As a tax professional, I want to emphasize a few additional points that could be crucial for your situation. First, make sure you're prepared for potential IRS questions about the fair market value of the timber. Since you received $3,100 from the mill, that establishes the fair market value, but if you're claiming any basis in the trees, you may need to substantiate that the timber was worth more than $3,100 before the pest damage. Second, consider keeping detailed records of the spotted lanternfly infestation in your area - photos, local government notices, extension service bulletins, etc. This creates a paper trail showing that your decision was based on legitimate environmental threats rather than market timing. Finally, since multiple neighbors participated, there might be economies of scale that affected the pricing. Make sure your individual allocation of both costs and proceeds is clearly documented and defensible. The IRS sometimes scrutinizes transactions involving multiple parties to ensure each person is reporting their fair share. One practical tip: if you're using tax software, you might need to manually override some entries since timber sales from personal property are relatively uncommon and the software might not handle all the nuances correctly. Consider having a tax professional review your return if the amounts are significant enough to warrant the expense.

This is such a helpful discussion! I'm new to this community but dealing with a similar situation with emerald ash borer damage to trees on my property. Reading through all these responses has been incredibly informative. I wanted to add one point that might be relevant for others in similar situations - if you're working with a logging company or sawmill, try to get everything in writing upfront about how proceeds will be calculated and what costs will be deducted. In my case, I assumed I'd get paid based on the full market value of the logs, but there were several fees I wasn't aware of (scaling costs, transportation, mill processing fees) that came out of my payment. Having that breakdown documented beforehand would have helped me better estimate the tax implications and ensure I was accounting for all the legitimate business expenses that could offset my capital gains. Also, for anyone considering this type of proactive tree removal due to pest issues, I'd recommend getting multiple quotes if possible. The pricing can vary significantly between different logging operations, and having documentation of the market rate helps support that you received fair market value for tax reporting purposes. Thanks to everyone who shared their experiences and expertise - this thread is going to be really valuable for my tax preparation!

I keep hearing everyone talk about ROC, but my ET K-1 last year had like 6 different categories of income! Part was ordinary business income, part was ROC, part was interest, and there were some others. Do I need to track all of these separately??

Great question! I went through this exact same confusion when I started investing in MLPs. Here's what I learned after making some mistakes my first year: When you reinvest MLP distributions, you're essentially doing two separate transactions: 1. **Receiving the distribution**: This reduces your cost basis by the ROC portion (say 25¢ out of your 30¢ distribution) 2. **Reinvesting**: You're buying new units at current market price with that 30¢ So your original shares have their cost basis reduced by 25¢, but you now own additional shares with a cost basis of 30¢ (whatever the market price was when you reinvested). The key is tracking each "lot" of shares separately. Your original purchase is one lot, each reinvestment creates a new lot. This becomes really important when you eventually sell, because you can choose which lots to sell first for tax optimization. I highly recommend setting up a spreadsheet or using portfolio tracking software that can handle multiple lots. Don't try to average everything together - the IRS wants you to track each purchase separately. Also, make sure to save every K-1 form you receive, as you'll need the historical data to calculate your adjusted basis when you sell. One more tip: consider whether you really want to reinvest automatically. Some people prefer to take the cash distributions and manually reinvest to have better control over timing and record-keeping.

As a newcomer to this community, I just want to say how incredibly helpful this entire thread has been! I'm currently dealing with this exact same H&R Block access fee situation for a mortgage application, and I was getting so frustrated thinking I'd have to pay just to get my own tax documents. The IRS transcript solution that multiple people mentioned is brilliant - I had absolutely no idea that was even an option, let alone that mortgage lenders actually prefer it! It makes total sense that they'd want documents directly from the IRS rather than from third-party tax prep companies. I'm definitely going to try the IRS Get Transcript route first thing tomorrow morning. If my lender specifically needs the original H&R Block format for some reason, I'll head to my local office in person based on all the success stories shared here. This is exactly the kind of practical, real-world advice that makes online communities so valuable. Thanks to everyone who took the time to share their experiences and solutions - you've potentially saved me both money and a lot of stress during an already hectic mortgage process!

As a newcomer to this community, I just want to express my gratitude for all the incredibly helpful advice shared in this thread! I'm currently facing this exact same H&R Block situation - trying to access my 2023 return for a home loan application and running into their paywall. The IRS transcript solution that multiple people have mentioned is a total revelation! I had no clue this was even possible, and hearing from the mortgage lending professional that lenders actually prefer IRS transcripts makes this seem like the obvious first step rather than a workaround. I'm planning to contact my lender first thing tomorrow to confirm they'll accept an IRS transcript, then head straight to the IRS Get Transcript website. If for some reason they need the original H&R Block format, I'll definitely try the local office approach that so many people have had success with. It's honestly mind-blowing that the free, official government option is actually better than what these tax prep companies charge for. This thread has potentially saved me both money and hours of frustration - exactly why I love community forums like this for navigating these bureaucratic headaches! Thanks to everyone who shared their real-world experiences and step-by-step solutions. This is the kind of practical advice you just can't get anywhere else!

Just wanted to add - I'm a dental practice consultant, and this situation is actually pretty common. One thing to watch for: if you purchased any specialized dental equipment for the practice that you're taking to the new location, make sure you document the transfer carefully. The IRS might consider this a "sale" from one business to another, which could trigger depreciation recapture if not handled correctly. Your new business would likely need to purchase these assets at fair market value from the old business. Also, don't forget about any security deposits for office space, insurance premiums, etc. Some of these might be partially refundable, which would offset some of your losses.

I went through a similar situation when I had to dissolve my consulting LLC before it generated any revenue. One thing that really helped was keeping detailed records of everything - not just receipts, but also documentation showing the business purpose of each expense and dates when they were incurred. For the IRS filing, since you elected S-corp status, you're absolutely required to file that final 1120-S even with zero income. The IRS computer system is expecting that return based on your election. Miss it and you could face penalties. Regarding your startup expenses, the good news is that dental practice expenses from one location can generally be carried over to another dental practice since it's the same line of business. The key is proper documentation and making sure your new Colorado practice is set up to properly inherit these costs. One tip: consider whether any of your equipment purchases might qualify as assets that can be directly transferred rather than treated as startup costs. Things like dental chairs, computers, or other equipment might be handled differently for tax purposes than purely startup expenses like licensing fees.

One more thing to consider - if you make over a certain amount from your contractor work (I think it's around $1,000), you'll need to file Schedule C along with your tax return. This is where you report business income and expenses. You'll also fill out Schedule SE for self-employment tax. Start keeping track of ALL business-related expenses now if you haven't already! Mileage for business travel (not commuting), home office if applicable, portion of internet/phone, software subscriptions, office supplies, professional development, etc. These can significantly reduce your taxable income.

This thread has been incredibly helpful! As someone who just started contracting this year too, I want to add one thing that caught me off guard - make sure you're tracking your business expenses from DAY ONE, not just when tax season approaches. I learned this the hard way when I realized I had forgotten to save receipts for legitimate business expenses like software subscriptions, equipment purchases, and even parking fees for client meetings. The IRS requires documentation for deductions, so having a system in place early (even something as simple as a dedicated folder or app) can save you hundreds or thousands in missed deductions. Also, don't forget about the home office deduction if you work from home regularly and exclusively use a space for business. You can either use the simplified method ($5 per square foot up to 300 sq ft) or calculate actual expenses. Even if it's just a corner of your bedroom that you use only for work, it might qualify! One last tip: consider making estimated payments for 2025 even if you're not required to. It helps with cash flow management and prevents that massive tax bill shock next April. You can always adjust the amounts throughout the year if your income changes.