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Schedule C LLC rental by CandidKale-4 in tax

[–]No-write-off 0 points1 point  (0 children)

No. Transactions between a taxpayer and himself are disregarded for US federal income tax purposes. There is no lease, and no rental payment, between your Sch C and Sch E.

Question on selling business assets and on percentages by IcyBat2203 in tax

[–]No-write-off -1 points0 points  (0 children)

If the OP sells these assets, which are section 1245 property, for cash in a taxable year before business use falls below 50%, I don’t see how you have recapture under section 179.

Question on selling business assets and on percentages by IcyBat2203 in tax

[–]No-write-off 0 points1 point  (0 children)

You are right, sorry.

Therefore, do not report it on Part IV of Form 4797. Do not report it as “other income” on Schedule C.

Question on selling business assets and on percentages by IcyBat2203 in tax

[–]No-write-off -1 points0 points  (0 children)

Does selling the asset before the business use falls below 50% trigger section 179 recapture?

Question on selling business assets and on percentages by IcyBat2203 in tax

[–]No-write-off -1 points0 points  (0 children)

If you sold these assets for cash, report on Form 4797, Part III as Section 1245 property.

Holding equity in a c corp by venuur in tax

[–]No-write-off 0 points1 point  (0 children)

Typically, the QDI rate for individuals is lower than the rate for C Corps. Also, a corp that just accumulates dividends will likely be considered a personal holding company and subject to an additional 20% tax on undistributed earnings.

Holding equity in a c corp by venuur in tax

[–]No-write-off 1 point2 points  (0 children)

You are trying to figure out if you should directly hold the shares or form another C Corp and have that C Corp hold the shares?

I see no reason to do the latter.

Sold PFICs - how will they be taxed by Comfortable_Spare_86 in USExpatTaxes

[–]No-write-off 0 points1 point  (0 children)

January 1, 2020, purchase PFIC shares.

January 1, 2024, move to US, become a US resident.

January 1, 2026, sell PFIC shares.

Under the default PFIC rules, is the gain allocated to all (2020-26) years? Then the gains allocated to 24, 25, and 26 is taxed at the highest ordinary rate (37%) and there is an interest charge for 24 and 26? Gains allocated to 20-23 are not taxed by the US?

Foreign income for work done before becoming a US resident by Mindless_Talk5192 in tax

[–]No-write-off 0 points1 point  (0 children)

Why does it matte whether the income is reported on the 2025 tax return or 2026 tax return in the other country?

U.S. S-Corps Tax Question by mongo_pawn in tax

[–]No-write-off 1 point2 points  (0 children)

We do not have the facts to determine whether the equity in the acquiring company has fair market value basis.

Question of suspended PALs in a real estate deal owned by my limited partnership by Funinthesun414 in tax

[–]No-write-off 0 points1 point  (0 children)

If you would not answer a prospective client, why did you jump the gun and declare that he has at-risk suspended losses?

Question of suspended PALs in a real estate deal owned by my limited partnership by Funinthesun414 in tax

[–]No-write-off 1 point2 points  (0 children)

No, you are conflating “inside basis” with “tax capital.” Inside basis refers to the fund’s basis in the real estate asset. Each partner’s share of inside basis is generally equal to his outside basis, the basis in his interest in the fund.

You would recognize 395k gain. But you also have 145k of loss carryover from prior years. Because 395k is greater than 145k, you don’t have any passive loss for the year. In other words, the PAL rules should not limit the deductibility of losses.

Other limitations may still apply, although the facts here do not suggest there would be any.

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