19 Has anyone been successful getting penalty abatement for being late MULTIPLE years? I just discovered I should have been filing 1065s for the past three years for my small LLC 😰

8 Don't panic - you're not alone in this situation! Many first-time LLC owners miss the 1065 requirement since it's not always obvious that partnerships need separate filings. Here's your action plan: **Immediate steps:** 1. File Form 1065 ASAP - every month you delay increases penalties ($210 per partner per month) 2. Request First-Time Penalty Abatement when you file - as a new business owner, you have a good shot at getting penalties waived 3. Include a detailed reasonable cause statement explaining this was your first year filing business taxes and you made good faith efforts to comply with all requirements **About your personal return:** Since you reported LLC income on Schedule C instead of receiving a K-1, you'll need to file Form 1040-X (amended return) after completing the 1065. LLC partnership income goes on Schedule E, not Schedule C. **Key tip:** When writing your reasonable cause statement, focus on being a first-time business filer who demonstrated good faith compliance with other tax obligations (you filed your personal return on time). The IRS is often more lenient with genuine first-time mistakes. Consider using tax software designed for partnerships - it'll walk you through the process and help ensure accuracy. You've got this!

Has anyone else noticed that TurboTax doesn't handle the supplemental information on 1099-Bs very well? I have RSUs where the 1099-B has this cryptic note about "Ordinary income of $X already included in Box 1 of Form W-2" but TurboTax doesn't seem to recognize that when I import.

I just went through this exact situation last month and wanted to share what I learned. The key thing that saved me was creating a spreadsheet to track everything separately before entering it into TurboTax. For RSUs, I listed each vesting event with the vesting date, number of shares, FMV on vesting date, and which shares were sold immediately vs. kept. The shares sold for tax withholding usually have minimal gain/loss since they're sold right at vesting. For ESPP, I tracked the offering period start date, purchase date, purchase price, and sale date for each transaction. This helped me determine qualifying vs. non-qualifying dispositions. One gotcha I discovered: if you have multiple RSU vest dates throughout the year and then sell shares later, your broker might use FIFO (first in, first out) to determine which specific shares you sold. This can affect your cost basis calculation. Also, double-check that your W-2 Box 1 includes all your RSU income. Mine was about $8K higher than my base salary due to the vested RSUs. Once I confirmed that, I knew I needed to adjust the cost basis on my 1099-B to avoid double taxation. The whole process took me about 3 hours to sort out, but it was worth it to make sure I got it right!

This is really encouraging to hear! As a tax professional who's been dealing with frustrated executors and beneficiaries for years, the improvement in Form 706 processing times is one of the best developments I've seen from the IRS recently. What's interesting is that the improvement seems most pronounced for straightforward estates with complete documentation. I've noticed that returns filed with all required schedules, proper appraisals, and clear supporting documentation are moving through much faster than those requiring follow-up. One thing I've started doing is creating a comprehensive checklist for each 706 filing to ensure nothing gets missed on the initial submission. This includes verifying all asset valuations are properly supported, all required elections are clearly indicated, and all schedules are complete. It's extra work upfront, but it seems to be paying off with faster processing times. The key seems to be avoiding any reason for the IRS to set the return aside for additional review or missing information. Clean, complete submissions are definitely getting prioritized in the current processing environment.

This is fantastic news to hear! As someone who recently started handling estate administration, the improved processing times give me so much more confidence in setting realistic expectations with clients. I've been using a combination of the tools mentioned here - both taxr.ai for ensuring complete submissions and Claimyr when I absolutely need to reach the IRS directly. The taxr.ai system has been invaluable for catching potential issues before filing, and I actually used Claimyr last month to get clarification on a complex valuation question that could have delayed processing for months. What really strikes me about this thread is how much the client experience has improved. Being able to tell families that their 706 will likely be processed in 14-20 months instead of 30+ months makes such a difference during an already difficult time. The beneficiary communication features in these newer tools have also been game-changers for managing expectations and reducing those anxious phone calls we all know too well. I'm cautiously optimistic that these improvements represent a real systemic change at the IRS rather than just a temporary backlog clearance. The combination of better IRS processing and these new professional tools is making estate administration much more manageable for both practitioners and families.

Has anyone used the "retail inventory method" for this kind of situation? I heard it can be useful for small retailers.

I'm dealing with a very similar situation with my online electronics resale business! What really helped me was creating a simple spreadsheet to track my inventory purchases by month, then using the weighted average method that others mentioned. Here's what I did: I calculated the total cost of all inventory purchased during the year, divided by the total number of items purchased, which gave me an average cost per item. Then I multiplied that average by the number of items I actually sold. It's not perfect, but it's a reasonable and defensible method that the IRS accepts. The key is being consistent and documenting your methodology clearly. I kept notes explaining exactly how I calculated everything in case I ever get audited. One tip: if you have receipts in Korean, consider using Google Translate's camera feature to get rough translations of the key information like dates and amounts. It's not perfect but it helped me organize my records better for this year. Good luck with your vintage clothing business! The first year is always the hardest for getting organized.

Just wanted to add that my wife works in farm equipment sales and gets manufacturer incentives all the time. We've learned to keep our own detailed records of every spiff and gift card because waiting for the proper tax forms is a lost cause. We maintain a simple spreadsheet with: - Date received - Manufacturer name - Amount - Type (cash, gift card, merchandise) - Which sale it was tied to At tax time, we just total it all up and report it as other income. If a 1099 arrives and matches our records, great. If not, we've still reported everything accurately. Never had an issue with the IRS doing it this way for 8 years now.

Has anyone ever NOT reported these kinds of incentives and actually gotten caught? I've been selling cars for 6 years and get spiffs and gift cards all the time but have never received a 1099 for any of them. I always figured if they don't send a tax form, they're not reporting it to the IRS either, so why should I?