All Forum Posts by: Lance Lvovsky
Lance Lvovsky has started 17 posts and replied 1372 times.
Post: Unlimited Marital Deduction Question
- Accountant
- Fort Lauderdale, FL
- Posts 1,407
- Votes 754
Originally posted by @Cara Lonsdale:
Originally posted by @Lance Lvovsky:
Originally posted by @Cara Lonsdale:
Originally posted by @Lance Lvovsky:
Originally posted by @Cara Lonsdale:
Can anyone break down the Unlimited Marital Deduction for me?
Spouses are both living, and still married. Spouses file taxes jointly. Both spouses are US citizens.
If Spouse A gives a CASH gift to Spouse B, is it a taxable event?
How does it get deducted on Spouse A's taxes (what line)?
Does Spouse B have to report it (I assume so)? If so, where (what line)?
What are the limitations, if any?
What else is important to know about the Unlimited Marital Deduction?
There is no income tax deduction for transferring cash to your spouse.
Unlimited marital deduction is relating to the wealth transfer tax laws = gift and estate tax. Not income tax.
High level - you do not pay gift tax on transferring (gifting) assets to your spouse.
I understand that. What I am referring to IS a wealth transfer of cash. Instead of the transfer of property, Spouse A liquidated some assets and is wanting to transfer the cash from the liquidation of those assets to Spouse B. It is in the amount of about $375K. So, how would this look on a tax return? I know it is referring to estate tax/gift tax, so does it not even go on an income tax return for either the giver or the receiver? Is anything needed to be filed?
No income tax reporting in transferring cash to a spouse; for either spouse.
Okay. Good. So my understanding is that it only has to be reported on the appropriate Estate/Gift tax forms (709 maybe?), NOT income tax forms.
So when the Giver liquidates the assets, what does he do with the 1099-S that he will receive from the title company reporting the sale? How does he report that if transferring the proceeds to his spouse under the UMD?
I really appreciate your help! My mind was swirling as I was reading through all of the IRS forms online, and most of them refer to transfers AFTER death, when it is most obvious, but not alot of info about transferring while still alive. I know to some of the responders here, it seems like a spouse should be able to just give over cash since they are married, but clearly transferring estate assets can be more complicated that handing it over, especially when you bring other issues like additional beneficiaries like children (step and full), previous or future spouses, declining health and other items into the mix that could be applicable.
At this point, I would recommend you speak to your CPA. I wouldn't be running a business if I gave away free advice all the time. Maybe another accountant here will chime in and help you further, for free. Good luck.
Post: Unlimited Marital Deduction Question
- Accountant
- Fort Lauderdale, FL
- Posts 1,407
- Votes 754
Originally posted by @Cara Lonsdale:
Originally posted by @Lance Lvovsky:
Originally posted by @Cara Lonsdale:
Can anyone break down the Unlimited Marital Deduction for me?
Spouses are both living, and still married. Spouses file taxes jointly. Both spouses are US citizens.
If Spouse A gives a CASH gift to Spouse B, is it a taxable event?
How does it get deducted on Spouse A's taxes (what line)?
Does Spouse B have to report it (I assume so)? If so, where (what line)?
What are the limitations, if any?
What else is important to know about the Unlimited Marital Deduction?
There is no income tax deduction for transferring cash to your spouse.
Unlimited marital deduction is relating to the wealth transfer tax laws = gift and estate tax. Not income tax.
High level - you do not pay gift tax on transferring (gifting) assets to your spouse.
I understand that. What I am referring to IS a wealth transfer of cash. Instead of the transfer of property, Spouse A liquidated some assets and is wanting to transfer the cash from the liquidation of those assets to Spouse B. It is in the amount of about $375K. So, how would this look on a tax return? I know it is referring to estate tax/gift tax, so does it not even go on an income tax return for either the giver or the receiver? Is anything needed to be filed?
No income tax reporting in transferring cash to a spouse; for either spouse.
Post: Unlimited Marital Deduction Question
- Accountant
- Fort Lauderdale, FL
- Posts 1,407
- Votes 754
Originally posted by @Cara Lonsdale:
Can anyone break down the Unlimited Marital Deduction for me?
Spouses are both living, and still married. Spouses file taxes jointly. Both spouses are US citizens.
If Spouse A gives a CASH gift to Spouse B, is it a taxable event?
How does it get deducted on Spouse A's taxes (what line)?
Does Spouse B have to report it (I assume so)? If so, where (what line)?
What are the limitations, if any?
What else is important to know about the Unlimited Marital Deduction?
There is no income tax deduction for transferring cash to your spouse.
Unlimited marital deduction is relating to the wealth transfer tax laws = gift and estate tax. Not income tax.
High level - you do not pay gift tax on transferring (gifting) assets to your spouse.
Post: Can stock investments to added to a LLC to offset tax losses
- Accountant
- Fort Lauderdale, FL
- Posts 1,407
- Votes 754
@Ed Kowalchuk
If you sell appreciated assets, it will be a cap gain. The rental loss will only offset cap gains if you qualify to take rental loss at 1040 level. Speak to your CPA so they can guide you.
Post: Can stock investments to added to a LLC to offset tax losses
- Accountant
- Fort Lauderdale, FL
- Posts 1,407
- Votes 754
@Ed Kowalchuk
You cannot. One is portfolio income and the other is business income to be classified as either passive or non passive but that's another discussion. If you are planning on selling stocks in the LLC that have depressed valuations, it will flow out as a capital loss on your K-1 subject to same limitation as on individual level. Cap losses can offset cap gains and up to 3K ordinary income.
Post: Help with quickbooks online (adding multiple properties)
- Accountant
- Fort Lauderdale, FL
- Posts 1,407
- Votes 754
@Christian D.
You can do one subscription for LLC and one for the ones held in personal name. This will give you reporting you need to provide financial records and have tax returns prepared accurately.
Post: Tax Planning and Filing for a New LLC
- Accountant
- Fort Lauderdale, FL
- Posts 1,407
- Votes 754
@Reuben Dacher-Shapiro
Best get a program such as QuickBooks that can feed in all LLC transactions into the program. You can connect the llc bank and credit card accounts. A good bookkeeper can handle the accounting side / write up for the LLC. That will keep your fees down when you hire a CPA. Inadequate accounting records are the most problematic I see for many new investors.
Post: New investor looking for advice on IRA
- Accountant
- Fort Lauderdale, FL
- Posts 1,407
- Votes 754
@Brian Eastman
I disagree with you and I am not here to get into it. I do expect anyone running an IRA firm like yourself to disagree with me. I represent many wealthy clients and none have rental real estate in an IRA. It is simply not the most tax efficient strategy of employing funds.
Post: New investor looking for advice on IRA
- Accountant
- Fort Lauderdale, FL
- Posts 1,407
- Votes 754
What may have worked for another investor will not necessarily work for you. You need to review your cash flow, tax, and financial needs to determine best approach. I am not an advocate for holding rental real estate in an IRA. You are losing out on the tax benefits of holding rental real estate. Speak to your CPA... that should be a good start.
Post: Looking for a good cpa in New Jersey
- Accountant
- Fort Lauderdale, FL
- Posts 1,407
- Votes 754
I know there are a few here in NY if that may work for you.