Unanswered Tax Questions

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Business Formation

Where best to file a PLLC: NY or NJ?

I am a psychiatrist starting a solo private practice seeing patients in both New York and New Jersey. Where would it make the most sense from a financial standpoint to file my PLLC?

Asked Monday, December 18, 2023 by Jingna Z.
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Personal Taxes

Married Filing Jointly with an EIN?

I am a sole proprietor (therapist) but have always filed jointly with my husband. This year I want to get an EIN so I can open up a solo-401k. Can I still file jointly even with an EIN?

Asked Sunday, December 17, 2023 by Elijah P.
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Deductions and Write-Offs

Reversing cash flow from mortgage deductions

Hi. I’d like to figure out how to get the cash in hand result from a deduction for year 1 of ownership of a property. I realize the real-life scenario is more complicated than this; but would love to understand a simplified method first. Simple scenario: 1MM property. 20% down. 800k loan. Let’s say 7% interest for sake of argument. 30% tax bracket. I think you’re supposed to figure out the ratio of 750k of 800k because of the cap. So that’s 0.9375. Just to keep the math easy, let’s say that the interest total is 55k a year. How do I figure out what that represents as cash in my pocket? I thought you should take the 55k * 0.9375 to get the max deduction of ~$51,500. Then you multiply that by tax bracket. .3 * $51.5k = ~$15.4k So the cash in hand result after the deduction is about ~15.4k? Any help is appreciated.

Asked Friday, December 15, 2023 by Cav C.
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Bookkeeping & Write-up

Why did my accountant opt for accrual method?

I am a one-person LLC (C-corp) providing services, with average revenues $150-$200K per year. Have few vendors paid on an account basis; no inventory at all. Why would was I set up on accrual accounting method if I fall under the gross-receipts threshold and qualify for cash method in all other ways. Isn't cash method simpler?

Asked Friday, December 15, 2023 by J W.
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Business Formation

Forming a Non-Profit

One of my clients has large profits this year and has decided to follow her dream of having a non profit organization providing the same services as the for profit organization. The for-profit will provide the supporting funds. What are my steps, Can we put this money in an account today towards the business even though we have not formed it/ registered it yet and it wont be completed before year end?

Asked Thursday, December 14, 2023 by Paula S.
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Credits

Two EV tax credits in one year for two vehicles

We just bought a Tesla and are thinking about buying a second, if we will get the $7500 tax credit for the second vehicle as well. Can you get more than one EV tax credit if you buy a second car?

Asked Wednesday, December 13, 2023 by Christopher F.
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Investment and Finance

Can I transfer Sole Prop. earnings into my LLC?

Hi, I have an LLC but do not use it. I work with a partner at our clients pay him and he then gives me my percentage of the earnings. I file my taxes as a sole prop. that said, I'd like to open a solo 401K and to do so with a brokerage like Vanguard or Schwab, they require an EIN. I was wondering two things: 1. can I just use my LLC EIN even though I have no earnings through it specifically and 2. if I need to have earnings, can I simply transfer that into the LLC?

Asked Wednesday, December 13, 2023 by Nick S.
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Family Issues

Sell of home before or after divorce is final?

Getting a divorce and have positive equity in our home. One partner says to wait to sell home prior to finalizing divorce for capital gains reasons. I'm not sure about that. Is there any downside to finalizing divorce THEN selling the house? Thanks.

Asked Tuesday, December 12, 2023 by Ed K.
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Personal Taxes

CA Settlement Distribution

I’ve been awarded a settlement after being sexually assaulted at work in CA. A portion of it is lost wages (taxable). What is the best way to distribute the remainder funds to save on taxes?

Asked Monday, December 11, 2023 by Erica P.
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Tax Filing Tips

An amazing tax opportunity? Am I correct?

My son will have no taxable income this year after the standard deduction is applied. He has considerable capital gains from a stock portfolio I created for him 8 years ago (approx. $450,000). Is it true that he will not owe ANY capital gains taxes if I sell all the stocks in his portfolio, providing I don't buy them back within 31 days?

Asked Sunday, December 10, 2023 by Frank M.
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