I completely understand your frustration - it's painful watching so much of your overtime disappear to withholding! But definitely don't claim exempt since you clearly have tax liability with $19K already withheld. Here's what I'd suggest: Check your 2023 tax return (Form 1040, line 24) for your total tax liability. If your $19K withholding already exceeds that amount, you're protected by the safe harbor rule and can significantly reduce withholding without penalties. The key is properly adjusting your W-4 rather than going exempt. Use Step 4(b) to enter additional deductions - this reduces your withholding per paycheck. The math is tricky with the new W-4, but you can often cut withholding by 50-70% while still having some taxes taken out. I did something similar last year and kept an extra $800 from my December checks while still getting a small refund. Much better than waiting until February for that money! Just make sure you're still withholding something reasonable rather than going completely exempt. And consider using a withholding calculator to get the numbers right - better to be precise than guess and potentially create issues later. You've got legitimate options here without taking the risky exempt route!

I was in almost this exact situation a few years ago and totally understand the frustration! Watching that overtime money disappear to taxes is genuinely painful, especially when you need the cash for the holidays. Here's what worked for me: I calculated my safe harbor threshold using last year's tax return (line 24 shows your total tax liability). Since I'd already exceeded that amount in withholdings, I could safely reduce my withholding significantly without penalty risk. Instead of going exempt, I submitted a new W-4 with a large deduction amount in Step 4(b). This reduced my withholding by about 60% for my final paychecks while still having some taxes taken out. The key is that you're not claiming zero tax liability (which exempt means) - you're just adjusting to a more accurate withholding amount. I ended up keeping an extra $900 from my last three December paychecks and still got a small refund when I filed. Way better than giving the government an interest-free loan until February! Just make sure you run the numbers first - either through the IRS calculator or one of the tools others mentioned. And definitely keep some withholding happening rather than going completely exempt, even if you're technically safe. Better to be conservative and avoid any potential scrutiny while still getting most of your overtime pay!

Just to add some clarity on the payment methods - you're absolutely right that you can split your payment multiple ways! I did exactly this last year with a $6,200 tax bill. I used two different credit cards ($2,000 each through different processors to stay under the limit per processor), then paid the remaining $2,200 via Direct Pay from my checking account. The key things to remember: 1) Each payment processor has its own 2-card limit, so you can technically use up to 6 credit cards if you go through all three processors, 2) Direct Pay/bank transfers have no fees, and 3) You can spread the payments out over time as long as everything is received by the due date. One tip - I spaced my payments about 3-4 days apart just to make sure each one processed cleanly in their system. All showed up correctly on my account transcript. The credit card processing fees (around 1.87-2.5% depending on the processor) did eat into my rewards a bit, but it was still worth it for the cash flow management and keeping my individual card balances reasonable.

Great question about timing! Yes, you definitely want to start early enough to account for processing delays. Credit card payments through the approved processors typically process within 1-2 business days, but Direct Pay from your bank account can take 3-5 business days to fully clear and post to your IRS account. I'd recommend starting your payment sequence at least 7-10 days before the April 15th deadline, especially if you're using multiple methods. This gives you a buffer in case any payment gets delayed or needs to be resubmitted. And yes, you'll get a separate confirmation number for each individual payment - whether it's through a credit card processor or Direct Pay. I kept a spreadsheet with the payment amount, method, date submitted, and confirmation number for each one. You can also check your IRS online account or call the automated payment line to verify that all payments posted correctly. One more tip: if you're using multiple credit card payments, make sure you have enough available credit on each card before you start the sequence. Nothing worse than having a payment declined halfway through your plan!

Quick question - does anyone know if the 6% excise tax on excess contributions continues to apply each year until you withdraw the excess? I just discovered I've had an excess HSA contribution sitting there for 2 years!

I went through this exact same situation last year with a $2,000 HSA overcontribution that I kept in cash. The IRS guidance is actually pretty clear on this - you only need to calculate earnings on what the excess contribution actually earned, not use the complex formula when the funds were segregated. Since your $1,650 was sitting in cash at 0.01%, your earnings calculation is straightforward: $1,650 × 0.0001 = about $0.17 for the year (assuming it was there the full year). That's the amount you'd need to withdraw along with the $1,650 excess. The complex formula everyone mentions is only required when excess contributions are commingled with investments and you can't directly trace the specific earnings. Since you kept yours separate in cash, you're in the clear with the simple calculation. Make sure to request a "return of excess contributions" from your HSA provider (not a regular distribution) and complete Form 5329 to report any excise tax owed for the time the excess remained in your account. Better to fix it now than let that 6% annual excise tax keep accumulating!

Your state filing requirements might be more urgent than the federal stuff tbh. What state are you in? Many states require you to file an amendment to your Articles of Organization within 30-90 days of an ownership change. Missing these deadlines can result in administrative dissolution of your LLC in some states.

Great thread everyone! As someone who went through a similar LLC partner buyout situation last year, I wanted to add a few practical tips that helped me navigate the process: First, don't underestimate the importance of getting your partnership agreement updated ASAP to reflect the new ownership percentages. This document will be crucial for your tax filings and any future business decisions. Second, consider whether you want to make the Section 754 election that was mentioned earlier. In our case, we consulted with a CPA who ran the numbers and showed us it would save about $3,000 annually in taxes due to higher depreciation deductions. The election has to be made with your return for the year of the buyout, so you can't go back and do it later. Finally, make sure you're clear on how to handle the departing partner's guaranteed payments (if any) and their share of partnership liabilities. These details can get messy if not properly documented during the buyout process. One more thing - keep detailed records of all payments made to the departing partner. The IRS may want to see proof that the payments were properly characterized (capital distribution vs. payment for services, etc.). This becomes especially important if the amounts are significant. Good luck with your filing! The partnership tax rules are complex but definitely manageable with proper planning.

Quick warning from someone who's been audited over this exact issue - if your equipment rental income is substantial compared to your service income, the IRS might challenge whether it's genuinely "rental" or just part of your service business. For example, if you charge $500 for your services and $2000 for equipment on the same job, that might raise flags. If you're regularly in the business of renting equipment (even to people who don't hire your services), that strengthens your position. Make sure you have documentation showing fair market value for your equipment rentals. Having rate sheets showing standard pricing helps. Also document maintenance costs, depreciation, and other expenses associated with the equipment ownership separately from your service business expenses.

This is such a common issue in our industry! I'm a lighting technician who also rents out my LED panels and control boards. I've been dealing with the same frustrating situation where some companies just don't want to be bothered with issuing separate forms. One thing that's helped me is creating a simple template email I send to accounting departments right after completing a job. I include the invoice breakdown and explicitly request they issue separate forms - one 1099-NEC for my technical services and one 1099-MISC for equipment rental. I send this within a week of the job while it's still fresh in their system. I also started requiring a deposit specifically for equipment rental at booking, which creates a clearer paper trail showing the rental component is separate from services. This has made it much easier when I need to demonstrate to the IRS that these are truly distinct income streams. The tax savings really do add up - last year I saved about $2,800 in self-employment taxes by properly categorizing my rental income. It's definitely worth the extra effort to get this right!