This is probably a dumb question but can you use a credit card to pay a CP2000? I've got points on my card and figured I might as well get something back from this painful experience lol

Just went through this exact same situation with a CP2000 from 2021! The key thing I learned is that you absolutely cannot set up the payment plan online through the regular IRS payment portal until after you've formally agreed to the CP2000 assessment. Here's what worked for me: 1. First, I had to decide whether to agree or disagree with the proposed changes on the CP2000 2. I signed and mailed back the response form agreeing to the assessment 3. About 2 weeks later, I called the specific number on my CP2000 notice (not the general IRS number) and requested the 180-day payment plan 4. The agent set it up over the phone and gave me a confirmation number The 180-day plan is nice because you don't have to provide financial statements like you do for longer payment plans. Just make sure to keep making payments even if you don't hear back right away - the interest keeps accruing! One tip: when you call, have your CP2000 notice in front of you with the specific reference number. The agents can pull up your case much faster that way.

Has anyone had to deal with the Net Investment Income Tax (NIIT) on foreign rental income? I heard the 3.8% NIIT applies to rental income even from foreign properties and that foreign tax credits don't offset it. Wondering if that's accurate.

I went through this exact same situation with my rental property in Toronto last year! A few additional tips that might help: 1. **Timing of currency conversion**: You can use either the yearly average exchange rate from the IRS or daily rates for each transaction. I found the yearly average much simpler for regular rental income/expenses. 2. **Canadian tax paid**: Even though you had a loss this year, keep all your Canadian tax documents. If you have Canadian taxes withheld or paid on rental income in future profitable years, you can claim those as foreign tax credits on Form 1116. 3. **Loss limitations**: Be aware that rental losses are generally considered "passive losses" and can only offset passive income unless you qualify for the $25,000 real estate professional exception (which requires significant involvement in real estate activities). 4. **Provincial vs federal**: Make sure you're accounting for both Canadian federal and provincial taxes paid when calculating foreign tax credits in future years. The good news is that once you get the process down for the first year, subsequent years become much more routine. I'd definitely recommend keeping detailed records of all your Canadian rental documents and currency conversions - it makes things so much easier come tax time!

Everyone's talking about tax deductions, but what about depreciation? Even if you can't deduct it as a W2 employee, if you do start a side hustle you should look into depreciating expensive equipment over time vs. taking an immediate Section 179 deduction. Sometimes spreading it out makes more sense tax-wise depending on your income situation.

This is such a common frustration for creative professionals! I went through the exact same thing when I was doing marketing photography as a W2 employee. The tax law changes really hurt employees who invest in their own equipment. One thing that worked for me was approaching my manager with a "business case" presentation. I showed specific examples of how the new lens would improve our content quality - like being able to shoot in lower light conditions for evening property shots, or getting sharper detail shots of amenities. I also researched what our competitors were doing visually and showed how better equipment could help us stand out. My company ended up creating an "equipment stipend" as part of my compensation package. It wasn't a full reimbursement, but it covered about 60% of the lens cost and they structured it so it wasn't taxable income for me. Worth asking if your company has any flexibility with equipment allowances or if they'd consider it a business investment rather than an employee expense. If that doesn't work, definitely look into the legitimate side business route that others mentioned. Just make sure you're actually marketing services and trying to make a profit - the IRS is pretty strict about hobby vs. business classification.

Don't overlook state taxes in your decision! I'm in California where S-corps pay an $800 minimum tax PLUS 1.5% tax on net income. This significantly reduced my S-corp advantage compared to federal-only calculations. Meanwhile, my friend in Texas with similar income saves much more with S-corp because no state income tax impacts the equation.

Based on your income range ($135-250k), I'd lean toward S-corp over the partnership route, but with some important caveats. The partnership strategy your advisor suggested is risky - a 70/30 split with your wife as "inactive" partner would likely face serious IRS scrutiny, especially at your income level. Here's why: the IRS requires partnership allocations to have "substantial economic effect," meaning profits must reasonably match actual contributions. Unless your wife is contributing significant capital, expertise, or documented work hours, that 70% allocation won't hold up in an audit. For S-corp, yes there are payroll complexities, but at your income level the math usually works out favorably. You'd need to pay yourself a reasonable salary (probably $80-120k based on typical 1099 contractor rates), with the remainder as distributions not subject to self-employment tax. My recommendation: run actual numbers for both scenarios including ALL costs - payroll administration, state taxes, compliance fees, etc. Many people underestimate these hidden S-corp costs. Also consider your long-term plans - S-corp structure becomes more valuable as income grows and if you plan to have employees eventually. Whatever you choose, document everything thoroughly from day one. The IRS is increasingly scrutinizing both family partnerships with unequal splits and S-corps with unreasonably low salaries.

This is like buying a concert ticket through StubHub versus directly from the venue - there's always that middle-man fee and delay! I did this last year with H&R Block and my refund came 2 days after the official DD date. My friend who used TurboTax with the same setup got hers 4 days after. Another who used a local preparer waited almost a week. Honestly, next year I'm just paying the prep fee upfront. The peace of mind knowing exactly when my money will arrive is worth it. Plus, when you do the math, you're essentially paying extra for what amounts to a very short-term loan. I was so relieved when I finally got my money though!

This is such a helpful thread! I'm in the exact same situation this year - took an advance and had the prep fees deducted from my refund. Reading everyone's experiences, it sounds like I should expect my money 2-5 days after the official DD date shows up on Where's My Refund. What I'm curious about is whether anyone has experience with what happens if there's an issue during that intermediate step. Like, what if the preparer's bank has a processing error or delay? Are we just stuck waiting with no recourse, or is there someone we can actually contact to get updates? Also, for those who mentioned tracking tools - has anyone found one that actually shows the money moving through each step in real-time? It would be so much less stressful to know "okay, IRS sent it, now it's at the preparer's bank, now it's headed to my account" rather than just guessing where it is in the pipeline. Thanks for all the insights everyone - this community is saving my sanity during tax season!