Would this also apply to stuff like laundry services at the hotel if you had to wash clothes for a video meeting? I had to do that once when a vacation got extended for work reasons.

Yes, that could potentially be deductible if it was specifically required for business purposes! The key is being able to show that the expense was ordinary and necessary for your business activities during the trip. If you needed clean business-appropriate clothes specifically for a client video meeting, you could make a good case for that being a legitimate business expense. Just make sure to keep the receipt and note which meeting it was for and why it was necessary.

Is that actually true? I've never heard of the distance affecting deductibility before. I thought it was just about the primary purpose of the trip.

That's a huge relief! So just to be 100% clear - as long as I file by May 17, 2024, I'll get my full refund amount for tax year 2020 with no penalties at all? Even though I'm super late?

That's exactly right! If you're DUE a refund, the IRS doesn't penalize you for filing late. They only assess penalties and interest when you OWE them money. Just make sure you get it postmarked by May 17, 2024, and you'll receive your full refund amount. The only downside to filing late is that you've essentially given the government an interest-free loan of your refund money for the past few years.

I used FreeTaxUSA for my 2019 return last year when I was in a similar situation. They charge like $15 for state returns but federal is free. Their interface for prior years is identical to current years and super straightforward. Printed everything, mailed it in, and got my refund about 8 weeks later. Definitely recommend for older returns.

Thanks for mentioning this! You're right - there were actually a few extra pages that came with the K-1 that I ignored because they looked like gibberish to me. Just checked and they do have some explanations about the passive activity stuff. Would you recommend I still get professional help or is this something I can handle with tax software if I'm careful?

For a relatively simple K-1 showing only $3,800 in income, you can probably handle it with good tax software if you're careful. Since this is your first K-1, learning how to report it properly now will help you in future years. If the investment becomes more complex or involves much larger amounts, then professional help would be worthwhile. Just make sure you keep copies of all K-1s and supplemental information, as you'll need them if you ever sell your interest in the partnership to calculate your basis.

This is so important! I learned this the hard way too. Also worth noting that some states require estimated payments even if federal doesn't. My state has a much lower threshold for when you need to start making estimated payments.

That's a really good point I hadn't considered. So even though some of the partnership income was earned in 2023, I'm reporting all of it on my 2024 personal return because the partnership's fiscal year ended within my 2024 tax year? Does this create any issues if I also have to file foreign bank account reports (FBARs) or Form 8938? Do those forms follow the same rules?

Yes, that's exactly right. All of the partnership income from their complete fiscal year (June 2023-May 2024) goes on your 2024 personal return. That's just how partnership taxation works. For FBARs and Form 8938, those follow different rules. Those forms are based on the calendar year reporting and the maximum value of accounts during that calendar year. So your FBAR and 8938 for 2024 would cover January 1 to December 31, 2024, regardless of any partnership fiscal years.

The Taxpayer Advocate Service is really only for when you have an actual tax problem that hasn't been resolved through normal IRS channels. They probably won't help with just form questions unless you've already filed incorrectly and are having issues. Your best bet for form questions is either the regular IRS help line (if you can get through) or a qualified tax professional who specializes in international taxation.

Would you recommend mailing it certified so I have proof they received it? I've had stuff "lost" by the IRS before.

Absolutely use certified mail with return receipt. That gives you proof of when it was received and by whom. Keep a complete copy of everything you send (EVERYTHING) including the certified mail receipt. Also good practice to follow up by phone about 30 days after sending to confirm it's been received and assigned to someone. Ask for the status and document who you speak with. If you get nowhere with that call, wait 2 weeks and try again.

I did it in 2022 and got approved! The key is showing that you've been consistently treating the business as an S-corp in all your filings and operations. In my case I had filed corporate returns, taken reasonable salary, etc. They approved it retroactively even though I was like 18 months late with the election.