1 But if the money is going directly to my US account, would I still need to file an FBAR? I won't actually have a foreign account at all in this transaction - the buyer is wiring the money directly to my account in America.

23 You're right that if the money goes directly to your US account and you never have it in a foreign account, you wouldn't trigger FBAR requirements based on this specific transaction. However, be careful about any other foreign accounts you might have, even temporarily. For example, if you have a foreign account set up to handle any aspect of the sale closing, or if there's an escrow account in the foreign country that you have signature authority over, even briefly, that could potentially trigger FBAR requirements if the amount exceeds $10,000.

16 You might have missed something. Even without a tax treaty, you can usually claim a Foreign Tax Credit on Form 1116 for taxes paid to foreign governments on the same income. Did your tax preparer look into this? It doesn't eliminate all double taxation but should have reduced your US tax liability.

Can you explain more about this accountable plan thing? I've never heard of it but sounds like it might be useful for my situation. My LLC is taxed as an S-corp already.

An accountable plan is an arrangement that allows your business to reimburse you for business expenses without those reimbursements being counted as taxable income to you. For it to qualify, you need three key elements: a business connection for the expense, adequate accounting within a reasonable time period, and returning excess reimbursements. For vehicles specifically, you can set up a plan where your S-Corp reimburses you at the standard IRS mileage rate for documented business miles. This creates a deductible business expense for the company while providing you tax-free reimbursement. It's often more advantageous than trying to deduct lease payments directly, especially for mixed-use vehicles.

Thats what i do! way easier and no headaches about mixed use. I just keep track of business miles in an app and bill my LLC monthly. My accountant said its the cleanest way to do it for a small business owner.

Does your method work if you have hundreds of different products? I sell a ton of different items on my Etsy shop and this sounds really time-consuming to maintain.

You're right that it gets more complex with hundreds of products. I have about 65 products and it's manageable. For larger inventories, I'd recommend grouping similar products into categories with similar margin profiles. You could also look into inventory management software that integrates with Etsy. I've heard good things about Craftybase and Inventory Planner - both calculate COGS automatically and connect to sales platforms. Might be worth the investment if manual tracking is becoming too burdensome with your product volume.

That formula is correct, but the challenge is figuring out the ending inventory value when you haven't been tracking it throughout the year. You'd need to do a physical count and valuation of everything left, which can be a huge task if you have lots of products!

This is really important! When I refinanced from 4.5% to 2.75% during the pandemic, my interest payments dropped significantly. Great for monthly cash flow, but suddenly my itemized deductions fell below the standard deduction threshold. Worth checking if this applies to OP's situation.

So what happens if the checks never get cashed? Do you have to add that back as income in the next year?

If checks never get cashed, it depends on your state's abandoned property laws and how long it's been. For tax purposes, if you determine a check will never be cashed (recipient lost it, company no longer exists, etc.), you should void the check in your accounting system. For the following year, this effectively increases your cash balance. It's not technically "income" - you're just reversing the previous expense. If it's material and from a prior year, you might need to file an amended return, but for small amounts many accountants just adjust it in the current year since Schedule L is informational only for most S-Corps.

Yes, use your QuickBooks cash balance for Line 1. QB is already handling those outstanding checks correctly for cash basis accounting. When you wrote the checks in QB, it reduced your book cash balance immediately, regardless of when they clear the bank. That's why when you reconcile in QB, your starting point is the bank statement balance, and then you check off cleared checks to reach your book balance. Your QB cash balance (the book balance) is the correct amount to report on Line 1.