Yes, this was for purchasing my primary residence, and the points were standard in my area (about 1% of the loan amount). The mortgage broker confirmed this was typical for getting a rate reduction. Anything else I should be concerned about for deducting them in full this year?

Sounds like you're good to go then! The other requirements are that the points must be computed as a percentage of the loan principal, shown clearly as points on your settlement statement, and paid directly by you rather than included in the loan amount. Since you paid part and the seller paid part, but they're clearly identified as points on your closing statement, you meet all the criteria for immediate deduction. Just keep good records of the transaction, especially documenting that the $6,000 seller credit was specifically applied to points rather than other closing costs.

In TurboTax, you need to go to the "Deductions & Credits" section, then "I'll choose what I work on," then "Mortgage Interest and Refinancing." After entering your 1098 info, there should be a question about whether you paid additional mortgage expenses not shown on Form 1098. Select "Yes" and you'll get a screen where you can enter the additional points amount.

10 Do you need to use certified mail? I'm worried about my return getting lost.

8 Yes, absolutely use certified mail with return receipt requested. It costs a bit more at the post office, but you'll get proof of delivery that the IRS received your return. This is crucial if there's ever any question about whether you filed on time. I also recommend making a complete photocopy of everything you're sending before you mail it, including W-2s and other documents. Store these copies somewhere safe in case you need to reference them later or if the IRS claims something was missing.

6 Tax pros have the same October 16th deadline for individual returns. They can efile business returns and some other forms year-round, but Form 1040 (individual returns) are subject to the same cutoff date for everyone.

If you're not active-duty military, then no, moving expenses haven't been deductible since 2018 due to the Tax Cuts and Jobs Act. This suspension runs through 2025. If your tax preparer deducted moving expenses on your 2024 return and you're not active-duty military, you might want to consider filing an amended return to correct this. It's better to fix it before the IRS notices, as penalties and interest can add up.

Section 195 doesn't cover moving expenses though, right? I thought it was more for things like market research, analyzing potential locations, legal fees for setting up the business structure, etc.

Did you have to pay back the tax benefits when you got audited? I'm worried about having to repay deductions years later plus penalties if something goes wrong.

I didn't have to pay back the deductions since the investment was structured legally, but I did have to pay for a specialized tax attorney ($8,500) to help defend the deductions during the audit. The IRS scrutinizes these investments closely. The bigger issue was that the project produced almost no oil after the first year, so my "investment" was basically worthless while the promoters walked away with their fees. The tax savings were real but not worth the stress and overall financial loss. If I had just invested that money normally and paid my taxes, I'd have been much better off. Don't let tax avoidance drive your investment decisions - it's usually a recipe for disaster.

I tried using TurboTax for my oil & gas partnership last year and it was a disaster. The software isn't designed to handle these specialized deductions properly. Had to hire an accountant anyway who told me I would have done it completely wrong. These investments require specialized tax knowledge - don't try to DIY it.

I use a 60/40 split (60% salary, 40% distribution) for my consulting S-corp based on what my CPA recommended. But I've heard of people going as low as 30% salary in some industries. It really depends on your specific business and what comparable employees make.

Is this really true? I've never heard of S-corp owners being subject to minimum wage laws. Wouldn't that defeat the purpose of being able to set a "reasonable" salary?

You're right that there's some confusion about this. The IRS's "reasonable compensation" standard is separate from minimum wage laws. However, as an employee of your corporation (even as the owner), you're still theoretically subject to FLSA minimum wage requirements. In practice, this rarely becomes an issue unless someone files a complaint. The bigger concern is that a very low salary compared to hours worked could trigger IRS scrutiny about whether your compensation is "reasonable." It's another data point they might use to challenge your salary if it's unusually low for your industry and workload.