Has anyone here used TurboTax for this situation? I'm trying to figure out how to enter our mortgage interest correctly when filing. When I try to enter the Form 1098, it assumes I'm claiming the full amount but I only want to claim my 50%.

This is such a common situation! I went through this exact same thing with my partner two years ago. The key thing to remember is that you can only deduct what you actually paid, not what's on the deed or mortgage paperwork. Since you mentioned you've been splitting bills 50/50 but have a 60/40 mortgage split, you'll want to look at your actual payment records. If you can show that you each paid 50% of the mortgage interest and property taxes through bank statements or other documentation, then you can each deduct 50%. One thing that really helped us was keeping a simple spreadsheet showing who paid what each month. We had similar ownership percentages but different payment arrangements, and having clear records made tax time much easier. Also, don't forget to check if itemizing even makes sense for both of you. With the higher standard deduction now ($13,850 for single filers in 2023), you need a decent amount of itemized deductions to make it worthwhile. Sometimes it makes more sense for just one person to itemize and claim all the house-related deductions while the other takes the standard deduction.

Dont forget that section 179 has limits! For 2023 the limit was $1,160,000 with a phase out starting at $2.89 million. But thats for all equipment not just vehicles. Vehicles themselves have even lower limits. SUVs and trucks over 6000lbs have a $28,900 limit for section 179. Dont forget this!!

Great thread with lots of helpful information! Just want to add one more consideration for Austin - since you mentioned this is your first time filing Schedule C, make sure you're also tracking all your other business expenses properly alongside the vehicle deduction. The mileage logs everyone mentioned are crucial, but don't forget about fuel receipts, maintenance, insurance (business portion), and any vehicle-related repairs. Even if you take Section 179, you'll still want good records for the ongoing expenses. Also, consider setting up a separate business bank account if you haven't already. While the vehicle can be in your personal name as discussed, having clean separation for business expenses will make your life much easier come tax time next year. The IRS likes to see clear business purpose for all deductions, especially on Schedule C where they scrutinize sole proprietors more heavily. One last tip - if your construction business grows and you start buying more equipment, keep track of your total Section 179 deductions across all assets to make sure you don't hit those annual limits Ella mentioned.

Ugh, I'm in the exact same situation! Got code 971 about 10 days ago and have been refreshing my transcript daily hoping something would change. Filed in late January and was really counting on getting my refund by now to catch up on some bills. The uncertainty is honestly the worst part - like is it going to be 30 days or 6 months?? I've been seeing everyone mention taxr.ai in this thread so I think I'm gonna bite the bullet and try it for a dollar just to get some peace of mind about what's actually happening with my return. At this point I'd pay way more than that just to know if I should expect my money in weeks or months! Anyone else feel like the IRS customer service line is basically useless? Every time I call they just tell me to "allow additional processing time" 🙄

I've been dealing with code 971 for about 3 weeks now too and I completely understand the anxiety! From what I've learned lurking in these forums, the 971 code means they're sending you a notice but it can take anywhere from 2-8 weeks to actually receive it in the mail. The frustrating part is not knowing what they need or how long the review will take. I ended up calling the IRS after seeing it mentioned here and waited on hold for 3 hours, but the agent was actually helpful - they told me it was just a routine review to verify some W-2 information. Still waiting for the letter but at least I know it's nothing serious. If you can't get through on the phone, maybe try that taxr.ai tool everyone's been talking about? Seems like it might give you some clarity while you wait for the official notice. Hang in there! 💪

I think there's some confusion here. The last month rule applies if you are covered by an HDHP on the FIRST day of the last month of your tax year (December 1 for most people). If you meet that requirement, you're treated as eligible for the entire year. But based on your post, you had HDHP coverage for 8 months but it's not clear if you still had it in December. If you DIDN'T have HDHP coverage on December 1st last year, then you CAN'T use the last month rule and are limited to the prorated amount (8/12 of $3,850).

Thanks everyone for the helpful responses! I realize I wasn't clear in my original post - I did have HDHP coverage through December 1st last year (my previous job's coverage ended December 31st), so it sounds like I do qualify for the last month rule. Just to make sure I understand correctly: since I had HDHP coverage on December 1st last year AND I have HDHP coverage now through my new employer, I can contribute the full $3,850 for last year to my current HSA account, as long as I maintain HDHP coverage through December 31st of this year. Is that right? The testing period requirement makes me a bit nervous since I'm relatively new at my current job, but I don't have any plans to leave or change coverage. I think I'll go ahead and make the full contribution since the deadline is approaching. Better to take advantage of the tax savings while I can!

My accountant always puts shareholder contributions on line 7 of Schedule M-2 and then on lines 22-23 of Schedule L. BUT he also adds a detailed statement explaining the contribution that attaches to the return. He says this statement is super important and prevents questions from the IRS. Has anyone else been told this?

This is exactly the kind of question that trips up a lot of S-corp filers! From my experience helping small businesses with their returns, here's what you need to do for that $25,000 shareholder contribution: **Schedule L (Balance Sheet):** - Increase your cash (or other asset if it wasn't cash) on the asset side - Increase "Additional paid-in capital" (line 23) on the equity side by the same amount **Schedule M-2 (AAA Analysis):** - Report the contribution on line 7 "Other additions" **Don't forget the statement!** Attach a brief explanation like: "Shareholder [Name] contributed $25,000 cash on [date] for equipment purchases." This prevents IRS questions later. One important note: Make sure your shareholder updates their stock basis records to reflect this $25,000 increase. This affects their ability to take tax-free distributions and deduct any potential losses in the future. The key is consistency - the same dollar amount should flow through both schedules, just serving different reporting purposes. Schedule L shows the balance sheet impact, while Schedule M-2 tracks the accumulated adjustments account changes.