Quick question - does anyone know if hiring a tax attorney is actually worth it for this size penalty (around $7,800 total)? I'm dealing with something similar and trying to decide if I should just set up a payment plan and move on, or if fighting the penalty might save enough to justify attorney fees.

I'm sorry you're going through this - dealing with IRS penalties can be incredibly stressful. One thing I haven't seen mentioned yet is the possibility of an Offer in Compromise (OIC) if you're truly unable to pay the full amount. While it's not easy to qualify for, the IRS will sometimes accept less than what you owe if paying the full amount would create a financial hardship. You'd need to demonstrate that paying the penalty would prevent you from meeting basic living expenses. The IRS looks at your income, expenses, assets, and ability to pay when considering an OIC. It's definitely worth discussing with your tax attorney when you meet with them. Also, make sure to request penalty and interest abatement in writing, even if you end up setting up a payment plan. Sometimes the IRS will consider abating interest that accrued while they were processing your abatement request, especially if there were delays on their end. Document everything - every phone call, every piece of correspondence. If you do end up working with the IRS directly, always follow up phone conversations with a written summary sent to them confirming what was discussed. This creates a paper trail that can be helpful if there are any disputes later about what was agreed upon.

One more thing to consider - if either of you have student loans, filing jointly might affect income-based repayment plans since they'll look at your combined income. Something to think about if she's got loans and is on an IBR plan.

Just wanted to add something that might help with your decision-making process. Since you mentioned using TurboTax before, you'll find that most tax software (including TurboTax) will actually run calculations for both filing jointly and separately, then recommend whichever saves you more money. In your case, with your $58k income and her $9.2k income, filing jointly will almost certainly be better because: 1. You'll get the higher standard deduction ($29,200 vs $14,600 each if filing separately) 2. Your combined income will likely keep you in lower tax brackets overall 3. You'll have access to more credits and deductions that phase out for separate filers The "dependent" confusion is totally understandable - it's one of the most common misconceptions for newlyweds. The tax code treats marriage as creating a partnership, not a dependency relationship. You're both equal partners in the return, even if one person earns significantly more. Good luck with your first married filing! The software will walk you through everything step by step.

5 Has anyone actually compared standard mileage vs MACRS over a 5 year period? I'm curious what the total deduction difference would be over the typical ownership period of a vehicle.

This is really helpful analysis! I'm in a similar situation with high business mileage and was leaning toward MACRS thinking it would automatically be better. Your 5-year comparison is eye-opening - I never thought to calculate the total deductions over the full ownership period. One thing I'm still confused about though - if I choose standard mileage this year, am I locked into that method for the life of the vehicle? Or can I switch to actual expenses with MACRS in future years if my situation changes (like if maintenance costs spike or I start driving fewer business miles)? Also, does the standard mileage rate typically increase each year with inflation? I'm wondering if that factors into the long-term calculation at all.

Remember that even with no activity, there may be state fees you can't avoid. I had an inactive LLC in California and still had to pay the $800 minimum franchise tax despite having literally zero dollars in revenue. It varies by state though, so check your state's requirements.

I went through this exact same situation last year with my inactive LLC! Here's what I learned after making some mistakes initially: First, yes you absolutely need to file the 1065 even with zero activity - the IRS doesn't care that nothing happened with your business. However, $420 is way too much for a zero-activity return. I ended up using FreeTaxUSA's business version which was around $40 and handled the partnership return just fine. The software walked me through each section, and since everything was zeros, it was actually pretty straightforward once I got started. The trickier part was figuring out my state requirements. I'm in Texas so I didn't have franchise tax issues like California, but I still had to file a "No Tax Due" report with the state comptroller. Make sure you research your specific state's requirements because they vary wildly. One tip: when you fill out the K-1 forms for each partner, even though the amounts are all zero, you still need to complete the partner information sections correctly. That's where I got tripped up initially. The whole process took me about 2 hours including research time, and cost me less than $50 total instead of hundreds for an accountant.

Don't forget that you need to formally elect to file Form 1120-H each year! This is a common mistake. The election isn't automatic - you need to check the box in Part I of the form. If you don't make this election, you'd have to file the regular corporate return (Form 1120), which is much more complicated and likely less favorable tax-wise. Also, while your situation seems straightforward now with just interest income, be careful if your HOA ever gets income from other sources like laundry machines, parking fees from non-residents, or cell tower leases. Those are typically considered non-exempt function income and could push you above that $100 deduction threshold.

Great discussion here! As someone who's been through several HOA tax filings, I wanted to add a few practical tips that might help: 1. **Keep monthly reconciliation records** - Don't just save bank statements. Create a simple spreadsheet tracking dues collected vs. expenses paid each month. This makes year-end reporting much easier and helps if you ever get audited. 2. **Document your HOA meeting minutes** - Even if it's just the two couples, keep basic records of decisions made about assessments, repairs, etc. The IRS likes to see that you're operating as a legitimate HOA, not just splitting bills between neighbors. 3. **Consider your fiscal year carefully** - You can choose a fiscal year that ends on any month, not just December. Some HOAs find it easier to align with when major expenses typically occur (like insurance renewals). 4. **File even if you owe zero tax** - As others mentioned, failing to file can result in penalties even when no tax is due. The IRS takes HOA filing requirements seriously regardless of the tax amount. Your $68 interest situation is very typical for small HOAs, and you're absolutely right that the $100 deduction will eliminate your tax liability. Just make sure you're consistent with your filing approach year over year!