Thanks for sharing this structure! I'm curious - how do you typically handle the ongoing relationship between the for-profit entity that holds the land and the non-profit doing the regenerative work? Is there a lease arrangement, or do you set up some kind of management agreement?

We typically use a long-term management agreement that gives the non-profit the right to implement their regenerative programs while the for-profit entity maintains ownership. This agreement needs to be established before the easement is placed, as it becomes part of the baseline documentation. For funding, we usually structure it so a portion of the tax benefit received by investors flows to the non-profit through a contractual arrangement. This provides ongoing operational funding beyond just the initial land access. Be careful though - the management fees must be reasonable and market-based, or the IRS might view the entire arrangement as a disguised donation scheme rather than a legitimate business structure.

That's actually really smart. We did something similar but with sustainable timber harvesting. The key was having a qualified appraiser who understood both the development value being restricted and the remaining economic use. Made the valuation much more defensible.

Is it too late to apply for a TCC for this filing season? We need to get this 1099 out pretty soon, and I'm worried about missing deadlines.

At this point in the filing season, it's probably too late to apply for a TCC for the current year. The IRS typically takes several weeks to process TCC applications, and we're already close to the January 31 deadline for issuing 1099s. I'd recommend going with one of the third-party e-filing services for this year. They're affordable for just one form and will ensure you meet the deadline. You could apply for a TCC later this year if you expect to be filing 1099s again next year.

The threshold for issuing a 1099-MISC for rent payments is $600. So if you paid the property owner at least $600 in rent during the year, you're required to issue a 1099-MISC with the amount reported in Box 1 (Rents). This is separate from the threshold for independent contractors, which is also $600 but would be reported in Box 3 instead. Since you're paying rent to a property owner, Box 1 is the appropriate place to report it.

That's a really good point I hadn't considered. Since I'm transitioning to W-2 soon, what's the best way to make sure enough is withheld? Should I just put "0" allowances on my W-4? And how much should I set aside from my remaining 1099 income for the rest of this year?

I'd recommend using the IRS Tax Withholding Estimator on their website to calculate exactly what you need for your W-4. With your student loans and other deductions, putting "0" might withhold too much and hurt your monthly cash flow when you're already tight. For your remaining 1099 income, the general rule is to set aside about 30-35% of your gross earnings for federal, state, and self-employment taxes. Since you're in a combined income situation with your husband's W-2, it gets more complicated, but that percentage should keep you safe. Make quarterly estimated payments on those earnings to stay compliant and avoid next year's penalties.

This is actually not entirely correct. The IRS can file a Federal Tax Lien even for amounts under $25k in some circumstances. Also, while being on a payment plan itself doesn't report to credit bureaus, if you default on your payment plan, it absolutely can impact your credit indirectly through collection actions.

That's a really good point about the childcare expenses vs. child tax credit! I just checked both returns and you're absolutely right - in TurboTax I somehow entered our childcare expenses in a way that didn't qualify us for the full credit, but in the IRS system it applied correctly. That accounts for about $900 of the difference! The rest seems to be related to how the student loan interest was calculated. Thank you so much for pointing me in the right direction!

Happy to help! This is actually a really common issue. TurboTax sometimes separates the Child Tax Credit questions from the Child and Dependent Care Credit questions in a way that can be confusing. The Child Tax Credit is different from the Child and Dependent Care Credit (which is for childcare expenses specifically). To maximize both credits, you need to properly identify your child as a qualifying dependent AND correctly enter the childcare expenses. Glad you found the discrepancy!

This is great advice. I always download the actual PDF forms before submitting anything. Sometimes the software interface simplifies things too much and hides important details.

9 Is Form 8833 required for all treaty benefits? I thought there were some exceptions where you don't need to file it?

3 You're right that there are exceptions. You generally don't need Form 8833 for treaty-reduced withholding on dividends, interest, royalties, etc. Also, if you're claiming treaty benefits that provide exemptions from tax on certain types of income (like scholarships), you might not need it. But for most substantial treaty positions - especially anything related to your residency status determination, permanent establishment issues, or business profits - you absolutely need it. Better safe than sorry - if you're claiming any significant treaty benefit, I'd recommend filing the form.

10 For 401k, if your employer offers it and you're eligible based on their plan rules, you can generally contribute regardless of your tax status. However, your contribution limit would be based on your U.S. taxable compensation only.