One thing I haven't seen mentioned yet is the importance of keeping your LLC's investment activities clearly documented and separate from any personal trading you might do. Even though both end up on your personal Schedule D for a disregarded entity, you'll want to maintain clear records showing which transactions were made through the LLC versus any personal accounts. This becomes especially important if you have both LLC and personal investment accounts with the same brokerage. I'd recommend using separate brokerages if possible, or at minimum keeping very detailed records that clearly identify the source of each transaction. If you ever get audited, the IRS will want to see that you maintained proper separation between your business and personal activities, even though they're taxed the same way. Also, since you mentioned your accountant disappeared, you might want to consider finding a new CPA before next year's tax season starts. Having professional guidance becomes even more valuable as your LLC grows or if you start generating more complex investment income. The peace of mind is worth the cost, especially when dealing with business entity taxation rules that can change or have nuances you might miss filing on your own.

One additional consideration I haven't seen mentioned yet is the potential impact on your LLC's operating agreement if you're doing significant investment activity. While the tax treatment for a disregarded entity is straightforward (everything flows to your personal return), you'll want to make sure your operating agreement properly addresses investment activities if that wasn't originally contemplated when you formed the LLC. Some operating agreements are written very narrowly and might not explicitly allow for investment activities beyond the LLC's primary business purpose. If you plan to continue trading through the LLC, it's worth having an attorney review your operating agreement to ensure it gives you the authority to engage in investment activities and that any liability protections you're seeking are properly structured. Also, depending on the volume and frequency of your trading, you might want to consider whether you need to register for any additional business licenses or comply with securities regulations in your state. Most casual investing doesn't trigger these requirements, but if you're doing substantial trading activity through a business entity, there could be additional compliance considerations beyond just the tax reporting we've been discussing. Better to address these structural issues now while your investment activity is relatively new rather than trying to fix them later if your trading becomes more substantial or complex!

As someone who went through this exact same confusion when I started my consulting business, I can confirm what others have said - your EIN IS your Tax ID number! They're literally the same thing with different names. One thing I wish someone had told me earlier: make sure you keep that EIN confirmation letter in a safe place (and scan a copy to the cloud). You'll need it for opening business bank accounts, and some banks are really picky about having the official IRS letter rather than just the number written on a napkin. Also, since you mentioned you're a developer starting a startup, you might want to consider whether you'll need to collect sales tax in your state for any software or services you'll be selling. That would require a separate sales tax permit in most states, but you'd still use your EIN/Tax ID for the application process. The business admin stuff definitely gets easier once you get the basics sorted out. You're already ahead of the game by getting your EIN early!

Great question! I went through this same confusion when setting up my small business last year. Yes, your EIN (Employer Identification Number) IS your Tax ID number - they're exactly the same thing, just different names for the same 9-digit identifier. You'll use this EIN/Tax ID for: - Filing your business tax returns - Opening business bank accounts - Any tax-related paperwork - If you hire employees down the road Since you mentioned you're a developer starting up, one additional tip: make sure to keep both a physical and digital copy of your EIN confirmation letter from the IRS. Banks often want to see the official letter when you open business accounts, not just the number itself. You're all set on the federal tax ID front! No need to apply for anything else from the IRS for tax identification purposes.

I went through this exact same situation last year! The key thing to remember is that Box 1 includes ALL taxable compensation, not just your regular wages. One thing that might be throwing off your calculation is bonuses or commissions that were paid throughout the year but might not be clearly visible on the final pay stub's YTD totals. Some employers show these separately or include them in ways that aren't obvious. Also, if your wife had any stock options vest, received severance pay, or got any kind of settlement when she quit, those would all be included in Box 1 even if they weren't part of her regular paycheck cycle. Have you tried calling the employer's HR department directly? Sometimes they can at least tell you the Box 1 amount over the phone even if they haven't mailed the physical W2 yet. It's worth a shot while you're waiting!

Just wanted to add another potential discrepancy source - employer-paid moving expenses! If your wife's company paid for any relocation costs during the year (even partial reimbursements), those are generally taxable income that gets added to Box 1. Also, keep in mind that some employers include the value of parking benefits or transit subsidies if they exceed the IRS monthly limits ($300/month for 2024). These fringe benefits often don't show up clearly on pay stubs but will be reflected in the final W2. Given how unresponsive this employer has been, I'd definitely recommend going the Form 4852 route if you can't get the actual W2 soon. The IRS is pretty understanding about substitute forms when employers are being difficult, and you can always file an amended return later if needed once you get the real W2.

This has been an excellent discussion with tons of practical insights! As someone who's been considering similar strategies for my own business, I want to add one more angle that might be helpful. Beyond all the tax and operational considerations mentioned, there's also the psychological aspect to consider. When your business investments are performing poorly, it can create emotional decision-making around your core operations. I've seen business owners hold onto bad investment positions longer than they should because "the business can afford the loss," or conversely, make overly conservative business decisions because their investment portfolio is down. Keeping your business focused purely on operational excellence - inventory management, product development, marketing optimization - keeps your decision-making clear and data-driven. When you're evaluating whether to launch a new product or scale PPC spend, you want those decisions based on business metrics, not influenced by whether your crypto holdings are up or down that week. The separation also makes it much easier to evaluate your true business performance. If your S-corp financials include investment gains/losses, it becomes harder to understand what's actually driving your Amazon FBA success and where you should focus your energy. Sometimes the best optimization is simplification. Focus on what you do best - growing your Amazon business - and let your personal investment strategy be a separate, well-planned activity funded by the profits from that success.

This entire discussion has been incredibly thorough and eye-opening! As a newcomer to S-corp taxation, I was initially drawn to the idea of having my business make investments directly, thinking there might be some tax advantage I was missing. After reading through everyone's real-world experiences, it's clear that the risks and complications far outweigh any potential benefits. The 25% passive income threshold for maintaining S-corp status is particularly concerning - I had no idea that limit was so restrictive or that violating it could eliminate the S-corp election entirely. The operational insights about Amazon FBA cash flow needs really hit home. The seasonal nature of the business and the need for liquid capital during scaling opportunities makes investment volatility especially problematic. Missing out on inventory purchases during competitor stockouts or Q4 ramp-up could easily cost more than any tax savings. I'm also grateful for the psychological perspective about keeping business decision-making separate from investment performance. That's not something you typically see discussed in tax planning articles, but it makes perfect sense. The consensus seems overwhelming: stick with reasonable salary + distributions for personal investing, and keep the S-corp focused on core business operations. Sometimes the straightforward approach really is the best approach, even when you're tempted to look for more complex "optimizations." Thanks to everyone who shared their experiences and expertise - this community is an amazing resource for navigating these complex decisions!

Another strategy to consider is the "grandparent loophole" if you have parents who might be willing to help. If grandparents gift money directly to the educational institution (not to you or your children), it doesn't count as reportable income for FAFSA purposes and won't affect future financial aid eligibility for your younger kids. Also, don't overlook state-specific education tax benefits. Some states offer tax deductions or credits for college expenses that can help offset the tax burden from IRA withdrawals. You might also want to check if any of your children's schools offer payment plans that could help spread the cash flow impact across multiple months rather than requiring large lump sums. One more consideration: if you do go the IRA withdrawal route, be strategic about timing. Making withdrawals in December versus January can affect which tax year the income hits, potentially helping you manage tax brackets more effectively across multiple years of college expenses.

As someone who went through a similar situation with multiple kids in college, I'd strongly recommend exploring a combination approach rather than relying solely on IRA withdrawals. Here's what worked for us: First, definitely check those employer tuition benefits - many people miss these! Also look into whether your kids' schools offer sibling discounts or multi-year payment plans that can help with cash flow. For the IRA withdrawal strategy, consider this timing approach: withdraw just enough each year to stay within your current tax bracket, then supplement with other funding sources. This prevents pushing yourself into higher tax brackets on large withdrawals. One option you didn't mention is having your kids take federal student loans for part of the costs, then you can help pay them off after graduation when your income situation might be different. The interest rates on federal loans are often reasonable, and it preserves more of your retirement funds for longer growth. Also, document everything meticulously if you do withdraw from IRAs. The IRS can be very particular about what qualifies as educational expenses, and having detailed records from day one will save you headaches later. Keep receipts for everything - tuition, required fees, books, supplies, even required technology like laptops if the school specifies them as necessary. The key is flexibility - don't put all your eggs in one funding basket. Mix and match strategies based on what works best for your tax situation each year.