I’m confusing the fuck out of myself. For tax basis Calc’s- should we be adding book income or tax income?
Should we be adding or subtracting no deductible expenses? If an expense was nondeductible that means it was included in book income and therefore we should add it back in to get to the tax amount no?
Posted May 13, 2021, 7:16 PM UTC
Tax basis= contribution - distribution + taxable income - nondeductibles+ tax exempt income.
On item L on k1 we have income - deductions = total per k1. LESS expenses on books not on k1 (capitalization of org costs) = total per item L
For my tax basis Calc should that capitalization of org costs be included?
No because that is not a non deductible expense. It is just timing difference
So it’s contributions - distribution + taxable income - 18c +18a + beginning tax capital.
Some people also decrease by us taxes paid. Some don’t
Thank you! Appreciate the help
Should be using taxable income, and NDEs will decrease basis.