Profits, Taxes, & Llcs: Tax Guide 202

by Crouch, Holmes F.

• ISBN13: 9780944817650
• ISBN10: 0944817653
• Format: Paperback
• Copyright: 2002-09-01
• Publisher: Allyear Tax Guides

Summary

Covers the unique characteristics of an LLC under federal law, forming it under state law, the importance of a written operating agreement, the requirement for maintaining a sufficient capital base to meet all business commitments, and the tax forms and balance sheets needed to be considered an LLC. Softcover.

Table of Contents

LLC: A Hybrid Entity	1	(1)
Not a Corporation	2	(1)
Where Confusion Arises	3	(2)
S Corporation Features	5	(2)
Partnership Features	7	(2)
Proprietorship Features	9	(1)
Not a Business Trust	10	(2)
Summary of LLC Features	12
Forming an LLC	1	(1)
Contact Secretary of State	2	(1)
Your State's LLC Law	3	(3)
The Essence of Formation	6	(1)
Articles of Organization; Contents	7	(4)
Statement of Information	11	(1)
Information Required to be Maintained	12	(2)
Operating Agreement: A ``Must''	14	(2)
Cash Starvation by Members	16
Liability of Members	1	(1)
The Basic Protection Rule	2	(2)
The ``Prohibited Distribution'' Rule	4	(1)
The ``Agree to be Obligated'' Rule	5	(1)
The ``Shall Carry Insurance'' Rule	6	(2)
The ``Alter Ego Liability'' Rule	8	(1)
The ``Like-a-Corporation'' Standard	9	(2)
Retroactivc Corrections Preempted	11	(1)
Outsourced Management Permitted	12	(2)
No Shield for Tortious Conduct	14
IRS Election Form 8832	1	(1)
Apply for EIN First	2	(2)
Other EIN Information	4	(1)
Purpose of Form 8832	5	(1)
Information on the Form	6	(2)
Checking ``Form of Entity''	8	(2)
Consent Statement & Signature(s)	10	(1)
The 60-Month Rule	11	(2)
Consequences of Change	13	(3)
Foreign Entity ``Relevance''	16
Tax Forms & Schedules	1	(1)
Where on Form 1044?	2	(3)
Schedule K-1: Top 1/3	5	(2)
Distributive Share Items	7	(2)
The Origin of Schedule K-1	9	(1)
The Allure of Form 1065	10	(2)
The Balance Sheets	12	(2)
Capital Accounts Reconciliation	14	(2)
Single Member LLCs	16	(1)
Solo S Corporation	17
California Form 568	1	(1)
California's ``Tax on Tax''	2	(2)
Overview of Form 568	4	(2)
Page 1, Form 568 Revisited	6	(1)
Single Member LLCs	7	(2)
Analysis: Schedule K (568)	9	(2)
Nonresident Members: List of	11	(2)
Source Determination Rules	13	(1)
Effect on Schedule K-1 (568)	14
Partnership LLC Rules	1	(1)
Categorizing the 29 Rules	2	(3)
The Anti-Abuse Rule	5	(1)
Economic Substance Rule	6	(3)
Maintaining Capital Accounts	9	(3)
Mandatory Allocation of Debt	12	(2)
Partnership Accounting Year	14	(1)
Changes in Members' interests	15	(2)
Basis & Adjustments Thereto	17	(2)
Partnership Basis Accounting	19	(2)
Contributions TO Partnership LLC	21	(1)
Distributions FROM Partnership LLC	22	(2)
Transfer of Partnership Interest	24
Not-For-Profit Rules	1	(1)
Suspect Patterns	2	(2)
``Not-for-Profit'' Defined	4	(1)
``Relevant Factors'' Listed	5	(1)
Your Manner & Expertise	6	(2)
Time and Effort Expended	8	(1)
Expectation & Other Successes	9	(2)
History of Income & Losses	11	(2)
Occasional Profits & Status	13	(1)
Elements of Personal Pleasure	14	(1)
Buying Tax Benefits	15	(2)
Rebutting the Presumption	17
At-Risk Limitations	1	(1)
Where on Form 1040?	2	(2)
Introductory Statutory Wording	4	(1)
Why Deductions ``Per Activity''	5	(1)
Meaning of ``Amount at Risk''	6	(3)
Finessing of Financing	9	(2)
Example of ``Circular'' Financing	11	(2)
Now to Form 6198	13	(1)
Use Part II: Simplified Computation	14
Material Participation	1	(1)
Proprietorship LLCs	2	(2)
Partnership LLCs	4	(1)
Sources of Income or Loss	5	(2)
Source 1: Trade or Business	7	(1)
Material Participation: Test 1	8	(2)
Hypothetical Allocation Example	10	(2)
Synopsis of Tests 2 Through 7	12	(1)
Source 2: Rental Real Estate	13	(2)
Real Estate ``Active Participation''	15
Passive Activity Losses	1	(1)
Meaning of ``Passive Activity''	2	(2)
Commentary on Rental Activities	4	(1)
Passive Activity Gross Income	5	(2)
Passive Activity Deductions	7	(1)
Special $25,000 Loss Allowance	8	(1)
Form 8582: Purpose & Overview	9	(2)
Also Form 8582-CR	11	(1)
Back to Part I, Form 8582	12	(1)
More on Part II	13	(2)
More on Part III	15	(2)
``Triggering'' of Suspended Losses	17
Foreign Entity LLCs	1
Same Elective Options Apply	2
Effective Date & Relevance	4
Registering with Each State	6
Federal Form 1065 Revisited	8
Foreign Accounts Questions	9
The Cross Hairs of Form 8865	12
Schedule K-1: 1065 vs. 8865	13
Aliens: Resident vs. Nonresident	15
Withholding at Source	16
Nonresident Returns: Form 1040NR	18