7 Wait really? That's important to know since I've moved twice since 2020. Do I need to update my address with the IRS before sending the old return?

15 Yes, you should definitely update your address with the IRS before filing your old return. You can do this by completing Form 8822 (Change of Address) and mailing it in before you send your tax return. This ensures your refund check will go to the right place. If you've already sent in your return with an old address, you can still submit Form 8822 afterward, or you can call the IRS directly to update your address. The IRS will usually forward tax refund checks for up to one year if you have mail forwarding set up with USPS, but it's much better to make sure they have your current address on file.

12 Unfortunately, yes. For 2019 taxes, the deadline to claim a refund was April 18, 2023 (three years from the original due date). The IRS is very strict about this three-year rule for refunds - once that window closes, any unclaimed refund money goes to the U.S. Treasury, and you can't get it back.

Thanks for the advice! I've actually already started putting some money aside each paycheck, but probably not enough. When you say use a free filing option - are there specific ones you'd recommend for someone with just a regular W-2 job and nothing complicated?

For a simple W-2 situation, the IRS Free File program is your best option. They partner with tax software companies to provide truly free filing if your income is below a certain threshold (around $73,000). I personally used FreeTaxUSA which has a free federal option for any income level and only charges about $15 for state filing. Avoid the big companies that advertise "free" but then try to upsell you on everything. If all you have is W-2 income and standard deduction, you honestly don't need anything fancy. The IRS website has a tool to help you find legitimate free options based on your situation.

This is such important advice! Also worth knowing that if you file for an extension (Form 4868), you get until October 15 to FILE, but you still need to PAY by April 15. The extension only gives you more time to submit paperwork, not to pay what you owe.

Do all states tax capital gains? I thought some states like Florida and Texas don't have income tax, so would they still tax capital gains from property sales?

You're absolutely right - states without income tax generally don't tax capital gains either. Florida, Texas, Wyoming, Nevada, South Dakota, Washington, Alaska, and New Hampshire don't have state income taxes, so you wouldn't pay state-level capital gains taxes in those locations. However, even in those states, you still need to pay the federal capital gains tax. And some states have other property-related taxes or transfer taxes when selling real estate that could still impact your total tax burden.

Are routine maintenance costs considered capital improvements? Like, if I replaced the water heater or fixed a leaky roof, does that count? Or only major renovations?

That's a good point I hadn't considered. How much does it typically cost to set up an LLC? And does it make taxes more complicated?

The cost varies by state - I'm in Ohio and paid about $99 for the filing fee. Some states are cheaper, some more expensive (California is like $800/year!). You'll also need to file an annual report in most states which usually costs $25-50. For taxes, it's actually not more complicated if you're a single-member LLC. The IRS treats it as a "disregarded entity" by default, meaning you still just file Schedule C with your personal return. No separate tax return needed. You get the liability protection without the tax complexity. Just make sure you keep business funds separate from personal (get a business checking account), and maintain good records. The separation helps reinforce the liability protection. Worth every penny for the peace of mind, especially when you're making products people use in their daily lives.

This is a really important distinction. The CTR is filed by banks for cash OR monetary instruments over $10k. But the bank handles this, not you, and it's completely routine. As long as you're depositing legitimate income and reporting it on your taxes, there's absolutely nothing to worry about. The only time people get in trouble is when they deliberately try to avoid these reports by making multiple smaller deposits. Don't do that and you're fine!

Do you think it's worth hiring a CPA who specializes in real estate for the first year at least? I'm concerned I'll mess this up, and it seems like getting it right from the start would be easier than fixing it later.

Absolutely worth hiring a real estate specialized CPA at least for the first year. They'll set up your depreciation schedules correctly from the beginning, which makes future years much easier. The upfront cost of a good CPA is nothing compared to the potential headache of incorrectly calculated depreciation that might need to be fixed through amended returns. Plus, a real estate CPA will know about deductions and strategies you might miss on your own. My biggest regret was trying to DIY my rental taxes for the first few years - I missed several legitimate deductions and had to go back and amend returns once I finally got professional help.

Yes, what you're referring to is a cost segregation study, which is essentially a more detailed version of what we're discussing. A professional cost segregation study identifies many building components that can be depreciated over 5, 7, or 15 years instead of 27.5 years. This might include electrical systems, plumbing, specialized flooring, cabinetry, and many other components. The benefit is accelerated depreciation deductions, meaning larger tax savings in the early years. However, a formal cost segregation study typically makes financial sense only for properties valued at $500,000+ because of the cost to have it professionally done. For smaller properties, you can still segregate obvious components (like appliances and land improvements) without a formal study, but you won't be able to get as detailed with building components.