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John P Fazzio III
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John Fazzio’s Answers

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  • Can my mother in law put down my daughters name on her tax return to get money?

    My mother in law wants to put my daughters name on her tax return to get some money. I don't agree with that and she wont force the issue but I want to know some information, incase I need to argue it out with her. Only a dependant would be named ...

    John’s Answer

    If your daughter lives with you more than half the year and you provide more than 50% of the income for her care, your mother in law cannot claim them.

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  • Which type of LLC is correct for my healthcare consulting business and what are the tax implications?

    I'm a licensed pharmacist in MD and I am looking to start an LLC. I am trying to determine which business designation is the correct for my services. The LLC will be focused on healthcare consulting. The consulting will take on a number of forms....

    John’s Answer

    Find a local business attorney to set this up for you. You do not need a professional LLC to my knowledge, but either way, the filing requirements are the same. Forming an LLC is an easy proposition and shouldn't take long.

    The tax implications are not great. The income/loss flows to your 1040, so long as it is a single-member LLC. If you have another member, it is treated as a partnership and K-1s must be issued. If you have losses in the initial years, it may increase your refund, but after a few years returns will be scrutinized if you are not showing a profit.

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  • How do I know if I need to bill sales tax for my consulting work?

    I am a new independent business consultant ready to bill a client for my first hours of work. I registered a sole owner business license with WA state and am planning to bill under that license. The work I did for this client (and planning for oth...

    John’s Answer

    I would defer to Mr. Gates's summary of the application of the State's Gross Receipts tax. It would seem that you pay these taxes quarterly and not on a per client basis, as with sales tax. You will want to investigate the tax you will likely owe at year's end with a local tax professional and determine how much you should raise your prices to make allowance for payment of the tax, and what portion of your gross receipts you should set aside for that purpose.

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  • How should the taxes be paid if I publish the app in this fashion and it generates income?

    Hello, I am an iOS app developer and have a new app that Apple will pay me to put ads on. The problem is that the Apple Developer Account name is not my name (if you want to know why I can tell you, but it's not important to the question). Ther...

    John’s Answer

    You will pay tax on the income. Apple has no discretion in how they issue the 1099s.

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  • Can they take my tax return ? How much ?

    I currently have a wage garnishment i need to know if this agency can take my tax return

    John’s Answer

    You cannot get good advice if you don't put the appropriate detail in your question.

    The tax offset program let's federal agencies and other federally chartered garnishees take any tax refund you may have.

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  • Should I win, do I pay taxes to California?

    I live in Nevada and purchased a lottery ticket in California.

    John’s Answer

    Yes. Pay your taxes. You should always anticipate that you will be paying some tax anytime you have income.

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  • 4. Are newly-formed LLCs in the states of NY and CT tax exempt for the first 3 years?

    My wife and I work in New York state, but are residents of Connecticut (pay tax in CT). We want to open an LLC, (consulting firm - only service provided, no physical goods moved, and no physical office required). Will have only two of us as employ...

    John’s Answer

    Right. You are better off forming in Connecticut because incorporation costs are lower. You can form an LLC and then report on Form 1065 and issue K1s to the inclusions on your joint 1040. Any tax lawyer can help you with the formation or you can do it yourself online. The tax reporting and accounting will be basic, but you want to get payroll through Paychex or ADP, but Zenefits and Xero are gaining in popularity. You can put down any address you want regardless of which jurisdiction you incorporate in. Moving jurisdictions or using Delaware is also not difficult, but a foreign registration is generally easiest. Hope that helps.

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  • Do I the wife get some of my husband's tax return money?

    My husband and I been legally married since 2012 and has filed one tax return together in 2014 and put our child as a dependent on it. When he got the money ,he didn't give me any of it. 4 months later he beat me up(DV case), I left the home and ...

    John’s Answer

    Right. This is a matter to be addressed in the Separation Agreement attendant to divorce proceedings. So long as you are married joint filers your financial futures are tied together.

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  • Do i have to pay tax for PayPal money

    i would like to know that do i have to pay tax or make report on money that i receive from PayPal? i heard that if the money was a gift i do not have to pay tax? my question is what if it was big money like thousands of dollar? how can Federal enf...

    John’s Answer

    As Mr. Cappuccio points out, PayPal sends 1099s to the IRS. Thus, they'll know of the income. If you don't report it as either income or a gift, you will be audited.

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  • Is there a loophole/law that someone can provide me or is there any way to avoid this unfair tax?

    Recently divorced and my ex-spouse and I were co-titled to two properties. In the divorce settlement, the court ordered stipulation awarded one property to each spouse. Hired a real estate attorney for the specific purpose of composing the deeds...

    John’s Answer

    I'm assuming this is a NY State Tax Auditor, not IRS. I'm assuming they are assessing the New York State Real Estate Transfer Tax (RETT), which is imposed at a rate of $2 per $500 of consideration. Your statement that: "there is a rebuttable presumption that the consideration for the conveyance, the relinquishment of marital rights, is equal to the fair market value of the interest in the real property conveyed." is generally correct. That comes from Title 19 RCNY Section 23-03(d)(3) and in Title 20 NYCRR section 575.11(a)(10). That means if the property is worth $1,000,000, then you each owe $2,000. If a figure is stated in the divorce decree, this will trump the presumption. Likewise, if the decree states the grantee spouse handles the taxes, then that will govern.

    Bottom-line, I could recite all the ins and the outs of the way this is PROPERLY calculated. But, the Auditor has a job to do, and frankly, is probably not terribly conversant with these laws. You are going to need to hire an attorney who specializes in Tax Controversy work to fight this for you, and depending on the bill, I'm not sure if this problem is big enough to justify the costs, but that is what you'll have to do if you want to resolve it.

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