We perform a wide array of personal tax returns that include self-employed individuals, parents with household employees, retirees with retirement distributions, students, families with investments, and more. Our goals are to complete your personal tax returns accurately and efficiently year after year.
Limited Liability Companies
Limited Liability Companies, often referred to as LLCs, are disregarded entities in the eyes of the IRS. Single member LLCs are taxed like sole proprietors and multiple member LLCs are taxed like partnerships.
Each Massachusetts LLC is required to file an annual report and pay an annual fee with the secretary of state.
A partnership is any unincorporated business that is operated by more than one person or entity. Partnerships file form 1065. Income and deductions are passed through to partners on form K-1. We often prepare partnership tax returns in conjunction with individual tax returns.
S Corporations (S Corps) are similar to partnerships because they are pass-through entities. S Corps are different from partnerships because owners are employees and they are required to receive reasonable salaries for their positions and payroll is required. There are opportunities for tax-free distributions if shareholders have enough basis. Equity is measured in shares and S Corps file form 1120-S.
Our corporate clients include owners of C Corps, S Corps, Partnerships, Limited Liability Corporations (LLCs), and condo associations. We utilize accounting records, payroll filings, fixed asset listings, balance sheet, profit and loss statements, and other documents to prepare their annual filings
Tax Exempt Organizations
Tax exempt organizations include churches, social clubs, and charities. While in many cases they may not owe any tax, many of these entities still have to file a return with the government. There may be an income tax on unrelated investment income.
Each U.S. citizen can gift up to $14,000 per recipient without filing a gift tax return. Married couples can gift up to $28,000 to a recipient without filing a gift tax return. Gifts in excess of these amounts require gift tax returns on form 709 and amounts will count against the lifetime estate exclusion. Medical expenses and tuition are generally exempt from these rules.
An election can be made to gift up to 5 years worth of exemptions at once to a recipient’s 529 plan. As such any further gifts over the five year period will exceed the annual gift exclusion, which would require additional gift tax returns.
There are two types of trusts, revocable trusts and irrevocable trusts.
A grantor letter should be filed for a revocable trust and its income is taxed on the grantor’s personal tax return. The trust becomes irrevocable upon the grantor’s date of death.
An irrevocable trust files form 1041. Trust documents will determine if the trust or beneficiaries will pay income tax.