Listener Q&A with Mike Jesowshek CPA (06/14/2023)

On this Podcast we answer listener questions! If you have a question you would like discussed on a future episode, submit it now!

1. Go to www.TaxSavingsPodcsat.com
2. Click Podcast 
3. Scroll to the Bottom and Submit Your Question

You never know, your question may be on the next Q&A session. Below are today's questions, tune into our Podcast to hear the answers!

Marcee: I've heard you talk about the Augusta Rule on your podcast several times. I have a general understanding of what it is and why it came about. My question is if I can use Sec 280 for the following? I have a real estate meet-up in my home about every 6-8 weeks. The goal is to help those who want to get into real estate or are just starting in real estate to learn more from my experience and to meet others who are in a similar situation as they are. Secondary goal is to find financial and equity partners to work with on future projects. My business is a partnership LLC with my husband. Would the above qualify for the Augusta rule?

Stacy: I hear lately a lot of feedback about the government using taxes as inventive to encourage the business owner to do what they want. This makes sense, but why then do banks penalize this (by using tax returns only) when the business owner has a good plan in action to use these deductions and credits properly? Getting a cash out refi or new mortgage is much more difficult if not impossible (or you pay a higher interest) when you strategize well, and are still a “small guy”. It seems the government does not offer incentive to banks or loan providers to work within these scenarios. It’s something that seems to disconnect so heavily so would love to hear if you have thoughts about this.

Curtis: I travel back and forth to work locations for my company. I am a sole employee LLC. I might work in the office one day , travel 30 minutes one day, and I might travel 6 hours the next day, all my car. On those long drives I'm forced to buy lunch . At what point can I write off meal expenses for non-overnight travel, if at all.

Curtis: I'm a sole member LLC. When I file my personal return and pay taxes, I write the IRS and state checks from my business account. What Quickbooks entry should I use. Note I don't pay quarterly taxes at this time because my wife takes extra taxes out of her paycheck.

Greg: I really enjoy your podcast and I know you discuss this issue a lot. However, one piece of it I haven’t heard is regarding IRS reporting. In 2022 I paid each of my four kids roughly $10,000 for work they did in my business. Should I have issued them each a W-2? In 2023 I plan to pay them similar amounts but I am filing as an S Corp and will pay my family management company and have it pay each of them. The same question goes, does the family management company need to issue each one of them a W-2 for 2023? 

Carlos: Just started listening to your show. Really enjoy the show as I’m about to start a business within the month. Here is my question, I remember hearing on one of your previous shows that in order to get the LLC protection, all payments must go thru the business bank account. Can I get the same LLC protection if I accept payments thru a personal CashApp and then deposited thru my business bank account?

Yo: If you have a single member LLC taxed as S corp, what is the best way to take a paycheck monthly quarterly or yearly?

Erika: If I have an online teaching business and I want to sell memberships, can I use the same llc or do I need to create a new one. The membership would consist of online learning but not through the business I have now.

Free Facebook Group Member: Can you combine two different types of businesses such as rental properties and a consulting business in one LLC?

Sal: For single member LLCs that have taken the S-corp tax election- do you pay quarterly estimates taxes on the business profits (after paying yourself payroll with payroll taxes paid)? If so what form on EFTPS.gov is the correct selection for S-corp quarterly tax payments? I called the IRS 2 times and was told form 1120 by one rep and 2220 by the other. They both seemed unsure of their answer. Last year when I was single member LLC WITHOUT Scorp election I just did a 1040ES but they seemed to think being an scorp I now need to do it differently.

Free Facebook Group Member: When you pay estimated tax for single member s-corp, do you pay under your own SS or business EIN?

Lorenzo: If I have a LLC with S-corp status & I setup multiple single-member LLCs under that S-corp, do I need a new EIN for each LLC or would I use my S-Corp’s EIN for each?