All Forum Posts by: David C.

@Bryan L. - I'm surprised but I find myself disagreeing with the obligation to sell your house to pay off unsecured debt.

Whoever loaned you 'unsecured' - presumably demanded a higher return for the risk that you might get sick, and you were unwilling to put up your house as collateral, so they are stuck waiting until you can pay.

If you are willing to sell your house to repay unsecured debt, then get debt secured by your house, it will be cheaper. And the only cost is being honest with yourself.

I have flipped on the issue of people walking away from mortgages, the more I've learned about how the market was gamed by the banks and people were encouraged to stretch thin - and thinking through the logic of 'secured debt' - the banks were making loans with their eyes open: they get paid x%, if not getting paid, they can take the asset. If you walk away when prices plummet, you are living up to 'option 2: give up the asset'. If you try to not pay AND not surrender the asset, then you are violating your ethical requirements, so people who hire lawyers to slow down foreclosure, or play other dirty tricks - they are showing unethical behavior, but simply doing the math and living up to 'option 2' feels less and less like 'bad ethics' to me. Or maybe I'm just losing my ethics.

Resurrecting this bed bug thread. I just found what I thought was a live bedbug in a hotel room my family and I were staying in. We examined everything else in the room and found no evidence of others, but we packed up and went home right away. We're doing laundry and freezing our luggage in our big freezer.

I was just curious, how common are bed bugs in flips and rentals?

@Steven Laub

you seriously just did a flip from Kuwait? That's amazing, you should write up a success story in one of those threads.

That's some real motivation to try to find a way to do a flip myself, I mean if you can do one from Kuwait?? my excuses seem very small.

@Ryan O. - but I don't work for the IRS, maybe they are nicer than me.

@Ryan O.

- there are those pesky 'profits' that you paid taxes on.

If I worked for the IRS, I'd say: you had 100k in profits, and you were actively involved - some of that should have been paid to you as salary so I could sink my teeth into it.

The fact that you chose to re-invest your 100k in profits gives you 100k in 'investment' that you may withdraw later tax-free, but does not exempt you from FICA this year from your 'profit generating activity' in your S-Corp.

@Ryan O. "My position is the IRS cannot force me to take a salary from the corporation. They CAN and have in the past reclassified distributions or loans as salary. But, I cannot find a single case, neither can anyone else for that matter, where the IRS reclassified "retained earnings" as salary."

Clearly you understand the issues at hand completely, sorry. As for what you explain - have you ever seen the IRS 'try to reclassify' and lose?

@Ryan O.

My understanding is that distribution vs. retention for an S.Corp is not a tax issue.

If you are actively involved and you show profits but not salary. IRS will say you are dodging FICA.

Because all profits are taxed - retaining earnings is the same tax-wise as: paying all profits as distributions, then reinvesting them.

This is why you see the lawsuits you mentioned, the investors get the tax liability but no distribution to help them pay it.

I see your point, if you take no cash flow - it seems like you could argue with the IRS that you had no 'income' - but sadly I think that's an argument you would lose every time.

@Steven Hamilton II - care to chime in?

I have left retained earnings in my S-Corp(for working capital) - then taken them out in future years "tax free" as a distribution of previous capital or something, it was already taxed when it was earned, so distributing it later is not a tax event.

@Ryan O.

S-Corp is a pass-through entity. You can leave the profits in the S-Corp but you are taxed on them the year you earn them. If you want to retain earnings untaxed, you need a C-Corp - and the double-taxation that entails.

The bonus of 'no double taxation' of the S-Corp comes at the cost of 'no untaxed retained earnings'.

I have my own corp and have been working on my TIN since 1998 and never received a 1099. Which makes me happy, I can only imagine the nuisance with my business being cash-basis and some of my checks being issued by my client in one year and received by me the next year. I believe I'd never match my 1099's.

I'm astonished at how complex tax rules are, and how little information you give the government on a tax return. I never understood how people could cheat their taxes when I was not a business owner - now I see. I was giving my accountant very detailed records with many categories of spending, miles driven, tolls paid, everything super detailed. He summarized it into broad categories on my taxes: Business Travel, Office Expense. I am still amazed at this disconnect.

Jerry, you mean CO? monoxide means 1 oxygen. CO3 is carbon trioxide.

Also, CO is not heavier than air.

http://www.firstalert.com/faqs/co-alarm/is-carbon-monoxide-heavier-than-air-what-is-the-diffusion-of-carbon-monoxide-in-air

Carbon monoxide is not heavier than air. The diffusion of carbon monoxide in air is relatively even, meaning that a source of carbon monoxide can distribute the gas evenly throughout the room and house. When installing a carbon monoxide alarm, choose a location where the alarm will stay clean, and out of the way of children or pets. See User's Manual for specific installation requirements.