One approach I haven't seen mentioned yet is considering a partial payoff strategy. Instead of paying off the entire $62K at once, you could pay down a significant portion (maybe $40-45K) while keeping some cash reserves and a smaller loan balance. This gives you several benefits: you dramatically reduce your monthly interest payments, maintain some liquidity for unexpected business needs, and still keep a modest interest deduction. Plus, if you're concerned about the tax implications of eliminating the entire deduction at once, this spreads the impact over time. I did something similar with my consulting business last year - paid off about 70% of our equipment loan and kept the rest. It felt like a good middle ground between debt elimination and maintaining financial flexibility. The psychological benefit of dramatically reducing the debt load was worth it too.

Just wanted to share my experience with a similar situation from last year. I had a $48K business loan for my marketing agency (also single-member LLC) and was torn between paying it off or keeping the cash for operations. What really helped me make the decision was creating a detailed cash flow projection for the next 12 months. I mapped out all my expected expenses, seasonal revenue fluctuations, and potential growth investments. This showed me that I could safely pay off about 80% of the loan while still maintaining adequate reserves. One thing I wish I'd considered earlier was negotiating with my lender first. When I mentioned I was considering early payoff, they offered me a 0.5% rate reduction to keep the loan. It wasn't enough to change my decision, but it's worth exploring if you have a good payment history. Also, don't forget to factor in the psychological benefits of reducing debt. The peace of mind from lowering my monthly obligations gave me more confidence to take on larger projects, which ultimately grew my business faster than the interest deduction was worth.

Quick question - does your cousin use the apartment at all? If she stays there when visiting, it might qualify as a second home for mortgage interest deductions if there's a loan on it.

Your cousin should also consider whether she needs to report this on her state tax return if she lives in a state with income tax. Some states have their own foreign asset reporting requirements that are separate from federal obligations. Also, since the apartment was gifted to her, she should try to get documentation of the property's fair market value at the time she received it. This will be important for calculating capital gains if she ever sells the property. The basis for gifted property is usually the donor's basis, but having the valuation at the time of gift can help with tax planning. One more thing - if she hasn't been reporting this property and decides to come into compliance, she should definitely document that the non-reporting was non-willful (meaning she didn't know about the requirements). This distinction is crucial for penalty mitigation under programs like the Streamlined Filing Compliance Procedures that others have mentioned.

As someone who went through a similar situation last year, I can confirm what others have said about the HSA rules being strict on timing. The IRS really does care about when the medical service was provided, not when you pay for it or when you got married. However, I'd suggest your wife contact the medical provider's billing department to see if they offer payment plans or financial hardship programs. Many hospitals and clinics have options to reduce the bill or set up interest-free payment arrangements, especially for bills that are several months old. Some will even accept a settlement for less than the full amount if you explain the financial situation. Also, since she had "crappy insurance" at the time, it might be worth having her double-check that the claim was processed correctly with her old insurance. Sometimes claims get denied incorrectly or there are coding errors that can be appealed even months later.

I'm dealing with a somewhat related HSA question and wanted to add another perspective here. While everyone's correctly pointed out that you can't use your HSA for pre-marriage expenses, there might be one more angle worth exploring. If your wife's medical bill is still showing as unpaid on her credit report or with the provider, you could potentially help her in other ways that might be more beneficial long-term. For example, if she pays it off quickly (even without HSA funds), she might be able to negotiate a "pay for delete" agreement where the provider removes any negative reporting from her credit. Also, depending on the type of medical tests she had done, there might be appeals options if the insurance denial was based on "medical necessity" or prior authorization issues. I've seen cases where people successfully appealed claims months later, especially for diagnostic tests that revealed important health information. Just another thought since the HSA route is unfortunately off the table! Sometimes the non-tax-advantaged solutions end up being better in the long run anyway.

I'm experiencing this exact same situation! My status just changed to "Under review - additional information may be requested" yesterday morning and I've been checking my account every few hours since then. This thread has been incredibly reassuring to read through. What really helps is understanding that the IRS is conducting way more of these routine verification checks this year due to their increased funding and system upgrades. It makes so much sense that most of these aren't full audits but rather automated flags for specific items on tax returns. Anna's detailed experience with the CP75 letter gives me such realistic expectations - 10 days to receive the actual correspondence and 6 weeks total to resolve what turned out to be simple charitable deduction verification. That timeline is so much more manageable than the months-long process I was imagining! I'm going to follow everyone's advice and organize all my tax documents this weekend. Having everything in one place (W-2s, 1099s, receipts for any deductions) will definitely help me feel more prepared and less anxious while waiting to see if they actually need anything from me. The waiting and uncertainty is definitely the hardest part, but seeing all these positive outcomes from people who initially thought they were facing something serious has really put my mind at ease. This community support makes dealing with IRS stress so much more manageable - thank you all for sharing your experiences!

I'm going through the exact same thing right now! My status changed to "Under review - additional information may be requested" about 2 weeks ago and I was initially terrified. This thread has been incredibly helpful and reassuring. What really put my mind at ease was learning that the IRS received significant funding increases and upgraded their processing systems, which explains why so many more people are experiencing these status changes this year. It makes perfect sense that they're conducting more routine verification checks rather than full audits. Anna's detailed timeline with the CP75 letter was especially valuable - knowing it took 10 days to receive correspondence and 6 weeks total for resolution of something as straightforward as charitable deduction verification really helps set realistic expectations. I followed everyone's advice and organized all my tax documents last weekend (W-2s, 1099s, receipts for deductions, etc.) and it definitely helped reduce my anxiety during this waiting period. Even though I haven't received any correspondence yet, having everything ready gives me peace of mind. The hardest part is definitely the uncertainty and waiting, but reading all these positive outcomes has reminded me that patience is key. Most of these "under review" statuses seem to resolve without major issues, and many people don't even need to submit additional documentation. Thanks to this community for sharing real experiences and practical advice - it makes navigating IRS stress so much more manageable when you know you're not alone!

Has anyone mentioned that TurboTax charges extra to file Form 4868 for the extension? I got hit with a surprise $39.99 fee when I went to file my extension through them. Might be worth using the free fillable forms on the IRS website instead if you're trying to save money.

I went through something very similar last year owing about $20k federal. Here's what I learned that might help you: First, the $0 balance on your IRS account is normal - it won't show anything until you actually file your return or extension. The IRS doesn't know what you owe until you tell them. For TurboTax, yes, they'll walk you through filing Form 4868 for the federal extension, but they don't handle payment plans. You'll need to set that up separately with the IRS after filing your extension. One thing that really helped me was making a partial payment when I filed the extension - even if it's just $1,000 or whatever you can manage. This shows good faith to the IRS and reduces the daily interest charges (currently around $5+ per day on your balance). After you file the extension through TurboTax, go directly to IRS.gov and look for "Online Payment Agreement" to set up your 90 or 180-day payment plan. The short-term plans (120 days or less) don't have setup fees, which can save you around $149. The key is to file the extension ASAP to avoid the failure-to-file penalty (which is much worse than the failure-to-pay penalty), then immediately set up your payment plan online. Don't wait until October to deal with the payment part!