Wanted to add a reminder about quarterly estimated tax payments since you're self-employed! If you expect to owe more than $1,000 in taxes for the year, you're supposed to make quarterly payments to avoid penalties. I learned this the hard way my first year as a freelancer and got hit with a $430 underpayment penalty. Now I set aside 30% of each payment I receive into a separate savings account and make my quarterly payments from there.

Great question about quarterly payments! There are actually two safe harbor rules you can use to avoid penalties: 1. Pay at least 100% of last year's total tax liability (110% if your prior year AGI was over $150k) 2. Pay at least 90% of the current year's tax liability Most people find option #1 easier since you know exactly what you owe. Just take last year's total tax (line 24 of your Form 1040) and divide by 4. Even if you end up making more money this year, you won't get penalized as long as you meet the 100% threshold. For your fluctuating income situation, I'd recommend the prior year method for your quarterly payments, then if you have a really good year, just set aside extra money throughout the year for the final balance due in April. Also remember that if you had zero tax liability last year, you don't need to make quarterly payments at all (though you might still want to for cash flow purposes).

This is a frustrating situation that unfortunately highlights gaps in how many tax offices handle identity verification. Since you own multiple properties and there's another Thomas Wilson who also owns multiple properties in the same county, the tax office really should have been more careful about verification. Here's what I'd recommend based on similar cases I've seen: 1. **File a formal written complaint** with your county's Board of Supervisors or equivalent governing body. Include all documentation showing you requested your bill by name and address, and that they provided the wrong one. 2. **Request an "erroneous payment transfer"** - this is different from a refund and specifically addresses payments made to the wrong account due to administrative error. Most counties have procedures for this even if front-line staff don't know about them. 3. **Document the systemic problem** - emphasize that their identification process failed when dealing with common names and multiple property owners. This isn't just about your money, it's about preventing this from happening to others. 4. **Consider small claims court** as a last resort if administrative remedies fail. You have documentation that you requested your specific bill and they provided the wrong one. The key is framing this as their procedural failure rather than just a payment mix-up. Good luck!

I work in municipal finance and see these kinds of mix-ups more often than you'd expect, especially with common names. The frustrating part is that many tax office clerks don't fully understand the procedures for correcting these errors, which is why you're getting the runaround. A few additional points to consider: First, most states have laws requiring tax offices to maintain reasonable identification procedures when accepting payments. When you specifically requested YOUR bill and they handed you someone else's, that's a failure of their verification process, not your mistake. Second, you mentioned paying in cash - make sure you have a receipt showing the date, amount, and any property identifiers. This documentation will be crucial for any formal complaint process. Third, if the informal approaches don't work, consider contacting your state's Department of Revenue or equivalent agency. They often have oversight authority over local tax collection procedures and can intervene when counties aren't following proper protocols. The bottom line is that you shouldn't be financially penalized for their administrative error. Keep pushing back - this is absolutely their responsibility to correct, not yours to just accept.

Just to clarify something that might help others - the self-employed health insurance deduction has another important limitation that hasn't been mentioned yet. You can't take this deduction for any month that you (or your spouse if filing jointly) were eligible to participate in an employer-sponsored health plan. So even if your business has enough profit to cover the full premium amount, you'd need to reduce your deduction by the months you had access to employer coverage. This caught me off guard when I started freelancing while still having access to my spouse's employer plan for part of the year. The IRS is pretty strict about this - "eligible" means you could have enrolled, even if you chose not to. Worth double-checking if this applies to your situation before calculating your maximum deduction.

This is really helpful information! I'm dealing with a similar situation where my premiums are higher than my net profit. Based on what everyone's saying, it sounds like I need to look at both Schedule 1 (limited to my business profit) and Schedule A (for the excess if I have enough medical expenses to itemize). One follow-up question - when you're calculating the 7.5% AGI threshold for medical expenses on Schedule A, does that include the health insurance premiums you couldn't deduct on Schedule 1? Or do you have to exclude those since they're already "accounted for" in the self-employed deduction calculation, even if you couldn't use the full amount? I'm trying to figure out if that $4,300 excess in my case ($14,500 premiums minus $10,200 profit limit) can count toward meeting the 7.5% threshold or if it gets excluded somehow.

Stupid question maybe but what exactly are the dates for the IRS shutdown? Is it the same every year? I've been filing quarterly stuff for 3 years and somehow never noticed this shutdown thing.

Great thread everyone! As someone who's been doing small business payroll for 8 years, I want to add a few key points that might help newcomers like Omar: 1) The December shutdown is frustrating but predictable - use it to your advantage by getting organized early rather than stressing about transmission timing. 2) Don't forget that your employees need their W-2s by January 31st regardless of when you submit to SSA. Many business owners focus on the government deadlines and forget about the employee deadline. 3) If you're using a payroll service, ask them NOW about their year-end timeline. Some providers have different cutoff dates for year-end processing that are earlier than you'd expect. 4) Keep good records of your submission confirmations. Whether you use third-party tools or just screenshot everything, having proof of timely submission can save you major headaches if there are processing delays or questions later. The learning curve is steep in your first few years, but once you understand the rhythm it becomes much more manageable!

Thanks everyone for the incredibly detailed responses! This has been exactly what I needed. Based on all the feedback, it sounds like the Section 754 election is definitely available in our debt assumption scenario, which is a relief. A few follow-up questions based on the discussion: 1. @Paolo Marino - when you mention "properly documenting the debt assumption," are there specific forms or statements that need to be attached to the partnership return beyond the standard Section 754 election statement? 2. @Isabella Oliveira - we do have some Section 704(c) built-in gain from contributed property. Do you have any recommendations for resources that walk through the interaction between 704(c) and 743(b) adjustments? This seems like where I might need to bring in additional expertise. 3. @Ravi Patel - great point on Section 755. Our partnership has both depreciable real estate and some intangible assets. Is there a standard methodology for determining fair market values for the allocation, or does this typically require formal appraisals? This community has been incredibly helpful - I feel much more confident about moving forward with the election now. Really appreciate everyone taking the time to share their experiences!

Great discussion everyone! As someone who's dealt with several partnership transfers involving debt assumptions, I wanted to add a practical tip that might help @StardustSeeker and others in similar situations. One thing I've learned is to pay close attention to the partnership agreement's provisions regarding transfers and debt assumptions. Sometimes there are specific clauses that can affect how the Section 754 election is calculated, especially if the agreement has special allocation provisions or restrictions on transfer rights. Also, regarding the timing that @Amara Oluwaseyi mentioned - it's worth noting that once you make a Section 754 election, it generally applies to all future transfers unless you get IRS permission to revoke it. So make sure you're comfortable with the ongoing compliance burden, as you'll need to make basis adjustments for all subsequent partnership interest transfers. The interaction between debt assumption and the election is definitely well-established in the regulations, so you're on solid ground there. Just make sure your documentation clearly shows the connection between the debt being assumed and the partnership interest being transferred. Good luck with your transaction!