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This call between Mike (Speaker A, client) and his accountants (Speaker B and Ching) focused on finalizing information for Two-Family's tax extension filing. The main discussion centered around confirming gross proceeds from sales, net additions (particularly trailer purchases totaling approximately $626k), and adjusting the fleet management expense from $3.6 million down to $1.2 million to maintain consistency with the prior year. The accountants indicated that with current numbers and bonus depreciation on vehicle additions, Two-Family would have approximately a $48k federal loss, making a zero-due extension appropriate for both federal and California filings.
The conversation also covered the broader tax planning timeline, with Mike confirming plans to complete a compilation by end of April and have books ready for tax preparation starting in May. They discussed implementing a new asset management system to better track book and tax basis going forward. Additionally, they reviewed the VS Rentals OpCo arrangement, which operates under an MSA (Management Service Agreement) where the company controls operations and receives income while paying fees for leased equipment, with formal asset acquisition delayed until certain liens are resolved. Mike also needs to address outstanding tax payments from 2025 and upcoming 2026 payments.
The call concluded with clear action items around confirming the sales proceeds and trailer additions, updating the fleet management expense to $1.2 million, and resending updated financials. The accountants will prepare a zero-due extension and send a summary of outstanding and upcoming tax payment obligations.
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