I went through one last year. They wanted to see my mileage log with dates, starting/ending odometer readings, business purpose for each trip, and total miles. They also asked for proof of my personal vehicle (registration and insurance documents) to verify I had another car for personal use. They checked my gas receipts against my reported mileage to make sure it made sense. Be SUPER detailed in your records.

Thanks for pointing this out! I hadn't considered the depreciation recapture when I eventually sell the vehicle. Is there a specific way to calculate how much depreciation I've already "taken" through the standard mileage rate for the past two years?

Yes, there's a specific calculation for this. The IRS considers a portion of the standard mileage rate to be depreciation. For 2022, it was 26 cents per mile and for 2023, it's 27 cents per mile. You'd take the total business miles you drove in each year and multiply by the depreciation portion for that year. For example, if you drove 30,000 business miles in 2022, that's 30,000 × $0.26 = $7,800 in depreciation already "taken" through the standard mileage rate. When you switch to actual expenses, you'd use this figure to reduce your depreciable basis in the vehicle. This prevents you from double-dipping on depreciation that was effectively included in your standard mileage deductions from previous years.

Did you claim any tax credits like earned income or child tax credit? Those automatically delay processing until at least mid-February because of the PATH Act.

No tax credits like that. Just a standard return with a W-2 and mortgage interest deduction. Nothing complicated! That's why it's so annoying - my husband's return is actually more complex than mine with business income and he gets his refund in like a week. Meanwhile I'm over here waiting 6+ weeks every year for my simple return. Makes zero sense.

I filed Jan 29 and still waiting lol. So much for the "file early" strategy working for everyone 😂

Thank you so much for these specific steps! I was completely lost. I just followed what you said and it worked perfectly. The software did ask me about the earnings and then calculated everything correctly. Really appreciate you taking the time to explain the exact process!

So does this mean the original $5700 contribution isn't taxed again? I'm confused about why the earnings are taxed but not the original contribution amount.

You HAVE to use your residential address on the BOI form. I tried using my business address and my application got rejected. Had to resubmit with my home address. The whole point of this law is transparency about who actually owns these companies, so they're strict about it.

Well that sucks but thanks for the info. I guess I'll have to use my home address then. Just feels like a privacy invasion when I've been so careful about keeping my home address separate from my business for so long.

For existing companies formed before January 1, 2024, you don't need to report company applicant information at all - just the beneficial owners. If your LLC was formed in 2020, you only need to report yourself as the beneficial owner, not your accountant who helped set it up. If your LLC had been formed after January 1, 2024, then yes, you would need to include your accountant as a company applicant since they filed the formation documents for you.

Thank you so much! That's a huge relief - my accountant retired and moved to Florida so I wasn't sure how I was going to get all his information for the filing.

$1500 sounds way more reasonable than what I was quoted! Did they provide written documentation of their findings that you could use if you were ever audited?

Yes, they provided a comprehensive memo documenting their research and conclusions for each state. The document included citations to specific statutes, regulations, and rulings that supported their position. They also included a matrix showing taxability by state with color coding for high/medium/low risk areas. This became our "reasonable cause" defense documentation in case of audit, which protects against penalties (though not the underlying tax if you're found to owe it).

Voluntary disclosure agreements (VDAs) can be incredibly helpful if you think you've had past exposure. Most states limit the lookback period to 3-4 years instead of their full statute of limitations, and they'll typically waive penalties. They're relatively straightforward to set up - you can even apply anonymously through a representative in most states until you have certainty about the terms. I'd suggest starting with the states where you have the most sales before they find you through audit or data mining.