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Demosthenis Zeppos

Demosthenis Zeppos’s Answers

23 total

  • If EMC changes from Corp to LLC does it affect the title who owns the note or do they need to change. by record.

    Mortgage Banking and Title Litigation

    Demosthenis’s Answer

    I need more information, but if the change you refer to is from Corp to LLC,, that is possible pursuant to a statutory conversion (certificate of conversion with the CA secretary of state). Its also known as a statutory conversion, and is taxable reorganization for must purposes. However, the legal entity is still the same entity, just changed its legal status. Regarding EMC and who owns title, typically, any reorganization referenced above means the successor new entity form continues to assume all rights and obligations of the predecessor. In essence, its the same entity, but instead, has simply changed its form.

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  • Hello, my CA LLC ended business in 2005 (paying all taxes due then). But then I never actually dissolved the LLC.

    I obviously don't want to pay 8 years of $800 annual fees just to fully dissolve an 8 year out of business LLC. My accountant says don't worry about it and just ignore occasional notices sent to the LLC for the $800 annual fee. ...

    Demosthenis’s Answer

    Your accountant is correct. If you don't ever seek to use the corporation or LLC, and there are no outstanding debts or obligations of the entity, leaving it 'alone' is typically the course of action. Of course, if you ever needed to revive the delinquent corporation or LLC (it held on to a contract, or forgotten property), you would need to pay the accrued franchise tax, plus interest/penalties, and thus, it would get expensive. Otherwise, leave it alone, but the preferred course of action is to dissolve the entity in the year you cease doing business with such emtity..

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  • What is the fees to register an LLC in California? Going forward, what is annual fees regarding keeping the registration of LLC?

    I would like to know what are the fees associated register an LLC in california. and recurring fees going forward. Thanks!

    Demosthenis’s Answer

    In addition to the below answers, if the business has gross receipts (sales) in excess of $250,000, the Gross Receipts tax applies, which is $900 a year, (in addition to the $800 a year described below), and at $500,000, its $2500 a year, and when sales top one million, its $6000, and when sales top $5,000,000 its $11,790.

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  • My now deceased husband bought our house & put it in a 'S' Corporation prior to our marriage. I am now the only shareholder .

    The S Corp has no other assets. The Corp is also listed in our living trust. The house is fully paid for & currently I have no plans to sell it. What do I need to do to avoid capital gains tax? Or can I just leave it until I sell it or until I die?

    Demosthenis’s Answer

    I would probably leave it (based upon certain factual assumptions). The reason is that the S corporation, unlike a partnership/LLC does not allow for the 'inside basis' - being the assets held by the S corp (the home), to get a 'step-up' to fair market value at the date of your husband's death. Although the basis in the stock is getting a step up at your husband's death, the assets held within the trust do not. I would hold on to it, unless you really need to move out of the house and sell the asset. Now, with that said, if the home was put into the S corp while it had a lot of value (i.e. - you already had a high basis, and the value has since not increased significantly - and wasn't fully depreciated - gets complicated), then taking out of the S corp or selling it may not create any significant tax liability. You need to consult with a tax attorney or CPA to analyze this carefully and consider your long-term goals before doing anything.

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  • Would I be charged by Los Angeles County for a second, subsequent transfer to my son of the title on my condominium apartment?

    In 2004 I made a free of charge title transfer adding my son as co-owner on the title of my condominium apartment in Los Angeles County. I want now to make another, subsequent transfer so that my son will become the sole owner of that same apartm...

    Demosthenis’s Answer

    You have to be very careful here with property taxes. In making your son the sole owner, you will completely change the ownership of the property. It will cause a change of ownership causing reassessment.
    You can possibly file for an exemption under the parent-child transfer exemption, but otherwise failing to do this or not being eligible, the property will be reassessed at current market value. You should seek the advice of a real estate or tax attorney

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  • If bank funds were transfered to a beneficiary 1 year before a decedent's date of death, would these funds be part of the estate

    In Tax Court cases, any assets distributed 3-yrs from the decedent's date are considered estate assets. I was just wondering if the same is true for a regular probate case. My father transfered $80,000 to a beneficiary after he discovered he had c...

    Demosthenis’s Answer

    You are correct on the tax side - IRC 2035 and 2036 - 3 years from date of death on certain transfers
    On the probate side, if the gifts were properly made and transferred before the death per your fact pattern, that would not be part of the probate estate

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  • If I formed my LLC in October of 2012, do I need to pay LLC fee for the year of 2012? Or just 2013, at the time of tax filing?

    LLC formed October 2012. Initial tax return in February 2013, with LLC tax fee payment for 2013.

    Demosthenis’s Answer

    • Selected as best answer

    Yes. You have to pay the $800 tax for 2012 on 4th month of following year. April 15 2013

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  • Can a non physical therapist own an S corporation in California that is a physical therapy clinic

    My husband and I are sole shareholders ( s corporation )in a physical therapy clinic which we wish to sell to the office manager. I know that a professional corporation in California can only have licensed physical therapists as share holders. ...

    Demosthenis’s Answer

    The s corporation election is an IRS tax election and has no relevance on who can be a shareholder of a professional corporation engaged in physical therapy. The office manager would need to be licensed as a physcial therapist to own shares or be an officer of the corporation

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  • Minimum California franchise tax for final year of corporation

    If I dissolved my S corporation with California SOS in October 2012, and 2012 was not the first year of my corporation's existence, then do I need to pay the California minimum franchise tax of $800 for 2012 taxable year when I file my final corpo...

    Demosthenis’s Answer

    Yes. The 800 minimum tax is due for each year the corporation is in existence. There is no way not to pay this unless you let the corporation go into suspension. ( which isn't necessarily bad). It will be due in 2013 with the final return

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  • When funds in a family irreversible family trust are distributed to beneficiaries, who pays tax on any short or long term gains?

    Grantor has passed and trust funds will be distributed to four beneficiaries. Trust funds were invested.

    Demosthenis’s Answer

    Here's the good news, typically, property held in trust that becomes irrevocable upon the death of the grantor will get a 'step-up' tax basis equal to fair market value as of the date of death. So any gain or sale upon 'realization' (disposition of the property) will equal be equal to the net income minus the basis (FMV) as of the date of death. So you may have little gain or none if the sale takes place soon after the death of the grantor. Otherwise, if there is gain, it gets allocated in propotion to the beneficaries of the Trust. You should speak with a CPA and/or tax/estate planning attorney

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