Did you claim any tax credits like the Earned Income Credit or Child Tax Credit? I've heard those always take longer to process.

I didn't claim any of those credits this year. Just standard W-2 employment income and the standard deduction. I claimed the child tax credit last year and that return definitely took longer - almost the full 21 days. So there does seem to be a clear pattern with certain credits triggering longer processing times.

Check if you claimed the Earned Income Tax Credit or Additional Child Tax Credit. By law, the IRS cannot issue refunds for returns claiming these credits before mid-February, so that might explain the delay.

Oh crap, I didn't even think about state taxes. I lived in Illinois for two of those years and New York for part of another before moving abroad. Are the processes similar for catching up on state taxes? Do I need to file state returns before federal?

The processes are similar but each state has its own forms and procedures. Illinois and New York both have relatively straightforward processes for filing past-due returns, but they'll have different forms than what you're filing federally. Both states maintain prior year forms on their tax department websites. You don't necessarily need to file state before federal - you can work on them simultaneously. However, since most state returns start with your federal AGI or taxable income, it often makes practical sense to complete your federal return first. Just be aware that both states may have their own penalties and interest for late filing, separate from the IRS penalties. New York in particular can be quite aggressive with penalties, so don't delay getting those filed once you start the process.

This! The FBAR penalties are no joke. My cousin got hit with a $10,000 penalty for a non-willful violation. If they determine it was willful, penalties can go up to $100,000 or 50% of the account balance. Definitely something to take seriously!

What's the link to that pre-qualifier tool? I can't find it on the IRS site and their search function is terrible.

Here's the link to the IRS pre-qualifier tool: https://irs.treasury.gov/oic_pre_qualifier/. It's definitely not easy to find on their site! The tool walks you through a series of questions about your financial situation to help determine if an Offer in Compromise might be right for you. It's not a guarantee, but it's a good starting point before you invest time in the full application.

Does that compliance requirement also apply to payment plans or just OICs?

Payment plans (installment agreements) also have compliance requirements, but they're typically not as strict as the 5-year requirement for an Offer in Compromise. With a payment plan, you generally need to file on time and pay on time while the agreement is in effect. If you default on a payment plan by missing payments or failing to file future returns, the IRS can terminate your agreement and may resume collection actions. They're sometimes willing to reinstate agreements if you quickly get back into compliance, but it's best not to test their patience.

14 What if I didn't officially claim the car for business use but I did use it sometimes for side gig deliveries? Do I still need to worry about this depreciation thing?

7 If you never claimed the car as a business expense on your tax returns, then you don't have to worry about depreciation recapture. The concern only applies if you took actual tax deductions for business use of the vehicle in prior years. However, if you did use it for your side gig but never claimed the deductions you were entitled to, that's a different issue - you missed out on potential tax savings in previous years, but it won't affect how you report the sale now. You'd simply use your original purchase price as your basis (minus any depreciation you actually claimed on tax returns, which in your case sounds like zero).

11 Technically, all capital gains should be reported regardless of size. But in reality, the IRS has bigger fish to fry than a $250 gain on a personal vehicle. Most people don't even report personal vehicle sales unless they're significant gains.

11 Does exclusive business use mean I can't ever let my kids do homework in there or have guests use it when they visit? What about if I occasionally take personal calls in the space? The IRS can't possibly monitor how I use every room, right?

21 The exclusive use requirement is quite strict. Your kids doing homework there, guests using the space, or taking personal calls would all technically violate the exclusive business use requirement. No, the IRS doesn't have cameras in your home, but if you're audited, they may ask detailed questions about how the space is used, request photographs, or even visit the location. They look for things like children's toys, guest beds, or other indicators of personal use. Many taxpayers have lost their entire home office deduction because they couldn't prove exclusive business use. It's not worth risking a potentially large deduction over occasional personal use, especially with a dedicated construction project specifically for business purposes.

1 I did look into renting, but where I live, commercial space is ridiculously expensive. Even a tiny office would cost me about $3,000/month. The construction is around $42,000 total, so it pays for itself pretty quickly compared to renting. Plus, I love working from home and not having to commute. The depreciation and potential recapture issues are definitely something I need to consider though. I just want to make sure I'm taking advantage of all possible tax benefits since this will be 100% business use.