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.

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When my business partner and I found ourselves in a land investment that was abandoned by the developers, we had no reasonable economic choice but to walk away from our mortgage loan.  While we understood that there would likely be tax consequences, the magnitude of our exposure was not fully anticipated.  Thankfully, Mr. Bode was able to work with us to strategize a defensible tax position and mitigate the tax implications of our investment loan abandonment.  I would recommend that anyone facing an investment loss that has tax implications due to debt forgiveness give Gary a call.  It is always best to fully understand the circumstances and the tax rules and related options before paying a hefty bill.  Thanks Gary!

Brian D. - CPA

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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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Subchapter S Corporation CPA discusses the Balance Sheet on Form 1120-S

Subchapter S Corporation CPA Form 1120-S

Your Subchapter S Corporation’s Form 1120-S can do more that just report data to the IRS. (910) 399-2705.

Subchapter S Corporation CPAs routinely analyze the Balance Sheet components of Form 1120-S during tax preparation. Why? Five reasons:

  • CPAs look for managerial implications of the Balance Sheet. Fortune 500 companies use relationships between Balance Sheet components to optimize their operations. Tax preparation of Form 1120-S might be the only opportunity your Subcapter S Corporation CPA has to help you with these same tools. After all, you’re already paying for the service; why not get the most value from your company’s CPA fees?
  • The IRS are experts at financial analysis, which helps find red flags for potential tax audits.  The Balance Sheet helps corroborate or discredit the income and profit your company reports for the year.
  • CPAs look for red flags, too. If it turns out that the underlying figures are correct, Subchapter  S Corporations CPAs provide supplementary information on Form 1120-S to explain the situation, hopefully preventing further IRS interest.
  • Shareholder equity transactions during the year flow to the Balance Sheet of Form 1120-S. Accurate accounting helps prevent internal discord.
  • This year’s Form 1120-S becomes the basis for future tax positioning.

“In Subchapter S Corporations, Form 1120-S functions as a substitute for Financial Statements. Financial Statements provide managerial insight. Tax positioning consists of applying multiple strategies that collectively create tax savings.”
– Gary Bode, Subchapter S Corporation CPA and Form 1120-S tax accountant

Form 1120-S Balance Sheet Managerial Examples

Financial analysis deals with financial ratios between components on the Financial Statements. Such ratios allow benchmarking, like comparisons to prior company performance, comparisons to the company’s industry segment and monitoring performance of strategic goals.

Common Financial Statement financial ratio categories include:

  • Profitability ratios.
  • Liquidity ratios.
  • Activity or efficiency ratios.
  • Debt or leveraging ratios.
  • Market ratios.
  • Capital budgeting Ratios.

Let’s imagine your Subchapter S Corporation anticipates an expansion loan in a year or so. CPAs know a banker will look to the company’s liquidity ratios as an indicator of loan re-payment capability. These liquidity ratios might be currently unacceptable, but over time, the company can structure itself such that these ratios become acceptable. For example, I graph liquidity ratios over time to visualize the company’s progress.

Our Form 1120-S Tax Preparation Philosophy

Most of my Form 1120-S Clients are untrained in accounting or financial statement analysis. Since they’ve paid me to prepare the return, I take that extra bit of time to look at the Balance Sheet, and then I share any managerial insight gleaned with that client.

Your Subchapter S Corporation’s Form 1120-S provides managerial insight. Our firm operates as an S Corporation, so I stay current on Form 1120-S issues. (910) 399-2705.

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