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| Author : | Danny C Santucci, JD |
| Course Length : | Pages: 226 ||| Word Count: 12,3084 ||| Review Questions: 125 ||| Final Exam Questions: 113 |
| CPE Credits : | 22.5 |
| IRS Credits : | 22 |
| Price : | $139.95 |
| Passing Score : | 70% |
| Course Type: | NASBA QAS - Text - NASBA Registry - IRS Enrolled Agents |
| Technical Designation: | Technical |
| Primary Subject-Field Of Study: | Taxes - Taxes for Course Id 2355 |
| Description : | This comprehensive book describes and compares sole proprietorships, partnerships, limited liability companies, “C” corporations, and “S” corporations. It examines their advantages and disadvantages, permitting the reader to properly select the right business entity for their tax and liability needs. Major emphasis is given to the maximization of tax benefits in each business format. Fringe benefits, retirement plan alternatives, and nonqualified deferred compensation are discussed in detail. |
| Usage Rank : | 13333 |
| Release : | 2024 |
| Version : | 1.0 |
| Prerequisites : | General understanding of federal income taxation. |
| Experience Level : | Overview |
| Additional Contents : | Complete, no additional material needed. |
| Additional Links : |
What Are the Basics of Business Development?
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| Advance Preparation : | None. |
| Delivery Method : | QAS Self Study |
| Intended Participants : | Anyone needing Continuing Professional Education (CPE). |
| Revision Date : | 27-Aug-2024 |
| NASBA Course Declaration : | Participants must complete the final examination within one year of purchase and with a minimum passing grade of 70% or better to receive CPE credit unless otherwise noted on the Course History page (i.e. California Ethics must score 90% or better). After logging in click on the Course History links on your My Courses page for the Begin date and Expire date for the Final Exam. |
| Approved Audience : | NASBA QAS - Text - NASBA Registry - IRS Enrolled Agents - 2355 |
| Keywords : | Taxes, Choosing, Right, Entity, Getting, Cash, Out, It, from, Tax, Perspective, v14, cpe, cpa, online course |
| Learning Objectives : |
As a result of studying each assignment, you should be able to meet the objectives listed below each assignment. ASSIGNMENT SUBJECTChapter 1 Sole Proprietorship At the start of Chapter 1, participants should identify the following topics for study:
* Formation * Schedule C * Self-employment tax * Estimated tax * Sale of a business * Classification of assets * Other business dispositions * Income splitting * Estate planning After reading Chapter 1, participants will be able to:
2. Identify not-for-profit activities particularly as they relate to Schedule C businesses and recall the various requirements permitting such businesses to complete the former C-EZ or request an automatic filing extension. 3. Recognize the taxes imposed on self-employed persons specifying compliance with payment requirements, determine how sole proprietorship assets are characterized on disposition, and identify income splitting and estate planning devices available for such business owners and their impact on entity choice. Chapter 2 Partnerships At the start of Chapter 2, participants should identify the following topics for study:
* Partners taxed as individuals * Partnership tax return * Year taxable * Transactions between partner & partnership * Contributions of property * Inside basis of contributed assets * Basis of partner’s interest – outside basis * Sales & exchanges of partnership interests * Partnership distributions After reading Chapter 2, participants will be able to:
2. Identify the taxation of partners and partnerships and its effect on the preparation of individual returns and K 1s and, specify the exclusion requirements stating the tax rate and §1031 exchange impact. 3. Recognize separately stated items identifying the relationship of deductions to outside basis, partnership versus partner deductions, allocation of deductions, and related filing requirements to improve accurate tax reporting. 4. Determine the closing of a partnership year, the events that terminate a partnership, and the events that do not close the year to ensure proper tax allocation. 5. Identify types of transactions between a partner and the partnership that can influence the treatment of the transaction, and specify the character of property contributions under §721. 6. Determine inside and outside basis, including complications caused by the contribution of services, specify their interplay with the at-risk & passive rules, their impact on the disposition of partnership interests, and their effect on partnership distributions, and identify how such distributions and liquidations effect gain or loss for partnership and partners. Chapter 3 Limited Liability Companies At the start of Chapter 3, participants should identify the following topics for study:
* Advantages of LLCs over S corporations * Advantages of LLCs over limited partnerships * Advantages of LLCs over general partnerships * Disadvantages * Uses * Federal tax consequences * Conversion to LLCs from other entities * Local taxes on conversion * California Limited Liability Company Act After reading Chapter 3, participants will be able to:
2. Cite reasons for choosing an LLC over S corporations, limited partnerships, and general partnerships and, in contrast, determine the drawbacks of LLCs to assist clients in entity selection. 3. Identify several ways to use the LLC form effectively and thereby fit client objectives and expand business-planning opportunities. 4. Recognize the varying tax consequences of forming or converting to an LLC including possible tax differences using the California Limited Liability Company Act. Chapter 4 Corporations At the start of Chapter 4, participants should identify the following topics for study:
* PSC corporations * Incorporation * Small business stock exclusion * Start-up & organizational expenses * Alternative minimum tax * Capital gains & losses * Accumulated earnings * Accounting periods & methods * Inventories After reading Chapter 4, participants will be able to:
2. Identify “personal service corporations” and small business investment companies, their requirements & tax treatment, and determine when and how clients can engage or avoid such classification for their benefit. 3. Recognize the transfer of money, property, or both by prospective shareholders to a corporation and the requirements of §351. 4. Specify the requirements of §1244 stock and the small business stock exclusion, and determine the differences between start-up expenses and organizational expenses. 5. Identify corporate pitfalls and dangers citing tax recognition of the entity, tax rates, AMT repeal, capital gains & losses under §1212, and the dividends received deduction under §243. 6. Specify necessary corporate action for making allowable corporate charitable contributions and avoiding tax penalties under §541 and §531. 7. Identify available corporate accounting periods and methods stating the treatment and impact of tax-exempt income, inventory identification & evaluation, multiple corporations, and corporate liquidations and distributions. Chapter 5 S Corporations At the start of Chapter 5, participants should identify the following topics for study:
* S corporation status * Termination * Income & expense * Built-in gain * Passive income * Basis of stocks & debts * Distributions * Form 1120S * Fringe benefits After reading Chapter 5, participants will be able to:
2. Identify variables that impact whether a business can choose S corporation status, ways that an S corporation may be terminated, and the related procedures that must be followed. 3. Recognize S corporation tax treatment including special areas involving income and expenses, pass-through items, built-in gain, passive income, tax preference items, LIFO recapture tax, capital gains tax, investment credit recapture, estimated tax payments, and basis of S corporation stock. 4. Identify S corporation owner compensation and distribution options recognizing reasonable compensation requirements, related party rules, S corporation distribution taxation, tax year choices, fringe benefits, and specifying when Form 1120S must be filed. Chapter 6 Basic Fringe Benefits At the start of Chapter 6, participants should identify the following topics for study:
* Employee achievement awards * Group term life insurance * Self-insured medical reimbursement plans * Medical insurance * Meals & lodging * Cafeteria plans * Employer-provided automobile * Adoption assistance program * Interest-free & below-market loans After reading Chapter 6, participants will be able to:
2. Identify the basic mechanics of typical fringe benefits, determine the fair market value of a fringe benefit under the general valuation rule or the special valuation rules, and cite the general accounting rule and the special two-month pour-over accounting rule. 3. Determine what constitutes a §274 “employee achievement award” and specify the rules for §79 group term life insurance specifying how to implement proper coverage. 4. Recognize the mechanics of §105 self-insured medical reimbursement plans, and determine the requirements of §106 medical insurance stating the differences between the two Code sections. 5. Specify the rules for excluding the value of meals and lodging under §119 and determine what constitutes a “cafeteria plan” stating how it operates. 6. Identify the requirements and limits of employee educational assistance programs and dependent care assistance determining how to obtain each type of assistance. 7. Determine “no-additional-cost services” and identify what property or services are excludable from income as qualified employee discounts under §132(c), and specify exceptions to working condition fringes and de minimis fringes. 8. Recognize the requirements for qualified transportation fringe benefits under §132(f), specify valuation methods for employer-provided automobiles, and identify qualifications for the popular physical fitness exclusion and the requirements and benefits of adoption assistance programs. 9. Identify planning services available under §§132, 212, and 67, determine interest-free and below-market loans, recognize the elements of childcare benefits and corporate-funded educational savings accounts, specify S corporation fringe benefits, and identify ERISA compliance requirements. Chapter 7 Retirement Plans At the start of Chapter 7, participants should identify the following topics for study:
* Basic requirements of a qualified pension plan * Basic types of corporate plans * Types of defined contribution plans * Self-employed plans – Keogh * Distribution & settlement options of IRAs * Tax-free rollovers for IRAs * Roth IRAs * Simplified employee pension plans (SEPs) * SIMPLE Plans After reading Chapter 7, participants will be able to:
2. Specify the requirements of the basic forms of qualified pension plans. 3. Identify defined contribution and defined benefit plans stating the types of defined contribution plans and specifying their effect on retirement benefits. 4. Determine the differences between self-employed and qualified plans for other business types recognizing key choice of entity factors. 5. Specify the requirements of IRAs, SEPs, and SIMPLEs, and identify tax-free Roth IRA distributions stating where to maximize plan benefits. Chapter 8 Nonqualified Plans At the start of Chapter 8, participants should identify the following topics for study:
* Purposes & benefits * Constructive receipt * Economic benefit * Funded company account plan * Segregated asset plan * Tax consequences * Accounting * Estate planning considerations * Withholding, Social Security & IRAs After reading Chapter 8, participants will be able to:
2. Specify the differences among unfunded bare contractual promise plans, funded company account plans, and segregated asset plans and the tax consequences of each, and identify the basic tax consequences associated with nonqualified plans. |
| Course Contents : | Preamble Passthrough Entities - 20% Deduction Limitations Deduction Amount Qualified Trade Or Business Corporations - 21% Rate Chapter 1 - Sole Proprietorship Introduction Advantages Disadvantages Formation Start-Up Expenses Withdrawals Schedule C Not-For-Profit Activities Deduction & Loss Limit Profit Presumption - 3/5 Schedule C-EZ - Discontinued Individual Rates Due Date - Form 1040 Extension to File - Form 4868 Business Entity Impact Self-Employment Tax Incorporation “S” Solution Estimated Tax Underpayment of Tax - Form 2210 Sale of a Business Classification of Assets Other Business Dispositions Income Splitting Estate Planning Chapter 2 - Partnerships Definition of Partnership Section 761(a) Co-tenancies Partnership Agreement Modifications Partner’s Share of Tax Items Limited Partners Family Partnerships - §704(e) Publicly Traded Partnerships - §7704 Advantages Disadvantages Exclusion from Partnership Treatment - §761 Complete Exclusion Election Partial Exclusion Election Partners Taxed as Individuals Exception - Separate Entity for Some Purposes Individual Returns & K-1s 20% Passthrough Deduction Partnership Expenses Paid By a Partner Separately Treated Items Character of Items & Limitations Deduction of Losses Outside Basis Limitation - §704(d) Loss Ultimately Deductible Effect of Losses on Outside Basis - §705 Partnership Tax Return Organization & Syndication Fees - §709 Capitalized Syndication Fees Business Start-up Costs - §195 Definition Filing Requirements Due Date of Return Failure to File Failure to Furnish Copies to Partners Special Allocations - §704(b) Economic Effect “Substantial Effect” Year Taxable - §706(a) Limitation on Choice of Taxable Year Closing of Partnership Year Events That Terminate Partnership - §708(b) Discontinuance of Business Winding Up Sale of 50% or More Interest - Repealed Events That Do Not Close the Year - §706(c) Sale of Individual Partner’s Interest Death of Partner Admission of New Partners - §706(d) Allocation Techniques Daily Allocation Required for Cash Items Transactions between Partner and Partnership Treating Partner as Stranger - §707(a) Payments by Accrual Basis Partnership to Cash Basis Partner Guaranteed Payments - §707(c) Section 709 Guaranteed Minimum Year Taxed - §706(a) Payments Resulting in Loss Accident & Health Insurance Premiums Certain Losses Disallowed - §707(b) Two Partnerships Constructive Ownership Sales at Gain Contributions of Property - §721 Contribution vs. Sale or Exchange Disguised Sale - §707(a) Disguised Taxable Exchanges - §704 & §737 Property Distribution to Contributing Partner - §737 Anti-Abuse Rules Contributed Property Distribution to Another Partner - §704(c) Inside Basis of Contributed Assets - §723 Allocation of Precontribution Gain or Loss - §704(c) Liabilities Earlier Optional Application of §704(c) Character of Subsequent Gain Taint On Contribution- §724 Character of Subsequent Loss - §724(c) Contribution of Services Basis of Partner’s Interest - Outside Basis Original Basis - §722 Adjustments to Basis Effect of Liabilities - §752 Deemed Distribution & Contribution Special Rule for Liabilities of Cash Basis Partnership Partner’s Share of Partnership Liabilities Limited partnerships Exception Guarantees Limits on Deduction of Partnership Losses At-Risk Rules - §465 Definition of Amounts at Risk Passive Losses - §469 Sales & Exchanges of Partnership Interests Exchanges & Transfers Like-Kind Exchanges - §1031 Transfers to Controlled Corporations - §351 Partner’s Interest Basis Incorporation Methods Foreign Person Sale of U.S. Partnership Interest Hot Assets - §751 Unrealized Receivables Depreciation Recapture Inventory “Inventory Items” Basis of §751 Property Tax Reporting Effect Capital Gains - Regulations Liabilities of Partnership Inside Basis after Transfer of Partnership Interest General Rule - §743(a) Special Basis Adjustment - §754 & §743(b) Allocation of Basis - §755 Substantial Built-in Loss - §743(d) Partnership Distributions - §731 Exceptions to General Rule Partner’s Interest - §733 Property Received - §732 Nonliquidating Distribution Basis Limitation - §732(a) Liquidating or Complete Distribution Allocation of Basis When Limited - §732(c) Partnership’s Basis Greater Than Partner’s Basis Partner’s Basis Greater Than Partnership’s Basis Special Adjustment to Basis Holding Period - §735 Partnership Property - §754 & §734 Distributions of Receivables or Inventory Proportionate Distributions Disproportionate Distribution - §751(b) Partnership Liquidations Types of Liquidating Distributions Liquidating Distributions of Money Section 736(a) Payments Section 736(b) Payments Effect Exclusions From §736(b) Treatment Distributions of Property in Liquidation Chapter 3 - Limited Liability Companies Introduction LLC Benefits Advantages of LLCs over C Corporation Double Tax 20% Passthrough Deduction Basis Adjustment Special Allocations Contributions Liquidation Unreasonable Compensation Non-Tax Benefits Advantages of LLCs over S Corporations Advantages of LLCs over Limited Partnerships Outside Basis & Debt Share Advantage Substantial Economic Effect Rules - §704(b) Discharge of Indebtedness Income Advantages of LLCs over General Partnerships Disadvantages Uses Professional Firms Venture Capitalists Leveraged Buyouts - LBO Joint Venture Corporations Filing Consolidated Returns Foreign Investment Real Estate Ventures Charitable Investment Estate Planning Problem Uses Federal Tax Consequences Check-the-Box Regulations Self-Employment Tax Proposed Amendments to Limited Partner Regs Moratorium The Old Quandary – What to Do? Chief Counsel Advice 201436049 At-Risk Rules Debt Discharge Income Passive Loss Rules Method of Accounting Audit Procedures Conversion of Partnership to LLC Conversion of S Corporation to LLC Conversion of C Corporation to LLC Local Taxes on Conversion Sales & Use Tax Real Property Taxes Real Property Transfer Taxes California Limited Liability Company Act Example Formation Members Permissible Businesses Professional Practice Limited Liability Partnerships Formation Fees Operating Agreement Office in California Foreign Limited Liability Companies California LLCs in Other States Reporting Requirements Secretary of State’s Office Member Requirements Franchise Tax Board Requirements California Taxes & Fees Franchise Tax Entity-Level Fee Computation of Gross Receipts Ownership Requirement Dissolution Chapter 4 - Corporations Corporation Defined Effect of State Laws Corporate Characteristics Partnership Determinations - 3 Through 6 Trust Determinations - 1 & 2 Professional Associations Unincorporated Associations Check-the-Box Regulations C Corporations Advantages Disadvantages PSC Corporations - §441, §448, §469 Testing Period Personal Services Principal Activity & Substantial Performance Employee-Owner Independent Contractor Passive Loss Limitations - §469(a)(2) Qualified Personal Service Corporation - §448 Small Business Investment Company - §1243 Rollover of Gain from Sale of Securities - §1044 Replacement Property Postponed Amount Annual Limit on Postponed Gain Incorporation - §351 Basic Requirements Corporate Nonrecognition Property Stock Solely For Services Impact on Recipient Impact on Other Shareholders Stock for Debt Control Property Basis Stock Basis Liabilities Section 1244 Stock Maximum Ordinary Loss Original Issuance Distributed Stock General Requirements Small Business Stock Exclusion - §1202 Eligible Gain Limit Qualified Small Business Stock Active Business Test Eligible Corporation Qualified Trade or Business Pass-Through Entities Capital Gains & Investment Interest Start-Up Expenses - §195 Covered Expenses Amortization Organizational Expenses - §248 Definition Stock Issuance & Syndication Expenses Amortization Start of Business Tax Recognition of the Corporate Entity Tax Criteria Nominee & Agency Corporations Section 482 Reallocation Section 269A Corporate Income Tax Rates Tax Tables Current Rate - 21% Tax Return & Filing Corporate Estimated Tax Corporate Alternative Minimum Tax Reinstatement of AMT for Larger Corporations - §55(b)(2) Capital Gains & Losses - §1212 Net Capital Loss Carryovers S Corporation Status Asset Types Five-Step Characterization Process Netting Capital Gains (Losses) Netting Section 1231 Gains (Losses) Character of Section 1231 Gains (Losses) 5 Year Averaging NOL Carryback & Carryover - §172 Loss Computation Deduction Computation Dividends Received Deduction - §243 Dividends from Domestic Corporations - §243 Dividends from Foreign Corporations - §245A Charitable Contributions - §170 Timing of Deduction Limitation Carryover of Excess Contribution Personal Holding Companies - §541 Penalty Tax Professional Corporations Named Professionals Avoidance of PHC Status Accumulated Earnings Tax Trap - §531 Imposition of Penalty Tax Computation Accumulated Earnings Credit Application of Credit to Controlled Groups Reasonable Accumulations Working Capital Service Corporations Minority Stock Redemptions Majority Stock Redemptions Stockholder Harmony Tax Exempt Income Accounting Periods & Methods Accounting Periods Calendar Year Fiscal Year Required Year Section 444 Election Business Purpose Tax Year 25% Test Length of Accounting Period Short Tax Year Not in Existence the Entire Year Change in Accounting Period Election of Accounting Period Changing Accounting Periods Changes without IRS Consent Accounting Methods Methods Available Cash Method Limitation Accrual Method Economic Performance Rule Special Methods Combination (Hybrid) Method Accounting for Long-term Contracts Changing the Accounting Method Inventories Identification Methods Specific Identification Method FIFO Method LIFO Method Valuation Methods Cost Method Uniform Capitalization Rules - §263A Lower of Cost or Market Method Multiple Corporations Controlled Group Rules Definition Parent-Subsidiary Groups Brother-Sister Groups Consolidated Returns Definition Corporate Liquidations & Distributions The Old General Utilities Doctrine Loss Limitations Repurchase of Corporate Stock - §4501 Chapter 5 - S Corporations Introduction Advantages Planning Disadvantages Passthrough Entities - 20% Deduction Becoming an S Corporation S Corporation Status Number of Shareholders Individuals Only Estates Grantor Trusts Voting Trusts Testamentary Trust Qualifying Simple Trusts Electing Small Business Trusts Aliens C Corporations Tax-Exempt Entities Exception for S Corporation ESOP - §512 One Class of Stock Affiliated Groups & Subsidiaries Prior Law Current Law Domestic Corporation Election Requirement Making the Election Form 2553 Invalid S Elections Extension S Corporation Termination Revoking the Election Procedure Effective Date Ceasing to Qualify Effective Date Passive Income - §1362 Effective Date S Termination Year Pro-Rata Allocation Allocation Based On Normal Accounting Rules Annualization of 1120 Short Year Taxation of S Corporations S Corporation Income & Expense Separately Stated Items Nonseparately Stated Items Interest Expense on Debt-Financed Distributions Tax Exempt Income Net Operation Losses Carryover of C Corporation NOLs Reduction of Pass-Thru Items Built-In Gain - §1374 Net Recognized Built-In Gain Recognized Built-In Gains Recognized Built-In Loss Deduction Items Amount of Tax Credits Net Operating Loss Carryovers Treatment of Certain Property Transfer of Assets Passive Income - §1375 Gross Receipts Sales or Exchanges of Stock or Securities Passive Investment Income Royalties Rents Interest Figuring the Tax on Excess Net Passive Income Net Passive Income Excess Net Passive Income Special Provisions Waiver of Tax Tax Preference Items LIFO Recapture Tax Capital Gains Tax Reducing Corporate Capital Gains Figuring Corporate Taxable Income Recapture of Investment Credit Estimated Corporate Tax Payments Basis of Stock & Debts Adjustments to Basis Limitation on Loss Deductions Basis Limit Adjustments to Stock Basis Increases Decreases Adjustments to Debt Basis Restoring Basis of Loans Loan Repayments Guarantees At-Risk Rules - §465 Reasonable Compensation Related Party Rules Definition of Related Party Stock Attribution Rules Business Expenses & Interest Distributions Earnings & Profits Accumulated Adjustments Account (AAA) Dividend Election Post-Termination Distributions Transition Period Order of Distribution No Earnings & Profits Appreciated Property Distributions Taxable Year Business Purpose Change of Tax Year Form 1120S Extension Late Filing Reasonable Cause Schedule K-1 Shareholder’s Treatment Of S Corporation Items Pro Rata Share Optional 10-year Write-Off of Tax Preferences Fringe Benefits Health Insurance Premiums Reporting Requirements Medical Deduction Entity Tax Comparison Chapter 6 - Basic Fringe Benefits Concept Definition of Income - §61 Deductions without Taxable Income Benefit Mechanics Discrimination General Valuation Rule Fair Market Value Special Valuation Rules Restrictions on Special Valuation Rules Withholding & Accounting General Accounting Rule Special 2-Month Pour-Over Accounting Rule Same-Sex Marriage Types of Benefits Employee Achievement Awards - §74(c) & §274(j) Exclusion Definition of Employee Achievement Awards Tangible Personal Property Qualified Plan Award Employer Deduction Limits Aggregation Limit Special Partnership Rule Employee Impact Group Term Life Insurance - §79 Monthly Cost Table Family Member Cost Employment Taxes Group Requirements Employee Permanent Benefits Discriminatory Plan Eligibility Type & Amount of Benefits Key Employee Self-Insured Medical Reimbursement Plans - §105 Allowable Expenses Requirements Benefits Reporting Exposure Medical Insurance - §106 Group Health Plan Restrictions - COBRA Coverage Requirement Continuation Requirement American Recovery & Reinvestment Act Exemptions Continuation Period Notice Meals & Lodging - §119 Convenience of Employer Substantial Nonpay Reasons Meals with a Charge Lodging Required by Employer Highly Compensated Employees 50% Limit on Meals Cafeteria Plans - §125 Definition Qualified Benefits Non-Qualified Benefits Controlled Group Rules Salary Reduction Plans Nondiscrimination Highly Compensated Participants Key Employees Timing Reporting Requirements Employee Educational Assistance Programs - §127 Requirements Educational Assistance Dependent Care Assistance - §129 Amount of Assistance Requirements 55% Test Reporting Conflict with Dependent Care No-Additional-Cost Services - §132(b) Covered Employees Line of Business Requirement Definition Reciprocal Agreements Nondiscrimination Highly Compensated Employee Qualified Employee Discounts - §132(c) Manner of Discount Real Estate & Investment Property Exclusion Amount of Discount Nondiscrimination Working Condition Fringes - §132(d) Additions to Exclusion Covered Employees Substantiation Exceptions De Minimis (Minimal) Fringes - §132(e) Subsidized Eating Facilities Qualified Transportation - §132(f) Employer Provided Automobile - §132 & §61 General Valuation Method Special Method #1 - Lease Value Annual Lease Value Fair Market Value Safe Harbor Value Items Included in Annual Lease Value Table Prorated Annual Lease Value Daily Lease Value Special Method #2 - Cents Per Mile Regular Use Mileage Rule Items Included In Cents-Per-Mile Rate Special Method #3 - Commuting Value Control Employee Employer-Provided Transportation in Unsafe Areas Qualified Employee On-premises Athletic Facility - §132(j)(4)(B) Adoption Assistance Program - §137 Employment Taxes Conflict with Adoption Credit Eligible Child Children with Special Needs Limits on the Exclusion Dollar Limit Income Limit Timing Employer-Provided Retirement Advice & Planning - §132 Financial Planning - §212 & §67 Popularity Taxation Tax Planning - §212 & §67 Taxation Estate Planning - §212 & §67 Moving Expense Reimbursement - §217 Interest Free & Below-Market Loans - §7872 Permissible Discrimination Employee Needs Imputed Interest Types of Loans Demand Loans Term Loans Application of §7872 and Rate Determinations Summary 25% Credit Allowed For Employer Child Care Facilities Corporate Funded Educational Savings Accounts Family & Medical Leave - §45S Employer-Provided Cell Phones - §132(a) Noncompensatory Business Purposes Fringe Benefit Plans for S Corporations ERISA Compliance Welfare Plans Additional Requirements Chapter 7 - Retirement Plans Deferred Compensation Qualified Deferred Compensation Qualified v. Nonqualified Plans Major Benefit Current Deduction Timing of Deductions Part of Total Compensation Compensation Base Salary Reduction Amounts Benefit Planning Corporate Plans Advantages Current Deferred Disadvantages Employee Costs Comparison with IRAs & Keoghs Basic ERISA Provisions ERISA Reporting Requirements Fiduciary Responsibilities Bonding Requirement Prohibited Transactions Additional Restrictions Fiduciary Exceptions Loans Employer Securities Excise Penalty Tax PBGC Insurance Sixty-Month Requirement Recovery Against Employer Termination Proceedings Plans Exempt from PBGC Coverage Basic Requirements of a Qualified Pension Plan Written Plan Communication Trust Requirements Permanency Exclusive Benefit of Employees Highly Compensated Employees Reversion of Trust Assets to Employer Participation & Coverage Age & Service Coverage Percentage Test Ratio Test Average Benefits Test Numerical Coverage Related Employers Vesting Full & Immediate Vesting Minimum Vesting Unified Vesting Nondiscrimination Compliance Contribution & Benefit Limits Defined Benefit Plans (Annual Benefits Limitation) - §415 Defined Contribution Plans (Annual Addition Limitation) - §415 Limits on Deductible Contributions - §404 Assignment & Alienation Miscellaneous Requirements Basic Types of Corporate Plans Defined Benefit Mechanics Defined Benefit Pension Defined Contribution Mechanics Discretion Favorable Circumstances Types of Defined Contribution Plans Profit-Sharing Requirements for a Qualified Profit-Sharing Plan Written Plan Eligibility Deductible Contribution Limit Substantial & Recurrent Rule Money Purchase Pension Cafeteria Compensation Plan Thrift Plan Section 401(k) Plans Death Benefits Defined Benefit Plans Money Purchase Pension & Target Benefit Plans Employee Contributions Non-Deductible Life Insurance in the Qualified Plan Return Universal Life Compare Plan Terminations & Corporate Liquidations 10-Year Rule Lump-Sum Distributions Asset Dispositions IRA Limitations Self-Employed Plans - Keogh Mechanics Contribution Timing Controlled Business General Limitations Effect of Incorporation Mechanics Parity with Corporate Plans Types of Keogh Plans Figuring Retirement Plan Deductions For Self-Employed Self-Employed Rate Determining the Deduction Individual Plans - IRAs Deemed IRA Mechanics - §219(b) Phase-out - §219(g)(2) Special Spousal Participation Rule - §408A(c)(3) Spousal IRA Eligibility Contributions & Deductions Employer Contributions Retirement Vehicles Distribution & Settlement Options Life Annuity Exemption Minimum Distributions Required Minimum Distribution Definitions Required Minimum Distributions During Owner’s Lifetime Sole Beneficiary Spouse Who Is More Than 10 Years Younger Required Minimum Distributions in Year of the Owner's Death Beneficiaries - Distributions after the Owner’s Death Estate Tax Deduction Charitable Distributions from an IRA Post-Retirement Tax Treatment of IRA Distributions Income In Respect of a Decedent Estate Tax Consequences Losses on IRA Investments Prohibited Transactions Effect of Disqualification Penalties Borrowing on an Annuity Contract Tax-Free Rollovers Rollover from One IRA to Another Waiting Period Between Rollovers Partial Rollovers Rollovers from Traditional IRAs into Qualified Plans Rollovers of Distributions from Employer Plans Withholding Requirement Waiting Period Between Rollovers Conduit IRAs Keogh Rollovers Direct Rollovers From Retirement Plans to Roth IRAs Rollovers of §457 Plans into Traditional IRAs Rollovers of Traditional IRAs into §457 Plans Rollovers of Traditional IRAs into §403(B) Plans Rollovers from SIMPLE IRAs Roth IRA - §408A Eligibility Contribution Limitation Roth IRAs Only Roth IRAs & Traditional IRAs Conversions Recharacterizations Reconversions Taxation of Distributions No Required Minimum Distributions Simplified Employee Pension Plans (SEPs) Contribution Limits & Taxation SIMPLE Plans SIMPLE IRA Plan Employee Limit Other Qualified Plan Set up Contribution Limits Salary Reduction Contributions Employer Matching Contributions Deduction of Contributions Distributions SIMPLE §401(k) Plan Chapter 8 - Nonqualified Plans Postponement of Income Advantages IRS Scrutiny & Approval Nondiscrimination ERISA Funding No Immediate Cash Outlay Annual Report Notice Requirement Purposes & Benefits Benefit Formula Incentive Deferred Bonuses Contractual Arrangement Necessary Provisions Tax Status Service’s Position Rationale Congressional Moratorium No Ruling or Regulation Policy Constructive Receipt Beyond Actual Receipt Simple Set-Asides Are Not Possible Revenue Ruling 60-31 Regulations Time & Control Concept Control Timing After-the-Fact Contract Amendment to Existing Contract Economic Benefit Has Something of Value Been Transferred? Insurance Coverage Has a Calculable Value Segregated Funds Have Immediate Economic Value Value v. Control Revenue Ruling 60-31 Situation 1 Situation 2 Situation 3 Situation 4 Situation 5 General Principles Unfunded Bare Contractual Promise Plan - Type I Risk Funded Company Account Plan - Type II Ownership & Segregation Bookkeeping Reserve or Separate Account Employee Still Bears Economic Risk Limited Protection Investment of Deferred Amounts Life Insurance Premiums Third Party Guarantees Segregated Asset Plan - Type III Section 83 Approach Tight Rope Format Transferable or Not Subject To A Risk of Substantial Forfeiture Substantial Restrictions Redemption or Forfeiture Condition Related to a Purpose of the Transfer Noncompetition Consultation Time Alone is Not Enough Realization & Taxation 30-Day Election Period Deduction Allowed Timing Withholding Tax Consequences Reciprocal Taxation/Deduction Rule No Difference for Cash or Accrual Separate Accounts for Two or More Participants Employer Deduction Traps Income Tax on Employer-Held Assets Inclusion in Income Under §409A State Tax Issues Accounting Two Sets of Rules Financial Accounting Rules IRS Rules Estate Planning Considerations Death During Deferral Income Tax Consequences Estate Tax Consequences Gift Tax Consequences Withholding, Social Security & IRAs Other Payroll Taxes Social Security Benefits IRAs Glossary |
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