I tried claiming medical mileage last year and my tax software flagged it as an "audit risk" item. Is there some specific way we're supposed to document this? Do we need anything beyond a personal log of trips?

For medical mileage documentation, the IRS doesn't require anything super complex, but you do need to keep a written record. A simple log showing the date, destination (doctor's office, pharmacy, etc.), purpose of the trip, and miles driven is sufficient. You can use a notebook, smartphone app, or even a spreadsheet. The key is being consistent and contemporaneous - don't try to recreate months of trips from memory at tax time. Many people use apps like MileIQ or even just the notes app on their phone to track this. Your tax software flagging it as "audit risk" is probably just because it's a commonly overlooked deduction that sometimes gets inflated. As long as you have proper documentation and reasonable mileage amounts, you should be fine. The IRS expects people to claim legitimate medical travel expenses.

This is really great advice! I had no idea about the OTC medication rule. My doctor recommended several supplements and OTC pain relievers after my surgery, but I never thought to track those expenses. Do you happen to know if there's a specific way the doctor needs to document the recommendation? Like does it have to be a formal prescription pad, or would notes in my medical chart be sufficient? Also, regarding the medical equipment - does this include things like ergonomic supports or special pillows that were recommended for recovery? I bought a few items to help with my back issues that my physical therapist suggested, but I'm not sure if those would qualify since they weren't from a doctor specifically.

This is really helpful advice about the double-counting issue! I hadn't thought about that potential problem. Quick question - if we reimburse employees for emergency lodging through our regular expense reimbursement process, do we need any special documentation beyond the normal receipts and expense reports? And regarding the vehicle maintenance point, you're absolutely right. Looking back, most of our "emergencies" were with two older vehicles that probably should have been replaced last year. Thanks for the reality check!

Wouldn't the approach of not reporting as a guaranteed payment cause other issues though? Like wouldn't it mess up the partner's self-employment tax calculation? The guaranteed payment affects both SE tax and QBI.

You're absolutely right - that workaround would indeed cause SE tax issues by understating the guaranteed payments subject to self-employment tax. I shouldn't have suggested that approach. The correct method is definitely to report the health insurance as a guaranteed payment on the 1065 and then override the QBI calculation on the 1040 to prevent the double reduction. It's frustrating that we have to manually fix software issues, but at least it's a straightforward override.

I'm new to dealing with partnership returns and this thread has been incredibly helpful! I've been struggling with this exact issue for a client and wasn't sure if I was missing something or if it really was a software bug. It's reassuring to hear that experienced practitioners are seeing the same problem across multiple platforms. I was hesitant to override the QBI calculation without being 100% certain, but the consensus here gives me confidence to make the adjustment. One quick question - when you're documenting the override, are you just adding a note in the software or are you creating a separate memo to attach to the return? I want to make sure I'm properly supporting the position in case of any IRS questions down the road.

Filing an extension is definitely easier than amending a return later. An extension is very simple to file (Form 4868) and gives you until October 15 to submit your final return. Just remember that an extension gives you more time to file, not more time to pay. You'll need to estimate what you owe and pay that amount by the April deadline to avoid penalties. If you're expecting K-1 income, make a reasonable estimate based on previous years or any information you have about the current year. It's better to slightly overpay and get a refund later than underpay and owe penalties.

Definitely go with the extension if you know a K-1 is coming late! I learned this the hard way after amending returns multiple times. Filing an extension is literally a 5-minute online process, while amending a return can take weeks to prepare and months to process. One thing to add to what Natalie said - if you've received K-1s from the same partnerships in previous years, you can use that income as a baseline for estimating your payment. Most partnerships have relatively consistent distributions year over year, so last year's K-1 income is usually a decent approximation for your extension payment calculation. @f014fc63b237 is spot on about the payment timing - the extension only extends your filing deadline, not your payment deadline.

This spreadsheet approach is brilliant! I wish I had thought of this years ago. I'm definitely going to start tracking this data going forward. Quick question - do you also track whether the K-1s from each partnership tend to have corrections or amended versions? I've had a couple partnerships send out corrected K-1s weeks after the original ones, which threw off my whole filing timeline even more. Also, I had no idea some brokerages were adding K-1 warnings - that's such a helpful feature. I'm with TD Ameritrade and haven't noticed this yet, but I'll definitely look more carefully at my account interface. Might be worth switching brokerages just for better K-1 management tools at this point!

Wait, Wells Fargo gave you an early deposit?! That's crazy, they NEVER do that! Gives me hope that maybe the banks are just processing things differently this year. I'm also with PNC and still waiting - maybe they're just running behind their usual schedule. Thanks for the update, definitely keeping my fingers crossed it hits before the end of the day!

Same here! PNC with DDD 3/14 and still nothing as of 5:30pm. Filed on 1/27 and got accepted the same day. This is nerve-wracking since PNC is usually so reliable with the 2-day early deposits. But you're right, seeing Wells Fargo customers getting theirs today when they normally don't do early deposits makes me think maybe all banks are just processing things differently this year. The 846 code on my transcript is definitely reassuring though - at least we know the IRS has sent the payment! I'm going to try not to check again until around 8pm. Hope we all see our deposits hit tonight!