One thing to remember that no one mentioned - if u don't have a business license and ur supposed to in ur city, the IRS might share info with local authorities which could lead to fines. Happened to my friend! Also don't forget about self-employment taxes (15.3%) on top of regular income tax. Those hit hard when ur not expecting them!

Great question! I was in a similar situation last year with my freelance graphic design work. The key thing to understand is that business expenses are deductible based on whether you're legitimately running a business, not whether you have a license. However, I'd strongly recommend getting that business license sooner rather than later. While it won't change your tax deductions, it protects you legally and shows the IRS you're serious about your business operations. Plus, at $23k in income, you're definitely past the "hobby" threshold. Make sure you're tracking that business use percentage accurately for mixed-use items like your laptop and internet. The IRS loves documentation, so keep detailed records of when and how you use these items for business. Also, don't forget to set aside money for self-employment taxes - they caught me off guard my first year! One last tip: consider opening a separate business bank account even without the license. It makes tracking expenses so much easier and creates a clear separation between personal and business finances.

One thing nobody's mentioned yet - there are different rules if your annual business income is over $27 million (average of last 3 years). If you're over that threshold, you're considered a "tax shelter" and subject to different bonus depreciation rules. Also, the bonus depreciation rules are different depending on when you placed the properties in service. The 2017 tax reform made big changes: - 100% for property placed in service after 9/27/2017 through 2022 - 80% for 2023 - 60% for 2024 - 40% for 2025 - 20% for 2026 - 0% after 2026 Make sure your CPA considers these phase-out periods!

Be careful with DIY cost segregation! I tried to do my own for my rental last year based on some percentages I found online, and ended up getting audited. The IRS wanted to see a formal engineering report to back up my allocations. If you're going to do this, either use one of the specialized services mentioned or get a real cost segregation study from a qualified firm. The few thousand you'll spend on proper documentation is worth it compared to dealing with an audit and potential penalties.

One thing nobody mentioned yet: Form 1139! Instead of filing an amended return (1120X), C corporations can file Form 1139 "Corporation Application for Tentative Refund" for capital loss carrybacks. The BIG advantage is that the IRS processes these much faster - you can get your refund in 90 days instead of waiting 6+ months for an amended return to process. BUT - and this is crucial - Form 1139 must be filed within 12 months of the end of the tax year in which the loss occurred. For a 2022 loss, if your tax year ended December 31, 2022, you would have had to file Form 1139 by December 31, 2023. If you missed that window, then you're back to the amended return route.

Just wanted to add a crucial timing consideration that could save you significant money: Since you're dealing with substantial penalties and interest that continue to accrue, I'd strongly recommend filing your Form 1120X as soon as possible - don't wait until closer to the October 2025 deadline. Even though you have until then to file the amended return, every month you delay means more penalties and interest accumulating on that $170,000 balance. Once you file the 1120X claiming the capital loss carryback, the IRS will stop the penalty clock on any tax liability that gets eliminated by the carryback. Also, make sure to include a detailed statement with your amended return explaining the capital loss carryback calculation and referencing the specific losses from your 2022 return. This helps the IRS processor understand exactly what you're doing and can prevent delays or requests for additional documentation. Given the complexity and dollar amounts involved, this definitely seems like a situation where professional help would be worthwhile to ensure everything is done correctly the first time.

anyone else notice that sometimes forms ask for "SSN" and other times they ask for "TIN" even though they want the same thing? super confusing when you're filling out tax forms. why can't they just use consistent terminology??

Don't worry, this isn't a dumb question at all! I was in the exact same boat when I started my first "real" job. Your TIN (Taxpayer Identification Number) is most likely your Social Security Number if you're a U.S. citizen or permanent resident. The confusion comes from the fact that TIN is basically an umbrella term - it can refer to different types of tax ID numbers depending on your situation. For most regular employees like yourself, your 9-digit SSN serves as your TIN. You can double-check this by looking at any previous tax documents you might have (like a W-2 from a part-time job) - your SSN will be listed in the TIN field. So when your HR person asks for your TIN on the tax forms, just provide your SSN. It's totally normal to be confused by tax terminology - the IRS doesn't exactly make things crystal clear with their language choices!

I went through this exact same thing about 6 months ago! The notice looks super scary at first, but it's actually pretty straightforward once you get through to them. My biggest tip is to call right when they open at 7 AM - I got through in like 10 minutes vs the 2+ hours I waited when I called in the afternoon. Also, have your Social Security card handy because they asked for the exact issue date on mine, which I totally wasn't expecting. The agent was really nice and explained that they just flag returns that seem unusual (mine was because I moved states and had a big change in income). Whole process took maybe 25 minutes and my refund was processed within 5 days. You got this! 💪

Just wanted to chime in with my experience! I got the 4883C notice about 3 months ago and was totally panicking at first. But honestly, once I actually called (took me like 4 tries to get through lol), the whole thing was way less scary than I expected. The IRS rep was super professional and walked me through everything step by step. They asked for basic stuff like my SSN, filing status, and some questions about my previous year's return. The call took about 15 minutes and my refund was released 3 days later! My advice: don't put it off like I did - just rip the bandaid off and call. And definitely try that early morning calling tip someone mentioned above. Good luck! 🍀