Wait, I'm confused. Are you saying the extension doesn't extend the IRA contribution deadline? Or that it does? Sorry, your wording was a bit unclear to me.

Sorry for the confusion! The extension does NOT extend the IRA contribution deadline. Even if you file an extension giving you until October to file your tax return, you still must make any IRA contributions for the previous tax year by April 15th (the original filing deadline). The filing extension only gives you more time to complete and submit your tax forms - it doesn't extend other tax deadlines like IRA contributions, estimated tax payments, etc. That's the mistake I made thinking I had until October for my IRA contribution.

You can file a federal extension for free using Form 4868 directly on the IRS website. Don't pay TurboTax for something that's free! State extensions might be different depending on where you live though.

Do you know if before/after school programs count as childcare expenses? My kids are in elementary school but I pay for after-school care until I get off work. My tax software is giving me contradictory information about whether this qualifies.

Yes, before/after school programs definitely count as qualifying childcare expenses as long as they allow you to work or look for work. The IRS is pretty clear on this - any care provided for children under 13 that enables you to work or actively search for work qualifies. The key is that the primary purpose of the program must be childcare, not education. Most standard before/after school programs fall into this category. Summer day camps can also qualify, but overnight camps don't. Make sure you get the tax ID or SSN of the provider, as you'll need to include that on Form 2441.

Thank you! This worked for me too. When I went to the form view, I saw TurboTax had somehow entered part of my childcare expenses in the wrong field. It was counting some of my expenses as "dependent care benefits" from an employer (which I don't have). Once I zeroed out that field and put everything under the actual expenses, it calculated correctly to $600. Thanks everyone for the help! Saved me from either overpaying for the "expert" review or submitting an incorrect return.

Glad it worked for you! I've found that looking at the actual forms is always the best way to catch these errors. TurboTax and similar software try to make things "easy" by hiding the forms behind their interview questions, but sometimes that just creates confusion. For anyone else with this issue, another thing to check is that your care provider information is entered correctly. If the provider's tax ID is missing or formatted incorrectly, some tax software will reduce the credit amount without clearly explaining why.

Does this step-up in basis apply even if the property is held in an LLC? My tax guy told me it might not work the same way.

The step-up in basis generally applies regardless of whether the property is in an LLC or not, as long as it's what's called a "disregarded entity" or a pass-through LLC for tax purposes. If you have a single-member LLC or a multi-member LLC that files as a partnership, the step-up should still apply. Where your tax guy might be cautious is if you have an LLC that's elected to be taxed as a corporation. In that case, the rules get more complicated and the step-up might not apply in the same way. The ownership is of the corporate shares, not directly of the real estate.

Wait but didn't you also make money on the property appreciation itself? Seems like you're only looking at one piece of the puzzle.

That's a great point about owner-manager taxation! I've had limited exposure to this through some of the trust work, but haven't seen the full picture of how it integrates with corporate planning. Is there a particular industry you think would give the best exposure to these concepts during a short secondment?

Professional services firms (doctors, lawyers, dentists) typically offer the richest learning experience for owner-manager taxation because they have more flexibility in their structures than capital-intensive businesses. They often have complex structures with holding companies, family trusts, and professional corporations all working together. Real estate is another good sector if you want to see how capital gains planning works in practice. The strategies used for property developers versus long-term holders are quite different, and you'll learn a lot about timing strategies for triggering gains or losses.

Totally agree with this distinction! I'd also add that if you're someone who likes definitive answers, tax preparation might be more satisfying. Planning work involves a lot more gray areas where you're dealing with probabilities rather than certainties.

But doesn't this mess up your book value in Quickbooks for future years? If you don't depreciate it at all in Quickbooks, won't your financial statements show an asset that should be fully depreciated?

That's a really good point about the book value. In January of the following year (2023), after you've filed your taxes, you should go back to Quickbooks and add a manual depreciation entry that matches what you took on your tax return. This way, your financial statements will reflect the proper book value going forward. Think of it as keeping two separate depreciation tracks - tax depreciation (handled in TurboTax) and book depreciation (which you'll update in Quickbooks after filing). The key is to not have any depreciation in Quickbooks during the import process to avoid duplication.

Is there any chance Congress extends the 100% bonus depreciation? I've heard rumors they might keep it at 100% to help small businesses, but haven't seen anything official.

There's always a possibility that Congress could extend the 100% bonus depreciation, but I wouldn't count on it. While there have been some discussions about extending certain business tax benefits, nothing concrete has been proposed regarding bonus depreciation specifically. The phased reduction (100% to 80% to 60%, etc.) was built into the original Tax Cuts and Jobs Act legislation with the specific intent of gradually reducing the benefit. For planning purposes, it's safer to assume the reduction will continue as scheduled unless you hear official news about an extension. If you have planned asset purchases and can move them up to qualify for the higher percentage, that's the more conservative approach.