Wait, I'm confused about something. If both you and your spouse are W2 employees, aren't you limited by the 2018 tax law changes that eliminated miscellaneous itemized deductions for unreimbursed employee expenses? Or does that not apply since this is for rental property?

Great question! Just want to add a few practical tips from my experience as a rental property owner who went through this exact situation. First, definitely keep a dedicated notebook or app in your car specifically for rental property trips. I learned the hard way that trying to recreate mileage logs months later for tax prep is nearly impossible and the IRS won't accept estimates. Second, consider whether the standard mileage rate might actually be better than deducting actual lease payments. For 2024, the business mileage rate is 65.5 cents per mile. If you're driving substantial miles for rental property management, this could exceed your lease payment deduction, especially after factoring in the lease inclusion amount if your vehicles are over the IRS threshold. Also, don't forget you can deduct other trip-related expenses like tolls, parking fees, and even meals if you're staying overnight for property management (subject to the 50% meal limitation). One last tip - take photos of your property during these trips with timestamps. It helps document the legitimate business purpose if you're ever questioned about the frequency of your visits. The fact that you're asking these questions upfront shows you're being responsible about compliance, which is exactly the right approach!

Just wanted to add my experience from last year - my mom had cancer treatment and we received about $15k from GoFundMe. I was worried about taxes too but my accountant confirmed it wasn't income. He did suggest keeping the GoFundMe money in a separate account just to make it easier to track, which might be helpful for you too if it's not too late. Also, if your daughter qualifies for any disability benefits, make sure to look into that too. We didn't realize my mom qualified for some assistance until several months into treatment.

I'm so sorry to hear about your daughter's diagnosis and everything your family has been through. Pediatric AML is incredibly challenging, and you're doing an amazing job advocating for her care. Regarding the GoFundMe money - the good news is that donations received for medical expenses are generally considered gifts to you, not taxable income. Since you received donations from many different people (most giving under the annual gift tax exclusion limit), you don't need to report this as income on your tax return. However, given your previous experience with the IRS, I completely understand wanting to be extra cautious. Here are a few suggestions: 1. Keep detailed records of how the funds were used - medical bills, travel receipts, medication costs, etc. This documentation will be helpful if you ever need to show the money was used for legitimate medical expenses. 2. Consider setting up a simple spreadsheet tracking major expenses paid with the GoFundMe money, even if it's mixed with your regular funds. 3. If you're still concerned, you might want to consult with a tax professional who has experience with medical fundraising situations. Many will do a brief consultation to give you peace of mind. The fact that you're being proactive about this shows you're handling everything responsibly. Focus on your daughter's health - the tax side of this should be straightforward. Wishing your family all the best during her ongoing treatment.

Something nobody's mentioned is that Section 179 has a spending cap and phase-out threshold. For 2023 you can deduct up to $1,160,000 in qualifying property, but this begins to phase out after you've spent $2,890,000. Also remember that for a sole proprietorship, the equipment must be used more than 50% for business purposes to qualify for Section 179. If you use that sawmill for personal projects on weekends, keep track of business vs personal usage. And remember only new OR used equipment purchases qualify - not equipment you lease. Sounds like you're planning to buy though.

I see a lot of good advice here, but one thing to consider that's been missed - you mentioned you have W-2 income as well. Remember that as a sole proprietor, you'll pay both income tax AND self-employment tax (15.3%) on your business profits. So writing off legitimate business expenses is EXTRA important because they reduce both taxes. This is true even if your W-2 income already puts you above the standard deduction threshold.

One thing to consider if you give your nephew money directly or to his 529 plan - it could potentially impact his financial aid package if he's receiving any need-based aid. Money in a student's name is assessed at a higher rate (20%) than parent assets (around 5.6%) when calculating the Expected Family Contribution. Might want to coordinate with his parents about this.

Great advice from everyone here! Just to add another perspective - since you're in California and your nephew will be in Pennsylvania, make sure you understand which state's 529 plan might work best. While California doesn't offer state tax deductions for 529 contributions, some other states allow non-residents to get deductions if they contribute to that state's plan. Pennsylvania actually does offer a state tax deduction for PA 529 contributions, but only for Pennsylvania residents. However, if your nephew's parents are PA residents, they could potentially benefit from any contributions they make. One strategy might be to give the money to your nephew's parents, who could then contribute to the PA 529 plan and potentially get the state tax benefit themselves. This would require coordination with them and might complicate the gift tax situation slightly, but could maximize the overall tax efficiency for the family. Also echoing the financial aid concern mentioned earlier - definitely coordinate with his parents about timing and structure to minimize any negative impact on his aid package!

I had an IP PIN issue with my son last year, and what worked for us was filing a paper return. Electronic filing systems are super strict with IP PINs, but paper returns get handled by actual people who can verify the information more flexibly. Just print your return, attach a copy of the IP PIN letter, write a brief explanation of the situation on top, and mail it certified with return receipt requested. Yes, it will take longer to process, but it will eventually go through without the electronic validation errors.

Has your daughter checked if her identity might have been compromised? The IRS usually issues IP PINs when there's been some kind of identity theft concern. The fact that she got one automatically and now it's not working properly might mean someone tried to file using her SSN. It might be worth checking her credit report at annualcreditreport.com (the official free site) just to make sure nothing fishy is going on. Sometimes resolving the underlying identity issues helps resolve the PIN problems too.