One thing nobody's mentioned yet - what's the actual benefit you're trying to achieve with this structure? If it's just liability protection, there might be simpler ways to structure this. I had a Revocable Trust -> LLC structure for my business initially, and it was a huge headache for taxes. I ended up restructuring to simplify things. If it's for estate planning, have you considered whether a SMLLC owned by one spouse (with appropriate estate planning) might achieve your goals with less complexity? Or potentially an irrevocable trust structure if you're looking for asset protection?

Based on everything discussed here, it seems pretty clear that you'll need to file Form 1065 for your LLC. The consensus from multiple experienced folks is that the IRS will look through both disregarded entities (your revocable trust and the SMLLC) and see two ultimate beneficial owners in a non-community property state. I'd suggest getting this confirmed officially before filing, especially since you mentioned this is your first year with this structure. The penalty risks for filing incorrectly on partnership returns can be significant. Also, for next year's planning, you might want to evaluate whether this structure is still serving your needs. From what you've described about wanting probate avoidance and business continuity, there might be simpler ways to achieve those goals without the Form 1065 complexity. An estate planning attorney who works with business owners could probably show you some alternatives that accomplish the same objectives with cleaner tax reporting. Good luck with your filing - and congratulations on the successful Amazon FBA business!

Check if your housing might qualify as excludable under Section 119 of the tax code! If the housing was provided for the "convenience of the employer" and on the employer's premises, and you were required to accept the housing as a condition of employment, it might not be taxable. Worth looking into before you amend!

I went through something very similar last year with a tech company that forgot to report my relocation bonus. The whole process was honestly less scary than I expected once I got started. A few practical tips from my experience: First, gather all your documents from that tax year (original W2, W2C, your filed return, any records of the housing arrangement). The IRS will want to see everything matches up. Second, if you used tax software originally, most programs like TurboTax or H&R Block have tools specifically for amended returns that walk you through the W2C situation step by step. One thing that surprised me - I actually ended up getting a small state refund because the additional federal tax I owed put me in a higher bracket that qualified for a bigger state deduction. So it's not always doom and gloom! The interest on what you owe will probably be manageable since it's only been 3 years, not like 10. Definitely don't wait though. The company already sent the corrected info to the IRS, so their computers will eventually flag the mismatch anyway. Better to handle it on your terms.

Don't forget that even though you report the income in the year you receive it, the character of the income (ordinary income, capital gains, tax-exempt income, etc.) flows through from the trust to you. The trust should provide a detailed K-1 showing the breakdown of what types of income are included in your distribution. This is important because different types of income are taxed at different rates. For example, if part of your distribution represents long-term capital gains realized by the trust, that portion would be taxed at the preferential capital gains rates on your personal return.

Quick heads up - if your trust distribution was large (over $15,000 in 2022/2023), make sure the trustee isn't confusing the 65-day rule with gift tax reporting. I've seen this happen where trustees think the beneficiary needs to report large distributions as gifts, but trust distributions aren't considered gifts for tax purposes (the original transfer to the trust may have been). Trust distributions are generally reported as income by the beneficiary (unless they're distributions of principal, which usually aren't taxable). The gift tax annual exclusion amount ($17,000 for 2023) isn't relevant to trust distributions.

dont overthink this. i deposit cash from my side business all the time. just go to the bank with ID, tell them its payment for freelance work, sign the CTR form they give you, and your done. takes like 5 extra minutes. they see this stuff every day.

One thing I haven't seen mentioned yet is to make sure you keep detailed records of this transaction for your own files. Beyond just getting a receipt from your client, document the date, method of payment, what services were provided, and maybe even take a photo of the cash before depositing (sounds paranoid but it's good documentation). Also, if this client is going to continue paying you large amounts, you might want to consider asking them to get a cashier's check instead of cash for future payments. It's safer for both of you to transport and creates a cleaner paper trail. Banks are much more comfortable with large cashier's checks than large amounts of cash. For tax purposes, just make sure you're setting aside the appropriate amount for taxes since this is self-employment income. The IRS will expect their cut regardless of how you were paid!

I completed an OIC two years ago and have some practical advice: DON'T use those "pennies on the dollar" tax relief companies you see advertising everywhere. They charged me $4,500 upfront, then basically just filled out the same forms I could have done myself. Here's what worked better for me: 1) I called my local Taxpayer Advocate Service office (they're free and actually work for taxpayers) 2) They helped me understand if I was even a good candidate before wasting time 3) I used the pre-qualifier tool on the IRS website first 4) When I finally submitted, I included EVERY possible document that might be relevant, even if not specifically requested

I went through the OIC process about 18 months ago and wanted to share my experience since you're looking for real stories. I owed around $28,000 in back taxes from 2019-2021 when my freelance income wasn't being properly tracked. The process was honestly more complex than I expected, but it worked out. I ended up settling for $3,200 paid in a lump sum. The key things that helped me: 1) I was brutally honest about my financial situation - included everything down to my $800 car value 2) I gathered 3+ years of bank statements, pay stubs, and expense records before starting 3) I calculated my reasonable collection potential very conservatively using the IRS formula The biggest surprise was how thorough their review was. They asked for additional documentation twice, including proof of some medical expenses I'd claimed. The whole process took about 8 months from submission to acceptance. One thing I wish I'd known: having a tax lien in place actually helped my case because it showed genuine financial hardship. Also, timing matters - I submitted in February when their workload is supposedly lighter. Overall, it was stressful but absolutely worth it. Just make sure you qualify before spending the time and $205 application fee. The IRS pre-qualifier tool is pretty accurate.