Has anyone tried the free fillable forms directly from the IRS website for 1120-S? I'm wondering if that's a viable option to save on software costs while still getting the calculation help.

One thing I haven't seen mentioned yet - if you're mailing your 1120-S, make sure you're aware of the March 15th deadline (or September 15th if you filed an extension). The IRS considers it timely filed if it's postmarked by the deadline, not when they receive it. This is different from some other tax situations where actual receipt date matters. Also, double-check that you're using the most current forms for tax year 2024. The IRS sometimes makes small changes to forms between years, and using an outdated version can cause processing delays. You can download the latest versions directly from irs.gov to make sure you have the right ones. One last tip - if your S-Corp had any unusual transactions during the year (like asset purchases, loans, or changes in ownership), you might want to consider at least getting a consultation with a tax professional even if you prepare the return yourself. The basic 1120-S isn't too complicated for simple situations, but certain transactions can have tricky reporting requirements that aren't obvious.

Another angle worth exploring is whether your state has any "assignment of prize rights" provisions. In some jurisdictions, you can legally assign your rights to a prize before actually claiming it, which might allow your friend to step into your shoes as the original winner. This approach could potentially avoid both the double sales tax issue and some of the gift tax complications mentioned earlier. The key would be having the assignment documented properly before any title transfers occur. I'd also suggest checking if your state has a specific "winner designation" process. Some states allow contest winners to designate someone else to receive the physical prize while the original winner still reports the income. This is different from a gift or sale - it's more like you're directing where the prize should go from the start. The challenge with both of these approaches is that they're very state-specific and not all states recognize them. But given the significant tax implications you're dealing with, it's worth a quick call to your state's revenue department to ask about these options specifically. One last thought - make sure to keep detailed records of all your research and communications about this situation. If you do end up with any tax questions later, having documentation showing you tried to handle everything properly from the beginning will be valuable.

I work for a state revenue department, and I can confirm that many of the strategies mentioned here are legitimate options, though they vary significantly by state. The key is acting before any titles are transferred. For assignment of prize rights, most states that recognize this require the assignment to be documented before you officially accept the prize. You can't retroactively assign something you've already claimed. The charity would typically need to be involved since they're the ones issuing the prize. Winner designation processes are less common but do exist in some states. These usually require forms to be filed with both the prize-issuing organization and sometimes with the state revenue department within a specific timeframe. One practical tip: when you call your state revenue office, ask specifically about "prize transfers to third parties" and "assignment of contest winnings." Don't just ask about general gift or sale tax rules - the specific language matters because these situations often have special provisions that regular customer service reps might not know about. Also, be prepared that even if your state allows these arrangements, the charity might have their own policies that prevent it. Some organizations have insurance or legal restrictions that require prizes to go directly to the actual winner, regardless of what state law allows. The good news is that most states recognize this double taxation issue and have some provision to address it, even if it's not well-publicized.

Whatever you decide, make sure you keep EVERY receipt and document from the hospital translated to English. I had to do this for my mom's surgery in Colombia and the IRS flagged my return for review. I had all the docs translated and they accepted the deduction, but it was a headache.

I'm sorry to hear about your father's situation. This is definitely a complex scenario with international medical expenses. From what I understand, you're likely looking at the 10% early withdrawal penalty since your father probably won't qualify as your dependent given his residence in Guatemala. However, don't overlook some potential alternatives: 1. **401k loan option** - As mentioned by PaulineW, this could be your best bet to avoid taxes and penalties entirely. You can typically borrow up to 50% of your vested balance (max $50k) and pay yourself back with interest. 2. **HSA funds** - If you have an HSA, those funds can be used penalty-free for qualified medical expenses, even for family members in some cases. 3. **Payment plans with the hospital** - Many international hospitals will work with you on payment arrangements, which might be better than taking the immediate tax hit. For the medical expense deduction, you'd need to itemize and the expenses would need to exceed 7.5% of your AGI. Given the dependency issues with your father living abroad, I'd strongly recommend getting professional tax advice before proceeding. The documentation requirements for foreign medical expenses are also quite strict, so make sure everything is properly translated and detailed. Have you checked with your 401k plan administrator about loan options? That might give you the funds you need without the immediate tax consequences.

sometimes they do this if theres identity verification issues too. happened to my cousin last month

Had this exact same thing happen to me last year! Turns out it was because I had moved and updated my address with the IRS after filing but before they processed my refund. Even though my bank info was perfect, the address mismatch triggered their system to switch to paper check for "security reasons." If you've changed your address recently or there's any discrepancy between what's on file vs your return, that could be it. Super frustrating but at least the check should come within 6-8 weeks instead of the usual paper timeline.

Theodore raises excellent questions about the Section 199A mechanics that are crucial for your planning. Let me clarify how this works: Capital gains from property sales do count toward your adjusted gross income for QBI phase-out calculations, so yes, a large gain could potentially push you above the thresholds and eliminate QBI benefits on your other S-corp business income. This is why installment sale treatment could be particularly valuable - spreading a $175k gain over 3-5 years might keep you in the QBI-eligible income ranges each year. Here's a key strategy many people miss: if your S-corp has both real estate and active business operations, you might be able to structure the sale to maximize QBI benefits on the ongoing business while managing the capital gains impact. For example, if you typically generate $100k in QBI-eligible business income annually, but a lump sum $175k capital gain pushes your total income to $275k, you'd lose the QBI deduction entirely. However, spreading that gain over multiple years via installment sale might preserve $20k annually in QBI deductions (20% of $100k), effectively reducing the real cost of the capital gains tax. The interaction gets even more complex when you consider that development expenses on your third property might generate additional QBI-eligible losses in the sale year, potentially offsetting both the capital gain AND qualifying you for larger QBI deductions on other income. This is exactly why you need a CPA who understands both S-corp taxation AND Section 199A planning. Ask potential CPAs specifically about their experience with "QBI optimization in asset sale scenarios" - if they can't immediately discuss income smoothing strategies and threshold management, keep looking.

Grace, you're absolutely right to be thinking about how all these pieces interact - it's a complex puzzle that can either save or cost you significant money depending on how it's structured. Regarding your question about development expenses and entity structure: Yes, the losses would generally need to be within the same S-corp to directly offset the capital gains for pass-through purposes. However, there's an important timing consideration here. If you accelerate development expenses into the same tax year as your property sale, those expenses could reduce the S-corp's net income that passes through to your personal return, effectively offsetting some of the capital gains impact. But here's where it gets interesting from a QBI perspective: development expenses that qualify as ordinary business deductions could actually serve a dual purpose. They offset current year income (reducing your capital gains tax burden) AND potentially set you up for better QBI treatment in future years when that developed property becomes income-producing. One strategy worth exploring is whether you can structure the development as a separate business activity within the S-corp that generates its own QBI-eligible income stream. This could help you maintain QBI benefits even in years when you're receiving installment payments from the property sale. The timing question you raised is critical. You might want to model scenarios where you accelerate development expenses versus spreading them out, considering both the immediate offset against capital gains and the long-term QBI optimization across multiple years. This kind of multi-year tax planning is exactly where a specialist CPA earns their fee - they can run projections showing you the total tax impact of different timing strategies. This really has evolved far beyond a "simple" property sale into comprehensive business tax planning territory. The potential savings from getting this right could easily justify hiring the best specialist you can find.