This is a really good point. My brother ignored the state notice after resolving the federal one and ended up with state penalties that were worse than the federal ones.

That's really helpful, thanks! If I tell them I'm waiting on more documentation, do you know approximately how much extra time they typically give?

In my experience, they usually give an additional 30 days if you ask for an extension and explain why. Be very specific about what documents you're waiting for and when you expect to receive them. I included a line in my response letter that said "I am awaiting final documentation from XYZ Casino which they have confirmed will be sent by [specific date]. I respectfully request an extension until [date + 1 week] to provide this final documentation." They approved my extension request without any issues. The key is being specific rather than vague about what you're waiting for and when it will arrive.

How much did TaxAct charge for each prior year? And did you have any issues with the 2017 filing from the accountant?

TaxAct charged around $60-70 per year for their business editions when I used them, though prices may have changed. I found it reasonable considering the alternatives. For the 2017 return, the accountant charged me $350, which was actually less than I expected. There weren't any issues with the filing itself, but they discovered I had been calculating depreciation incorrectly on some equipment, which affected the subsequent years. This meant I had to make some adjustments to my 2018-2020 returns as well. If you have depreciating assets, make sure you're tracking them consistently across all tax years - that's something the software won't necessarily flag for you.

UltraTax is professional-grade software used mostly by accounting firms, not really meant for individuals. For DIY, stick with TaxAct, TaxSlayer or H&R Block's prior year versions as others suggested. Much more user-friendly and way cheaper.

Can you explain more about the mega backdoor Roth through an S corp? My accountant mentioned this but didn't explain how it actually works with the S corp structure specifically.

Sure thing. The key is setting up your Solo 401k plan with the right provisions. Your plan needs to specifically allow for both after-tax contributions (beyond the normal $22,500 employee limit) and in-plan Roth conversions. With an S corp, you wear two hats - employee and employer. As employee, you contribute up to the standard limit ($22,500 for 2023, plus catch-up if over 50). As employer, your S corp can contribute up to 25% of your W-2 wages. Then, if your plan allows it, you can make additional after-tax contributions up to the total annual limit ($66,000 for 2023 combining all sources), then immediately convert those after-tax dollars to Roth. This gives you way more Roth conversion potential than just the standard backdoor Roth IRA.

Does your S corp pay for these directly, or do you pay personally and get reimbursed? I've heard conflicting advice on the best approach.

Wait, I'm confused. The previous comments said to use (what I paid + the discount) as my cost basis. But you're saying to use just the fair market value on purchase date. Aren't those the same thing? Or am I missing something?

You're right to be confused - I didn't explain that clearly. Let me clarify: The fair market value (FMV) on purchase date and (what you paid + discount) should mathematically be the same number. For example, if the FMV was $100 per share, and you got a 15% discount, you paid $85 per share. Your cost basis should be $100 ($85 you paid + $15 discount that's already included in your W-2). Both methods get you to the same place - I just find it easier to think of it as using the FMV as basis since that's usually clearly stated on the supplemental tax form from employers. The key is making sure you're not double-taxed on the discount amount.

I tried that feature but it doesn't handle ESPP adjustments correctly. It imports the basis exactly as reported on the 1099-B, which for ESPPs is usually wrong since it doesn't account for the discount reported on your W-2. I ended up having to manually adjust each one anyway.

7 Does VITA actually help with learning business tax prep though? I thought they only do basic 1040s and don't handle Schedule C filers?

20 You're right that VITA primarily focuses on basic returns, though some sites do handle simple Schedule C returns with limitations on income amounts and deductions. It won't give you comprehensive business tax experience, but it does provide excellent training in the fundamentals and client interaction skills. For business tax experience specifically, you might consider trying to work part-time at a local CPA firm during tax season. Many firms hire seasonal preparers and will train you on their procedures. Another option is finding a mentor through your local chapter of the National Association of Tax Professionals (NATP) or the Texas Society of Enrolled Agents.

13 I started out charging by form and it was a DISASTER. Clients hated the uncertainty and I had to have awkward conversations when additional forms were needed. Now I do tiered flat fees based on return complexity (basic W-2 only, itemized deductions, Schedule C, etc) and both me and my clients are much happier.