24 389.93 back what should I do

Personal Taxes

Transcript meaning

Home Ownership

Tax Implications of Holding Title to a House as Tenants in Common

Hello, my wife and I are buying a house and looking to hold title as tenants in common, as we have a prenup that states that we don't have community property. The question is whether we'd still qualify for the $500K capital gains tax exemption should we sell and not be on title as husband and wife community property. If not, do we lose that exemption entirely? thank you!

Personal Taxes

Married But Filing Separately

I am recently married in June of 2022. Prior to June of 2022 I made a 401K withdrawal due to being out of work. I became employed in October 2022. I filed my taxes including married but filing separately, my 401K withdrawal, and my income from my new job. My husband has also filed married but separate with his CPA. I have provided his CPA my W2 and they have filed, but now I wonder if I should have also found the paperwork in regards to my 401K withdrawal prior to our marriage? We weren't married at the time but I live in a community income state, Arizona. Will my 401K withdrawal not being listed on his tax return be an issue even though we weren't married at the time?