All Forum Posts by: Jeff Nash

@Daniel Newman

It might make sense to do that but as you probably have  heard before with any interaction with a CPA or tax professional, "it depends".  When I work with clients I try to dig deep to understand their overall financial situation and goals beyond just what the tax returns reveal as that information is extremely relevant.  Entity selection is important for many reasons and impacts or limits certain tax strategies.  The primary motivation for the S-Corp is to mitigate the impact of self-employment taxes, namely the Social Security component which is capped annually ($160,200 this year). You have to pay yourself a "reasonable" salary as well and there is not a bright-line test but rather some general guidelines to help substantiate.  So the bottom line is that it might make sense to do (you have until March 15 this year to file Form 2553 as @Charles Carillo noted) unless a late election beyond that point is available. If you would like to discuss further feel free to reach out or consult your CPA or others in the group.  

Since you are dealing with health insurance it depends on you and your family’s needs and expected heath expenditures and the plan you are enrolled in or choose.  Ultimately what you are trying to do is not limit your tax deduction to the typical health insurance premiums only, but rather have the deduction cover all health costs that generally can only be deducted if you itemize and clear the AGI hurdle.  The other consideration is whether you just use an HSA which is arguably one of the best tax strategies out there (again, it depends on the taxpayer’s needs for health insurance), the limitation being that the contribution allowed is not higher and closer to a 401k.  Hopefully this helps. 

Hi Millie, I'd have to understand the entire fact pattern but if they are both being done in the same year you normally would do a 1031 exchange and then do the cost segregation study.  There are some complexities with how the cost basis is recorded (can be done 2 ways) and an election that can be made to ensure you maximize the deduction.  I'd be glad to discuss further.   

Hi Daniel, I would be happy to discuss your situation since you are local. @Bruce Lynn provided you with a lot of good considerations and issues to mull over.  I work with clients on both the tax angles and also potential investment ideas depending on their background, goals, time horizon, liquidity, etc.  

Yes, I use that strategy with clients when they are a good fit.  Feel free to reach out and I can help.

The tax strategies that are available to you are more limited when you are an employee and not a small business owner or a real estate professional.  There are options though, but it depends on a variety of factors and knowledge of your overall financial situation.  I would be glad to discuss.  

It can be done, but your motivation and intent when you sell the property can't necessarily be for eventual personal use, and the replacement property must be used for investment purposes for a period of time, which is 2 years or more.  There are some other considerations as well.  Feel free to reach out to me and/or I can refer you to my wife Whitney who is a qualified intermediary at Above & Below 1031. 

There is Cost Segregation Audit Technique Guide (Publication 5653) that I think @Greg Scott is referring to, and here is a few noteworthy excerpt:

"The preparation of cost segregation studies requires knowledge of both the construction process and the tax law involving property classifications for depreciation purposes. Unfortunately, there are no prescribed qualifications for cost segregation preparers. However, a preparer’s credentials and level of expertise may have a bearing on the overall accuracy and quality of a study. In general, a study by a construction engineer is more reliable than one conducted by someone with no engineering or construction background. However, the possession of specific construction knowledge is not the only criterion. Experience in cost estimating and allocation, as well as knowledge of the applicable tax law are also important criteria."

So it appears you probably have the requisite technical expertise based on your engineering background, but your level of tax knowledge and it's application would have to be demonstrated.  Perhaps you can just collaborate with a CPA to bridge any knowledge gap and perform the detailed work nevertheless.  Hope this helps. 

I completely agree with @Chris Picciurro regarding the value proposition and having 2 separate engagements - one for tax preparation and one for tax planning.  Every situation is unique and I always recommend just reaching out to a few CPAs so you can share more information about your particular circumstances and they can provide their feedback.      

Disregard.