For what it's worth, I thought I was going crazy with the same form 8832 situation last month. My solution: I ended up checking my email history for "8832" and found that I actually HAD filed it when setting up my LLC but completely forgot. The IRS had even sent a confirmation letter that I'd filed away and forgotten. Might be worth searching your email, cloud drive, or any paperwork file you have from when you set up the LLC. You'd be surprised what you might find!

Another option if you need confirmation quickly: check if you received any IRS correspondence after setting up your LLC. When Form 8832 is filed, the IRS typically sends an acknowledgment letter within 4-6 weeks. If you never received anything like that, it's a strong indicator you didn't file the form. Also, look at your business bank account statements from when you first started operating. If you were paying yourself through regular transfers (not payroll with tax withholdings), that's another sign you're operating as a disregarded entity without the 8832 election. For future reference, most online LLC formation services will explicitly ask if you want to make this election during setup, so if you don't remember making that choice, you probably didn't file it. You're most likely Category 2 - just make sure to tell your client the 1099 should be issued to your SSN, not your EIN.

Has anyone mentioned the filing deadline implications? If you're planning fundraising activities soon, timing matters a lot here. The IRS generally recommends filing for 501(c)(3) status within 27 months of formation to have tax-exempt status apply from your date of formation. If it's been longer since your club was formed, your tax-exempt status might only apply from the date of application forward. This could impact how you handle any fundraising you do while waiting for approval. Also, don't forget about state requirements! Even with federal 501(c)(3) status, you might need to register for state tax exemptions separately, and some states require charitable solicitation registration before fundraising. I learned this the hard way with our cycling club - we got federal approval but forgot about state requirements and had some complications.

Great thread! I'm dealing with a similar situation for our university soccer club. One thing I haven't seen mentioned yet is the potential impact on your current university funding. When we looked into forming our own 501(c)(3), our student activities office warned us that having independent nonprofit status might affect our eligibility for certain university grants and allocations. Apparently some schools have policies that prevent them from funding organizations that have their own tax-exempt status, since it creates potential conflicts with their own nonprofit designation. We ended up going the EIN-only route for now - it satisfied most of our immediate fundraising needs (restaurant nights, local business partnerships) without the complexity of full nonprofit status. We're planning to revisit the 501(c)(3) application next year once we have more clarity on the university policy implications. @AstroAce - have you checked with your student activities office specifically about how independent nonprofit status might affect your current university funding and RSO status?

Has anyone dealt with state taxes in this situation? I've heard some states have different rules than the IRS about spousal liability, even when filing separately.

I'm so sorry for your loss and the stress you're dealing with during this difficult time. Based on your situation, you should have very limited liability for your husband's tax debts since you consistently filed separately and maintained separate finances throughout your marriage. The key protections working in your favor are: 1) You always filed "married filing separately" which generally protects you from the other spouse's tax obligations, 2) You kept separate finances after that joint account incident, 3) You owned no joint property or assets, and 4) You were estranged and living in different states. Since your husband passed away, his estate would be responsible for any tax debts, not you personally. If the estate has no assets to pay the debts, they typically can't be collected. However, I'd strongly recommend getting a consultation with a tax attorney who specializes in these situations - many offer free initial consultations for situations like yours. Also consider contacting the IRS Taxpayer Advocate Service (it's free) to explain your situation proactively. They can help ensure your records clearly show your separate filing status and financial separation. Having documentation ready (your separate tax returns, bank statements showing separate accounts, rental agreements in your name only) will be helpful if any questions arise. You've been through enough - don't let fear of his tax problems add to your burden when you're likely protected.

21 Question for anyone - if I have unrealized losses (stocks that have gone down but I haven't sold yet), can I still claim those on my taxes? Or do I actually have to sell to get the tax benefit?

Great question about unrealized losses! You absolutely have to sell the stock to claim the tax loss - just holding a stock that's down in value doesn't give you any tax benefit. This is actually a strategic consideration many investors face near year-end. If you have stocks that are significantly underwater and you don't think they'll recover, selling them before December 31st lets you claim those losses on that year's tax return. Just remember the wash sale rule I mentioned earlier - if you sell for a loss but then buy back the same stock (or something "substantially identical") within 30 days before or after the sale, the IRS disallows the loss deduction. So if you still believe in the company long-term, you'd need to wait 31 days before repurchasing, or buy something similar but not identical. Some people get around this by selling their losing position in Company A and immediately buying a similar company or ETF in the same sector, so they maintain market exposure while still capturing the tax loss.

Have you considered using the IRS's Reasonable Cause Assistant on their website? It's not as well-known as calling, but sometimes works better for straightforward cases like yours. 😂 Though "straightforward" and "IRS" rarely belong in the same sentence! Jokes aside, you might also want to check if your state has separate requirements for reasonable cause exceptions - some states are more forgiving than others for medical emergencies.

I went through something very similar after a car accident kept me hospitalized for several weeks during tax season. The key thing that helped me was being proactive once I was able to handle my affairs again. I immediately filed my return with a detailed letter explaining the medical emergency, included copies of hospital discharge papers, and specifically referenced "reasonable cause" under IRC Section 6651(a)(1). The IRS did initially send me penalty notices, but after I called and explained the situation (yes, the hold times were brutal), they completely abated all failure-to-file and failure-to-pay penalties. The whole process took about 90 days from start to finish, but I didn't pay a single penalty dollar. One tip: if you do get penalty notices, don't panic. The IRS computer systems automatically generate these, but human review almost always results in abatement for legitimate medical emergencies. Just make sure you respond promptly to any notices and keep detailed records of all communications. Your quarterly estimates for 2024 shouldn't be affected by this situation at all - those are separate obligations going forward.