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Level 10
March 21, 2025

Consulting, SSTB and 'crack-and-pack"

  • March 21, 2025
  • 1 reply
  • 8 views

If you have a consulting firm with non-SSTB activities, I would like to know your advice or your experience about using the crack-and-pack strategy.

My clients are consultants in a professional services field. But I know that they do technical inspection and monitoring that does not lead to reports or consultation.  Before I ask them to determine the income from each of these two separate activities, I'm researching this strategy.

thanks

1 reply

BobKamman
Level 15
March 21, 2025

That's something you do prospectively, not retroactively on a tax return for a completed year.  

Level 10
March 21, 2025

Thank you. 

The S Corp for 2024 has already been prepared and filed.  Is it possible to change the allocation of income and wages on the shareholder's 1040?

BobKamman
Level 15
March 21, 2025

No, and since Section 199A might be repealed or amended this year, I wouldn't spend much time planning for it until seeing the new rules.