All Forum Posts by: Brett Roth

@Dan Handford thank you! I’ll check this out and let yoy know my opinion.

@Eamonn McElroy     Sorry for goofing up the mention tag in the post above.  I appreciate your advice, and yes the QSST has one beneficiary, with each shareholder having their own QSST I believe.  

@Eammon McElroy

Thank you!

If I'm reading you correctly it is I had thought and S-Corp losses in a QSST are passed through to the beneficiary's tax return "as if the trust is disregarded".   We've seen income passed though, but one accountant is saying losses can't pass though which I think is incorrect because it is a QSST.

If it is correct to say that losses pass through then my question is answered and I'm very appreciative.  

Appreciate the note of caution on the necessity of the trust only having one beneficiary, I've read that before but its easy to forget.  All of this is confusing for the layperson :)

cheers

Brett

I have a tricky one for any of the tax gurus that would like to take a stab at it.  

Here's a situation.  S-Corp stock is held in a QSST (Qualified Subchapter S Trust) and the S-Corp stock will generate a loss for the year.  Let's assume active loss, but I'd be curious about passive losses also and if there is a difference there.   CPA thinks that the losses are not passed through to the Trust beneficiaries tax return but instead are held by the trust.  I'm thinking CPA is confused on the specifics of QSST's and is thinking about some other sort of trust maybe.  I'm thinking CPA might not be correct because the whole point of a QSST is that the S-Corp stock still behaves like an S-Corp and is a pass through entity for profits and losses even though it is held in trust.  The losses are attributed to the S-Corp stock and to keep things simple lets assume the trust holds no other assets.   Am I right?  Those losses should pass through to the the beneficiaries individual return?   Thoughts?

thanks

Brett

Apologies if this has been discussed a ton. I didn’t see it in my quick search but have to believe it’s out there Looking for a good free or cheap iPhone app for midlease condition and safety checks. Should have a photo feature, so for example I’d take a photo of the plumbing under the sink, smoke detectors etc and mark them OK as of that date. Any recs? Thanks Brett

Sounds good @Nicholas Aiola.  You a providing a great service.   Thank you.

This is flipping incredible.   @Nicholas Aiolayou are a saint.   The root of this question is this, what does one do when significantly too much depreciation has been claimed in previous tax years by mistake on a property that was sold this tax year?  I'll add that this situation has been communicated to a local CPA/attorney for assistance and the plan is to hire this out but am asking here for additional background and understanding because I had not idea what the answer should be.

If you are curious, the background of the question is this:   The depreciable basis for a condo that was sold in 2017 was calculated incorrectly from the it was used as a rental which started in 2009.  The owner owned 50% of the condo but by mistake depreciated it as if 100% was owned, meaning that too much depreciation was claimed.  I'm not sure who or how the mistake was made but looking at the tax returns it looks to me like that is what happened and at this point how it happened is irrelevant.  Also, the gain on the sale will look like a loss because by basis was entered as 100% of the purchase price, rather than the correct 50%.   The property was sold for a gain but not so much or a gain that my 50% stake in the sale is larger than 100% of the purchase price.   What needs to be done here?  File amended returns going back the 9 years since it was converted to a rental?  I have read online that from 3115 and 481(a) might be required, whatever that means.   

Thanks @Robert Gilstrap, I appreciate it and I am familiar with that rule.   The bar is pretty high on that mark if you have another career as I do. After I retire though, if I like real estate as much as I do now, I can see going full time and enjoying the potentially flexible schedule!  I do understand that even for passive investors who are unable to deduct all of their losses for whatever reason (More than 100-150K income, income to high, married filing separately etc.) the "suspended passive losses" can be deducted when a property is sold.  At least, that's my understanding.

Thanks for the advice @Robert Gilstrap, 

Do you know if the Property Managment LLC could need to show income or could it just pass everything through to the property owning LLC and in essence have no income even though it collected all the rents?

Do any DIY landlords have a separate LLC for the management function? Or is it not worth it....?

thanks

Brett

Hi @Christopher Neeson

     Thanks for sharing your ideas.   Just probably a language thing, but to be clear when you talk about the 4 plex in Anchorage the $55K is the gross income, not the net right?

thanks

Brett