Taxes Us Chat

hcppqu28d

you should try other banks... I use bench for bookeeping and they sent me a list of banks that were taking applications (can send if you want), and they advised to apply with multiple banks at once. I didn't have to go that route, but sounded like good advice....

aepuacfq28d

Yes, please 🙏

avpaohkx28d

What did you decide about this U17A5A9U5? Did you check yes?

jrahrhmz28d

I honestly don't know the right answer. I'm assuming that the banks would verify if I qualify based on the documents I provided, but that may be a faulty assumption.

tumzwpvb28d

It’s so confusing

ajipijpjijd28d

me too please!

iysqmn28d

I can't share links since I'm a newbie :( -- but just sent it to zhgauqrul if he can share the full link - -but main bank they listed was BlueVine then a list of other community banks.

wjdkvuzv28d

bench.co/disaster-loans-financial-relief-programs/|https://bench.co/disaster-loans-financial-relief-programs/

xhzryepgiih28d

woman-bowingskin-tone-2

jkfctsbp25d

I just got a notice of my stimulus payment in the mail about a month after the actual payment was direct deposited 😅

amjqds25d

apparently everyone's getting a letter in the mail in addition to the deposit (with Trump's signature) that your check was deposited. It's for memories 😂

gujkswssf25d

www.accountingtoday.com/news/irs-gives-taxpayers-until-may-13-to-register-for-coronavirus-stimulus-payment-direct-deposit?position=editorial_1&campaignname=ACT_Daily_Daily-05112020&utm_source=newsletter&utm_medium=email&utm_campaign=ACT_Daily_Daily%2B%27-%27%2B05112020&bt_ee=pNQ49nC%2Bvj%2BnC5yyCKfrbP5kRC6wcj2TgrPUXcE3Oi3I%2B3EbrY4hHayohYPaxd12&bt_ts=1589191286042

qqnhdpowrcy25d

why tf is there a deadline

mezbvhqfiwgjgozj25d

because fuck you that's why

avqpyzghubcmuwbn25d

They're sure that all the people with accountants have already done it, and they don't give a fuck about people who don't have an accountant, because those people are poor

okjcgcpguuahayoj25d

What a gigantic god damn waste of money

rowzgilbqxuygpne25d

(not the checks, mailing out shit with Trump's signature)

yueylmf25d

i thought they were already mailing peoples checks though/

nhqizpdf25d

Oh no. I clicked on that article link and now I only have one more free article left to read this month in Accounting Today

zuhmhzpt25d

Mine says it was “scheduled to be mailed May 1” so what the heck am I supposed to do?

kdwcrmkmynh25d

mine was scheduled to me mailed may 1 and it took several days to arrive so I expect it wasn't actually mailed may 1

lioqmrap25d

Mine still hasn’t arrived. I assume they’re mailing it to my accountant since that’s the address I used on my 2018 tax return. She’s in the Netherlands so I guess it could take a week or so

schnqkhy25d

My stimulus check…if it actually exists…may do more traveling than me this year

zdwnpqnx25d

My check gonna have status and I’m nothing ovah heya

hgfamu25d

yup a ridiculous waste of money, time and effort...smh

lxuhjuumzgedx25d

Why can't I just pay _them_ $1200 less, this is so ridiculous

hipnzxnbhwxox25d

Their system still thinks I don't exist, so whatever not worth my sanity

kfdcwmhcoeawwcb25d

There is a certain irony of having his signature on checks given all the stories we heard of him stiffing small businesses and individuals before getting to the WH.

dxvrjyuavsrf22d

Question RE FEIE. Does anyone know how IRS classifies variable foreign earned royalty income? (royalty from book sales?)

ycuwhuvvd22d

znuiejkukutpv My understanding is that it’s earned if you’re still working in the space (writing it, marketing it, etc). Thus it’s subject to SE tax but falls under FEIE. If it’s passive then it’s not earned so it’s subject to income tax but not SE tax.

ctsmpkzaipkd22d

Ok, makes sense. So better earn it under a salary from a company...

qncdakvetppl22d

Thank you

wmjcnmgpk20d

home.treasury.gov/news/press-releases/sm1010|https://home.treasury.gov/news/press-releases/sm1010

jcrdgkfk20d

Is it a good idea to be cautious with PPP funds until the forgiveness is approved?

oxofwrwur19d

Remember that funds need to be spent within an 8 week period

znxuvqgb19d

What does that mean?

sfnbfozr19d

Especially for independent contractors....

lmozhvvbnt19d

I thought PPP can't be used to pay contractors

umhtriazj19d

It can't be used to pay independent contractors, but if you are an independent contractor, you can qualify for funds.

xjdmohxgd19d

bench.co/blog/operations/ppp-forgiveness-contractors-sole-props/

qmyohika19d

Yikes! That seems to significantly reduce the amount I can get forgiven... I doubt I can claim an Airbnb bill as a forgiveable expense...

lwnpbyjy19d

Or, wait... Maybe not...

meuruchs19d

I guess the loan I got is already for the forgiveable amount.

lkrjyog18d

I think the PPP rules may be changing soon

ukexqej18d

U.S. expected to revise terms of PPP loans seekingalpha.com/news/3575360-u-s-expected-to-revise-terms-of-ppp-loans|https://seekingalpha.com/news/3575360-u-s-expected-to-revise-terms-of-ppp-loans

kuyksmqvxxpy17d

Does anyone have an idea whether being a "self employed" overseas would be a CFC in the eyes of IRS? (not asking for a tax advice)

hncfbjtb17d

chlorofluorocarbon?

ieghxgxrhabd17d

lol

lyxjkfzrwwb16d

jifztglxtckkf do you run a company that is based in US? Or you’re freelance?

plsolmiwbvtp16d

jprjuyodawhu neither, I run a company which is based in Europe

rqyrqnvwayvg16d

My question is how IRS sees US Citizens who are self-employed in Georgia, for example

hbeirkczy16d

The US taxes it's citizen on their worldwide income

rlrgbqsuthnz16d

hey, hqqqplzeqh , how are you doing? Yeah, this fact is not an issue.

zekbguwgjygk16d

In some countries self-employed is kinda a business form, and may or may not be treated as a pass-through entity. so I'm wondering if those incomes are personal incomes or CFC incomes

hqdhccnix16d

I'm not really up on CFCs tbh, but if it's passthrough, the US will tax it. You've got the FEIE and the FTC to offset it. That's about as far as my knowledge stretches

yxkdgwecutgw16d

Is there an IRS doc that says what is actually passthrough for the tax purposes?

pmdiamzdv15d

It all passes through UJT9E93EY. That’s pretty much the government’s goal. You get taxed on all of it irrespective of entity. It used to be that you could leave some money in an entity and pay upon distribution. Now, mostly, you can’t. You take in money, deduct business expenses, pay tax on the difference. Thankfully you get an FEIE break if you’re eligible. What are you trying to exclude? And how much is it?

bruhhfqmfaax15d

But it answers the "self employed" type of European entities in my case

ogyfnvuczvlj15d

U02T6G2G0 hmmm isn't there is an exception when the corp tax rate is above 18.9% according to Subpart F income under Section 954(b)(4)

xoxiianvk15d

Yep, it's the Subpart F income that I was referring to when I referred to how things used to be - before the most recent significant changes. The tax reform mostly eliminated the possibilities for deferring the taxes.

blgnbjulm15d

You can eliminate the tax on the FEIE income for both spouses and you can eliminate the Self-Employment tax. There are some other trivial things you can do. Beyond that, from what I can tell, you've got to pay the taxes.

hzvthmkpsohv15d

Wait, but as far as I understand, 18.9% high tax exclusion according to 954(b) is still in effect, no?

zdllezffrsjo15d

```While the statutory language to the high-tax exception was unchanged by the TCJA, other amendments affect the determination of whether an item of income meets the high-tax exception. First, the TCJA reduced the top U.S. corporate tax rate from 35% to 21%. As a result, an item of income will meet the high-tax exception if it is subject to tax in a foreign country at a rate greater than 18.9% (rather than the 31.5% pre-TCJA rate). With the corporate tax rate in many foreign countries exceeding 18.9%, there is a greater likelihood that U.S. groups of multinational enterprises can take advantage of the high-tax exception post-TCJA because it is more likely that the effective tax rate requirement will be satisfied.```

uxkowrzijgak15d

I'm in a no way an expert, but this has been a theme through multiple people I've talked to

axmwvuqfoujx15d

And yes, FEIE totally makes sense, absolutely, if we're talking about my family's personal income

oyennukwj15d

Lets back up a bit - have you ever paid, or do you anticipate paying, corporate income tax? If so, why?

jeiznmnsqaao15d

Haven't done it, but it will be paid in Estonia in case of dividend distribution. So 20% corporate to Estonian govt + whatever personal ordinary/gap gains tax. that IRS wants from me

tmfzlxauzmeb15d

Basically:
• Corp reinvests revenue into itself or public stock
• Corp pays dividends to the shareholders at some point, which triggers a 20% corp tax
So let's say, for 2021 there are some dividends distribution planned.

eimvxnpgq15d

I'm sure you're doing it right. I'm assuming you can't avoid a profit. But I've never been forced into that position and would do everything possible to avoid that kind of double tax. Obviously in the US (or in a zero corporate tax jurisdiction) it's easy to just pay it out in payroll.

dlvlmeoiudss14d

Yes. The main target is payroll. The question is whether I can count that 20% Corp tax for the purpose of high tax deduction

etajafjdqoer14d

And if yes, then I can safely reinvest profits that are not paid via payroll into stocks or other assets, or temporary keep in cash for timing structuring purposes

wyqksjrly6d

Many EIDL loans now closing. Emergency payments came through way back but the rest of the loan is now being funded for many folks I know.

botsjrdspiud5d

Does anyone have any clue how would an Ex-Californian FEIE status affect a newly formed WY LLC and CA franchise tax? Customers are in US CA, NY, PA

jytbrlrbilay5d

It sounds like there is no hope and there is no effect at all, but maybe...

wskmdanxodas4d

What do you mean by ex-Californian FEIE status?

papxjfmojybz4d

Regardless of your LLC's location, your FEIE status, and your personal state residency, you still have to file a non-resident return and pay CA franchise tax if you have income sourced from California. I think there might be a minimum income threshold for this but I'm not sure

xoqhmt4d

Does anyone have information on PPP forgiveness for business owners?

zojmcb4d

I’ve been reading the following “New Loan Forgiveness Caps for Owner-Employees and Self-Employed Individuals. To the surprise of many, the SBA imposes a cap on the amount of loan forgiveness available for owner-employees and self-employed individuals based on their 2019 income. For such individuals, payroll compensation cannot be more than the lesser of $15,385 or 8/52 of their 2019 compensation. Schedule C filers are capped by the amount of their owner compensation replacement, calculated based on 2019 net profit, and general partners are capped by the amount of their 2019 net earnings from self-employment multiplied by .9235. There is also no additional forgiveness for retirement or health insurance contributions of self-employed individuals.”

mqywox4d

I’m aware this is varying regularly, just was curious if anyone has applied in this situation and what the response has been?

vonwejncj2d

I don’t understand the question. All the above quote seems to say is what the program terms were stated to be prior to applications being accepted. It was not a surprise..

rdftcmjii2d

You apply, you get the money, you get it forgiven (later) if you do what you’re required to do

bcjelqtgfymm2d

Yeah, domicile and income source are two separate tests....

dfapcfxosyqg2d

Thanks for your response

oekspoaxpgrq2d

I guess I was hoping to avoid a "doing business in CA" label

tqwnzxxsqlzr2d

Yeah, I'm in a similar position and also wanted to avoid this. My accountant said there's no getting around it since I source about 36% of my income from California clients. IIRC, if it had been less than 25%, I might not have had to file in CA? But don't quote me on that

nchwhqlkotys2d

I guess this is will be inevidable for any service business that targets technology

jhdcbxstcfjo2d

Basically, most of tech /startups is in CA... so for me that would be always the case

xncjzpgfjqld2d

Then question is this, whether having LLC in CA would affect FEIE in any way...

doyvqljpjgpj2d

like CA thinks I'm doing business in CA and I'm not qualifying for a self harbor. question for an accountant.

tuyuxrcalzon2d

I also had the same question about FEIE and CA, because that was where I lived before becoming a nomad. My accountant made me sever all ties with California personally, but she said it was OK to have my LLC's address be there because FEIE is for my personal taxes, and the LLC is a separate entity

igruqiikhtxz2d

The other thing to note is that CA does not recognize FEIE on your personal state taxes. So if you haven't done so already, it'd be good to establish permanent residency in another state (one that does recognize FEIE), or a different country, before you leave. But this is just relevant to your personal taxes, not your LLC

sjbhxrowjnzk2d

But obvi check with an accountant for all this because this conversation took place 2 years ago and I might not be remembering right

znmlzkbgakpb14h

Yeah, my case is not residence in a different state, but more like employment in a foreign company.

vztbmeswqjyu14h

Makes sense anyway. Do you have any idea what's the overall maintenance cost over a year for a generic single member software LLC in CA? Is it opening fees + $800 CA license +~$200 tax return prep fees?

qpcukheryooe12h

Not sure. I use a very comprehensive tax prep package, so I pay far more than $200/year for tax prep, but they manage all this stuff for me. It's been a while since I've thought about the cost breakdown for this

ihnldo9h

whxnuac there is talk that all PPP loans < ~$150k will get auto-forgiven

ocpeut9h

heard whispers about that this morning, thanks for the tip

llllpv9h

seems like things are changing so fast might as well just wait and see

vdrwdj9h

Yep! We aren’t filing any paperwork for a while

pkfhba9h

Letting this play out