Does anyone know if you need to file Form 8938 (Foreign Financial Assets) for PTPs like UCO? My accountant is saying that because some of the underlying assets in the partnership might be foreign, I might have an FBAR obligation, but that doesn't sound right to me.

I went through this exact same situation with UCO! The key thing to understand is that you're NOT getting double-taxed, but the reporting can definitely be confusing. Here's what's happening: The Schedule K-1 shows your share of the partnership's income/loss for the year, which you must report regardless of whether you sold shares. When you do sell, you need to adjust your cost basis by adding all the K-1 income you've already paid taxes on (and subtracting any distributions received). For your 2022 sale, you'll report both the K-1 income AND the sale on Schedule D/Form 8949, but use your adjusted basis. So if you bought UCO at $20/share, had $5 of K-1 income over the years, and received $2 in distributions, your adjusted basis would be $23/share ($20 + $5 - $2). Make sure to keep all your K-1s from previous years - you'll need them to calculate the proper adjusted basis. The "higher revenue" on your K-1s compared to your brokerage gains is normal because K-1s show the partnership's actual business income, not just price appreciation.

I'm so sorry you're going through this - the combination of medical bills and an indefinitely delayed refund is incredibly stressful. I went through something very similar last year and wanted to share what finally worked for me. After my 60-day period expired with no updates, I called the IRS using the early morning strategy others mentioned (7 AM sharp). The key thing I learned is to specifically ask for a "manual refund trace" rather than just asking about your refund status. This is different from a regular case trace and actually requires them to physically locate your return in their system and provide you with the specific reason for the delay. When I did this, I discovered my return had been flagged because I had moved between tax years and they needed to verify my address change, even though I had filed a change of address form months earlier. The agent was able to clear this immediately once she saw the documentation in their system. The whole process took about 2.5 hours on hold, but once connected, the issue was resolved in 15 minutes and I had my refund deposited within 6 business days. For your medical bills situation, definitely reach out to the billing departments and explain you're waiting on a delayed federal tax refund. Most healthcare providers are familiar with IRS delays this year and many will put your account on hold or set up a payment plan without penalty if you can provide them with documentation of your pending refund (like a copy of your 60-day letter). Don't lose hope - your money is there, it's just stuck in bureaucratic quicksand. The squeaky wheel really does get the grease with the IRS.

I'm really sorry you're dealing with this stress, especially with medical bills adding financial pressure. This exact scenario happened to my neighbor last year - 60-day letter in February, nothing until May. What finally broke the logjam for her was calling the IRS and specifically mentioning "financial hardship" due to medical expenses. The IRS has expedited processing procedures for taxpayers facing financial hardship, and medical bills absolutely qualify. When you call (definitely try the 7 AM strategy everyone's mentioned), tell them you're experiencing financial hardship due to medical expenses and that you need an expedited review of your return. Ask them to flag your account for "hardship consideration" - this can move your return to a priority queue. Also, keep detailed records of all your medical bills and payment due dates. If you need to escalate to the Taxpayer Advocate Service later, having documentation of the financial impact will strengthen your case significantly. The transparency issue is maddening - it's like they expect us to just trust that everything will work out eventually while we're struggling financially. But don't give up! Your refund is sitting there waiting to be processed, and advocating for yourself with the hardship angle might be the key to getting it moved along faster. Hang in there - medical emergencies are stressful enough without the IRS adding to it!

is it weird that my accountant just puts a plug number on line 5 to make line 8 match schedule k line 18? he says "everyone does it that way" but it seems kinda sketchy to me...

I've been doing S-corp returns for small businesses for over 15 years, and Schedule M-1 reconciliation is definitely one of the most confusing areas for new filers. Here's my step-by-step approach that might help: 1. Start with your book income (line 1) 2. Add back any federal income tax expense you recorded on books (line 2) - S-corps don't pay entity-level tax 3. Add excess capital losses and charitable contributions that exceeded limits (line 3) 4. This gives you line 4 - your adjusted book income Then for deductions not on books: 5. Add non-deductible expenses like 50% of meals, penalties, etc. (line 5) 6. Add income that's on your tax return but not your books (line 6) 7. Add other deductions on return not on books (line 7) Finally: Line 4 minus line 7 should exactly equal Schedule K line 18. If they don't match, work backwards - there's always a specific reason. Don't ever use "plug" numbers to force a balance. Each adjustment should be traceable to actual transactions or differences in how items are treated for book vs. tax purposes. The key is being methodical and documenting every adjustment you make.

Has anyone used TurboTax for filing S-Corp returns? I've used it for my personal taxes but not sure if it can handle the 1120-S and all the other forms for a single-member LLC with S-Corp election.

I went through this exact same situation last year as a Canadian who moved to the US and set up a single-member LLC with S-Corp election! The learning curve is definitely steep, but you're asking the right questions. One thing I wish someone had told me earlier: make sure you're keeping detailed records of ALL business expenses from day one. With an S-Corp election, the IRS scrutinizes the separation between business and personal expenses much more carefully than with a regular LLC. This includes things like your home office, business meals, equipment, software subscriptions, etc. Also, since you mentioned you have a client in California, be aware that California has some unique rules for LLCs doing business in the state. You might need to register as a foreign LLC in California and pay their annual $800 LLC fee, depending on how much business activity you're conducting there. It's worth checking with the California Secretary of State or a tax professional about this. The good news is that with only $13,500 in revenue, your situation is relatively straightforward compared to higher-earning S-Corps. Just make sure you get everything filed correctly this first year to establish good habits going forward!

As a financial advisor who specializes in education funding, I want to add some perspective on the long-term retirement impact that several people have touched on. The rule of thumb I use with clients is that every dollar withdrawn from retirement accounts in your 40s costs roughly 3-4 dollars in retirement purchasing power (assuming 7% average returns over 20+ years). So Chad's potential $30K withdrawal could indeed cost him $90K-$120K in today's purchasing power at retirement. **However**, there's also value in considering the "return on investment" of private education. While we can't put a precise dollar figure on it, quality education often leads to better college prospects, scholarships, and career outcomes for kids. Sometimes the long-term benefit to the family's overall financial picture justifies short-term retirement account sacrifices. **My recommendation for Chad's situation:** 1. First, exhaust all other options - scholarships, 529s if available, education loans at current low rates 2. If you must use Roth funds, limit it to contributions only and spread across multiple years 3. Consider a "hybrid" approach: maybe one child in private school initially while you build other funding sources 4. Set a firm limit on retirement withdrawals - perhaps no more than 10-15% of your current Roth balance The key is making this decision intentionally rather than reactively. Get the analysis done, understand all your options, and make sure both parents are aligned on the trade-offs involved. Anyone else have experience with setting these kinds of family financial boundaries around education expenses?

I've been following this discussion and wanted to share my experience as someone who went through this exact decision three years ago. We had twin boys starting private high school with similar costs, and I was 41 at the time with about $52K in my Roth IRA. After much deliberation (and consulting with a fee-only financial planner), we decided on a mixed approach that worked really well for us: **Year 1:** Used about $12K from Roth contributions plus took a small education loan for the remainder **Years 2-4:** Shifted to primarily education loans at low interest rates while preserving the rest of our retirement savings What made this work was getting very granular about our family's priorities and limits upfront. We set a hard cap of $15K total from retirement accounts over all four years, which forced us to get creative with other funding sources. The boys ended up getting partial merit scholarships in their sophomore year (something we hadn't anticipated), which dramatically changed our financial picture. One unexpected benefit was that having some education debt actually helped with FAFSA calculations for college - it showed financial need without the income bump that Roth withdrawals would have created. Looking back, I'm glad we were conservative with the retirement withdrawals. The education loans will be paid off in two more years, but that money we left in the Roth has continued growing tax-free. Sometimes the "pain" of monthly loan payments actually helps families stay more disciplined about education spending. For Chad: definitely get that detailed analysis done before deciding. Having the actual numbers in front of you makes it much easier to have honest conversations with your spouse and kids about what's sustainable for your family's long-term financial health.