Talking with TaxSpeaker Video 104
1. In 2018, it was thought that charitable contributions made from a pass through entity (i.e. S corp, partnership) did not reduce QBI; however, with their filing instructions to Form 8995 and 8995-A, the IRS in 2019 seem to indicate that charitable contributions do reduce QBI. Is Bob following this approach with his 2019 returns even though it might not be supported by the law (i.e. are charitable contributions really trade/business type expenses that should be in the QBI calculation).
2. I have a married couple who each owns a house and then they own one together. The total amount of mortgages is about $1.1M. 2 of the mortgages totaling $680,000 were incurred before 12/31/17, the one for $350,000 was incurred in 2019. Is the maximum mortgage interest deduction based on $750,000 for this couple? I'm assuming it is, but you know what happens when you assume!
3. Do you need to reduce the charitable contributions by the $300if you are able to itemize on a state return?
4. Is new employee’s payroll qualified for PPP loan?
5. In 2020, is there a $300 charitable deduction even if a person takes the standard deduction?
6. We have a client that went out of business in May. They had one employee and paid him twice.
7. Their gross receipts were 50% less than they were in the 2nd quarter of 2019, but would they qualify if their business closed? I would think they would not because they are no longer retaining employees, but I can’t seem to find anything about that scenario.
8. Taxpayer worked for P.O. and collects a government pension. Spouse collects Social Security. If spouse dies, does the taxpayer collect her social security. I read the Windfall Elimination Provision and the Government Pension Offset but I'm not sure if it applies to the situation.
9. Any idea as to why the IRS is backed up on refunds, have they released anything? I have clients from April that have not yet gotten refunds
10. A client of mine has been approached by a solar salesman/cpa who says my client can go 100% solar for $96K and over 5 years the US government will give him about $100k is cash payments over the 5 years. 70% in year 1. The salesman said tax benefits and cash payments are better for S Corp and not as good for sole prop. Have you heard anything about this?
11. Since the Cares Act allows one to carryback an NOL for 5 years for a 2018 individual return using a faxed in Form 1045 using an extended and then extended again due date, I have a question. Someone at our firm suggests that since that deadline to do this has passed, we can still file amended returns using 1040X for years 2013 through 2017 to carryback the 2018 NOL. I didn’t see anything in any of my readings that suggest this is possible. If it were possible, what would be the deadline to do this?
12. Can an SMLLC be a shareholder in and S-Corp?
13. Is it possible for an S Corp to pay rent to it's employees? With Covid, we have all moved home. I understand our employees would need to file schedule E, however would that work?
14. How can the owner of an S Corporation and his wife take advantage of the full 401K deduction + Catch up if the employees don’t participate as much (Top Heavy)? This is a small company and it can’t afford the Safe Harbor.