All Forum Posts by: Brandon Hall

@Logan Allec you are correct - there is not a deduction for pre-paid 2018 state income taxes. Which is why I said to pre-pay the 2017 state income tax bill, rather than waiting until April 15th to pay :)

@Account Closed for what purpose? Sole-props are generally afforded the same benefits. We're not 100% sure how the wage limitation applies to sole-props and LLCs over S-Corps as of yet. 

@Account Closed standard advice would be to pre-pay 2018 property taxes (primary and secondary residences), Jan 2018 mortgage (primary and secondary residences), and your 2017 state tax bill (if you owe).

@Francis R. why do you feel she is not qualified? 

@John Vietmeyer there is no tax reason to move your rentals into an LLC per the GOP tax plan. The benefits are extended to sole props, meaning you can report on Sch E and still claim the same benefits as someone reporting on Form 1065 or Form 1120-S.

Our firm threw together a document that analyzes the final tax bill for RE investors: https://docs.google.com/document/d/1wXgWAnxAvPcUVK2a8Ixlqvpts6pirkDZ49Jba5Cmzwc/edit?usp=sharing

We put together a google doc for real estate investors that breaks the plan down. You can find it here: https://docs.google.com/document/d/1wXgWAnxAvPcUVK2a8Ixlqvpts6pirkDZ49Jba5Cmzwc/edit?usp=sharing

@Stefanie K. the reconciled bill released this week made no changes to the Sec 121 exclusion. If this bill passes, everything will stay the same regarding Sec 121. 

@Carlo Michelotti how did you request the Form W-9? You will need to prove to the IRS that you attempted to get that information from the contractor. So emails or certified mail requests are good ideas. 

In the future, don't start with a contractor until you have a W-9 from them. I'd even include this in your contract "payment for services will not be rendered until a completed Form W-9 has been delivered to our office."

Ultimately, while the cheap labor is nice, you need to protect your business. Missing 1099s can be costly.

@Michael Plaks my understanding was that the wage limitation applies only if net income exceeds $250k if single and $500k if MFJ. 

@Kyle Cortez the timing of the gift will be dependent on the facts and circumstances. Your questions are great, but not any that I can answer without specific knowledge of the taxpayer and the transaction. 

@Carol C. resigning from the LLC is a gift of value from parent to student. Gifts can have unintended tax consequences if not adequately planned for.