Partnership No SS for partners

[Taxing Matters]

Wow, I didn't realize that it had gone up!

It'll go up every year. The Congress when it amended the Code several years ago provided that the penalty will be indexed for inflation. See IRC § 6698(e). So when the IRS issues its inflation adjustment rev procs each year it will include the increase to this penalty.

 

[Zigner]

The state does not require SSNs for the members when the LLC is formed. It is up to the managing member or tax matters partner to ensure he/she has all the information needed to comply with the LLC's tax obligations.

Perhaps a better question would have been: "Why was an LLC formed without that information?"

 

[Woodsman]

After my dad passed, mom's health was failing. She had to go stay in a nursing home. She had savings, but at $5k a month, after a period of time it became apparent that the savings were to run out. We would have to put mom on Medicaid. This would cause the state of Ga. to take the family home after her death. We hired a Medicaid "expert" who performed some magic I didn't understand, We were able to use my power of attorney to put the home in a LLC, due to my sister owing money to the feds for a unrelated matter. No one asked for SS #. This process would have worked if we were 3 people moving in the same direction with a common goal. This was not the case. Lies were told. Priceless relics from the past were stolen and blamed on the other party. We did the dance, "You'll get your share when the stolen items are returned." No help. The surprise is that most of the items fought over are pictures. Pictures can be scanned and copied. They wish to punish me for some childhood perceived jealousy, or no longer have them, or don't understand the pictures can be copied. I had a lawyer I was working with. I am trying to extend the payment for another year to give my sibling ample time to come around. The money is in the bank. I am waiting for them to return the stolen items. The house was sold in late November. So this will extend from 2018 to 2019, doubling the cost of filing tax returns. There was a time in this process I could have asked for their SS #, and got them. But now they refuse to help in any way.
What is your best advice?
Thanks!

 

[Zigner]

What is the time frame that this occurred in?

 

[FlyingRon]

Yes, when was the house transferred into the LLC versus when your mom entered the nursing home? Despite your "medicaid expert" you may not want to spend the money from the sale of that house too quickly.

 

[Woodsman]

The LLC was set up in April, 2015. Mom went into a nursing home a few months before this. The taxes on the place were expensive, so I let my brother stay there for a year if he paid the taxes and kept the place up. A mistake. He paid taxes, but the place was run down even more than before after a year. It took a long time to clean it up. Paint. yard work. Had to have trees taken down. Repairs. Lots of expenses. I had to cover all that, with no help from my brother or sister. I have reimbursed myself for some of these expenses in 2019. I have receipts. But the actual net has not been touched. House sold in Nov. 2018.

 

[Zigner]

The LLC was set up in April, 2015. Mom went into a nursing home a few months before this. The taxes on the place were expensive, so I let my brother stay there for a year if he paid the taxes and kept the place up. A mistake. He paid taxes, but the place was run down even more than before after a year. It took a long time to clean it up. Paint. yard work. Had to have trees taken down. Repairs. Lots of expenses. I had to cover all that, with no help from my brother or sister. I have reimbursed myself for some of these expenses in 2019. I have receipts. But the actual net has not been touched. House sold in Nov. 2018.

Was your mom put on Medicaid?

 

[Woodsman]

Yes. When all monies were exhausted. We had no choice.

 

[Zigner]

Then Medicaid is going to want their portion to be repaid. It's called a "lookback" period.

 

[Woodsman]

No. The Medicaid expert was able to obtain an exemption. I'm not sure how that was done, but it was. There was other property they did want, but it was valued under $10k, so there was no interest in it.