近距离内射合集

Q: As part of our estate planning, my wife and I have established two separate trusts. These trusts, in turn, are owners of LLC membership interests. We have several LLCs that are owned by the two trusts. The attorney who drafted the trusts says that they are grantor trusts that will be disregarded for tax purposes. My question is whether we need to file a partnership tax return for the LLC entities. They own real estate and securities.

A grantor trust is defined by the tax law and is ignored for federal tax purposes. The income from the trust is put on the grantor鈥檚 tax return.

An LLC is a partnership if it has two or more members. If an LLC is wholly owned by an individual, tax law calls it a disregarded entity, or DE.

A DE does not file a separate tax return. All income is reported on the owner鈥檚 return.

Because a grantor trust is treated as owned by the grantor, your LLCs should be treated as if they are owned by two individuals.

That is, ignore the trust and look through to the individual who is the grantor of the trust as if they are the direct owner.

If you and your wife establish separate grantor trusts, the LLC with two grantor trust owners will be treated as a partnership with two individual owners.

There is a wrinkle in your situation because New Mexico is a community property state.

The IRS has a procedural rule that allows spouses who are the only owners of an LLC to treat it as a DE provided the interests are held as community property.

This means that although the LLC is deemed to have two owners, you can choose to treat the entity as a DE.

I suggest that you contact the attorney who drafted the trusts and ask whether the trust interests will be treated as community property in New Mexico.

If the answer is 鈥測es,鈥� you can elect to treat the LLCs as disregarded for tax purposes, or to file as a partnership.

This election can be done separately for each entity. You should discuss which option is best with your tax adviser.

Q: I believe that after the 2017 tax year you can no longer claim a dependent as a tax exemption. But the tax return still asks for dependents, with their relationship and Social Security number. Is there a reason to complete this information if we don鈥檛 get a tax exemption amount?

You are correct that there is no longer a tax exemption amount allowed for dependents.

The reason a tax return asks for your dependents is that there are other reasons why it can be beneficial to have a dependent.

I don鈥檛 know your specific situation, so I cannot provide a list of those benefits that you might be eligible for.

For that reason, I will give a general explanation of some of the benefits available to taxpayers with dependents.

You may know that a dependent may be claimed for either a qualifying child or a qualifying relative.

The child tax credit is available only for a qualifying child. The credit will be disallowed if you have no dependent listed.

A partial child tax credit is allowed for a qualifying relative. Again, that relative needs to qualify as a dependent.

The earned income credit also requires that the taxpayer have a dependent. The same is true for the dependent care tax credit.

The head of household, or HOH, filing status is available for taxpayers who are not married. The standard deduction and tax rates are more favorable than filing single.

HOH status requires that the taxpayer have a dependent. The same is true for filing as a surviving spouse, which is also more favorable than filing single.

There may be downsides to claiming a dependent. The dependent you claim then cannot claim others as their dependents.

Education tax credits cannot be claimed by someone who is allowed as a dependent on someone else鈥檚 return. The person claiming the dependent gets the credit.

If a student is eligible to be your dependent, but you do not claim them, then the student is eligible for education tax credits.

Jim Hamill is the director of tax practice at Reynolds, Hix & Co. in Albuquerque. He can be reached at jimhamill@rhcocpa.com.