Thanks for the practical advice! Do you typically include any specific language about how you handle bulk purchases? Like if we buy 5 refrigerators at $900 each for different properties, would those be expensed or capitalized under a $1000 policy?

I recommend addressing bulk purchases explicitly in your policy. For refrigerators across different properties, we typically expense them individually since they're installed at separate locations and depreciate independently. If you're buying multiple identical items for the same property (like 10 ceiling fans for one building), our policy typically states that similar items purchased in the same transaction or as part of the same project should be considered collectively against the threshold. So ten $200 ceiling fans ($2,000 total) would be capitalized despite each being under the limit since they're part of a single improvement project.

That's really helpful to know. Did the auditor give any specific guidance about what they consider reasonable for different business sizes? We've got 12 properties worth about $3.5M and currently use a $1500 limit.

The LLC never owned the property - it was rented commercial space. The property taxes I'm referring to are personal property taxes on business equipment and fixtures, not real estate taxes. Does that change anything about how I should handle this?

That actually makes your situation clearer and potentially simpler. Personal property taxes on business equipment and fixtures are definitely business expenses. Since you had a single-member LLC that was disregarded for tax purposes, you can claim these on your Schedule C even with zero income now that the business is closed. Make sure you categorize them correctly on your Schedule C as "Taxes and licenses" rather than lumping them in with other expenses. This provides clearer documentation if your return is ever questioned. The fact that these are specifically business personal property taxes strengthens your position for taking the deduction.

You're thinking of the hobby loss rules, which is different. There's no specific time limit for legitimate business expenses related to winding down a business. As long as these are actual business property taxes tied to business assets, they remain deductible until the obligation ends or the assets are disposed of.

Thanks for the clarification. I was confusing this with the rules about businesses that never make a profit. Glad to know there's no specific cutoff for winding down expenses as long as they're legitimate.

Did your status on the Where's My Refund tool update to show "sent" before you actually received the deposit? My status has been on "approved" for 5 days now with no movement.

Yes, my Where's My Refund status changed to "sent" about 24 hours before the money actually showed up in my account. From what I understand, once it shows "sent," it's basically just waiting for the banking system to process the deposit. If you've been stuck on "approved" for 5 days, that's a bit longer than typical, but not necessarily a problem. The IRS can sometimes batch process refunds on certain days of the week, so you might see movement soon. If it goes beyond 7 days at "approved" status, that might be when you want to consider checking if there's an issue.

States typically process much fewer returns than the IRS, which handles hundreds of millions. Also, the verification process for federal returns is usually more complex. Some states actually wait until your federal return is processed before they even start on your state return, so consider yourself lucky your state was faster!

That's a good point about business losses offsetting income! His business actually had a pretty good year, but there were some startup costs for new equipment. How exactly does the Qualified Business Income deduction work? Is that something we'd automatically get when filing jointly?

The QBI deduction generally gives you a deduction of up to 20% of your qualified business income, which can be significant! It's not automatic though - it has to be calculated on your return. For equipment purchases, those are usually handled through depreciation or Section 179 expensing, which allows you to deduct the full cost of qualifying equipment in the year it's purchased (up to certain limits). These deductions are available regardless of filing status, but when filing jointly, they can help reduce your combined tax liability. The benefit is that these business deductions can offset your income too, potentially putting you in a lower tax bracket together.

Filing status doesn't affect self-employment tax at all. Self-employment tax (15.3% for Social Security and Medicare) is calculated on the Schedule C profit regardless of filing status. But filing jointly might help with your overall tax situation in other ways.

I hadn't thought about the state education department! That's an excellent suggestion. Did you have to request the letter specifically or did they have some kind of standard form they provided?

I had to make a specific request for the enrollment and tuition verification letter. Most state education departments have procedures in place for closed institutions, but you need to ask for exactly what you need. When you contact them, be sure to request both enrollment verification (with specific dates) and an itemized statement of all tuition and qualified expenses paid during the tax year. Be prepared to provide proof of your son's identity and your right to access his records, like a birth certificate or his signed authorization if he's over 18.

This! 100% this! Same thing happened with my brother's trade school. The main website was gone but the separate student portal system (run by a third-party) stayed up for document access. Worth checking if they used common systems like Blackboard, Canvas, or dedicated student financial portals.