1 the new schedule e in the real world presented by: national society of accountants 1010 n. fairfax...
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The New Schedule EIn the
Real World
Presented by:National Society of Accountants
1010 N. Fairfax StreetAlexandria, VA 22314
800-966-6679www.nsacct.org
5/18/2012
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Schedule EHot Issues!
• Disclosing Form 1099’s
• Vacation / Short-Term Rental
• Qualified Joint Venture
• Self Rental
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New Schedule E
• Major Facelift for 2011
– The devil is in the details!
• Unlike the New Schedule D
– Just a summary form now
• More on that in our Schedule D seminar
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Why do we have a Schedule E?
• IRC §469
• Tax Reform Act of 1986
• Passive Activities
• At-Risk Rules
• Pass-Through Entities
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Practice Management Tip
• Have a Process
• Have Procedures
• Do Your Due Diligence
• Ask The Right Questions
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Schedule EPage 1
• What’s New?– Lines A & B
• 1099 Mystery
– Line 1• Ask first! There is a code
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Schedule EPage 1
• What’s New?– Lines A & B
• 1099 Mystery
– Line 1• Ask first! There is a code
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Schedule EPage 1
– Line 2• Fair Rental Days
• Personal Use Days
• Qualified Joint Venture?
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Vacation HomeShort Term Rental
• IRC §280A
• 14 Day Rule
• Reporting Income
• Allocation of Expenses– 9th and 10th Circuit Court Rulings
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Qualified Joint Venture
• Must be Husband and Wife
• New for 2011
• Both Must Materially Participate• IRC §469-5T – yep, temporary
• Community Property State Issues
• Simple Election – Is that a problem?
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Passive Activity Loss Rules
• Passive Activities
• Nonpassive Activities
• Real Estate Professionals– Rev Proc 2011-34
• Exceptions – of course!
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Self-Rental
• Know and Understand the Rules
• Income is Non-Passive Income
• Losses are Passive
–Court Case Carlos v. Comm
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Schedule EIncome or Loss
• More Detail
• Line 3 - Form 1099-K
• Line 4 - Wait for it!
• Line 23!– Reconciliation of Amounts Reported
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Schedule EIncome or Loss
• More Detail
• Line 3 - Form 1099-K
• Line 4 - Wait for it!
• Line 23!– Reconciliation of Amounts Reported
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Schedule E Page 2
• Part II– Income or Loss from Partnerships
– Passive vs. Non-Passive
– Loss Rules - Basis, Basis, Basis
– Unreimbursed Expenses - UPE
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Schedule EPage 2
• Part II…………………part 2 – Income or Loss From S Corporations– Passive vs. Non-Passive– Loss Rules - Basis (again)– No Such Thing as “Unreimbursed
Shareholder Expenses”
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Schedule EPage 2
• Part III
– Income or loss from estates and trusts
– Again with the passive and non-passive!
• Part IV
– Income or loss from REMICs
– Schedule Q, Form 1066
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Schedule EPage 2
• Part V – Last but not Least!– Farm rental income – Form 4835– Reconciliation of farming and fishing
income – read the instructions!– Reconciliation for real estate
professionals• IRC §469(c)(7) Agarwal TC Summary
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Practice Management Tip
Ask yourself, have you;
• Been Reasonable
• Been Prudent
• Been Ethical
• Asked the Right Questions
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For More Information:
National Society of Accountants (NSA)
More information is available including additional materials at:
Booth in Vendor HallOr Table in Lobby
800-966-6679www.nsacct.org