Your 1868 tax return might actually be worth some money to collectors. My friend works at a historical auction house and documents from Brooklyn during that era can fetch good prices, especially work-related items like a traveling salesman's tax forms. The 5% tax rate documentation from that specific period has historical significance too. Before you donate it, you might want to get it appraised. Just make sure whoever handles it uses proper preservation techniques - those old documents can be fragile!

Wait this is so random but my dissertation was actually on tax history in NY from 1850-1900! The 5% federal tax rate in 1868 was part of the "Revenue Act" which was originally a Civil War funding measure. Fun fact: the income tax was actually repealed in 1872, then ruled unconstitutional in 1895, and didn't come back permanently until the 16th Amendment in 1913! For a traveling salesman in Brooklyn, there would have also been some local taxes beyond just the federal 5%. And the comparison to today is mind-blowing - not just the rates but the complexity. The entire tax code back then was just a few pages compared to today's thousands of pages of regulations!

Just FYI - I'm a tax preparer, and one thing many people don't realize is that penalties can be reduced or eliminated through the IRS First Time Penalty Abatement program if you have a clean compliance history (meaning you've filed and paid on time for the past 3 years). Even if you owe money and face penalties, you might be able to get them removed. Worth asking about if you end up owing!

Did anyone else end up owing way more than expected when they filed late? I missed filing last year and when I finally did it, I owed like $2400 including penalties. Freaking out about this year now.

Something else to consider - if your rental property is in an opportunity zone, there might be additional tax benefits that interact with these passive activity loss rules. We bought a small rental in a designated opportunity zone last year and not only were we able to defer capital gains from another investment, but the way it affected our passive activity calculations was significant.

Here's another wrinkle - if any of your rental property is short-term (like Airbnb or VRBO where average stay is 7 days or less), it falls under different rules and might not qualify for the $25k special allowance at all regardless of your MAGI. Those properties are considered nonresidential and have different passive activity classifications. I learned this the hard way last year when I converted one of my long-term rentals to a vacation rental and discovered I couldn't use those losses against my other income even though I was below the MAGI threshold. Real estate tax rules are full of fun surprises!

Quick practical advice that helped me when I missed the extended deadline last year: 1. Pay as much as you can estimate RIGHT NOW through IRS Direct Pay (google it) 2. Get your documents organized ASAP even if you can't complete the return 3. File within 60 days of the missed deadline if at all possible - penalties increase substantially after that 4. If you have a clean payment history for the last 3 years, request "First Time Penalty Abatement" when you do file 5. Include a letter explaining your situation with your late return The 3-year clean compliance history was key for me - got nearly all penalties removed with a simple phone call after filing late by about 3 weeks.

Something important no one mentioned - if you're truly self-employed, don't forget about your quarterly estimated tax payments! Even while sorting out last year's taxes, make sure you're making estimated payments for 2024 if you haven't been. The Oct 15 deadline happens to fall very close to the Q3 estimated payment deadline (Sep 16 this year). Missing estimated payments creates a whole separate penalty issue (underpayment penalty) that exists regardless of extensions. Even if you get filing penalties abated, underpayment penalties for missing quarterlies typically won't be forgiven.

One thing nobody mentioned yet - check if your employer is withholding the correct amount from your paychecks. This happened to me last year - my company somehow had me listed as "exempt" from withholding for half the year! You can adjust your W-4 to have more taken out each check to cover your freelance income too. For the side gig income, you should really be making quarterly estimated tax payments. The rule is if you expect to owe more than $1,000 at tax time, you're supposed to pay quarterly or you might get hit with underpayment penalties on top of what you owe.

Don't forget to check if your state has income tax too! I had the same situation with federal taxes but then got hit with another $300 for state taxes I wasn't expecting. Does your tax software recommend any credits you might qualify for like the Earned Income Credit? Sometimes people with lower incomes can get that.