This is really helpful! A lot of that money did go to developers creating new algorithms for the app. Is there a specific way I need to document these expenses to qualify for the R&D credit? And can I claim this credit as a single-member LLC?

You can absolutely claim the R&D credit as a single-member LLC, since the credit will flow through to your personal return. Documentation is crucial though - you need to track not just the expenses but also what specifically was being developed. For developer costs to qualify, you need to document what technical uncertainties they were addressing, the process of experimentation, and how it relies on hard sciences (computer science counts). Keep timesheets showing hours spent on qualified activities, project plans showing the research component, and any technical documentation describing the innovations.

Did you face any issues with the IRS questioning your business vs hobby status since you weren't profitable? I've heard they scrutinize tech startups that show losses for multiple years.

With FreeTaxUSA, you can absolutely do this! Complete both your federal and state returns in the software, but when you get to the filing stage, only select to e-file your state return. There should be an option to "file state only" somewhere in the filing process. For your federal, make sure you fill out and submit Form 4868 for the extension and pay your estimated amount owed. You can either generate this form through FreeTaxUSA or use the IRS direct pay website to make the payment, which automatically gives you the extension.

Thanks for bringing this up! Do you have any recommendations for figuring out the specific tax rules for different countries? I'm considering properties in either Portugal or Greece.

For Portugal and Greece specifically, you'll want to look into their "Golden Visa" programs if you're investing enough, as these can offer some tax advantages for foreign investors. Portugal has a decent tax treaty with the US, and they offer a Non-Habitual Resident tax regime that might benefit you. For accurate country-specific advice, I strongly recommend consulting with a tax professional who specializes in expat taxes and has specific experience with those countries. Local property taxes, transfer taxes, and income tax rules vary significantly by country and sometimes even by region within countries. In my experience, spending money on good tax advice before making an international property purchase saved me from some expensive surprises later.

I did one in 2023 and it was definitely complicated but doable. The key was using a qualified intermediary who handled all the details. The hardest part was finding suitable replacement properties within the 45-day identification period in the crazy market. You absolutely need to follow the timelines exactly - no extensions. I almost lost my tax deferral because my closing got delayed, but we pushed hard to get it done just under the wire. But remember, as others mentioned, this won't work for foreign property - has to be US to US.

That's a great suggestion about the state nonprofit association - I hadn't considered that angle. Do you know if the extension request needs to be submitted in a specific format or to a particular office at the SBA?

The extension request should be submitted through your SVOG portal account under "Correspondence." Include a detailed explanation of your efforts to secure an auditor (with dates and names of firms contacted) and specify how much additional time you need. Be sure to mention that you're specifically struggling to find auditors familiar with Title 2, Subtitle A, Chapter II, Part 200, Subpart F requirements for SVOG grants. Don't wait until the last minute to request this - submit at least 30 days before your deadline if possible. In my experience, the SBA has been reasonable about extensions when you show you're actively trying to comply.

Is that threshold based on the actual awarded amount or the amount spent? My SVOG was for $265k but I only ended up using $248k of it and returned the rest. Not sure if that changes anything regarding the Single Audit requirement.

The threshold is based on the amount expended during your fiscal year, not the amount awarded. So if you only spent $248k of your SVOG funds, you would fall under the $250k threshold and could opt for the simplified compliance audit instead of the full Single Audit requirements outlined in Title 2, Subtitle A, Chapter II, Part 200, Subpart F. Make sure you have proper documentation showing exactly how much was spent and when. This distinction has saved several venue operators a lot of time and money, so it's definitely worth confirming your exact expenditure amount!

Wait, really? My daughter also has a savings account that my parents set up that earned like $320 in interest last year. Does that complicate things even though it's a pretty small amount?

Since your daughter's interest income is only $320, you don't need to worry about the kiddie tax complications. The rules only kick in when unearned income (like interest) exceeds $2,300 for 2024. Since she's under that threshold, she can just report both the W2 income and the interest income on her own simple return. Just make sure she receives the 1099-INT from the bank for that interest income and includes it on her return along with her W2. And remember, you can still claim her as your dependent if she meets the other qualifying requirements.

This is so confusing to me. So the kid files their own W2 income, but the parent claims the education stuff? How does TaxSlayer handle this split situation?