Discussion:At Risk and NOL's
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| Revision as of 21:36, 29 September 2009 Ss-cpa (Talk | contribs) (Sorry for the co) ← Previous diff |
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| {{ForumReplyPost|UserID=Ss-cpa|Date=29 September 2009|Text=Sorry for the confusion. There was never any NOL calculated, as no loss was allowed under the At Risk Rules. At least, this is the way the former CPA filed. In my opinion, the At Risk Rules do not apply due to the fact that the loans were either personal and/or personally guaranteed. If I am correct, then the losses would have flowed through from the S Corporation to his personal return and would have resulted in a NOL in a tax year(s) that are now beyond the statute of limitations. How would a correction for this be made for tax years beyond the statute of limitations? Would this be done with a change in accounting method?}} | {{ForumReplyPost|UserID=Ss-cpa|Date=29 September 2009|Text=Sorry for the confusion. There was never any NOL calculated, as no loss was allowed under the At Risk Rules. At least, this is the way the former CPA filed. In my opinion, the At Risk Rules do not apply due to the fact that the loans were either personal and/or personally guaranteed. If I am correct, then the losses would have flowed through from the S Corporation to his personal return and would have resulted in a NOL in a tax year(s) that are now beyond the statute of limitations. How would a correction for this be made for tax years beyond the statute of limitations? Would this be done with a change in accounting method?}} | ||
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| + | {{ForumReplyPost|UserID=Ss-cpa|Date=29 September 2009|Text=Blrgcpa, with regards to the S Corporation losses, the former CPA treated all loans as shareholder loans, which gave him the necessary basis to take the losses. Sorry, did not get your point earlier.}} | ||
Current revision
Discussion Forum Index --> Advanced Tax Questions --> At Risk and NOL's
Discussion Forum Index --> Tax Questions --> At Risk and NOL's
| 29 September 2009 | |
| I just picked up a client that has a 100% owned S Corporation with large losses. The prior CPA treated these losses as limited due to the At Risk Rules. I believe that he handled this in error, due to the fact that the loans used to finance the S Corporation were personal loans and/or loans with property as security that are held personally. If he had not limited the losses under the At Risk Rules, the individual taxpayer would have used these losses on his personal return to create a large NOL. How do you fix a situation like this if the losses go back beyond the statute of limitations? | |
| 29 September 2009 | |
| Maybe over the years, the nol was more than the basis. In this situation it is not deductible. It would be carried over until there is some basis. | |
| 29 September 2009 | |
| Sorry for the confusion. There was never any NOL calculated, as no loss was allowed under the At Risk Rules. At least, this is the way the former CPA filed. In my opinion, the At Risk Rules do not apply due to the fact that the loans were either personal and/or personally guaranteed. If I am correct, then the losses would have flowed through from the S Corporation to his personal return and would have resulted in a NOL in a tax year(s) that are now beyond the statute of limitations. How would a correction for this be made for tax years beyond the statute of limitations? Would this be done with a change in accounting method? | |
| 29 September 2009 | |
| Blrgcpa, with regards to the S Corporation losses, the former CPA treated all loans as shareholder loans, which gave him the necessary basis to take the losses. Sorry, did not get your point earlier. | |
