Is there a specific form or documentation the IRS sends to confirm they received your extension? I'm planning to file one for the first time and want to make sure I have all the proper documentation.

The IRS doesn't typically send a confirmation specifically for Form 4868 extensions. When you e-file the extension, you'll get a confirmation from whatever system you use (IRS Free File, tax software, etc.) showing it was accepted. This acceptance confirmation is your proof. If you make a payment with your extension, you'll get a separate payment confirmation. Save both of these confirmations - the extension acceptance and the payment receipt. I recommend saving them as PDFs and also printing physical copies. If you mail your extension, definitely send it certified mail with return receipt requested so you have proof of when it was delivered.

Technically, if you're getting a refund, you don't NEED to file an extension. The penalties for late filing only apply if you owe money. However, I still recommend filing the extension for two reasons: 1. If your calculations are wrong and you end up owing even a small amount, you'll be subject to late filing penalties if you didn't file an extension. 2. Some states require you to file a state extension even if you're getting a federal refund, so filing the federal extension covers your bases.

Thanks for the explanation! That makes a lot of sense. I think I'll file the extension just to be safe, even though I'm pretty sure I'm getting a refund. Better not to risk it in case my calculations are off.

Thanks for this suggestion! She does have a visa stamp in her passport. Are you saying we could use the visa number in place of an ITIN? I had no idea that was an option. Do you just enter the visa number where the tax form asks for the spouse's SSN/ITIN?

Not exactly - I should have been more clear. You can't use the visa number on the actual tax forms in place of an ITIN/SSN. What I meant was that for certain purposes (like opening bank accounts), sometimes the visa number can be used temporarily. For tax filing, you'd still need to follow one of these approaches: 1) Get the ITIN by submitting the W-7 with your return, 2) File as "married filing separately" now and amend later when you get the ITIN, or 3) File for an extension to give yourself more time to complete the ITIN process. Sorry for any confusion!

Did you need a professional translation service for the driver's license or just a certified translator? My wife has a Japanese driver's license but I'm not sure how to get it properly translated for the IRS.

Did you find it difficult to set up QuickBooks initially? I've heard mixed things about how user-friendly it is. Also, does it handle the LLC specifics well?

QuickBooks has a bit of a learning curve at first, but it's not too bad for a basic setup. I watched a couple YouTube tutorials and got comfortable with it in about a week. The mobile app is actually pretty intuitive for day-to-day stuff like taking pictures of receipts and tracking mileage. For LLC specifics, it handles the basics well for a single-member LLC (which is taxed as a sole proprietorship by default). If you have a more complex LLC setup with multiple members or special tax elections, you might need QuickBooks Online rather than Self-Employed. The main thing is that it keeps your business finances separate and organized, which is crucial for any LLC regardless of tax treatment.

I've been using TurboTax Home & Business for my LLC for 3 years now and it's actually pretty good. It walks you through all the business deductions and asks a ton of questions to make sure you don't miss anything. Costs around $170 for federal and state filing, which is way cheaper than a preparer.

Thanks for the suggestion. We have considered that, but my property is in a really hot location that my mom has specifically wanted to invest in for years. It's also got some unique features that make it perfect for the rental strategy she wants to pursue. I'm willing to pay my capital gains tax, I just want to make sure she can get her 1031 benefits. But you're right that it might not be worth the risk if there's a chance her exchange could be invalidated.

I understand wanting a specific property type and location. One alternative approach might be for your mom to purchase a different replacement property now to complete her 1031 exchange properly. Then later (after a reasonable time period has passed), she could do another 1031 exchange from that property into yours. This would require more time and potentially more transaction costs, but it would avoid directly linking her current 1031 exchange funds to your property. You'd still owe taxes when you sell, but at least her exchange would be protected. Just make sure there's enough time and separate transactions between her current exchange and any purchase from you to avoid the step transaction doctrine.

That's actually incorrect and could get the OP in serious trouble. The related party rules absolutely apply even when only one party is doing a 1031 exchange. This is specifically addressed in Revenue Ruling 2002-83, which states that a taxpayer cannot use a qualified intermediary to acquire replacement property from a related party, even if the related party recognizes all gain in the transaction. The IRS's concern is that the exchange funds would ultimately be going to a related party, which could be used as a way to cash out while still getting exchange treatment. This is prohibited regardless of whether both parties are doing exchanges.

An IP PIN will only protect future tax returns, not previous ones that have already been filed. For the situation with your cousin's 2022 return, she needs to report the identity theft attempt immediately using Form 14039 (Identity Theft Affidavit). For protecting previous returns from fraudulent amendments, she should consider getting a Tax Account Transcript regularly to monitor for any unusual activity. The IP PIN is still worth getting to protect all future filings.

How do you get IP PINs for minors? Do they need their own IRS accounts? My kids are 8 and 10.

You request IP PINs for your dependents as part of your own IP PIN application. There's a section where you can add dependents - you'll need their Social Security numbers and dates of birth. They don't need their own IRS accounts since they're minors. I did this for my three kids last year, and it was actually pretty simple. Just make sure to keep track of all the PINs when they arrive, as each person (including each child) gets their own unique 6-digit number.