For the 2018 tax filing year, there are new Internal Revenue Service (IRS) partnership audit rules [also adopted by the California Franchise Tax Board (FTB)] in which the partnership, not its members, will now be responsible for tax adjustments under audit. There is a very narrowly defined opt-out provision that many partnerships do not qualify for. Please consider amending the partnership operating agreement to designate a “partnership representative” to represent the company in disputes with the IRS or the FTB. Also, you should consider including language regarding the responsibility of tax audit adjustments pursuant to the three allowable methods: “amend”,
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Monthly Archives February 2019
Estate & Trust Department Welcomes Three New Hires
As tax season starts, WFY welcomes three new hires to our Estate & Trust department: Lisa Marking, Heena Shah, and Ann Doan. We are pleased to welcome these new hires to the WFY team. Lisa Marking Lisa Marking joined Wright Ford Young & Co.’s Estate & Trust department as an Estate & Trust manager. She went to Pepperdine University to receive her undergraduate degree as well as her law degree. Lisa also attended University of Southern California to receive her Master’s degree in Taxation. During her free time, Lisa likes to travel and attending music concerts. Heena Shah This month,
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Rental Real Estate Owners-Guidance Related to the 20% Pass-through Deduction
On January 18, 2019, the IRS issued a notice providing “safe harbor” conditions under which rental real estate activities will be treated as a trade or business for purposes of the IRC Section 199A deduction. To qualify for the safe harbor: Separate Books and records must be maintained for each rental real estate enterprise. At least 250 hours of rental services must be performed by the taxpayer and/or workers for the taxpayer during the tax year for each rental real estate enterprise. To clarify, a real estate enterprise may be one rental or multiple rentals. Commercial and residential rentals cannot
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