Something nobody's mentioned yet - you should check if the debt collector properly renewed the judgment. In most states, judgments expire after a certain period (often 7-10 years) unless the creditor files paperwork to renew it. If yours was from 2013 and they never renewed it properly, it might have expired. You can check this by contacting your county clerk's office and asking about any judgment renewals filed against you. If they didn't renew it and the original judgment has expired, you might be able to challenge the garnishment on those grounds. I went through something similar with an old credit card judgment from 2010. They tried to garnish my bank account in 2022, but I discovered they never renewed the judgment which expired after 10 years in my state. The court immediately terminated the garnishment order when I pointed this out.

Just want to add that if the majority of your income is from SSD, you might qualify to file Form 982 "Reduction of Tax Attributes Due to Discharge of Indebtedness" which can help if you're considered insolvent. This might not stop the current garnishment but could prevent future tax consequences if some of your debt gets discharged. Also, many states have homestead exemptions or wildcard exemptions that protect certain amounts of your assets and income from creditors, even after a judgment. These vary dramatically by state though - where are you located? Might be able to point you to specific state resources.

Curious what tax software people recommend for filing the partial year returns after conversion? I'm going through this exact scenario and usually use TurboTax Business but not sure if it handles this situation well.

I appreciate everyone sharing their experiences here. Just want to add a few additional considerations that might help with your decision timing: 1. **Quarterly estimated taxes** - If you're making quarterly payments as a C Corp, converting mid-year will complicate your Q3 and Q4 estimates since you'll need to calculate them based on your new entity structure. 2. **Employee benefits** - If you have employees or provide yourself benefits through the C Corp (health insurance, retirement plans), these will need to be restructured. Some benefits that were tax-deductible for the C Corp might not be for an LLC. 3. **State franchise taxes** - Many states charge annual franchise taxes for C Corps that are calculated differently than LLC fees. Converting mid-year might still leave you liable for the full year's C Corp franchise tax in some states. The timing really depends on your specific situation, but given the complexity everyone's outlined here, waiting until your accountant returns might be worth the delay. Two weeks could save you from making a costly mistake, especially since you'll need professional help with those dual tax filings anyway.

Your situation sounds like a textbook case for Bona Fide Residence. I've been using it for 9 years in Chile despite traveling to the US for 2-3 months each year. One tip nobody mentioned: keep digital copies of EVERYTHING. When I got questioned (not audited, just a letter requesting more info), I uploaded digital copies of my: - Lease agreement - Permanent resident card - Utility bills (showing consistent usage) - Local bank statements - Community involvement (gym membership, church, etc) - Travel records showing pattern of returns to Chile Never heard from them again! The documentation speaks for itself. From everything you wrote, you're in better shape than I was. Go for it!

Based on your detailed description, you have an extremely strong case for the Bona Fide Residence Test. Your situation checks all the major boxes: continuous residence since 2012, permanent resident status since 2016, property ownership, and strong ties to your foreign country without maintaining a US home. The flexibility you're seeking is exactly what the Bona Fide Residence Test provides - it's designed for people like you who have genuinely established their life abroad but need occasional US travel flexibility. The Physical Presence Test is really better suited for shorter-term assignments or digital nomads. Don't worry about the audit concern. Switching tests is completely legitimate when your circumstances support it, and your documentation is solid. The IRS actually prefers the Bona Fide Residence Test for long-term expats because it demonstrates genuine commitment to foreign residence. One suggestion: start keeping a simple travel log documenting the purpose of your US visits (work, family, etc.) and evidence of your intent to return to your foreign home. This creates a clear paper trail showing the temporary nature of your US trips. Your permanent resident visa and property ownership are particularly strong evidence. You're making the right move!

Am I the only one who hates that the answer to every tax question is always "it depends" or "run the numbers both ways"?? Like, there should be a simple rule of thumb for when filing separately makes sense vs filing jointly. Tax software should automatically tell you which is better for your situation without making you do everything twice.

Great thread everyone! As someone who's been through this exact scenario, I wanted to add that timing can also matter. If you're planning any major life changes this year (like having another child, buying investment property, or one spouse changing jobs), it's worth considering how those might affect your filing decision. Also, don't forget about state taxes! Some states have different rules for married filing separately vs jointly, and that can sometimes tip the scales. In my state, filing separately actually cost us an extra $400 in state taxes even though the federal calculation was close. One more tip - if you do decide to run both scenarios, make sure you're accounting for ALL the credits and deductions that change between filing statuses. It's not just the child tax credit - things like the earned income credit, education credits, and even the standard deduction amounts are different. The total impact can be much bigger than you'd expect just looking at income tax brackets alone.

Has anyone used a QPRT (Qualified Personal Residence Trust) instead of direct gifting? My accountant suggested this might be better than what you're doing with the Form 709 gift splitting.

I went through this exact same process last year with a vacation home in Washington state. The section you're stuck on is likely Schedule A Part 2 where you need to provide a detailed description of the property and confirm the gift splitting election. Make sure you include the complete legal description of the property (you can get this from your deed), the physical address, and the date of transfer. You'll also need to attach the $675,000 appraisal report to both your and your husband's Form 709. One thing that tripped me up - don't forget that both of you need to sign each other's returns in the "Consenting Spouse" section. The IRS is very strict about this requirement for gift splitting to be valid. Also, since you bought the house for $280,000 and it's now worth $675,000, your daughter and son-in-law will receive a carryover basis of $280,000, so they'll have significant capital gains if they ever sell. Just something to factor into your overall planning.