Tax Tuesdays with Toby Mathis 03-19-19

Toby Mathis and Jeff Webb of Anderson Advisors encourage you to look at taxes as something that's enjoyable because it's a very rewarding subject. Learn how to use tax laws to your advantage and put money in your pockets. Do you have a tax question? Submit it to taxtuesday@andersonadvisors.

Highlights/Topics:

• What happens if I forget to submit Form 8606? You don’t have to file a return if you let the IRS know there’s something you put in, but you are not taking a tax deduction for it
• What principle assets should I use for my LLC, if I work from home? Depends on where you set up the LLC; a physical address, but not your home address, as principal address
• Can paying my minor kids for their work in my business offset taxes? Yes, if they do something of value; shift money from a higher bracket to someone in a lower bracket
• How can we pay kids? Is there a limit? If you're a sole proprietor, you don't have to put them through payroll; if you're anything else, you do put them on the payroll
• Can I pay my parents for babysitting? Yes, but you're not going to write that off because it’s not an expense
• Do I have to file tax through each state where I own a rental property? If you're making money in a state, you must report that income somewhere
• Can a self-directed 401(k) invest in an opportunity property? Self-directed IRA means you don't have to have a custodian; you can be your own administrator or trustee
• Can I invest in opportunity property? Yes. Opportunities zones and opportunity funds get the tax exemption; you can invest in those areas and defer capital gains
• What documents need to be filed for a C Corp? Depends if you're filing it with the state, then there’s three areas to be aware of: State, third parties, and federal government
• Do you need a real estate license to be considered a real estate professional? No.
• What is a good IRA platform to use, has the lowest fees? IRA Club
• Is partnership income in an IRA required to be income taxed? No. An IRA owning a partnership doesn’t pay tax on that income
• Do you lose long-term capital gains being a real estate professional? No. Capital gains are capital gains; you don't lose them because the losses aren’t considered passive
• Do kids pay FICA taxes? If it's payroll, yes; they're not going to pay on employment taxes
• What are the main tax advantages of a C Corp? Separate tax bracket and fringe benefits that are not taxable to you and not available through others
• I have a home office in the basement. Is that basement going to be deducted? Yes, if you’re a sole proprietor; have an accountable plan and reimburse yourself by determining how much square feet of the house you're using
• I formed a single-member LLC. What tax form do I report? You don't; it's disregarded
• What's the best bookkeeping system for real estate investors and financial services corps? QuickBooks

For all questions/answers discussed, sign up to be a Platinum member to view the replay!

Resources

Form 8606

Form 1065

Form 1099-C

Form 1099-A

Form 1120

Section 280A: Home Office Deduction Rules

UBIT

Backdoor Roth IRA

TAFTA

It's not a dream: My Pillow hit for $1.1 million in unpaid NY sales tax

Family Owned Non-Corporate Entity (FONCE)

26 U.S. Code 7702

ACA

SS-4

199-A Dividends

IRA Club

501(c)(3)

Schedule C

Schedule E

1031 Exchange

QuickBooks

Qualified Retirement Plan (QRP)

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