Would it be better to just use a Roth IRA for this kind of real estate investing? Does UBTI still apply with Roth accounts? Trying to figure out the best structure before I get started.

UBTI rules apply equally to both Traditional and Roth IRAs - there's no advantage to either type when it comes to UBTI taxation. The difference is that with a Traditional IRA, you'll eventually pay taxes on distributions anyway, while with a Roth, you'd normally never pay taxes on qualified distributions. This makes UBTI potentially more disadvantageous in a Roth because you're paying taxes on money that would otherwise grow completely tax-free. However, if the leveraged real estate investment significantly outperforms other potential investments even after UBTI tax, it might still be worthwhile in either account type.

I used the checkbook IRA LLC structure for several years. The UBTI rules still apply exactly the same way - if there's debt-financing involved in the real estate, you'll trigger UBTI regardless of whether it's a direct IRA investment or through a checkbook LLC. The checkbook structure gives you more control over the investments but doesn't change the tax treatment. You'll still need an EIN for UBTI reporting purposes if applicable.

I had no idea this existed! How does my cousin apply for this Form 911 help? Does he need to provide specific documentation about his financial situation?

He'll need to fill out Form 911 (Request for Taxpayer Advocate Service Assistance) which asks for details about the hardship. He should be very specific about exactly how the tax situation is causing financial hardship - like documentation showing he can't pay rent, utilities, or medical expenses because of the tax payments. Supporting documentation is super important - recent bank statements, bills, income proof, anything showing the gap between income and necessary expenses. The more concrete evidence of hardship, the better his chances. He can submit the form online, by mail, or fax. Sometimes it's actually faster to reach out to his local Taxpayer Advocate office directly by phone - the form includes contact info for local offices.

This is so important! I was a 1099 worker and realized I missed like $8k in legit deductions when I finally got help from a tax pro. Lowered my tax bill significantly. Does the cousin already have an accountant or did he DIY his taxes?

I don't think I made any payments after the bankruptcy, but now I'm paranoid. Would partial payments reset the clock or only full payments? And how would I check for liens? Just call the county recorder's office?

Any payment, even a small partial payment, can reset the collection statute. It's one of the ways people accidentally revive old tax debts. The IRS sometimes even sends out collection notices on expired debts hoping you'll make a payment without realizing it restarts the clock. For liens, yes, you can check with your county recorder's office or clerk's office. Most counties now have online systems where you can search for liens by name. If you find a lien and your debt is truly beyond the collection statute, you can request a "lien withdrawal" from the IRS using Form 12277. Just be careful about contacting them if you're not 100% sure the debt is uncollectible.

Is this really true? I thought once the statute of limitations was up, they couldn't touch your money at all - including refunds. Can someone confirm if refund offset is really not subject to the 10-year rule?

You're partially right - I should have been more clear. For most federal tax debts, the refund offset ability does end when the collection statute expires. However, there are exceptions for things like child support, student loans, state tax debts, and a few other categories that can continue to offset refunds. Also, if the IRS has already applied your refund to an old tax debt before the statute expires, they don't have to give it back even if the debt becomes uncollectible later. Always best to check your tax transcripts for the specific collection statute expiration date (CSED) for each tax year you owe.

How did you handle insurance and liability issues with renting out heavy equipment? I'd be terrified someone would hurt themselves and I'd get sued into oblivion.

I purchased a specific commercial equipment insurance policy that covers rental use. It was about $1,800 annually but well worth the protection. I also created a simple LLC to own the equipment and had renters sign a detailed liability waiver that my attorney drafted. Most equipment sharing platforms also offer some basic insurance coverage as part of their service, though I wouldn't rely solely on that for heavy machinery. The key is being properly insured and having clear documentation of the equipment's condition before and after each rental.

Your accountant is partially correct but missing some nuance. Land itself is never depreciable, and certain permanent improvements to land (like grading or clearing) must be capitalized to the land basis. However, the equipment used to make those improvements is separate from the improvements themselves. If the equipment is used in a business or income-producing activity, it can typically be depreciated regardless of what you're using it for. The key distinction is between the equipment (depreciable asset) and the permanent land improvements (capitalized to land basis).

Was there a deadline to file the 8915-E form? My brother took money from his 401k during COVID but I don't think he ever filed that form. Is he in trouble with the IRS now?

Yes, there was a deadline for taking the qualified distributions - December 30, 2020. The distributions had to be reported on Form 8915-E which would have been filed with the 2020 tax return (or potentially spread over returns for 2020, 2021, and 2022 if he chose to spread the income). If he took a distribution but didn't file Form 8915-E, he may have paid the 10% early withdrawal penalty unnecessarily. He could potentially file an amended return for 2020 to claim the special treatment if he qualified. The IRS generally allows amendments within 3 years of the original filing date, so he might still have time depending on when he filed his 2020 return.

Yes, TurboTax would have created and filed the appropriate Form 8915 if you indicated you took a qualified disaster distribution from a retirement account. You can check your actual filed return - there should be a PDF copy in TurboTax that shows all forms that were submitted.