Home  >  FAQ  >   June  2004		FREQUENTLY ASKED QUESTIONS
			Partnership Special Allocations   Overseas Money Transfer   Former Employee Stock Options   Gift To Non-Citizen Spouse   California Title as Community Property

In a two-person partnership, can one person, deduct all of the interest on a loan?		Yes, but to accomplish the proposed allocation you will need to draft and sign a partnership agreement that permits special allocations and follow the rules under IRC Sec. 704 and the comprehensive regulations thereto.
My friend, a non-US resident, wants to wire $20,000 to my account and then I am to deposit the funds into his stock account. Are there any tax reporting requirements for such a transaction?		Why doesn't he wire the funds directly to his own account? Doing it your way will entail documentation that he is wiring the money to you as his agent, and that you'll be depositing the funds into his account - otherwise, you could have a gift-tax liability arising from the transfer from your account to his. See Also: The Tax Prophet's Section on Foreign Taxpayers
A former employee exercised stock options in 2004. Since he is no longer an employee, are the proceeds subject to FUTA?		There could be an obligation on behalf of the employer to report the payments on a timely basis. If the service recipient (company) timely complies with applicable Form W-2 or 1099 reporting requirements, the employee is deemed to have included the amount in gross income for this purpose. See Also: The Tax Prophet's Section on Employee Stock Options
My wife is a non-US citizen. May I gift my share of our house to her, utilizing the $110,000 annual gift tax allowance for a non-citizen spouse?		Yes. The marital deduction for gifts from a U.S. taxpayer to a non-U.S. taxpayer is $114,000 per year for tax year 2004. The annual exclusion is $11,000 per year per beneficiary, so you can give a total of $125,000 per year to a non-U.S. taxpayer spouse. There is no reporting requirement if the gift is below the annual marital deduction allowance; otherwise, file Form 709. See Also: The Tax Prophet's Section on Foreign Taxpayers
We live in California and hold our residence in joint tenancy. To obtain a full step-up basis evaluation for marital assets in the event of the death of either spouse, do we need to change title to community property?		Yes. There is a new type of title in California - Community property with rights of survivorship. You need to sign a deed changing the title of your property in accordance with the new law. See Also: The Tax Prophet's Tax Class on Real Estate

Home |  Who We Are |  What's New |  Search |  Contact Us |  Subscribe

[Wealth Preservation]   [Employee Stock Options]   [Foreign Taxpayers]   [Tax & Trust Scams]   [Expert Witness]   [General Tax Information]

All contents copyright © 2008 Robert L. Sommers, attorney-at-law. All rights reserved. This internet site provides information of a general nature for educational purposes only and is not intended to be legal or tax advice. This information has not been updated to reflect subsequent changes in the law, if any. Your particular facts and circumstances, and changes in the law, must be considered when applying U.S. tax law. You should always consult with a competent tax professional licensed in your state with respect to your particular situation. The Tax Prophet(TM) is a trademark of Robert L. Sommers.