Tax Guru – Ker$tetter Letter

Helping real people win the tax game.

Archive for January 17th, 2003

Posted by taxguru on January 17, 2003

S Corporations

Lately, I have been receiving a lot of feedback from various people around the country who have read my article describing some of the big differences between C and S corporations, thanking me for pointing out things that other advisors have been ignorant of. One area of confusion still seems to be regarding exactly when a corporation becomes an S. Many people believe that the decision to be an S or a C is made at the time when the corporation is originally formed. That is not true. All corporations, when originally chartered by the State, are C corporations. Do nothing extra and it will remain a C corp.

However, to convert it to an S corporation, the shareholders must all sign and submit Form 2553 with the IRS to request that status. This can be done right away after the corp is originally chartered, or several years down the road. You need to be sure to watch the effective dates of the S election. Some States automatically accept the IRS’s S election, while others require a separate form to be submitted to the State tax agency.

If a corp has been using a fiscal year that ends in a month other than December, it will have to change to a 12/31 fiscal year end if it changes to an S status. If the S status is later revoked, you will not be allowed to change from the 12/31 year end.

KMK

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Posted by taxguru on January 17, 2003

Tax Protestor On TV Tonight

I was just scanning what’s on TV tonight and noticed that ABC’s 20/20 show is doing a profile on one of those idiot tax protestor promoters who claims that taxes are all voluntary and who supposedly makes a fortune selling her garbage to gullible saps. I haven’t seen the show yet; but will try to watch it and report on how accurate it is.

I hadn’t heard of this Lynn Meredith before, but found this report of her arrest in April 2002 for tax fraud. She is supposedly connected to Bob Shulz’s idiotic and illegal We the People group, which I have discussed on several occasions earlier.

KMK

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Posted by taxguru on January 17, 2003

Presidents since Washington have fought tax battles

And CPAs since then have been helping their clients work with the tax laws.

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Posted by taxguru on January 17, 2003

If you owe the IRS a bunch of money, one of the things you shouldn’t do is appear on national TV showing off all of your expensive possessions. It’s a shopping list for IRS Collection Agents. Of course, celebrities aren’t exactly known as being the sharpest tools in the shed.

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Posted by taxguru on January 17, 2003

It’s not just a Hummer, it’s a tax break

The backlash against SUVs and their tax breaks is continuing to grow. Anyone who may be planning to take advantage of this may want to do so soon, before our rulers react to the hatred for SUVs and remove this deduction.

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Posted by taxguru on January 17, 2003

I’ve long described what I do as helping real people win the Tax Game. Maybe Tax War would be more appropriate, considering the class warfare rhetoric used by supporters of big expensive government.


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