^^rs
bbm
@RAISINISBACK - thanks for your response to my post. Although I did my best to snip what I was responding to (re-quoted above), it seems I was not clear, and apologize.
Although I was not referring to the legal definition of "disregarded entity," I think the better choice of word is non-entity.
I think Forge was a non-entity, where the profits and losses pass through to the owner, and the proprietorship was solely owned by one spouse, AM.
I'm not sure why OP sent link for the grand jury indictment filed 7/20/22, USA v Russell Lucius Laffitte? If the intent was to send the complaint by the Estate against BOA, I've already seen this. Thanks again.
This post is about to get real boring so some people may want to roll and scroll on it. lol
@Seattle1
Let me explain a little about federal income taxes since I don't think I was clear in my earlier post and may have confused some people. I apologize if I did confuse anyone or am about to confuse anyone.
Most of the people in the U.S file a federal income tax return even if they are retired. The only way you are exempted from filing is if you had no reportable income. Some examples of that would be people who only draw Social Security or veteran's pension or some type disability that is non taxable or certain monetary gifts (note: some inheritances are exempt) or you don't have any income at all.
Otherwise all money a person receives is income even if it is illegal income. All of it is reported on various forms issued by the IRS.
I am going to exclude non profit returns (990) and 1120 Corporation Returns (which are not pass through entities) and payroll returns to shorten this up a bit so I don't put everyone to sleep. (I know and you're welcome.)
Your personal income tax is filed on a form 1040 return. This is important to remember (there will be a quiz later. Just joking lol). That form 1040 return has many forms that tie into it so to speak. W-2's, 1099R's, 1099G's, Schedules A, B, C, D, E, F ect. The Schedules also have forms that tie into them such as the 4797 and 4562.
Anyone who's name is on the form1040 as a primary or joint taxpayer must sign this return either manually if filing on paper or form 8879 if filing electronically.
Obviously most people know what a W-2 is because they get one every year from their employer. The income from this goes on line 1 under salaries, wages, and tips.
Line 2b and 3b is taxable interest and qualified dividends which is reported on a Schedule B then transferred to the 1040 form.
Line 4b and 5b is taxable pensions and annuities which are entered on the 1040 form from a 1099R or CSA 1099-R.
Line 6b is social security benefits which are entered on the 1040 form from a SSA-5 form.
Line 7 is capital gains. This income is entered through the Schedule D which has entries from various forms such as a 1099B sales of stocks and bonds or 1099S which is sales of real estate or 4797 sales of business property.
Line 8 is what we want to get to here. This is other income which is entered on the form 1040 from a Schedule 1. Amounts on Schedule 1 come from many forms but the ones in particular I want to address are the Schedule C and Schedule E.
The Schedule C is Profit and Loss from a Business. The taxpayer can elect to use their own social security number (SSN) or obtain an Employer Identification Number (EIN) free from the IRS to report income on a Schedule C.
There are 2 types of income you can report from your business on this form, sole proprietorship or an LLC. A sole proprietorship can contain in the name DBA (Doing Business As) such as: John Doe DBA John's Auto Repair
but cannot be a disregarded entity since it has not been set up with the state you live in as a business. Many types of income can be reported as a sole proprietorship such as contract labor reported on a 1099 NEC or cash money. If you chose to register your business as an LLC then it also can be reported on a Schedule C. The name will contain LLC such as: John's Auto Repair LLC.
LLC's are special in the fact the business owner can elect to report it on a Schedule C (John's Auto Repair) or a form 1065 Partnership (John and Son's Auto Repair) or a form 1120S (small corporation) John's Auto Repair INC. The form 1065 and 1120S are both pass through entities meaning that those returns have no tax liability on the profits in of themselves but are instead passed through to the Schedule E (PartII) then to the Schedule 1 onto the form 1040 Personal Income Tax Return.
If it is reported on a Schedule C then it is a sole proprietorship. Nothing else other than a sole proprietorship can be reported on a Schedule C. That income is then entered into the form 1040 through the Schedule 1
even if only one person owns the business.
If the person owning the business opens a bank account they either have to use their own SSN or the EIN from the IRS. Sometimes both. To open a bank account on a Partnership or Corporation they must have the registering certificate from the state they are in and the bylaws of said partnership or corporation. They must use an EIN (some banks will add the taxpayers SSN) and all checks made out to the corporation must go into that corporation bank account. You cannot put corporate checks in your personal bank account and you cannot put personal checks made out to you in your corporate account.
Many married people have different kinds of income. One might be working for someone and have wages or salaries while their spouse may be in business for themselves(self-employed) but both of their income is reported on the form 1040.
Remember the form 1040 is your personal income tax return which must be signed by the primary and joint taxpayer.
The Schedule E Supplemental Income and Loss is used for income from rental property (part I) Income from pass through entities (so called because no actual tax is due on the income from these forms but is simply entered in Part II of the Schedule E) such as partnerships (Form 1065 return) or income from Form 1120S corporation return.
This excludes the form 1120 which is a Corporate Return which has it's own tax liability, in other words the form 1120 is NOT a pass through entity.
Part III deals in estates and trusts which we will not go into. (I know a lot of you are saying thank God on that right now.)
The income from the Schedule E is entered on the Form 1040 through the Schedule 1. Once again, the form 1040 is your personal income tax return that the
primary and joint taxpayer must sign.
There are 4 filing statuses on the 1040 form.
1.Single (unmarried with no dependents)
2.Married filing Joint (MFJ) (married couples filing together)
3.Married filing Separate (MFS)(married couples electing to file separate returns, for various reasons but mainly because one spouse does not want to be responsible for the other spouses tax liability. You see this a lot in marriages where one spouse gambles and has a lot of W-2G's and the other spouse says (heck no I am not paying taxes on the money you won, i told you to stay out of the casinos." lol)
4.Head of Household (HOH)(for unmarried taxpayers that have dependents)
5.Qualifying widower (QW) (someone who has minor children who's spouse died during the tax year)
So assuming that AM and MM did not file Married Filing Separate (in which case since MM did not work outside the home she would not file a tax return at all.) then the only other filing status is Married filing Joint. If they filed
MOJ then
MM HAD to sign the tax return even though only AM had business income.
So she had to know what income was being reported.
Example is hubby and I. I own a business which is incorporated and before he retired he worked for an employer.
My income is reported on an 1120S ((entered on our form 1040 from form 1120S, form Schedule E (Part II) and then Schedule 1), his wages (when he was still working) were reported on the form 1040 from a W-2 (line 1) and his retirement is reported on form 1040 through a 1099R (401K) on line 4b and since he was a federal civil service employee a CSA 1099-R on line 5b. (Federal employees have their own retirement plans so he cannot draw Social Security). All of this income is on the form 1040 personal income tax return which we both must sign even though only I am self employed with a business.
Now as all of you are probably asleep by now I will just say that if
AM was reporting that income then MM had to sign their tax return so therefore she had to see what income he reported.
BBM
I'm not sure why OP sent link for the grand jury indictment filed 7/20/22, USA v Russell Lucius Laffitte? If the intent was to send the complaint by the Estate against BOA, I've already seen this
That link has nothing to do with BOA. It contains the amounts and types of ways Lafitte allowed AM to distribute money from loans from his clients conservatorships (money orders, cashiers checks personal checks ect).
JMO
