Just a heads up that the person BUYING the property in this scenario also needs to consider tax implications. When my mom sold me her house below market value, I didn't have to pay gift tax (that was on her), but when I eventually sold the property years later, I had to use HER original basis for calculating capital gains, not the discounted price I paid. This is called "basis carryover" for related party transactions and it really surprised me at tax time.

One important thing I haven't seen mentioned yet is the timing aspect of getting your appraisal. The IRS expects the fair market value to be determined as close to the transaction date as possible. If you're using an appraisal that's several months old, they might question its validity, especially in a volatile real estate market. Also, make sure your appraiser knows this is for a family transaction that will likely involve gift tax reporting. Some appraisers will note this in their report and provide additional documentation about their methodology, which can be helpful if the IRS ever questions the valuation. I learned this the hard way when my first appraisal didn't have enough detail and I had to get a second one specifically for tax purposes. The key is having rock-solid documentation for every aspect of this transaction - the appraisal, the reasons for the below-market sale, and proper filing of all required forms. It's definitely worth consulting with a tax professional who has experience with family property transfers before you proceed.

Has anyone used TurboTax Business to file their single-member S corp return? Can it handle the K-1 generation properly? I'm trying to decide between doing it myself or paying my accountant $950 to file it all.

I went through this exact same situation when I formed my single-member S corp two years ago. Yes, you absolutely need to issue yourself a Schedule K-1 even though you're the only shareholder. The S corporation is a pass-through entity, so all income, deductions, and credits flow through to you as the owner via the K-1. Think of it this way: your W-2 shows the salary you earned as an employee of the corporation, while the K-1 shows your share of the business profits/losses as the owner. These are two different capacities - employee vs. shareholder - so you need both forms. The K-1 will report things like your share of ordinary business income, any rental income if you have it, business deductions that pass through to your personal return, and various credits. Make sure when you prepare the 1120-S that you're consistent between what's reported on the corporate return and what flows to your K-1. The IRS matches these up, so any discrepancies will trigger questions.

Is anyone else noticing that returns with W-2G gambling income seem to trigger these verification letters more often? And why does the IRS send these letters without any warning on the WMR tool? Shouldn't there be some kind of indication that verification is needed before the letter arrives weeks later?

I went through the exact same thing as a first-time filer! Got my 5071C letter in late February, verified online through ID.me on March 1st. It took exactly 14 business days for my transcript to update with the TC 571 release code, and then my refund was issued 5 days after that. The WMR tool was completely useless during this time - it didn't update until literally the day before my refund hit my account. My advice: check your transcript weekly on the IRS website instead of relying on WMR. The transcript will show you the actual hold codes and when they're released. Also, don't panic if it takes the full 21 business days - that seems to be pretty normal for identity verification cases, especially for first-time filers like us!

Don't forget to check if you qualify for education credits like the American Opportunity Credit or Lifetime Learning Credit! If you're a student, these can be worth up to $2,500 depending on your qualified education expenses.

Great that you found those 1099s! Just to add another perspective - since you're a student with relatively low income, make sure you're not missing out on any refundable credits. Even if you don't owe taxes after the standard deduction, you might still be eligible for refunds through credits like the Earned Income Tax Credit (EITC) if you qualify. Also, keep good records of these stipend payments and any related expenses. If the stipends were for research, volunteer work, or educational activities, there might be deductions you can claim that could offset some of that income. The key is making sure everything is properly documented and reported - which sounds like you're on the right track now that you have the 1099s!

I went through something very similar with Treasury bonds last year. One thing that helped me was understanding that the $675 accrued market discount on your 1099-B is essentially the taxable portion of your $1,000 total gain ($13,000 - $12,000). The difference between your total gain and the reported market discount likely accounts for the accrued interest and any other adjustments your broker made. When you enter this in your tax software, you'll report the $675 as ordinary income (not capital gains) and it gets added to your regular income. Combined with your $65 interest from the 1099-INT, you're looking at about $740 in additional taxable income from this bond. The key thing to remember is that even though your 1099-B shows no capital gain/loss, the IRS still wants their cut of the "built-in gain" you received by buying the bond at a discount. It's counterintuitive but that's how the tax code works for market discount bonds.

Just to add another perspective on this - I had a similar bond situation last year and made the mistake of trying to handle it myself initially. The tax software questions about market discount elections are confusing because they're asking about a choice most individual investors never make. Here's what I learned: When your 1099-B shows "Accrued Market Discount," that's money you need to report as ordinary income (taxed at your regular rates, not capital gains rates). The reason your Cost Basis equals Proceeds is because your broker already adjusted your basis to account for the market discount - but you still owe taxes on that discount amount. Think of it this way: You bought a $13,000 bond for $12,000. The IRS considers $675 of that $1,000 difference as taxable income that you earned by holding the bond. Even though you didn't receive a separate payment for it, it's built into the redemption value. So yes, you'll be taxed on $740 total ($675 market discount + $65 interest). Make sure when your tax software asks about including the market discount in current year income, you select "yes" - that's the normal treatment for most people who haven't made special elections about annual amortization.