Maybe consider keeping it until you've at least paid off the loan? Since you're underwater, you'd have to come up with cash to pay off the remaining loan balance if you sell. Plus, with the depreciation recapture, you might end up with a tax bill too. Sometimes holding an asset a bit longer can make the math work better.

This is a tough spot to be in! One thing to consider that might help with the cash flow issue is timing the sale strategically. If you're expecting higher income this year, you might want to wait until early next year to sell so the depreciation recapture income hits in a potentially lower tax bracket year. Also, since you're underwater on the loan, you could explore trading it in toward a more fuel-efficient business vehicle rather than selling outright. The dealer might roll the negative equity into the new loan, and if you buy another qualifying business vehicle, you could potentially take advantage of bonus depreciation again on the new purchase to offset some of the recapture tax hit. Just make sure to keep detailed records of business use percentage for both vehicles if you go that route. The IRS gets pretty picky about business vehicle deductions, especially on luxury vehicles like the GLE.

Random question - if I've already certified in Robinhood but was confused about this, should I try to redo the certification? Or am I fine since I now understand what it actually means?

This is such a helpful thread! I've been dealing with the exact same confusion across multiple brokerages. It's frustrating that these financial institutions use such unclear language when asking for tax certifications. What I've learned from reading everyone's responses is that there's a critical distinction between: 1. The financial institution's FATCA reporting obligations (what Robinhood's form is about) 2. Your personal FATCA reporting obligations on Form 8938 (completely separate) The certification you're making to Robinhood is essentially saying "As a US person, you don't need to report my US account under FATCA." This doesn't affect whether you need to report foreign assets on your tax return. I think all brokerages should be required to use clearer language like "I certify that this account is exempt from FATCA reporting requirements" instead of making it sound like you're claiming a personal exemption from all FATCA obligations. The current wording creates unnecessary anxiety about committing perjury when you're actually just providing routine account classification information. Thanks to everyone who shared their experiences and resources - this has been incredibly clarifying!

Has anyone had experience with the Foreign Housing Exclusion/Deduction that goes along with FEIE? I'm moving to London next month and I hear housing costs are insane there. Wondering if this additional exclusion makes FEIE better than FTC in high-cost cities?

Great question! I went through this exact same decision process when I moved back to the US after working in the UK for several years. One key point that hasn't been fully addressed: you mentioned having $13,500 in excess FTC from 2023 - those credits are gold! Since FTC carryovers last 10 years, you can absolutely use them on your 2025 return even though you used FEIE in 2024. This might actually make your decision easier since you'll get immediate benefit from those carried-forward credits. A few additional considerations for your situation: - If you're planning to stay in the US long-term, FTC might make more sense going forward since you won't qualify for FEIE as a US resident - State taxes: some states don't recognize FEIE but do recognize FTC, so if you're in a state with income tax, this could affect your calculation - Alternative Minimum Tax (AMT): FTC can sometimes trigger AMT issues, while FEIE generally doesn't Since you're back in the US for 2025, you probably won't have foreign earned income anyway, so the FEIE vs FTC decision might be moot for this year. Focus on maximizing the use of those carryover credits from 2023! The switching rules are exactly as others described - you can go from FTC to FEIE anytime, but once you revoke FEIE, there's that 5-year waiting period.

Are any of you using online tax prep software for your C-Corp returns when you actually file? I'm trying to figure out if I should just buy software now and use that to file the extension too, or if that's overkill for just an extension.

As someone who just went through this process last month, I'd strongly recommend e-filing your Form 7004 rather than mailing it, especially if you're cutting it close to the deadline. The IRS free e-file options for business extensions are actually pretty good now. One thing I wish I'd known earlier - even though you're bootstrapping, consider setting aside some cash for the estimated payment. I made the mistake of filing the extension without any payment thinking I could figure it out later, and ended up with interest charges that added up quickly. Even a rough estimate based on your projected profit is better than zero. Also, don't forget to check if your state requires a separate extension filing. Some states automatically extend when you file federal, but others don't. Since you mentioned you're a tech startup, depending on your state's business tax requirements, this could be important to avoid additional penalties. The whole process really doesn't have to be overwhelming - Form 7004 is much simpler than the actual tax return you'll file later!

Have you considered Short-Term Treasury Bills instead? They're yielding around 5.3-5.4% right now, and they have a tax advantage over HYSAs because they're exempt from state and local taxes. If you're in a high-tax state, this could give you a better after-tax return than a HYSA.

I'd echo what others have said about Treasury bills being worth considering. The state tax exemption can be a real advantage depending on where you live. One thing I haven't seen mentioned yet is considering a CD ladder as another option. Some banks are offering competitive rates on CDs (around 4.5-5.2%) with terms that could align with your 12-18 month timeline. While they don't have the state tax advantage of T-bills, they might offer slightly better liquidity planning since you can time the maturities exactly when you expect to need the funds. You could also look into money market accounts, which sometimes offer rates competitive with HYSAs but with check-writing privileges that might be useful during the home buying process when you need to move money quickly for earnest money deposits, inspections, etc. Given your substantial down payment amount ($325k), you might also want to consider spreading across multiple institutions to stay within FDIC limits if you go the HYSA route. Most banks have $250k FDIC coverage per depositor, so you'd want to split your funds to ensure full protection.