All Forum Posts by: Lance Lvovsky

@Matt Bennett

As a contractor, you will want to be aware of the different recognition of revenue methods (completed contract vs percentage of completion method) along with an understanding of how your WIP schedules affect your accounting and tax return. If you also have to report to a bonding company, then you may need a financial statement review.

@Matthew Curley

You cannot sell stocks in a brokerage account and do a 1031 exchange. The 1031 exchange is limited to real property. Stocks are not real property. One workaround is taking a loan against the stock account and using loan proceeds to fund real estate purchases.

@Laurence K.

Who settled (funded) the trust? To be a US trust must meet both the control test and court test (jurisdiction). If foreign trust, you may have a 3520A filing requirement which needs to be filed with the IRS annually ($10,000 penalty if not filed). You should consult with a tax advisor who specializes in the area of trust taxation.

@Joseph Hammel

Some examples of estate planning I have done with my real estate clients include the use of family limited partnerships to freeze value of estate along with defective grantor trusts; LLCs with preferred interests (similar to debt instrument); sale of membership interests to defective grantor trusts; annual gifting of LLC interests using discounts for lack of marketability and/or lack of control, etc.

It will come down to what your goals and wishes are, as well as what the economics of your finances looks like. If you are concerned of being in an estate tax environment, consider then both estate and income tax (step up basis planning). While the current lifetime exemption is approx $ 11.7M, this is set to be cut in half effective 1/1/26, and that reduction may further be accelerated if tax legislation gets passed. Current bill from house ways and means committee cuts exemption effective 1/1/22.

@Sam Zdrum

Based on the fact pattern that you provided, no you would not do that. Rather you would assign the LLC membership interest into your revocable trust. The LLC membership interest is an asset. Make sure you get this reviewed by tax and legal advisors.

@Erik Browning

Just keep in mind us CPAs are facing 9/15 government filing deadlines for business returns. If you are getting a delayed response, that may be why. On the other hand if you are getting ignored, then you should probably move on in your search. Good luck.

@Shafi Noss

There is no magic formula as to how Congress derived these numbers decades ago when this was implemented into tax law. Could have been at the advice of industry groups, could be influenced by revenue constraints and revenue raising as required by congressional bills, etc.

@Evan Loader

As a passive investor in a syndication deal, the syndication (partnership) would only generate depreciation recapture at time of asset sale, which would flow through on a K-1 to you. It would likely be unrecaptured section 1250 gain which would be a subset of any capital gain you have on the sale allocated to you. Suspended passive losses you have been carrying forward on your return would reduce the gain. The suspended losses can be released upon disposition of an activity (asset sale).

@Derek Kroeger

Daniel is spot on. Alternatively you can also local colleagues/friends for a recommendation.

@Adam Steinberger

Be sure you understand how a revocable living trust works and operates, probate protections, etc. creating a trust is one thing. Funding it is where most taxpayers overlook. You need to make sure assets are titled correctly.