LinForPros
12-23-2014, 11:11 PM
Hi, Here is the Story and a question:
In Sept 2012 A Two memeber LLC purchased two vehicles for Taxi Service.
That year is a short tax year for the LLC.
Depreciation Detail Listing looked like below:
Descr
Date
Cost
Biz Percentage
Depreciation Basis
Life
Method
Rate
Current Depr
Accumulated
AMT Current
Lincoln
2012-09-12
7391
100
7391
5
200 DB HY
20
1478
1478
1109
Buick
2012-09-13
12619
100
12619
5
200 DB HY
20
2524
2524
1893
Question is: is it correct for the short tax year of 2012 when the LLC existed since Sept 2012?
Should the Rate of 20 be used from table B1 at all?
My problem understanding this is the method and convention that was set here.
Now 2013 is the real Problem because of the Business Structure Change that occured.
On Sept 19 2013 one member DISSOCIATED from the LLC taking with him the Lincoln Car as part of his dissociation.
Member "A" retained the Buick and Terminated LLC/S-Corp Status with the IRS on Dec 31, 2013 (closed LLC on state level, too).
Member "B" kept the Lincoln and continued the Taxi business as Sole Proprietor effective Sept 20 2013 (another short tax year for him?)
Depreciation Detail Listing (Form 1120S) for 2013 was as follows:
Descr
Date
Cost
Biz Percentage
Depreciation Basis
Life
Method
Rate
Current Depr
Accumulated
AMT Current
Lincoln
2012-09-12
7391
100
7391
5
200 DB HY
32
1183
2661
942
Buick
2012-09-13
12619
100
12619
5
200 DB HY
32
4038
6562
3218
Is it Correct that Lincoln is shown here after the dissociation? I understand that Lincoln was depreciated in the LLC from Jan 1 to Sept 19 (when two members worked togather). Is the above correct and does it follow regulations on depreciation with the IRS?
On top of the above, member "A" continues the taxi business as Sole Proprietor in 2014 (having terminated LLC/S-Corp Status). What should be the cost basis for the Buick car in 2014?
FMV or the Purchase price minus "erronious" depreciations?
LinForPros
thank you for any answers.
In Sept 2012 A Two memeber LLC purchased two vehicles for Taxi Service.
That year is a short tax year for the LLC.
Depreciation Detail Listing looked like below:
Descr
Date
Cost
Biz Percentage
Depreciation Basis
Life
Method
Rate
Current Depr
Accumulated
AMT Current
Lincoln
2012-09-12
7391
100
7391
5
200 DB HY
20
1478
1478
1109
Buick
2012-09-13
12619
100
12619
5
200 DB HY
20
2524
2524
1893
Question is: is it correct for the short tax year of 2012 when the LLC existed since Sept 2012?
Should the Rate of 20 be used from table B1 at all?
My problem understanding this is the method and convention that was set here.
Now 2013 is the real Problem because of the Business Structure Change that occured.
On Sept 19 2013 one member DISSOCIATED from the LLC taking with him the Lincoln Car as part of his dissociation.
Member "A" retained the Buick and Terminated LLC/S-Corp Status with the IRS on Dec 31, 2013 (closed LLC on state level, too).
Member "B" kept the Lincoln and continued the Taxi business as Sole Proprietor effective Sept 20 2013 (another short tax year for him?)
Depreciation Detail Listing (Form 1120S) for 2013 was as follows:
Descr
Date
Cost
Biz Percentage
Depreciation Basis
Life
Method
Rate
Current Depr
Accumulated
AMT Current
Lincoln
2012-09-12
7391
100
7391
5
200 DB HY
32
1183
2661
942
Buick
2012-09-13
12619
100
12619
5
200 DB HY
32
4038
6562
3218
Is it Correct that Lincoln is shown here after the dissociation? I understand that Lincoln was depreciated in the LLC from Jan 1 to Sept 19 (when two members worked togather). Is the above correct and does it follow regulations on depreciation with the IRS?
On top of the above, member "A" continues the taxi business as Sole Proprietor in 2014 (having terminated LLC/S-Corp Status). What should be the cost basis for the Buick car in 2014?
FMV or the Purchase price minus "erronious" depreciations?
LinForPros
thank you for any answers.