Did you get any kind of confirmation number or anything when they approved it? I just submitted my request and realized I forgot to ask for some kind of reference number.

This is really helpful, thanks! Is there a difference in success rates between calling vs writing a letter for the FTA request?

In my experience, calling is generally faster if you can actually get through to someone. You'll often get an immediate decision during the call. The agent can check your compliance history on the spot and approve the FTA right then. Letters take much longer due to IRS processing backlogs - sometimes 8-12 weeks or more. However, the success rate is probably about the same either way. The FTA criteria are pretty straightforward, and if you qualify, you should get approved regardless of which method you use. One advantage of writing is that you have documentation of exactly what you requested. If you call, make sure to take detailed notes of who you spoke with, when, and what they said.

Can you still report them if they sent it but to the wrong address? Technically my old employer has my wrong address because I moved and never updated them after I quit.

That's a slightly different situation. If they sent your W-2 to the last address they had on file, they've technically fulfilled their legal obligation. The responsibility to provide updated address information typically falls on the former employee. However, if you can prove you attempted to update your address with them and they ignored it, then you might have a case. But in most situations where you simply didn't notify them of your move after leaving, they're considered compliant if they sent it to your last known address.

SSA.gov will show your earnings record but it won't have current year detailed W-2 information in time for tax filing. The detailed info from W-2s typically isn't available through SSA or IRS until May or June of the following year. It's great for verifying past years though!

That's a great point I hadn't thought about! I just double checked and thankfully mine shows coverage for all 12 months for both me and my kids. But what would have happened if there was a mistake and you'd already filed? Would you have needed to amend your return?

If you'd already filed and later discovered an error on your 1095-B, you typically wouldn't need to amend your return in most cases. Since 2019, when the tax penalty for not having health insurance was reduced to $0 at the federal level, there's generally no direct tax impact. However, it's still important to get the form corrected by contacting Medicaid, as having accurate records of your health insurance coverage can be important for other reasons, including potential state requirements or if questions come up later about your coverage history.

You don't need to submit either form with your tax return. Both the 1095-B (from Medicaid) and 1095-C (from your employer's insurance) are informational forms for your records. You do need to accurately answer the health insurance coverage questions in your tax software, indicating that you had coverage all year through a combination of employer insurance and Medicaid. The forms themselves don't get submitted - they're just proof of your coverage if you're ever asked about it.

Thank you! That makes it so much clearer. I was driving myself crazy thinking I needed to enter all the policy numbers and dates from both forms. Such a relief to know I just need to indicate I had coverage all year and keep these forms in my records.

This finally makes sense! So basically I can't get both benefits on the same dollars - either the money is tax-free OR I can use it for LLC but not both. Would it be possible to split my qualified expenses? Like use $8,000 for tax-free fellowship treatment and the remaining $5,500 for the LLC calculation?

Exactly! You can absolutely split your qualified expenses to optimize your tax situation. You could allocate $8,000 of your qualified expenses to make that portion of your fellowship tax-free, and then use the remaining $5,500 toward calculating your Lifetime Learning Credit. With the LLC giving you a credit of 20% of your qualified expenses, that $5,500 would generate a $1,100 tax credit. You'd need to calculate whether this approach saves you more than making all $13,500 of your fellowship tax-free. It depends on your tax bracket, but credits are generally more valuable than exclusions from income.

I used TaxSlayer last year with a research fellowship and Lifetime Learning Credit. It worked fine but you have to be careful about how you enter the fellowship income. If you received a W-2, enter it as wages. If no W-2, you need to report it as "Other Income" and then separately indicate how much was for qualified expenses. For the LLC, make sure you're only claiming expenses that weren't already covered by tax-free scholarship/fellowship funds. TaxSlayer has a decent education credits section but doesn't always make this distinction super clear.

Thanks for bringing this up - I hadn't even considered redemption timing issues. Is there any exception if the redemption is very small compared to the total outstanding shares? For example, if they bought back 2% of shares from a departing employee?

There is a de minimis exception for redemptions, but it's very limited. The exception only applies if the total value of stock redeemed within the relevant period doesn't exceed $10,000 OR 2% of the value of all outstanding stock at the beginning of the period. So for most businesses of meaningful size, that 2% threshold is really tiny. The safest approach is to ensure no redemptions have occurred in the look-back period. If there have been redemptions, you'll need to carefully analyze whether they fall within the de minimis exception or whether there's a qualifying exception for death, disability, or divorce (there are specific carve-outs for these situations).

Yes, this is a real concern! One way around this is to establish a separate entity for your excess cash/investments. The "active business" test requires that at least 80% of assets be used in the active conduct of a qualified business. If your cash reserves are getting too large, you could dividend out excess cash to yourself and then invest personally, or create a separate investment entity that wouldn't affect your QSBS-eligible company.