Harlan Lunsford wrote:

- quote -

Thanks. You're right. Now as to what the IRS would
actually DO if they got a return with multiple SE's with the
same SSN -- I have no idea.

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Harlan Lunsford wrote:
- quote -

Because he said "SEs", not Schedule SE. I took that as
meaning [three] self-employed activities.

It appears that this original poster has started more than
one thread, and in the other thread, it is clear that he is
talking about Schedule C.

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- quote -

Seems to me is that you combine the SE income one ONE SE for
each taxpayer. In that way, you net any SE losses against SE
income.

But what do I know?
Only a CPA

Bruce Raskin, CPA
Small Business and Individual Tax and Accounting Services

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Arthur L. Rubin wrote:
- quote -

(snipped....)

IRS would only "consolidate" the two se's that OP said he
filed, and not his and hers, since each one is separate and
said figures have to go to SSA for posting.

ChEAr$,
Harlan Lunsford, EA n LA

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D. Stussy wrote:
- quote -

Ouch!

Please let us know why you think three (schedule se's) are
needed?

ChEAr$,
Harlan Lunsford, EA n LA

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Arthur Kamlet wrote:
- quote -

Based on this and another thread of the same topic:

I believe that the original poster is confusing the use of
Schedule C and Schedule SE.

There can be only one Schedule SE per person (i.e. 2 for a
joint return) attached to a 1040.

There is supposed to be a Schedule C for each business
reported (which means that if there's more than one
business, there's more than one C).

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- quote -

No, not "everyone." I agree, you must do three, and
possibly a fourth depending on how the LLC is organized.

- quote -

You will NOT get hit with a fraud penalty. :-)

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"John" <John[at]john.com> wrote:

- quote -

Screwing things up? I would immediately look for a new
accountant. Knowing how to do a Schedule SE is fairly
elementary in terms of a tax professional.

--
David M. Woods, EA, ChFC, CLU
Woods Financial Services
Norwood, MA 02062
www.woods-financial.com

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- quote -

I don't know what Social Security is capable of receiving
when the IRS sends them your SE info to be credited to your
Social security account. It is just possible that only one
of your SEs will be accepted and the other treated as a
correction of the first? So you could lose out on Social
security credit.

But a situation which is particularly wrong is teo Schedule
Cs, one with $250 net profit and the other with $500 net
profit.

Combining them as you are supposed to gives 750 net profit
as the starting point of your SE calculation.

But if you used one SE for te $250 sch C, that Schedule SE
would not have to be filed, so would escape SE tax, and only
the %500 SE would have SE tax calculated -=- and that's not
right. Anyone with several sources of self empolyment
income that they choose to divide into many separate Sch Cs
in order to get many Sch SEs each under $433 net profit,
thus no SE tax, has to know this is wrong!

And it is wrong even if each Sch C is over $1000.

__
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

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- quote -

Two for the three businesses? Correctly you should have
filed one that showed a "consolidated" loss and therefore no
SE tax.

But I'm (just) guessing you filed one each for the two
profits, in which case you overpaid the SE tax.

If that is the case, IRS probably used the two schedule se's
and accepted the tax you did pay. Should be the end of it.

However, they MAY not have sent both schedule se's 'to the
Social Security Administration. If some eagle eyed clerk
spied the two and when entering data into the computer added
the two together, fine. If not, and IRS actually sends the
schedule se's to SSA, (which I doubt) perhaps once there,
the SSA disregarded one of them, posting the other one
however. That you won't know until a couple years from now
you check SSA records when they send you the benefits
statement.

Still though, you overpaid.

ChEAr$,
Harlan Lunsford, EA n LA
14 Oct 04 22:37:49

the se tax you did pay. BUT,

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"John" <John[at]john.com> wrote:

[snip]
- quote -

If you exceeded the limit for OASDI, you would overpay,
because the limit is applied separately on each Schedule SE.
Don't know about you, but I wouldn't want to do that.

--
Chris Green

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- quote -

The main reason I see for NOT filing multiple Schedule SEs
is that you will probably pay MORE in Medicare taxes for the
year (SS taxes maxed out on W-2 income).

In your situation, you have a PROFIT in two business' ($22K,
$319 in MC tax), a LOSS in another ($37.5K, 0 in MC tax). If
you only file ONE SE form, you have a NET LOSS for income
and employement tax purposes, and will owe NO MC tax. Most
people would rather keep the $319 in their own pocket.

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"John" <John[at]john.com> wrote:

- quote -

Your accountant is wrong, however, since you are over the
max for SS it doesn't make any difference. You only owe
the Medicare tax portion on your SEs. From page SE-2 of
1040 Instruction booklet see "More than one business" for
the IRS's answer to your question. Can't your accountant
read? ed

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John wrote:

(in regard schedule SE)

- quote -

It's possible the IRS consolidated the SEs when entering the
information into their computers, so there would be no
effect. It's NOT possible for the computer to have more than
one SE per person per year.

Consequences? You could overpay SE tax if the total of SE
line 1 + wages exceeds the Social Security income limit.

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Tom Healy wrote:

- quote -

I'm not so sure about item #4. I believe the original post
noted that the taxpayers were in a community property state.
As per Rev Proc 2002-69, it has been my understanding that
the IRS will accept ~whatever~ allocation the community
(married) owners agree to.

However, I ~thought~ I had seen a modification or revocation
of that procedure beginning in 2004, but I can't find it at
the moment.

MTW

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- quote -

Thank you for the information. My accountant told me to do
three, two for me and one for my wife.

But since everyone is certain there can only be two...
So far the IRS has not objected to the three I did last year.
What consequences could there be from filing three?

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"The Avatar" <theavatar007[at]hotmail.com> wrote:

- quote -

Only one SE per person per return. So if you are married
(filing a joint return) there will only be two SE on return.
Yours and hers.

I'm pretty sure that is what was meant by 'consolidated SE'.

As to the rest . . .I'd rather not offer a thought.

MO


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- quote -

What a set-up! But I won't tell you the punch line.

For the LLC, the right answer will be found by reading the
documents that create the LLC and seeing who the owner is.
IMHO, it's not a judgment call, not a variable, it's not
based on who's doing the work, it's a matter of written
documentation...

And when that's resolved, there should be *two* Schedule
SE's: one for the husband and one for the wife.

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The Avatar wrote:

- quote -

Okay; you're pretty, too!

Serously though, "consolidated" was meant I'm sure to say
that all three of husband's activities are consolidated, or
added , or rather netted to come up with the figure that
goes on the ONE schedule se. (He does not file one for each
business!) You of course file your own separate schedule se.

You say that the LLC is set up as a single member LLC. And
that's why he files a shedule c. No problem.

For you to be added to the LLC, that will take a new
operating agreement, or maybe an addendum to the existing
one to add another member. thereafter (and not before)
the LLC will file a form 1065 (partnership) and each
member's results (profit or loss ) will flow through to
the 1040 form. But not before.

Remember too, after the change in the LLC structure is
accomplished (via competent local legal counsel I should
advise) the newly constituted LLC will need a new federal
identification number.

ChEAr$,
Harlan Lunsford, EA n LA
11 Oct 04 16:07:38

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The Avatar <theavatar007[at]hotmail.com> wrote:

- quote -

One SE only per person. If MFJ and each person had schedule
C income then only two SEs. I think your tax advisor told
you wrong.

__
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

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