Just wanted to add something important that hasn't been mentioned yet - make sure your mom considers the timing of the purchase carefully. The truck needs to be "placed in service" (actually used for business) by December 31st, 2025 to qualify for the 2025 tax year deductions. Also, since she's financing most of the purchase, she can still claim depreciation on the full purchase price, not just the amount she's paying out of pocket. The $10,500 trade-in value gets subtracted from the purchase price for depreciation purposes, so she'd be depreciating $32,500 ($43,000 - $10,500) if used 100% for business. One more thing - if her landscaping business has been profitable and she expects it to continue being profitable, the immediate deduction from bonus depreciation could be really valuable for reducing her current tax liability. But if she's expecting much higher income in future years, she might want to consider spreading the deduction out more evenly.

Great discussion here! As someone who's helped several small business owners navigate vehicle depreciation, I wanted to add a few practical considerations for your mom's situation. Since she's in landscaping, make sure to document not just mileage but also how the truck is used for business - hauling equipment, transporting materials to job sites, etc. This strengthens the business use justification beyond just driving miles. Also, with a seasonal landscaping business, consider the cash flow impact. While the 80% bonus depreciation ($26,000 as Marcus calculated) gives a great tax deduction this year, it means much smaller depreciation deductions in future years. If her business has good years and lean years, timing this large deduction during a profitable year makes sense. One last tip - if she's considering any other equipment purchases (trailer, mower, etc.), coordinate the timing since the total Section 179 and bonus depreciation deductions can impact her overall tax strategy. Sometimes spreading major purchases across tax years works better for cash flow and tax planning.

Just be careful with DIY approaches if you have any complexity in your situation. I tried to file my own back taxes and accidentally missed a form, which resulted in the IRS sending me a terrifying letter 6 months later demanding additional money. If you're ONLY dealing with W-2 income and taking the standard deduction, you're probably fine doing it yourself. Otherwise, it might be worth investing in professional help.

As someone who works in tax preparation, I'd strongly recommend starting with the IRS website to download the prior year forms for free. For 2019, you'll need Form 1040 and the instructions are actually pretty straightforward for W-2 only income. A few key points that haven't been mentioned: First, make sure you have ALL your W-2s from each year - employers are required to keep copies for 4 years, so you can request duplicates if needed. Second, if you're expecting refunds (which is likely if you had standard withholding), there are no late filing penalties, but you do need to file 2019 by April 15th of this year to claim that refund. Before paying anyone $200 per return, try filling out one year yourself first. If it's truly just W-2 income with standard deduction, it's much simpler than you think. The IRS also has a helpline specifically for prior year returns at 1-800-829-1040 if you get stuck on specific questions. You can always pay for professional help later if you run into complications, but start with the free options first!

One thing I haven't seen mentioned yet - if you do get the retroactive S-Corp election approved, make sure your CPA prepares a reasonable compensation study to justify whatever salary you're setting for yourself. The IRS really scrutinizes S-Corps because they know owners try to minimize salary (which is subject to employment taxes) in favor of distributions. Have you actually calculated how much you might save by switching to S-Corp status for 2022? It's mainly the Medicare and Social Security tax savings on the distribution portion, but you need to weigh that against the additional complexity and compliance costs.

I went through a very similar situation about two years ago and successfully did the retroactive S-Corp election. A few things I learned that might help: First, yes, Rev. Proc. 2013-30 is absolutely legitimate, but timing is crucial. You have 3 years and 75 days from the original due date you wanted the election to be effective. So for 2022, you'd need to act soon. Second, the "reasonable cause" statement is critical. I used the fact that my previous tax preparer never mentioned S-Corp elections as an option despite my business income level. The IRS accepted this reasoning. Document everything - emails, conversations, even the lack of discussion about entity elections. Third, calculate the potential savings first before diving in. In my case, I saved about $18k in self-employment taxes, but I also had to establish a reasonable salary (I used about 60% of net income based on industry data) and file amended returns for multiple years. The process took about 6-8 months total to get fully resolved, but it was absolutely worth it. Make sure your new CPA has experience with late S-Corp elections - not all tax professionals are familiar with the process. Good luck!

Something important that hasn't been mentioned yet - check your sale agreement carefully. Often there are tax provisions specifically addressing this situation. In my case, we had a "tax true-up" clause that required the company to make a distribution to departing shareholders specifically to cover tax liabilities attributable to undistributed profits. If your agreement has language about tax distributions, tax true-ups, or tax withholding related to shareholder exits, you may have contractual recourse against your former partners.

The timing of your sale creates a unique issue. If you sold mid-year 2024 but the transaction completed in 2025, there's a possibility that your income allocation on the K1 isn't properly pro-rated for the period you actually owned shares. S Corps are required to allocate income based on per-share, per-day calculations when ownership changes mid-year. Did your K1 reflect owning shares for the entire year or just the portion you were an actual owner?

I'm going through almost the exact same thing right now! They misread my $127 charitable deduction as $1,270 and are claiming I owe an extra $400. It's so frustrating because you can clearly see on the 1099 what the actual amount should be. I sent my certified letter with all the documentation about 4 months ago and just got my fourth "we need more time" letter. At this point I'm starting to wonder if anyone actually reads these things or if they just automatically generate delay letters forever. The worst part is seeing that balance on my account transcript knowing it's completely wrong but being powerless to fix it quickly. Thanks for posting this - at least I know I'm not alone in dealing with their scanning problems!

I went through something very similar about 18 months ago when the IRS misread my handwritten $847 medical deduction as $8,470. Like you, I got those maddening 60-day delay letters for what felt like forever. Here's what I learned: those letters are basically automated placeholders their system generates when your case hasn't been assigned to a human reviewer yet. The frustrating reality is that correspondence review is one of their lowest priority queues, especially for what they consider "simple" scanning errors. What finally worked for me was being persistent about documentation. I kept meticulous records of every letter, every date, and every certified mail receipt. When I hit the 7-month mark with no resolution, I contacted my state representative's office. Their caseworker was able to get my file reviewed within 2 weeks, and the error was corrected with a full refund of the incorrect amount plus interest they had charged me. Don't pay what they're asking for - you're 100% right that it's their scanning error. Keep waiting, keep your documentation organized, and start thinking about Congressional help if you hit the 6-month mark. You will eventually get this resolved correctly.