This is such helpful information! I'm in a similar situation planning to move to Turkey later this year. Based on what everyone's shared, it sounds like buying the Apple Watch in the US before moving is definitely the way to go. I'm leaning toward the GPS-only aluminum model to minimize the tax impact. The 20-22% rate is much more reasonable than the 35%+ for cellular models. Plus with that temporary exemption program Sarah mentioned, I might be able to save even more if I time it right. Has anyone dealt with declaring multiple personal electronics when moving? I'll also be bringing my iPhone, iPad, and MacBook. I want to make sure I don't accidentally trigger any red flags at customs by having "too much" tech, even though it's all legitimately for personal use.

Great thread everyone! As someone who works in international tax consulting, I can confirm most of the information here is accurate. One additional tip for anyone planning this move: keep detailed records of when you first started using each device. Turkey's customs officials have become more sophisticated in recent years and sometimes cross-reference social media posts or digital footprints to verify personal use claims. I've seen cases where people had issues because they posted photos of their "new" Apple Watch on social media just weeks before traveling, even though they claimed months of ownership. Also, regarding the material classifications that Natalie mentioned - this is still true in 2025. The customs codes differentiate between aluminum (lower luxury classification) and premium materials like titanium or ceramic (higher luxury tax bracket). The difference can be 5-10% in total tax burden. For those using tools like taxr.ai, make sure you're inputting the exact model specifications including case material, as this significantly affects the final calculation. The tool should ask for these details if it's comprehensive.

Does anyone know if there's a way to recreate the Schedule P Part 2 if you didn't properly track this in prior years? I've got functional currency amounts but never maintained the separate dollar basis tracking until now.

I've been dealing with Form 5471 for several years now and can confirm what others have said - you absolutely need to carry forward the dollar basis amounts from your 2022 Schedule P Part 2 ending balance to your 2023 beginning balance. Don't convert using 2023 rates. One thing I haven't seen mentioned yet is that you should also make sure you're properly categorizing any new 2023 inclusions by the correct PTEP category (Section 951(a), Section 951A, etc.) when you add them to your basis amounts. Each category needs to be tracked separately because they have different distribution ordering rules. Also, if you had any actual distributions during 2023, make sure you're reducing your basis amounts in the proper LIFO order and calculating the Section 986(c) gain/loss on the difference between your dollar basis and the dollar value of the distribution. This is where a lot of people mess up the currency calculations.

I'm currently dealing with a 570 code that appeared on my transcript 5 days ago. Reading through everyone's experiences here is really reassuring! I filed claiming the EITC and Child Tax Credit, so I'm guessing that might have triggered the review. Has anyone noticed if filing early vs. late in the season affects how long these reviews take? I'm trying to stay patient but it's hard when you're expecting that refund for bills.

I'm going through this exact same situation right now! Got the 570 code on my transcript about 10 days ago and have been checking obsessively every day since. Filed with both EITC and Additional Child Tax Credit, so I'm pretty sure that's what triggered the review. The waiting is honestly the worst part - not knowing if it's going to be 2 weeks or 2 months. Reading everyone's experiences here makes me feel a lot better though. Seems like most people get it resolved within 3 weeks or so. Fingers crossed we all get our refunds soon! 🤞

Has anyone mentioned the fact that you might also get hit with underpayment penalties if you don't have enough withheld throughout the year? IRS expects you to pay as you earn, not all at the end of the year.

One thing I don't see mentioned here is that you should also consider whether you have any other deductions or credits that might help offset the tax impact of your bonus. If you're planning to use this money for a house down payment, you might want to look into whether you qualify as a first-time homebuyer for any tax benefits. Also, if you haven't already maxed out your 401k contributions for the year, increasing those contributions can help reduce your taxable income and partially offset the bonus. You could ask your employer to increase your 401k withholding percentage for the remaining months of the year to capture some of that bonus money before taxes hit it.

I went through exactly this transition last year! Left my SEP open with the existing money and started a 401k when I brought on employees. One thing to watch for - make sure you properly document the termination of new contributions to the SEP (even though there's no formal closure). I kept a corporate minute in my company records noting the board decision to freeze the SEP and establish the new 401k. My accountant said this creates a clear paper trail if there's ever a question about why we stopped SEP contributions for the business.

Great question! I actually went through a similar transition when my consulting business grew. You're on the right track - you can absolutely leave your existing SEP IRA open with the current funds and simply stop making new contributions when you switch to the 401(k) plan. Since you'll have employees in 2025, continuing SEP contributions would require you to contribute the same percentage for all eligible employees, which gets expensive fast. The 401(k) route gives you much more flexibility with different contribution levels and employee matching options. One practical tip: when you set up the new 401(k), check if the plan allows incoming rollovers from IRAs. If so, you might want to roll your SEP funds into the 401(k) to consolidate everything in one place. This can also help if you ever want to do backdoor Roth conversions later, since having money in traditional IRAs complicates that strategy due to the pro-rata rule. The transition timing is perfect since you're doing it at the start of a new tax year. Just make sure your 401(k) plan document is properly drafted to handle the contribution types you want (employee deferrals, employer matching, profit sharing, etc.).