We Prepare Tax Returns!

We prepare most type of tax returns:

Individual. 

S Corporation.

C Corporation.

Partnership.

Payroll.

Amended.

Gary Bode, CPA is a Master's Degreed, nation wide accountant offering tax and business services. Member of AICPA and NCACPA. Our virtual office provides excellent service to long distance and international clients. Call (910) 399-2705 for a free phone consult.

Client Video Testimonials

Click here to watch some of our clients in their video testimonials!

Client Testimonials

I became totally and permanently disabled after a working for 44 years. I returned to college late in life (while working full-time) to fulfill my dream of becoming an RN and at that time found it necessary to secure student loans. Three years after being declared totally and permanently disabled my student loans were discharged. In January 2013 we received a 1099-C form declaring said student loans that were discharged however that amount could be considered as income for 2012. This was a large amount of money and we live on two pensions and social security income.

I started looking on the internet for information regarding 1099-C and felt that this was something that we could not handle alone. I made phone calls locally to a very reputable tax group in a city near us and they said it would cost $500 for an appointment and that they really prefer to do corporate taxes and they referred me to a local person who had worked for them at one time, we called and explained the situation and an appointment was made and then the comment was made that "I will have to do some research on this" and flags immediately went up and we called back and cancelled that appointment. I had been researching the IRSwebsite and every place else I could think of and I was not comfortable doing our own taxes this year. We called another local tax preparer that we had used in the past and made an appointment, however prior to the appointment, while still seeking information regarding our situation,

I came across a website for Gary l. Bode, MSA, CPA, PC in Wilmington, NC. I called Mr. Bodeand explained our situation and asked if he could help. He spoke very knowledgeably regarding the situation and stated that yes; he felt he could help us. As Mr. Bode was in North Carolina and we were in New York I scanned all of our documents including back-up documents for all of our claims and forwarded all to him. Mr. Bode kept in touch with us via email; we have spoken on the telephone several times and have become very comfortable with his knowledge and professionalism. Also, as I am a true "worrier" I have continued looking into information regarding our tax situation and I came upon another web page for Mr. Bode that included testimonials which spoke of his experience with this type of tax situation as it became prevalent during the recession. This reinforced in our minds that we had made the right decision in hiring this person as our tax preparer.

I share all of this as our taxes are now ready to be filed (we do owe tax for 2012 but not the astronomical figure we thought we were facing), and we are confident that they have been prepared with the utmost care by a gentleman who has an excellent working knowledge of the situation we faced and the tax laws that were applicable to said situation.

 

Bill and Carol

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Even though Gary enjoys helping colleagues, we no longer provide free consults to other tax preparers. He's happy to consult on an hourly billing basis if our schedule allows.

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Form 1120-S CPA discusses S Corporation Loans to and from Shareholders | Form 1120-S, U.S. Income Tax Return for an S Corporation

Form 1120-S CPA. S Corporation CPA. U.S. Income Tax Return for an S Corporation.

I run our CPA firm as an S Corporation. So you know I stay current on S Corporation issues. For a free consult call (910) 399-2705. We can provide service regardless of where the S Corporation is registered or where the Shareholders live.

When Form 1120-S CPAs see problems with S Corporation accounting it usually involves the Balance Sheet. Which is understandable. Most S Corporations are small enough that the managing shareholder can track financial transactions by memory. And without some training, the Balance Sheet isn’t as useful for managerial purposes as the Income Statement. But brilliant minds have crafted managerial tools using components of the Financial Statements. I’ve always thought it’s a shame S Corporations lose out on that opportunity.

The IRS takes an interest in loans between the S Corporation and Shareholders

“I think the IRS worries about the S Corporation loaning money to shareholders that never gets paid back and thus escapes taxation. But in my experience as a Form 1120-S CPA, the Shareholders more often lend money to the S Corporation and never get it back, meaning those funds are double taxed – ouch!”
– Gary Bode, Form 1120-S CPA

Two lines of the balance sheet section of Form 1120-S, U.S. Income Tax Return for an S Corporation, are devoted to such loans. Just because the IRS takes an interest in some S Corporation issue doesn’t mean it’s taboo. And that’s the case with S Corporation loans to and from Shareholders. When I prepare Form 1120-S I like to document the loan figures on page four. I think as long as good records are kept there’s no big deal with such loans. See other suggestions below. But good records aren’t always kept. I don’t know if the IRS audits specifically on shareholder loans but once an audit starts, shareholder loans usually get close inspection.

Corporate Schizophrenia

Your S Corporation is a distinct entity by itself, even though you own it. Many IRS audit parameters look for co-mingling of S Corporation and personal finances. Even I feel strange sometimes when I structure transactions between myself and the Firm. I own 100% of it. I am the S Corporation. But the IRS doesn’t see it that way.

Use formal structure with shareholder loans

Here’s what I’d like to see if I was representing your S Corporation for an IRS Form 1120-S tax audit.

  • Detailed history with documentation for all loan related transactions.
  • An actual loan document between the S Corporation and shareholder. Even though it seems like you’re only passing from one hand to the other.
  • Documentation of the loan in the Corporate minutes.
  • An established interest rate.
  • Formal payments.

If you pay attention to only one aspect of the Form 1120-S, U.S. Income Tax Return for an S Corporation, balance sheet make it loans between the Shareholders and S Corporation.

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