Does Cash App Taxes handle rental property? I have a duplex and TT charges me for their premium version just for that. Looking to save some $$ this year.

Yes, Cash App Taxes does handle rental property income and expenses through Schedule E without charging extra. I don't personally have rental property, but a close friend uses it for his duplex rental and says it works fine for basic rental situations. The only real limitations I'm aware of are for people with multi-state returns or certain less common situations like foreign income. For standard rental property reporting though, it should work well and save you from paying for TurboTax's premium tier.

Pro tip: Always save a PDF copy of your full tax return on your own computer or cloud storage every year! I learned this lesson years ago. Don't rely on any tax service to maintain your records - download the final PDF before submitting and keep it somewhere safe.

Would this work if I'm already maxing out my SEP IRA? I thought there were limitations if you have multiple retirement accounts.

Yes, you can absolutely contribute to both a SEP IRA and a traditional or Roth IRA in the same year. The SEP IRA is considered an employer plan, while the traditional/Roth IRA is a personal plan. They have separate contribution limits. The only limitation is on the tax deductibility of traditional IRA contributions. If your income is above certain thresholds and you're covered by a workplace plan (which the SEP IRA counts as), you may not be able to deduct traditional IRA contributions. But you can still make non-deductible contributions to a traditional IRA, or, if your income permits, contribute directly to a Roth IRA. Or look into backdoor Roth strategies if your income exceeds Roth limits.

The confusion happens because the actual calculation is approximately 20% of your NET self-employment income (Schedule C profit), but it's technically defined as 25% of your net earnings after deducting the SEP contribution and half of self-employment tax. The math works out to roughly 20% of your Schedule C profit in most cases. So both of you are right in a way, just looking at different reference points.

Is the 5-year thing a hard rule? I thought there was some flexibility if your business circumstances changed significantly.

There's no absolute 5-year "lock-in" rule, but the IRS generally won't allow you to terminate S status within 5 years without a legitimate business purpose. A significant change in business circumstances can qualify, but simple "tax planning" or "it was more work than I expected" usually won't be enough. The IRS is wary of businesses jumping back and forth between tax statuses purely to minimize taxes, so they put these restrictions in place. If you do want to terminate within 5 years, you'd need to file a letter requesting permission and explaining your circumstances.

Do you think the tax savings have outweighed the extra costs and hassle in your case? Would you do it again if you had the choice?

I've considered that option but there's a specific reason I'm sticking with the company plan. They have access to some institutional funds with extremely low expense ratios that aren't available in individual plans. Plus the plan administrator handles all the compliance testing and Form 5500 filing, which I'd otherwise need to manage myself once the solo 401k exceeds $250k. Also, there's a potential opportunity in the future for me to be brought on as a W-2 employee, so staying in their plan makes that transition smoother. I just need to figure out the proper tax treatment for now.

Those are excellent reasons to stick with the company plan. The institutional fund access alone can save you significant money over time with those lower expense ratios. And you're right about the Form 5500 requirements - that paperwork gets complex fast when you're handling it yourself. For the proper tax treatment, one additional document that might help your CPA get comfortable is IRS Notice 2012-8, which provides specific guidance on affiliated service group arrangements. It clarifies that contractors who qualify under 414(m) should treat their contributions similarly to self-employed individuals with their own plans, but within the structure of the larger company plan.

Form 8606 is specifically for IRAs and reporting nondeductible contributions to traditional IRAs or Roth conversions. It doesn't apply to 401(k) contributions, whether in an affiliated service group or otherwise. Using this form would actually create more confusion.

Thanks for pointing this out! My company only does reimbursements after I submit receipts, so it sounds like I'm good. But do you know how advances are treated differently?

Advances can be tricky. If you receive money before incurring the expense, it might be considered an "advance" rather than a reimbursement. If you don't provide adequate documentation afterward or don't return unused funds, the IRS might consider it a non-accountable plan. In a non-accountable plan situation, the advance would be included in your W-2 income, and you'd have to claim any eligible expenses as miscellaneous itemized deductions (which are currently suspended until 2026). Much worse tax treatment than a proper accountable plan reimbursement.

I've been using Expensify for the past year and it's been great. You can snap photos of receipts on the go and it automatically extracts the info. Makes submitting to accounting super easy too.