I've been through this exact scenario! Also a travel healthcare worker (physical therapist) and got a certified IRS letter while on assignment in another state. I was panicking for days until I could get someone to open it for me. Turned out to be a CP75A notice - they just wanted me to verify some W-2 information because I had worked in 4 different states that year and the wage reporting looked unusual to their automated systems. Literally took 5 minutes to respond online once I knew what they needed. The timing issue you mentioned (where the IRS rep couldn't see anything pending) is super common. These verification letters often get generated by different departments and don't always show up immediately when customer service checks your account. Since your account balance is zero and you're current on filing, this is almost certainly just routine verification related to your multi-state work pattern. Have your sister take photos of the envelope first to confirm it's legitimate, then the contents. You'll probably be able to handle whatever they need remotely without interrupting your assignment. Don't let it stress you out - in my 6 years of travel healthcare, I've gotten 3 of these types of letters and they've all been simple verification requests. The anxiety of not knowing is always way worse than the actual letter contents!

I just wanted to jump in and say this thread has been incredibly helpful! I'm also in healthcare (work as a traveling radiology tech) and have been dreading the day I might get one of these mysterious IRS letters. Reading through everyone's experiences, it's clear that certified IRS mail for travel healthcare workers is pretty common and usually relates to our complex multi-state filing situations. The pattern I'm seeing is: certified mail = ensuring delivery of important info, not necessarily bad news, especially when your account balance is zero like yours. What really stands out to me is how many people mentioned identity verification letters (like the CP75A that @bef52cdd6657 mentioned). Given that you move between states every 13 weeks, it makes total sense that their automated systems might flag your filing pattern for routine verification. The advice about having your sister check the envelope format first is spot-on - better to rule out scams before stressing about contents. But honestly, with your account showing zero balance and the IRS rep confirming nothing pending, this is almost certainly just paperwork related to your travel work pattern. Hope it turns out to be as routine as everyone else's experiences! Keep us posted on what it actually was - would be helpful for other travel healthcare workers who might face similar situations.

Has anyone tried the IRS's W-4 calculator? I think it's free and supposedly helps you figure out proper withholding based on multiple jobs. Wondering if it would solve part of your problem at least for the W2 portion?

I've been dealing with a similar situation - multiple income streams including S-corp income can really mess with your withholding calculations! One tool that's worked well for me is FreeTaxUSA's TaxCaster. It's free and handles S-corp salary vs distribution scenarios better than most consumer tools I've tried. The key thing I learned is that you need to track your S-corp salary as regular W-2 income for withholding purposes, but then account for the self-employment tax savings compared to if that income was straight 1099. Most calculators miss this nuance. Also, don't sleep on making quarterly estimated payments - even if your withholding is close, having that extra buffer from estimated payments can save you from underpayment penalties. I set up automatic transfers to a separate "tax savings" account so the money is there when quarterly dates roll around. The IRS safe harbor rule is your friend too - if you pay 100% of last year's tax liability through withholding + estimated payments (110% if your AGI was over $150k), you won't owe penalties even if you end up owing more at filing time.

This is such a helpful thread! I'm in a very similar boat with my first S corp loss and was completely overwhelmed by the form requirements. Based on all the excellent explanations here, I think I now understand the key points: 1) Form 7203 is essentially mandatory when claiming ANY S corp loss - it's how you prove to the IRS that you have sufficient basis to take that deduction 2) Form 6198 is only needed if there's a possibility that at-risk limitations might apply to your situation 3) The basis vs. at-risk distinction is crucial - they're related but different concepts What really helped me was @Yara Nassar's explanation about the three-tier limitation system (basis, then at-risk, then passive activity). It's like a series of gates that your loss has to pass through. For the original poster @QuantumQuester - since you mentioned this is your first loss after 3 years and you believe your basis exceeds the $23,000 loss, you'll definitely need Form 7203 but probably not Form 6198. Just make sure you can actually substantiate that basis calculation with your historical K-1s and investment records! The suspended loss carryforward rules mentioned by @Muhammad Hobbs are also really important to understand - at least if you can't deduct the full loss this year, it's not lost forever.

As a tax professional who deals with S corp compliance regularly, I want to emphasize a few critical points that haven't been fully addressed in this excellent discussion: **Documentation is everything.** The IRS doesn't just want you to file Form 7203 - they want to see that you can support every number on it. Keep detailed records of your initial investment, all K-1s, any additional contributions, loans to the S corp, and distributions received. I've seen too many taxpayers get into trouble during audits because they filed the form but couldn't substantiate their basis calculations. **Timing matters for contributions.** If you discover your basis is insufficient to absorb your loss, you generally have until the due date of your return (including extensions) to make additional capital contributions to increase your basis. This can allow you to deduct losses that would otherwise be suspended. **Consider state implications.** Many states have their own basis tracking requirements that may differ from federal rules. Some states don't recognize suspended loss carryforwards the same way the IRS does, so make sure you're considering both federal and state implications. @QuantumQuester, given that this is your first loss situation and you mentioned your accountant is unavailable, I'd strongly recommend being conservative and filing both forms if you're unsure. The penalties for incorrectly claiming losses you're not entitled to are much worse than the minor inconvenience of filing an unnecessary form.

As someone who's been through this exact situation, I want to warn you - don't just assume the insurance company is reporting correctly. My disability insurer reported my benefits as fully taxable for 3 years before I caught the error. Had to file amended returns for all three years. The definitive test: If YOU paid the premiums with after-tax money, the benefits are NOT taxable. If your EMPLOYER paid OR if you paid with pre-tax money (like through a section 125 cafeteria plan), then the benefits ARE taxable. Something else to try: Check your last pay stubs before you went on disability. If the disability premium was deducted AFTER taxes were calculated, that's evidence you paid with after-tax dollars.

I'm dealing with a very similar situation and want to share what I learned after months of research. The key is understanding that the insurance company often defaults to reporting ALL disability benefits as taxable unless they have specific documentation proving otherwise. Since your employer is out of business, you'll need to build your case with whatever documentation you can gather. Here's what worked for me: 1. Request your Social Security earnings record (Form SSA-7050) - this shows your reported wages for each year and can help prove whether disability premiums reduced your taxable income or not. 2. If you have ANY old tax software files or tax prep documents, those sometimes contain more detailed breakdowns of deductions than the actual returns. 3. Contact your state's insurance commissioner - they can sometimes compel the insurance company to provide better documentation, especially if there's a pattern of incorrect reporting. The fact that you're getting "3rd Party Sick Pay" on your W-2 suggests the insurance company is treating it as taxable by default. But if you truly paid 100% with after-tax dollars, you have a strong case for getting this corrected. Don't give up - I recovered over $4,000 in overpaid taxes once I proved my case. The insurance company's past citations for incorrect reporting actually work in your favor if you need to escalate this to tax authorities.

Just a heads up that the IRS actually released specific guidance on this topic after the tax law changes. Look up "Notice 2018-76" which details exactly how to handle business meals vs. entertainment. The key tests are: 1. The expense must be ordinary and necessary for business 2. The expense can't be lavish 3. You or an employee must be present 4. Food and beverages must be provided to a current or potential business contact 5. For food served at entertainment events, it must be purchased separately

This is such a helpful thread! I've been dealing with the same confusion about meals vs entertainment deductions for my freelance consulting business. One thing I learned from my tax preparer last year is to also keep notes about the business purpose and topics discussed during each meal - not just the receipt. The IRS wants to see that there was a legitimate business discussion, so I now keep a simple log on my phone noting who I met with, what business matters we discussed, and any follow-up actions. For example, instead of just keeping a receipt that says "Dinner at Mario's - $85", I'll note "Dinner with potential client Sarah Johnson to discuss Q2 marketing strategy for her startup. Discussed budget parameters and timeline. Follow-up: send proposal by Friday." This documentation has been invaluable when my accountant prepares my Schedule C, and it gives me confidence that I can substantiate these deductions if ever questioned. The business purpose requirement is just as important as getting the meal vs entertainment categorization right!