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IRS Form 1120 instructions discussed by C Corporation CPA | ROBS

C Corporation CPA. Form 1120 instructions.

The IRS Form 1120 instructions can cover too much or too little information. Do you need a C Corporation free phone consult? Call me. (910) 399-2705.

The IRS Form 1120 instructions are a hard read. It has strange jargon, has too much information (making it difficult to pick out relevant issues), assumes you’re familiar with a host of tax issues (which all have their own IRS instructions) and uses an odd form of technical writing.

Why would anyone want a C Corporation?

C Corporations have some advantages to them, despite their bad reputation,especially with the new 2018 21% flat rate tax. I mostly deal with Form 1120 for ROBS (rollover business startup; where you capitalize your C Corporation tax-free with your pension funds). When the IRS created S Corporations almost all new companies used it. I can provide most of your due diligence for using ROBS. But I come in after the ROBS setup. I suggest calling Benetrends and Guidant for due diligence on the actual setup.

Other sources of information besides the IRS Form 1120 instructions

Most CPAs would probably recommend a professional tax preparer. Especially so for a ROBS C Corporation. Not so much for the fees, but because Form 1120 gets complex quickly. Folks tell me a CPA signature helps avoid audits. My firm has never been audited. But I do occasionally represent taxpayers being audited. I always ask how the IRS picks taxpayers to audit. They use what they call DIF, a weighted factor process.

Help for C Corporation tax return preparation

  • Your 2017 Form 1120 for your C Corporation.
    • That might help you identify issues and jump-start navigation for the 2017 Form 1120 instructions.
    • Changes are fairly easy to identify.
      • If you understand your last C Corporation’s Form 1120, the Form 1120 instructions are your first source of information.
      • Why? The IRS always has a section about what’s new. So the 2017 Form 1120 instructions will show you the new corporate flat line 21% tax rate and changes to due dates.
  • Tax database.
    • Your local college may have a subscription. Here C Corporation CPAs and lawyers interpret the IRS and local tax instructions making it easier to read.
      • Plus it will link to other IRS documentation.
  • Tax software.
    • Turbo Tax has a desktop tax program for Form 1120.
    • It’s good software.
    • The help section is useful.
    • You still have to know what you’re doing. It’s not as automatic as their 1040 version.
    • It’s a widely held belief that self preparation, with Turbo Tax, increases audit risk.
      • That’s not a swipe at TurboTax. It’s more of a self prepared issue.
  • Seminars or CPA self-study.
    • There are lots of these since C Corporation CPAs have to take 40 hours of Continuing Professional Education a year.
  • The internet is problematic as few professionals want to cover details that could be misinterpreted and incur professional liability.
    • I don’t update most of my posts and the tax reporting regulations may have changed for 2018 from specifics in a 2013 post.

Don’t use a tax chain for a C Corporation. I don’t think H&R Block prepares them. So, if you decide you need a tax preparer here is list of credentials to look for.

  • CPA. If you’re a ROBS C Corporation be sure to ask about their experience with ROBS Clients.
  • Tax attorney.

Do you need a ROBS CPA to prepare your C Corporations Form 1120 tax return

It depends. I’m sure lots of C Corporations use TurboTax software. You definite want to include the balance sheet section of Form 1120. Here the Form 1120 instruction get murky. Do you need a free phone consult? (910) 399-2705.

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