All Forum Posts by: Steven Hamilton II
Steven Hamilton II has started 25 posts and replied 5110 times.
Post: "Individual" expenses in a 50/50 LLC
- Accountant, Enrolled Agent
- Grayslake, IL
- Posts 5,272
- Votes 2,325
Originally posted by @Ashish Acharya:
Originally posted by @John Gillick:
Tax question. If you and a friend have a 50/50 LLC and you drive say 10 miles to check on the venture, is that $5.80 mileage expense:
a. an expense put on just your K-1?
b. an expense put on the LLC's tax form (8825) and split 50/50 on the partners' K-1s?
c. other?
Context: I'm considering my first partnership. It's a place that is a couple of hours drive from me and a couple of hours flight or my partner. He has every right to come to inspect and work on the investment and deduct his flight, etc. but I really don't want to pay for half his flight, nor do I want the benefit of half that deduction. Can we put things like payments to contractors on the LLC's expenses and keep things like travel on our separate K-1s?
Yes, those expenses can be deducted as Unreimbursed Partnership Expenses on schedule E page 2.
Your partnership agreements should clarify that your partnership is not responsible for reimbursement of such expense and he could treat it as such. There are other few requirements too.
Unreimbursed Partnership Expenses(UPE) as mentioned above is exactly correct.
You would see on your Form Schedule E Page 2 UPE list as a separate line item.
Post: CPA or Tax Software? - TurboTax, H&R Block, etc.
- Accountant, Enrolled Agent
- Grayslake, IL
- Posts 5,272
- Votes 2,325
I love TurboTax I get a ton of audit representation work because of it. I find we typically have 25-50 open cases we're representing that self prepared.
Post: Help with Account Software for Flipping Houses??
- Accountant, Enrolled Agent
- Grayslake, IL
- Posts 5,272
- Votes 2,325
Originally posted by @Aaron McGinnis:
Things I wish someone had told me early on -
1 - as soon as you have money to count, get an accountant to do, at minimum, monthly reconciliations and year end taxes
2 - use quickbooks. It is a virtually universal skillset and will grow beyond what you will likely ever need it to do
3 - put quickbooks on a remote server
4 - use a bank that allows for employee log in to view transactions
5 - hire a VA to do day to day data entry. We have a guy in India who does a fine job and is so inexpensive I would literally be stupid to do it myself.
Set these systems in place early. I failed to do this as a young business owner and fixing the many problems that inevitably arose cost me tens of thousands to pay someone else to fix. Learn from my mistakes!
Edit to add: if you already have several concurrent projects, have your accountant also give you a monthly job sheet and move to a basis of completion or accrual method of accounting directly... do not screw around with a cash basis as it will bite you early on!
Have a VA do record keeping for you? I would never want to outsource that information outside the country. I've seen some very horrible things as a result of that strategy. Just be careful to protect your Personally Identifying Information. We spend so much time fixing the work of others it is insane.
Post: Issuing 1099 to contractors
- Accountant, Enrolled Agent
- Grayslake, IL
- Posts 5,272
- Votes 2,325
Personally you can apply for an EIN number as well. The house is whatever you intended it to be from the beginning. I'd recommend issuing them to cause yourself the least trouble.
Post: Looking for a HI. CPA. That understands HARPTA.
- Accountant, Enrolled Agent
- Grayslake, IL
- Posts 5,272
- Votes 2,325
Yes, any income derived from other states you will be required to report. I'd be happy to give you some guidance. Just let me know what you need. You're welcome to send me a PM.
Post: Looking for a HI. CPA. That understands HARPTA.
- Accountant, Enrolled Agent
- Grayslake, IL
- Posts 5,272
- Votes 2,325
Originally posted by @Natalie Kolodij:
I was coming here to recommend @Steven Hamilton II he has a florida office.
HARPTA is BASICALLY Hawaii's version of FIRPTA
Some reading for the un-initiated to the HARPTA World.
https://mauinow.com/2018/07/18/what-is-harpta-the-new-law-and-are-there-any-exemptions/
https://www.taxservicesoahu.com/harpta-hawaii-property-sale/
https://tax.hawaii.gov/forms/a1_b3_6harpta/
Post: 1099-INT for private investors
- Accountant, Enrolled Agent
- Grayslake, IL
- Posts 5,272
- Votes 2,325
You should be issuing them as part of your business expenses. I would recommend that you utilize Track1099.com to issue them.
You PAID interest. He has it backwards. They do not need to issue a 1098 to YOU. However, you should to them. Technically depending upon your entity you may not be required to issue them altogether.
Post: Looking for a HI. CPA. That understands HARPTA.
- Accountant, Enrolled Agent
- Grayslake, IL
- Posts 5,272
- Votes 2,325
What would you like to know? Happy to give you some guidance.
Post: San Jose, CA - Tax Accountants and Real Estate Attorneys
- Accountant, Enrolled Agent
- Grayslake, IL
- Posts 5,272
- Votes 2,325
A good Friend of Mine Juan Montes, EA of www.thetaxproblem.com
Post: Opened a Solo Roth 401k Account / Incredible Experience
- Accountant, Enrolled Agent
- Grayslake, IL
- Posts 5,272
- Votes 2,325
Originally posted by @Jon Schoeller:
I just finished signing up for my Solo 401k account with Sense Financial. The service was incredible. As a business owner myself, I wish more people would leave positive reviews just as quickly as they would leave a negative review. This one is well deserved.
Dmitriy talked me through opening the account on Christmas Day. He didn't have to and I didn't ask him to. He was happy to. He has basically held my hand throughout the entire process in order to get this account set up in time. As many of you know, a Solo 401k must be set up and contributed to before the end of the year. We didn't have much time to work with, especially with the holidays. But we did it. My account is now open with Solera Bank and my account is funded.
I don't know if they have the best pricing but good luck finding better customer service.
Thank you, Dmitriy and Sense Financial.
Now I just need some guidance from the rest of you on how to get this money to work without self-dealing, as I am also a full-time real estate investor and the lines can get blurry. I will make another post for that.
Keep in mind that account can depending upon what type of entity it is for can be contributed to either by January 15th for employee contributions(election to do so must be done by December 31st. For a sole prop that would be due April 15th for employee and employer contributions.
Matching contributions(employer contributions) can be paid in as late as the due date of the return including extensions for entities. So there is a great deal of slack in between.