My husband and I each have 1 member s-corps and one or both of us is always 11th hour filing returns--we're ALWAYS filing corporate 9/15 and our personal 10/15.
An unexpectedly high K-1 from my husband's s-corp had us paying a surprise amount of tax when we filed 2022 9 months ago on 10/15/23. I asked my husband to check his long-time bookkeeper's work because I KNEW that we hadn't actually had the kind of income we had to pay tax on for 2022.
Long story short, his bookkeeper has had cognitive decline and there have been several hundred thousand $$ in paid-but-not-recorded expenses going back to 2018. He has an appointment with his CPA of record late this month, but I am tossing and turning in the meantime, trying to get straight in my mind what we can and should amend going back in time to make use of the resulting NOL(s).
2020 Return--The unrecorded expenses would definitely result in an NOL on our joint return. But my understanding is pre-Tax Cuts & Jobs Act (TCJA) changes don't affect 2020 returns, so using "old" rules, that 2020 NOL would first have to be carried back 2 years. BUT--2018 and 2019 returns are too old to be amended... so do we have to kiss the NOL generated in 2020 goodbye?
I know TCJA changed treatment of NOLS generated 2021 and later to *only* carrying the NOL forward (among other refinements), so we will definitely be amending 2021 and 2022 returns to claim those NOLs, but I stump myself when I contemplate potentially amending our 2020 return... I'm hoping one of you kind, tax-savvy BHs will help me (roughly) pre-navigate this situation so I can stop obsessing about it until his accountant meets with him in a couple of weeks. Thank you in advance for any help.
An unexpectedly high K-1 from my husband's s-corp had us paying a surprise amount of tax when we filed 2022 9 months ago on 10/15/23. I asked my husband to check his long-time bookkeeper's work because I KNEW that we hadn't actually had the kind of income we had to pay tax on for 2022.
Long story short, his bookkeeper has had cognitive decline and there have been several hundred thousand $$ in paid-but-not-recorded expenses going back to 2018. He has an appointment with his CPA of record late this month, but I am tossing and turning in the meantime, trying to get straight in my mind what we can and should amend going back in time to make use of the resulting NOL(s).
2020 Return--The unrecorded expenses would definitely result in an NOL on our joint return. But my understanding is pre-Tax Cuts & Jobs Act (TCJA) changes don't affect 2020 returns, so using "old" rules, that 2020 NOL would first have to be carried back 2 years. BUT--2018 and 2019 returns are too old to be amended... so do we have to kiss the NOL generated in 2020 goodbye?
I know TCJA changed treatment of NOLS generated 2021 and later to *only* carrying the NOL forward (among other refinements), so we will definitely be amending 2021 and 2022 returns to claim those NOLs, but I stump myself when I contemplate potentially amending our 2020 return... I'm hoping one of you kind, tax-savvy BHs will help me (roughly) pre-navigate this situation so I can stop obsessing about it until his accountant meets with him in a couple of weeks. Thank you in advance for any help.
Statistics: Posted by anders37 — Thu Jun 06, 2024 5:13 pm — Replies 0 — Views 71