How do I handle corporate investments on my corporate and personal tax returns?
How do I handle corporate investments on my corporate and personal tax returns?
I own a corporation and want to invest corporate money in stocks and mutual funds. These cannot be considered expenses so how do I account them? Are they somehow managed through the S corp pass-through system to my personal tax return?
Thanks Tro but i dont think you understand my question, nor corporations.
Answers:
tro: you have two separate entities, the corp is its own person and should be handled as such, do not mix the two
what is corp is corp and what is your personal is your personal
the corp files an 1120 and you file a 1040, non the twain shall meet
2010-05-29 09:04:05
2010-05-29 09:04:05
the tax lady: Look at the 1120-S.
Unlike business income, you show investment income on schedule K, lines 4, 5, 7 and 8. These are then listed on the schedule K-1, same lines and flow through to your 1040 to the appropriate sections of the 1040.
As far as the balance sheet goes, you show them as assets.
2010-05-29 09:15:22
2010-05-29 09:15:22
Chosen Answer
Bostonian In MO: An S-Corp is a pass-through entity. As such, any investment income flows to your personal return via Schedule K-1 in the same characterization as if you held the investments in your own name. Holding them in the name of the S-Corp merely introduces an unnecessary layer of complexity to preparing your corporate and personal returns. Keep life simple and hold the investments in your own name. Putting them in the name of the S-Corp won't save you a dime in taxes but may cost you extra in tax prep time and expenses. Depending upon your state's reporting requirements for corporations, you may be required to publicly disclose much more information about your investment activities than you'd like to if the S-Corp holds the securities. Unlike your tax return, those other state filings typically are a matter of public record and ANYONE who wishes to can review that information.
2010-05-29 09:36:07
Bostonian In MO: An S-Corp is a pass-through entity. As such, any investment income flows to your personal return via Schedule K-1 in the same characterization as if you held the investments in your own name. Holding them in the name of the S-Corp merely introduces an unnecessary layer of complexity to preparing your corporate and personal returns. Keep life simple and hold the investments in your own name. Putting them in the name of the S-Corp won't save you a dime in taxes but may cost you extra in tax prep time and expenses. Depending upon your state's reporting requirements for corporations, you may be required to publicly disclose much more information about your investment activities than you'd like to if the S-Corp holds the securities. Unlike your tax return, those other state filings typically are a matter of public record and ANYONE who wishes to can review that information.
2010-05-29 09:36:07
Judy: If it's an s-corp, any realized gain or loss would pass through to you on your K-1, and go onto your personal return.
2010-05-29 09:47:42
2010-05-29 09:47:42