Benjamin, I feel your pain on this one! I went through something similar with my consulting business a few years back. The 5-year waiting period is brutal, but you do have some legitimate options beyond just waiting it out. Based on what you've described, I'd focus on the "reasonable cause" exception that others have mentioned. The fact that you revoked the S election when your business income was minimal ($40k) and you had a full-time job suggests you made a reasonable business decision at the time - not a tax avoidance scheme. Now that your circumstances have completely changed (full-time business, $180k projected income), you have a strong case for demonstrating that the original revocation wasn't primarily for tax benefits. The IRS has approved similar requests when taxpayers can show genuine business reasons. I'd recommend documenting everything: your income levels in 2023, your employment status change, projections for this year, and any advice you received that led to the original revocation. This paper trail will be crucial for your letter ruling request. The private letter ruling route isn't cheap (around $3,000-$7,000 in fees), but with your projected income level, the S corp tax savings would likely justify the cost. Just make sure you work with someone experienced in these types of requests - the formatting and arguments matter a lot. Don't give up! The IRS rejection letter is just their standard response, but exceptions do exist for situations like yours.

Benjamin, I've been following this thread and wanted to add another perspective based on my experience with S corp elections. You mentioned you've been relying on "random internet advice" - that's actually more common than you think, and it might work in your favor for the reasonable cause exception. The IRS recognizes that small business owners often make decisions based on general guidance available at the time. What matters is that you made a rational business decision given your circumstances (part-time business, minimal income, full-time employment). One thing I haven't seen mentioned yet is the timing of your quarterly estimated payments. Since you're projecting $180k this year and currently operating as an LLC, you're facing self-employment tax on the full amount. That's roughly $25k+ in SE tax alone that S corp status could help reduce significantly. Given the urgency of your tax situation, I'd actually recommend pursuing multiple approaches simultaneously: 1. File for the private letter ruling as others suggested 2. Consider the new entity approach (with proper legal structure to avoid substance-over-form issues) 3. Document everything about your 2023 decision-making process while it's still fresh The cost of professional help now is likely far less than the tax consequences of staying in LLC status for another 2+ years. Don't let the initial rejection discourage you - the IRS form letters rarely tell the whole story about available options.

I'm also waiting on a March 3rd DDD with Netspend! This thread has been so helpful - I had no idea about the weekend processing delays or the verification thresholds for larger amounts. My transcript shows the 846 code too, so at least we know the IRS has done their part. Based on what everyone's shared here, it sounds like checking first thing tomorrow morning around 6am is the move. The unpredictability is definitely stressful, but it's reassuring to see so many people going through the same thing. Thanks to everyone for sharing their experiences - this community is amazing for navigating tax season anxiety!

Just wanted to follow up for anyone still waiting! I'm in the exact same situation - March 3rd DDD with the 846 code showing on my transcript, but my Netspend account is still empty as of this evening. After reading through everyone's experiences here, I feel much better about the delay. It sounds like weekend DDDs really do create timing issues with the ACH processing, and Netspend's release schedule can be unpredictable even under normal circumstances. I'm planning to check my account early tomorrow morning around 6am like several people suggested. Really appreciate everyone sharing their experiences - it's so helpful to know this level of variation is normal and not something to panic about. Hoping we all see our deposits by tomorrow!

One thing to keep in mind - make sure you're keeping VERY detailed records of your poker/sports betting activities if you're reporting them as business income and setting up a SEP-IRA. The IRS scrutinizes gambling income closely, especially when it's used to establish retirement accounts. Daily logs of play time, tournaments entered, buy-ins, cash-outs, locations, witnesses, etc. - document everything. I learned this the hard way when I got audited in 2023 for my 2022 returns.

Just want to add another perspective here - I went through this exact same situation last year when setting up my SEP-IRA with poker tournament winnings. The confusion around that gambling business question is totally understandable because the wording is misleading. What helped me was thinking about it this way: the IRS is trying to identify businesses that are in the gambling INDUSTRY (casinos, bookmakers, lottery operators) versus people who gamble professionally. You're a customer of gambling establishments, not operating one yourself. I selected "NO" on that question and had zero issues with my EIN approval or SEP-IRA setup. My CPA confirmed this was correct - the distinction is crucial for tax purposes but won't affect your ability to report poker/betting income as self-employment income on Schedule C. Just make sure you have solid documentation of your gambling activities as others have mentioned. The combination of professional gambling income + retirement account contributions does tend to get extra scrutiny, so having your records organized is essential.

Does anyone recommend any specific tax software that handles wash sales correctly? I tried using FreeTaxUSA last year and it was a nightmare trying to manually figure out all the wash sales from my trading.

I want to clarify something important that might help ease your concerns. In your hypothetical scenario, you're thinking about this backwards. If you made $130k in gains and then later had losses that brought your net position down to $15, those are separate transactions. The wash sale rule would only disallow the losses if you repurchased the same securities within 30 days. But here's the key: those disallowed losses don't just disappear forever - they get added to the cost basis of your new shares. So let's say you had $129,985 in losses that were disallowed due to wash sales. That amount gets added to the cost basis of your repurchased shares. When you eventually sell those shares (and don't repurchase within 30 days), you'll get the benefit of that higher cost basis, which will reduce your taxable gain or increase your deductible loss. The timing is what creates the cash flow problem - you might owe taxes on the $130k gain this year, but the benefit of those disallowed losses will come when you sell the replacement shares. This is why active traders need to be very careful about year-end positioning and cash flow planning. You wouldn't permanently lose $38,985 - it's more of a timing issue that affects when you can claim those losses for tax purposes.

The comments about paper filing are correct, but one thing nobody's mentioned - if your 2021 return is simple enough, you can use the IRS Free File Fillable Forms even for 2021. You still have to print and mail, but it's easier than doing the forms by hand. Go to IRS.gov and search for "prior year forms" - you can download everything you need. And remember to use your 2021 address on the forms if you've moved since then! That trips up a lot of people.

I was in the exact same situation last year with my 2020 return! After trying every major tax software (TurboTax, H&R Block, FreeTaxUSA, etc.), I can confirm that none of them support e-filing for returns that old anymore. The cutoff seems to be around 2-3 years max. Here's what worked for me: I ended up using the IRS Free File Fillable Forms that someone mentioned, which let me complete everything electronically and then print clean copies. Way better than handwriting forms! The key things that made my paper filing go smoothly: - Used a large 9x12 envelope so nothing got folded - Sent everything certified mail with tracking - Included a cover letter explaining it was a prior year return - Made sure to sign with actual ink (apparently their scanners work better with real signatures) My refund took about 5 months to process, which was actually faster than I expected based on what I'd read online. And yes, I did get interest payments on top of my refund since it was for a prior year - that was a nice surprise! Don't let the paper filing discourage you from claiming your money. It's tedious but totally worth it if you're owed a refund.