The Turbotax error message is super misleading. Had the same issue last year and almost overpaid my state taxes. The $2,650 is definitely the gross proceeds (total sales amount) NOT your actual gain.

I had this exact same issue when I moved from California to Texas mid-year! The key thing to understand is that TurboTax is showing you gross proceeds (total amount received from sales) in column A, not your actual capital gains or losses. Since you mentioned all your transactions were short-term and resulted in a net loss, you should definitely enter zero in column B. The form is specifically asking about long-term capital gains that are attributable to your new state, and you don't have any. Don't worry about entering zero - the instructions literally say "If none, enter a zero in column b" for this exact situation. The state understands that not all proceeds shown in column A will be taxable by them, especially when you've moved mid-year and have no long-term gains. I made the mistake of overthinking this and almost entered the wrong amount. Once I realized that proceeds ≠ gains, everything made sense. Your federal return already properly accounts for your actual net loss, so you're all good there.

I negotiated with my CPA to pay based on the actual tax savings they generate for me. Base fee is $900 for preparation, plus 10% of any tax savings they find beyond what I would have gotten with basic software. The first year they found an additional $9k in deductions I'd missed (so I paid $900 + $900), but now it's usually around $1200-1500 total. This incentivizes them to actually look for optimization opportunities instead of just filling out forms. Might be worth asking if any CPAs in your area work on this kind of model.

Based on what you've shared, $1800 for comprehensive tax planning that identifies $13k+ in annual savings sounds like excellent value. I pay around $1600 annually for similar services and my CPA has consistently found optimization strategies I never would have discovered on my own. The key is making sure they can clearly explain those savings opportunities and that they're legitimate strategies, not aggressive positions that could trigger audits. I'd recommend asking for a detailed breakdown of exactly how they plan to achieve those savings - a good CPA should be able to walk you through each strategy. Also consider the ongoing relationship value. The best CPAs don't just prepare your return once a year - they provide guidance throughout the year on timing decisions, estimated payments, and strategic planning. If this CPA offers that level of service, the fee becomes even more reasonable when you consider the year-round support.

25 Has anyone here dealt with filing a final 1120 when you still had ongoing litigation against the corporation? My situation is similar to the original poster, but we have a pending lawsuit that might not be resolved for another year or more.

Just went through this exact situation last year with my dissolved S-Corp. Definitely use your personal address on the final Form 1120 - the IRS needs to be able to reach you for any follow-up questions or notices, and using an inaccessible business address will only create headaches later. One thing I'd add that hasn't been mentioned yet - make sure you also file Form 966 (Corporate Dissolution or Liquidation) within 30 days of adopting the plan of dissolution if you haven't already. Since you dissolved in December 2023, you may have missed this deadline, but it's still worth filing even if late to properly notify the IRS of the dissolution. Also, keep copies of your state dissolution paperwork with your tax records. The IRS sometimes requests this documentation to verify the dissolution date and process. Using your home address ensures you'll actually receive any such requests.

I went through this exact same process last month and can confirm Jade's approach works perfectly! FreeTaxUSA doesn't have any built-in validation for the Safe Harbor for Small Taxpayers election - it's basically invisible to the software since you're just entering expenses as "repairs" rather than capitalizing them. The key thing to remember is that you need to do the math yourself to make sure you qualify and stay under the limits. For me, my building's unadjusted basis was $180,000, so my 2% limit was $3,600. I had about $2,800 in what would normally be capital improvements (new HVAC unit, flooring repairs), so I was able to deduct all of it as repairs instead of depreciating over years. Just make sure you keep good records showing how you calculated everything - your rental income to prove you're under the threshold, your building value to show it's under $1M, and your basis calculation for the 2% limit. The IRS may never ask, but if they do, you want to be ready to show your work!

Just wanted to add my experience for anyone still struggling with this! I was in the exact same boat as Lydia a few months ago - couldn't figure out where to make the Safe Harbor election in FreeTaxUSA and was getting frustrated searching through all the menus. After reading through all these helpful comments and doing some additional research, I realized the "election" is really just a matter of how you report your expenses. Here's what worked for me: 1. Calculate your Safe Harbor limit first (2% of building's unadjusted basis or $10,000, whichever is less) 2. Add up all your repair expenses AND any capital improvements that would qualify 3. If the total is under your limit, enter it all as "Repairs and Maintenance" in FreeTaxUSA 4. Keep detailed records of your calculation and what expenses you included The beauty of this safe harbor is that it lets you deduct things immediately that you'd otherwise have to depreciate over many years. For my rental, I was able to deduct about $4,500 in what would have been capital improvements (new flooring, electrical work) as current year expenses instead of spreading them out over decades. One tip: I also printed out Revenue Procedure 2019-08 and highlighted the relevant sections to keep with my tax records, just in case I ever need to explain my election to the IRS.

I've been through this exact scenario with multiple PTP investments over the years, and you're definitely not alone in this frustration! The good news is that receiving K-1s after filing is extremely common with PTPs, and the IRS is generally understanding about this timing issue. For your Section 751 statement, you'll need to file Form 1040-X to amend your return. The key information should be on the transaction schedule that came with your K-1 - look for any amounts labeled as "Section 751(a) ordinary income" or similar language about "hot assets." A few practical tips from my experience: - Don't stress about penalties - if you file the amendment within a reasonable time after receiving the K-1, you're usually fine - The Section 751 statement itself is just a simple document showing the breakdown between ordinary income and capital gain portions of your sale - Keep copies of everything, including the date you received the K-1, in case you need to explain the timing later Since you mentioned the profit wasn't huge, the actual tax impact might be smaller than you're worried about. The main thing is getting it reported correctly. Consider this a learning experience for future PTP investments - now you know to expect these complications!

I went through this exact nightmare with Energy Transfer (ET) two years ago! The Section 751 reporting requirements caught me completely off guard too. Here's what I learned that might help you: First, don't panic about the timing - late K-1s are incredibly common with PTPs, and the IRS knows this. You're actually in good company since most PTP investors end up filing amendments. For your Section 751 statement, look at your K-1's transaction schedule for any line items showing "ordinary income under Section 751" or similar language about unrealized receivables. That's the amount that gets treated as ordinary income instead of capital gains when you sold your MMP position. The process is pretty straightforward once you know what to do: 1. File Form 1040-X (amended return) 2. Create a simple Section 751 statement showing the breakdown 3. Report the ordinary income portion on Form 4797 4. Report the remaining capital gain on Schedule D Since you only held for 3 months and the profit wasn't huge, the actual tax difference might be minimal. The important thing is getting it reported correctly. I'd recommend just biting the bullet and filing the amendment ASAP - better to deal with it now than worry about it later. Also, lesson learned for future reference: if you're thinking about investing in any more PTPs, maybe wait until after tax season to buy them, or at least be prepared for this complexity!