Slightly different perspective - have you checked if you might qualify for the reduced 50% exclusion rather than the 100% exclusion? The rules vary based on when the stock was acquired as C corp shares. For C corp shares acquired after August 10, 1993 but before February 18, 2009, you can exclude 50% of the gain. For shares acquired after February 18, 2009 and before September 28, 2010, you can exclude 75%. And for shares acquired after September 28, 2010, you can exclude 100%. But this all depends on when the shares were acquired as C corp shares, which in your case sounds like October 2018, so you'd be in the 100% category if you met the holding period.

I'm really sorry to hear about your situation - being just two months short of the 5-year requirement is incredibly frustrating, especially when you've been with the company since its founding. While the other commenters are correct about the general rule that C-Corp holding periods don't "tack" from previous entity types, there might be one avenue worth exploring given your specific timeline. Since your S-Corp to C-Corp conversion happened in October 2018, you should definitely investigate whether this qualified as a tax-free reorganization under Section 368 of the Internal Revenue Code. If the conversion was properly structured as a Section 368 reorganization (which many S-Corp to C-Corp conversions are), there's potentially an argument for holding period tacking under certain circumstances. This is an extremely technical area of tax law where the specific documentation and structure of your conversion matters enormously. Given the potential tax savings at stake, I'd strongly recommend consulting with a tax attorney who specializes specifically in Section 1202 and corporate reorganizations - not just a general CPA. You'll need someone who can review your conversion documents, operating agreements, and any legal opinions from 2018 to determine if there's any path forward. The fact that you were kept in the dark about sale details is also concerning from a fiduciary duty standpoint, but that's a separate issue. For now, focus on gathering all your corporate documents from the 2018 conversion and get specialized legal advice before your filing deadline.

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.

I'm a volunteer board treasurer, and we specifically set up our reimbursement process to avoid this exact problem. Make sure you're using an expense reimbursement form that clearly documents these are HOA expenses, not payments for services. For next year, I'd suggest working with your board to implement a better system. Our association has a credit card that board members can use for purchases, which eliminates the need for reimbursements entirely. Alternatively, some property management companies can make purchases directly if given enough notice.

I went through this exact situation last year with my condo board reimbursements. What worked for me was creating a detailed spreadsheet that matched each expense category to the corresponding receipts, then reporting it on Schedule C with the 1099-NEC amount as income and the exact same amount as expenses. The key is being very specific in your expense descriptions - instead of just "HOA expenses," break it down like "Landscaping supplies - HOA maintenance," "Pool chemicals - HOA facility maintenance," etc. This creates a clear paper trail showing these were legitimate association expenses, not personal income. I also wrote a brief explanation letter that I attached to my return explaining the situation - that I'm an unpaid volunteer board member who was incorrectly issued a 1099-NEC for expense reimbursements. While not required, it helps clarify things if there are ever any questions. The good news is that since your income and expenses will be equal, you'll have zero net profit and zero self-employment tax. Just make sure to keep detailed records of everything in case of future questions.

We did this exact same thing for years! My boyfriend and I owned a house together, paid from a joint account, but his income was much higher so he itemized while I took the standard deduction. He claimed 100% of the mortgage interest and property taxes, and we never had any issues with the IRS. Make sure your gf keeps a copy of the 1098 showing both your names but her SSN. That's really all the documentation needed since her SSN is the only one on the form anyway.

This is actually a pretty straightforward situation! Since you're unmarried, the IRS doesn't require you to split deductions proportionally like married couples filing jointly would. The key principle is that whoever actually paid the expenses can claim the deduction. Since you're both paying from a joint account that you both contribute to, either of you could technically claim these deductions. Given that you're taking the standard deduction anyway and she benefits from itemizing, having her claim 100% makes perfect financial sense. A few important points to keep in mind: - Make sure the total claimed between both returns doesn't exceed 100% of what was actually paid - Keep good records showing you both contribute to the joint account used for mortgage payments - Since her SSN is on the 1098, the IRS system is already expecting her to report this income, which actually makes this cleaner I'd recommend she keep a copy of the 1098 showing both names and her bank statements demonstrating joint contributions to the mortgage payments, just for documentation purposes. This is a completely legitimate tax strategy for unmarried joint homeowners!

My partner and I did this 3 years ago! One tip: consider putting only one person on the mortgage but both on the deed if your bank allows it. That way, only one person claims all the interest but both have ownership. We did this bc my credit score was way better so I got the loan alone (better rate!) but we're both on the deed. The person not on the mortgage can just transfer their share of the payment to the mortgage holder, who then makes the full payment and claims 100% of the deduction. Simplifies taxes a lot! But u need to trust each other obvs.

Great question! I went through this exact situation two years ago when my partner and I bought our first home. Here's what I learned from working with both a tax professional and mortgage lender: Since you're both on the mortgage and splitting payments 50/50, you can each deduct your proportional share of the mortgage interest on your individual tax returns. Keep detailed records of who pays what - bank statements, cancelled checks, or electronic transfer records showing each person's contribution. One key thing to watch out for: the mortgage lender will send ONE Form 1098 (mortgage interest statement) to whoever is listed as the primary borrower. You'll need to coordinate to ensure you both get the information needed for your tax returns. Some couples scan and share the 1098, others request the lender send copies to both parties. Also, don't forget about property taxes! If you're splitting those 50/50 as well, you can each deduct your portion of property taxes paid, which also goes on Schedule A. Given your combined income of $180k and a $520k mortgage, you'll likely have enough deductions to make itemizing worthwhile. The mortgage interest alone in your first few years will probably exceed the standard deduction threshold. One last tip: consider having a tax pro review your first year's return to make sure you're handling everything correctly. It's worth the cost to get it right from the start!