Don't forget about business insurance! As a contractor myself, I discovered that general liability insurance, equipment insurance, and even health insurance premiums can potentially be deducted. This saved me thousands last year. For your husband specifically in construction, he might also be able to deduct: - Professional association dues - Subscriptions to trade publications - Work gloves, boots, and specialized clothing - Temporary job site rentals (like portable toilets) - Permits and inspection fees - Subcontractor payments (if he hires help) One thing I learned the hard way: keep METICULOUS records with dates, amounts, and business purpose for everything. Take photos of receipts before they fade. The IRS loves documentation from contractors.

Has anyone used TurboTax Self-Employed for this? I'm in a similar situation and wondering if it's worth the extra cost compared to the regular version.

Anyone else planning to amend previous returns in light of this Limited Partner Self Employment exemption ruling? My accountant says we should go back and amend the last three years, but I'm worried that would just trigger an audit.

For anyone wondering about the Limited Partner Self Employment exemption ruling, I consulted with a former IRS attorney yesterday. He believes the ruling will likely stand on appeal because it's based on a functional interpretation of the statute rather than adding new requirements. His take is that anyone who was truly a passive investor with no management role might still have grounds to exclude income from SE tax. The real targets are active participants using the LP structure primarily as a tax strategy despite material participation in the business. He suggested documenting your lack of involvement if you want to maintain the exemption - meeting minutes showing you don't participate in management decisions, time logs showing minimal hours, etc.

Just want to add something important that nobody's mentioned yet - if you're filing a prior year return AND you owe money, you should file ASAP to minimize penalties and interest! The failure-to-file penalty is usually 5% of unpaid taxes for each month your return is late (up to 25%), while the failure-to-pay penalty is much smaller at 0.5% per month. Also, check if you qualify for "first-time penalty abatement" - if you haven't had any penalties in the prior 3 years, the IRS might waive your late-filing penalties. I saved over $400 this way!

Dont forget that if youre getting a REFUND for your 2023 taxes, you have until April 15, 2027 to file and still get your money back!! But if you OWE money, your already accumulating penalties and interest. The IRS doesn't care about unfiled returns that owe them $0 or that they owe YOU money for.

To answer your original question simply: Your traditional IRA basis would be $0 because you've moved everything to the Roth through conversions. But you absolutely must file Form 8606 each year to track those nondeductible contributions and conversions. TurboTax should ask if you made contributions to an IRA. Tell it yes, specify they were nondeductible contributions to a traditional IRA, then indicate you converted to a Roth. TurboTax will generate the proper 8606 form if you answer all the questions accurately.

Just wanted to add that if you're doing backdoor Roth conversions regularly, be careful about the pro-rata rule if you have any other traditional IRA, SEP IRA, or SIMPLE IRA accounts with pre-tax money in them. The IRS looks at all your IRA accounts together when calculating taxes on conversions.

I worked for a CPA firm for years, and honestly, there's massive variation in knowledge between professionals. Some CPAs focus almost exclusively on basic tax preparation and don't do much strategic planning. The Augusta Rule isn't obscure in tax planning circles, but if your CPA mainly does straightforward returns rather than proactive planning, she might not have encountered it often. The real question is how she responded after you explained it. Did she: 1. Dismiss it as not applicable or too aggressive? 2. Say she'd research it further to ensure proper application? 3. Immediately embrace it without verifying requirements? Her response tells you a lot about her approach. Option 1 suggests she might be too conservative. Option 3 might indicate she's too quick to accept strategies without proper diligence. Option 2 is the balanced approach you want.

Just to offer another perspective - I'm a small business owner (S-corp) and I've gone through 3 CPAs in 5 years. Each one had different strengths and knowledge gaps, which taught me something important: you need to be proactive about your own tax situation. The best client-CPA relationships are partnerships where both parties bring something to the table. Even the most knowledgeable CPA won't know every detail of your business or every potential strategy unless you have regular, detailed conversations. I'd recommend scheduling a dedicated tax planning meeting (not during tax season) to discuss various strategies including the Augusta Rule. Come prepared with questions about other potential deductions and strategies. A good CPA will appreciate a client who takes an active interest rather than seeing it as questioning their expertise.