User:CheshireKatz/Planning/Charts

As requested by Prof Broderick:

I N C O M P L E T E I N C O M P L E T E

Susie looking for Pass Thru losses, Income, & LTCGs Amalgamated (Foreign corp) Jeff Income & LTCGs

...and now TAX CONSEQUENCES!

S                A                     J (50K Cash)       (100K Loan)               (0K) ( 25K Prop) Ba: 50K          Ba: 100K               Ba: 0K CA: 75K          CA: 100K               CA: 0K

\\              ||                   //     \\              ||                  //                       L    L    C                       Bank Loan $25K Ama Loan $100K Antique $25K (704(c))

Latest
"No profit" businesses though they increase in value:
 * Landlords paying themselves for services and repairs/renovations
 * Pro-sports teams
 * Companies developing drugs/medical devices

Equity Interests:
 * 1) Capital → Constrained
 * 2) Appreciation/Profits → Wide Open
 * 3) Voting → Wide Open

LLC preferred structure to avoid restrictions on subchapter S Corps and require $1.1m in adjusted basis on Hatfield’s property to travel with him.

...and now TAXES with Vajtay!

Hatfield:
 * US Citizen
 * Depreciable real property
 * Sole proprietor
 * Doesn't like tax complexity
 * Dying

McCoy
 * US Citizen
 * Inheritance
 * 100k Joint income
 * Young & not sick

H                     M       ($ Ct Prop)              ($0.25m) ($ Ma Prop) ($ Vt Prop) ($ NJ Prop) Ba: $3.15m              Ba: $0.25m CA: $1.00m              CA: $0.25m

\\                //             \\               //

L   L    C

H Basis   6.40m -6.50m +3.25m -- Adj Bas  3.15m

Hatfield ought to include a term in the agreement that requires his approval on sales of appreciated land and triggers distributions to him to pay the tax hit.

Recourse or non-recourse indebtedness? Individual borrower for business loan, almost certainly recourse debt. If it had been non-recourse, his liability would've been redistributed to