Month: August 2021

Tax Basis for Inherited or Gifted Property: Implications for S Corporations and Partnerships

In a previous blog, we discussed tax basis—the amount that a taxpayer has invested in business assets, which determines the gain or loss when the asset is sold. Remember that a taxpayer must have sufficient basis to deduct a business loss on their tax return. Another set of tax rules that can be overlooked is …

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Debt Recourse and Tax Deductions for Partnerships and S Corporations

In a previous blog, we discussed how a shareholder in an S corporation or a partner in a partnership needs sufficient tax basis to claim a business loss. Tax basis refers to the amount that a taxpayer has invested in business assets, calculated by taking the purchase price and subtracting any accumulated depreciation. If the …

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Overcoming Limits to Tax Deductions for S Corporation or Partnership Losses

Understanding tax basis is key to maximizing tax deductions, especially for shareholders or partners involved in an S corporation or partnership. Tax basis refers to the amount that a taxpayer has invested in business assets, calculated by taking the purchase price and subtracting any accumulated depreciation. This value will determine the gain or loss when …

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Business Losses and PPP Loans: Understanding Tax Implications for S Corp Shareholders

Business losses have become all-too common during COVID-19. Though new tax benefits have been introduced, understanding whether these will benefit a specific business can be a complicated process. One common COVID-era benefit is the Paycheck Protection Program (PPP) loan. Businesses celebrated the news that PPP funds are tax exempt, so they wouldn’t have to pay …

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