I'm dealing with this exact same issue! My SBTPG account has been showing "unfunded" since 3/16, even though my IRS transcript shows code 846 (refund issued) dated 3/15. I also used TurboTax with fees deducted from my refund. After reading through all these comments, it's really reassuring to know this isn't just me - sounds like SBTPG is having major processing delays this year, especially for returns with fee deductions. The 7-10 business day delay mentioned by others who called seems to align with what we're all experiencing. I think I'll try calling their customer service line tomorrow to at least confirm they have my refund in their system. It's frustrating because last year this whole process was so much faster, but at least now I know to just wait it out rather than panic that something went wrong with my return.

I'm going through the exact same frustrating situation! My SBTPG account has been showing "unfunded" since 3/14, and my transcript clearly shows code 846 with refund issued on 3/13. I also used TurboTax with fees deducted, so that's definitely adding to the delay. After reading through all these comments, I feel so much better knowing this is a widespread SBTPG processing issue affecting tons of people rather than something specific to my return. The consistent 7-10 business day delay that multiple people have confirmed by calling SBTPG gives me hope that we should see movement soon. It's crazy how much slower this process has been compared to previous years - I remember getting my refund within 3-4 days last year. I think I'm going to call SBTPG tomorrow morning to at least confirm they have my refund in their processing queue. Thanks everyone for sharing your experiences - it really helps to know we're all dealing with this together!

Great thread! I'm dealing with this exact situation right now. One thing I wanted to add that hasn't been mentioned yet - make sure you understand the difference between an Accountable Plan and a Non-Accountable Plan when it comes to your 1120S reporting. With an Accountable Plan (which sounds like what you have), the reimbursements don't show up as income to the employee and you get to deduct the actual business expenses in their appropriate categories like everyone mentioned. But if your plan doesn't meet all the IRS requirements (business connection, substantiation, return of excess), it becomes a Non-Accountable Plan and those reimbursements become taxable wages to the employee. I see a lot of small S-corps accidentally create Non-Accountable Plans because they're missing one of the requirements, especially the "return excess payments" part. Just wanted to flag this since getting it wrong affects both your 1120S deductions AND your employee's tax situation. The good news is if you set it up right from the start like it sounds like you're trying to do, it's actually pretty straightforward to maintain.

This has been such a helpful thread! As someone who's been handling S-corp taxes for a few years, I want to emphasize something that's been touched on but is really critical - timing matters a lot with Accountable Plans. Make sure your Accountable Plan is formally adopted BEFORE you start making any reimbursements. I've seen businesses try to retroactively create an Accountable Plan after they've already been reimbursing expenses, and the IRS doesn't accept that. The plan needs to exist first, then the expenses and reimbursements follow the plan's rules. Also, for anyone just setting this up, consider adding a reasonable time limit for employees to submit expenses for reimbursement (like 60 days from when the expense was incurred). This helps with your bookkeeping and ensures expenses are properly documented while they're still fresh in everyone's memory. On the 1120S side, just remember that these are business expenses first - the Accountable Plan is just the mechanism for how they get paid, not a separate category of expense.

I completely understand your concern about this situation, Jamal. Your instincts are absolutely right - what your neighbor is suggesting is tax evasion, plain and simple. Here's the bottom line: You're required to report ALL income, regardless of how you're paid. At $300 per job doing 2-3 jobs monthly, you're looking at roughly $1,800-$2,700 per year. This definitely needs to be reported on your tax return. Your neighbor also has obligations - if he's paying you as an independent contractor and it totals $600+ per year, he should issue you a 1099-NEC. If not, you still need to report it as "other income" on your return. My advice: Start tracking all payments from now on, set aside about 25-30% for taxes (income tax plus self-employment tax), and consider making quarterly estimated payments to avoid a big bill next April. You might also be able to deduct work-related expenses like tools or mileage. Don't let your neighbor's casual attitude toward taxes put you at risk. The "everyone does it" mentality doesn't protect you from penalties, interest, or potential criminal charges. Better to handle this properly from the start than deal with IRS problems later.

Just want to echo what others have said - your gut feeling is absolutely correct. This is tax evasion, not a "tax headache avoidance strategy." I work in tax preparation and see people in similar situations all the time. The "everyone does it" line is classic - it's what people tell themselves to justify risky behavior. But the reality is that unreported income catches up with you eventually, often when you least expect it. A few practical points for your situation: - Keep detailed records of all payments (dates, amounts, work performed) - You'll likely need to file Schedule C for this self-employment income - Don't forget about self-employment tax (15.3%) in addition to regular income tax - Consider quarterly estimated payments if this continues The peace of mind from doing things correctly is worth way more than the temporary "savings" from hiding income. Plus, as a legitimate business expense, your neighbor can actually deduct what he pays you - so there's really no good reason for him to want to hide these payments other than avoiding his own tax obligations. Better to have an honest conversation with him about proper documentation, or find a different side gig if he's unwilling to do things legally.

Am I the only one who thinks it's totally unfair that gambling losses can only offset gambling wins? If I invest $5000 in a small business that fails, I can usually deduct that loss against my regular income (with some limitations). But if I lose $5000 gambling, I can't deduct anything unless I also won money gambling? Makes no sense.

I understand your frustration about the $3,500 sports bet scenario. Just to clarify what others have mentioned - you're absolutely right that if you lose the entire amount with no other gambling winnings, you won't be able to deduct any of it. The loss won't help reduce your regular income taxes at all. One thing to consider is the psychological aspect too. That $3,500 loss would essentially be "dead money" from a tax perspective, whereas if you had invested it in something like an index fund or even a high-yield savings account, any losses might have different tax treatment (capital losses can offset capital gains plus up to $3,000 of ordinary income annually). Also, make sure you understand the reporting requirements if you do win. Even though you'd net $2,900 profit, you'd actually need to report the full winning amount as income, then deduct your original bet as a gambling loss if you itemize. The tax calculation can be more complex than just paying tax on the net profit.

Wait, I'm confused about land vs building depreciation. My understanding is you can only depreciate the building portion of your property, not the land. How do you calculate this split if you've made improvements?

One additional consideration that hasn't been mentioned yet - don't forget about Section 179 deduction and bonus depreciation for some of your rental property improvements! While most structural improvements to rental property need to be depreciated over 27.5 years as discussed, certain types of property improvements might qualify for accelerated depreciation. Things like security systems, some appliances, and certain non-structural improvements might qualify for immediate expensing under Section 179 or bonus depreciation. For example, if you're installing new appliances as part of your bathroom renovation, those might be eligible for immediate deduction rather than the 27.5-year schedule. The rules can be complex, but it's worth exploring since it could provide significant tax benefits in the year you make the improvements. Also, if you're doing substantial renovations that involve any accessibility improvements, there may be additional tax credits available beyond just the depreciation benefits. Always worth checking with a tax professional to make sure you're maximizing all available deductions and credits for your rental property investments!