Anyone know if you can get in trouble for deliberately overpaying? Like could the IRS see it as some kind of weird fraud attempt? I did it last year and my refund has been "under review" for 9 months!!!

I used to think the same way - just overpay and avoid the stress! But after learning more about taxes, I realize this approach actually costs you money in multiple ways. The biggest issue is opportunity cost. When you overpay by thousands of dollars, you're essentially giving the government a free loan for months while waiting for your refund. That money could be earning interest in a high-yield savings account, paying down credit card debt, or invested in your retirement account. Also, contrary to what many people think, the IRS doesn't actually know your complete tax picture. They receive your W-2s and 1099s, but they don't know about: - Charitable donations you made - Medical expenses that might be deductible - Education credits you qualify for - Child tax credits or dependent care expenses - Business expenses if you're self-employed - State and local tax deductions By just overpaying without filing properly, you could be missing out on legitimate deductions and credits worth hundreds or thousands of dollars. The tax code is complex, but that complexity often includes benefits designed to help taxpayers - you just have to claim them properly. A better approach is to adjust your withholdings throughout the year to get as close to your actual tax liability as possible, then file accurately to claim all the deductions and credits you're entitled to.

Don't forget about state tax considerations too! This gets overlooked a lot. I'm in California where they generally follow federal rules on this, but some states have different limitations or documentation requirements for business deductions. Also, keep VERY detailed records of who received what and when. I got flagged for audit last year specifically on promotional items because I couldn't prove exactly who received certain items. Had to eat some deductions because of poor record keeping.

Great question about promotional gift deductions! I've been dealing with this exact issue for my consulting practice. One thing I learned that might help - make sure you're also considering the "substantiation requirements" under IRC Section 274(d). The IRS requires you to document the business purpose, amount, time/place, and business relationship for each recipient. I created a simple tracking system where I log each gift box with: recipient name/company, date sent, total cost breakdown (promotional items vs consumable gifts), and specific business purpose (like "prospecting meeting scheduled for X date" or "follow-up to proposal submitted"). Also worth noting - if any of these gift boxes go to the same person multiple times in a year, you need to track that the total gifts to that individual don't exceed $25 for the gift portion. The promotional items with your logo aren't subject to this limit, but the snacks definitely are. One more tip: photograph your promotional items showing the permanent logo/branding before sending them out. This visual documentation can be really helpful if you ever need to prove they qualify as advertising materials rather than gifts.

This thread has been incredibly educational - I had no idea that preferred MLP units carried the same UBTI risks as common units when held in retirement accounts. I'm in a similar boat with some Kinder Morgan preferred shares in my Roth IRA that I bought purely for the steady income stream. Reading through everyone's experiences, it sounds like the key is getting the actual K-1 data rather than panicking about theoretical problems. Diego's point about the 40-45% UBTI classification for Energy Transfer is particularly useful - if that's typical across MLPs, then smaller positions might stay under the $1,000 threshold. I'm curious though - has anyone dealt with this in a Roth IRA specifically? I assume the UBTI rules apply the same way, but I'm wondering if there are any differences in how the Form 990-T filing or potential taxes are handled when it's a Roth versus traditional IRA. The tax-free growth benefit of the Roth might still make it worthwhile to keep the MLP position there even with occasional UBTI filings, assuming the distributions aren't massive. Going to follow Maria's advice and call Kinder Morgan's investor relations next week to get their historical UBTI breakdowns. Thanks everyone for sharing your real-world experiences rather than just theory!

I've been researching this exact issue after making a similar mistake with Enterprise Products Partners preferred units in my IRA. What I discovered through painful experience is that the "preferred" designation is really just about payment priority and stability - it doesn't change the fundamental partnership tax treatment. Here's what caught me off guard: even though preferred MLP units often have more bond-like characteristics (fixed distributions, less volatility), they're still partnership interests that pass through their proportionate share of the MLP's business income. The IRS doesn't distinguish between common and preferred units when it comes to UBTI - they both represent ownership in the same underlying partnership entity. I ended up calling my tax advisor after getting my K-1, and he explained that the UBTI issue stems from the fact that MLPs typically engage in active business operations (pipeline operations, energy production, etc.) rather than passive investment activities. This active business income becomes "unrelated" to the tax-exempt purpose of your IRA, hence UBTI. The silver lining is that not every dollar of your MLP distributions will be UBTI - some portion might be return of capital or passive income that doesn't trigger the filing requirement. But you won't know the exact breakdown until you receive your K-1 next year. My advice would be to contact Energy Transfer's investor relations for historical data and prepare for the possibility of Form 990-T filing, but don't panic until you see the actual numbers.

I just wanted to jump in as someone who had this exact same experience a few months ago! I received a "TCS TREAS 449" deposit for $634 completely out of nowhere and was convinced it had to be some kind of error. After reading through all these responses, I'm really impressed by how helpful this community is. Everyone's explanations about the Treasury codes and automatic IRS adjustments are spot-on. In my case, it turned out to be for a Saver's Credit that I had qualified for but completely missed when filing my return. What really struck me from reading this thread is how much the IRS systems have improved at catching beneficial errors. I had no idea they were automatically reviewing returns to find money we're owed! It makes these mystery deposits seem a lot less mysterious and a lot more like the system actually working as it should. Oliver, given everything you've shared about getting married in 2023 and having withholding complications, this really sounds like a legitimate adjustment. The filing status change alone could have triggered several different credit calculations that worked in your favor. I'd echo what others have said about trying to check your transcript online, but don't lose sleep over it - this is most likely good news, not something to worry about!

I've been reading through all these helpful responses and wanted to add my own experience! I received a similar "TCS TREAS 449" deposit last year for $1,134 that completely caught me off guard. Like you, I had already received my regular refund months earlier and couldn't figure out where this money came from. It turned out to be a combination of the Child Tax Credit (I had a baby in 2022 but filed before receiving all the proper documentation) and some interest on delayed processing. The IRS automatically calculated what I was owed and sent it without any advance notice. What really helped me was calling their automated transcript line at 1-800-908-9946. You don't have to deal with wait times for a human agent - it's just an automated system that can read your account transcript over the phone after you verify your identity. It gave me the breakdown of the adjustment immediately rather than waiting weeks for the letter. Given that you got married in 2023 and had withholding issues, this is almost certainly a legitimate adjustment. Marriage changes so many tax calculations - standard deductions, tax brackets, credit eligibility - that the IRS automated systems probably caught something beneficial that you missed. Don't stress about it being an error you'll have to repay. These systems are actually pretty good at not sending money unless you're truly entitled to it!

Has anyone actually calculated whether claiming sales tax is even worth it anymore? Since the standard deduction went up so much in recent years, I feel like you need a TON of itemized deductions to make it worthwhile.

This is exactly why I switched to tracking actual receipts a few years ago! The IRS calculator assumes spending patterns that just don't match reality for a lot of people. I'm in tech and got several big raises, but I actually spend MORE on taxable stuff now - better car, home improvements, gadgets, etc. What really helped me was setting up a simple system: I just take photos of receipts with my phone and sort them into a folder at the end of each month. Takes maybe 30 minutes monthly but saved me over $2,000 in additional deductions last year compared to the IRS estimate. The key is being consistent about it from January 1st - don't try to reconstruct a whole year of spending in March when you're doing taxes. Also remember that big purchases like cars, appliances, and home improvement materials can really add up in sales tax, especially if you live in a high sales tax state.