The key thing everyone needs to understand is that nominee relationships must be legitimate from the start - you can't retroactively create them for tax purposes. As a newcomer here, I've been reading through all these responses and wanted to add that the IRS has specific documentation requirements for nominee situations. You need to show: 1) Legal ownership of the assets (title documents, gift records, trust agreements) 2) Who provided the funds to purchase the investments 3) Who has actual control and decision-making authority 4) A clear paper trail showing the relationship existed before any tax reporting For Emma's original question about shifting income to her brother - this won't work because you own the account and the investments. The nominee concept only applies when someone receives income that legally belongs to someone else, not when you want to reassign your own income for tax savings. If you're genuinely dealing with a situation where you received 1099 forms for income that belongs to someone else, make sure you have all the documentation ready before filing anything. The IRS takes these situations seriously and will want proof that the nominee relationship is legitimate.

As someone new to this community, I want to thank everyone for this incredibly detailed discussion! I came here with similar confusion about nominee situations after inheriting some stocks that are still titled in my late grandfather's name but generating 1099 forms to his estate. Reading through all these responses has really clarified the difference between legitimate nominee scenarios (like mine, where I'm receiving tax documents for assets that legally belong to the estate) versus trying to create artificial arrangements to shift tax liability. The documentation requirements that Kaitlyn mentioned are spot-on - I've been working with an estate attorney and we have all the probate documents, death certificates, and inheritance records that show the legitimate ownership trail. It's reassuring to know that proper documentation makes these situations straightforward to resolve with the IRS. For anyone else dealing with nominee issues, the key takeaway seems to be: if you legitimately received income that belongs to someone else, document everything thoroughly. But if you're trying to artificially reassign your own income for tax savings, that's not what nominee reporting is designed for and could get you into serious trouble. This community is a great resource for understanding these complex tax situations!

Does anyone know if TaxSlayer Pro is any good? It's way cheaper than the others mentioned and I'm on a tight budget starting out. Also wondering about liability - should I make friends/family sign something saying they're responsible for providing accurate info?

Great discussion here! As someone who went through this exact situation a few years ago, I'd add a couple things. First, definitely get that PTIN - it's free and protects you legally. Second, consider getting Enrolled Agent (EA) credentials if you plan to do this regularly. It's not required for basic prep work, but gives you more credibility and allows you to represent clients before the IRS if issues come up. For software, I started with Drake Basic and it was perfect for handling the mix of personal, rental, and small business returns you're describing. The learning curve isn't too bad coming from an accounting background. Also, don't forget to track your own expenses for this side work - software costs, continuing education, office supplies, etc. are all deductible if you're doing this as a business activity (which the IRS might consider it to be given the service trades you mentioned). One last tip: set clear boundaries early about what you will and won't do. I learned the hard way that once you help someone, they expect you to be their permanent tax person and answer questions year-round!

This is such a common confusion! I run a consulting business through my single-member LLC and went through the exact same thing last year. After 15+ years of putting my business name first, a new client's accounting department rejected my W9 and insisted on the personal name/business name format. I ended up calling my CPA to confirm, and they explained that while many vendors don't scrutinize the technical details, the IRS instructions have always been clear about this. The key thing to remember is that for tax purposes, you and your single-member LLC are essentially the same entity - that's why your personal name needs to be primary. What helped me was creating a standard W9 template with the correct format and keeping it handy for new clients. I also proactively sent updated W9s to my regular clients during the slow season to avoid any payment delays. Most didn't even notice the change, but it prevented future headaches with their accounting departments. Don't stress about the years of "incorrect" completion - as long as you were using the right EIN, the important tax reporting information was accurate.

I've been dealing with this exact same issue! I'm a freelance graphic designer with a single-member LLC and just had a major client question my W9 completion last month. Like you, I'd been putting my business name on Line 1 for over a decade with no problems. After reading through all these responses, I went back and actually read the W9 instructions carefully (something I probably should have done years ago). Sure enough, it's right there in black and white - for single-member LLCs that are disregarded entities, the owner's name goes on Line 1. What's frustrating is that so many of us have been doing this incorrectly for years without anyone saying anything! But I guess as long as we were providing the correct EIN, the actual tax reporting was working fine. I've now updated my standard W9 and sent new copies to all my regular clients. Most didn't even acknowledge the change, but it gives me peace of mind knowing I'm finally doing it correctly. The last thing any of us need is payment delays because of paperwork technicalities. Thanks to everyone who shared their experiences here - it's really helpful to know we're not alone in this confusion!

This is such a helpful thread! I'm a new single-member LLC owner (started my graphic design business 3 months ago) and was completely confused about the W9 situation. Reading through everyone's experiences has been really reassuring. I've been doing exactly what the original poster described - personal name on line 1, business name on line 2, using my SSN - but I was second-guessing myself when clients started asking questions about payment processing. It's good to know this is the correct approach. The idea of creating an educational document to send with W9 forms is genius! I'm definitely going to put together something similar. Has anyone found that getting an EIN later (even as a single-member LLC) caused any complications with existing client relationships, or is it pretty straightforward to transition mid-year if you decide to go that route? Also really appreciate the practical tips about invoice wording - small details like that can prevent so much confusion down the line.

Great thread! As someone who's been running a single-member LLC for 4 years now, I can confirm that all the advice here is solid. I wanted to add one more perspective that might help newcomers avoid some pitfalls I experienced. When I first started, I made the mistake of being inconsistent with how I presented my business information to different clients. Some got W9s with just my personal name, others got the full LLC setup, and it created a mess during tax season. The key is consistency - pick one approach (personal name + business name + SSN like you're doing) and stick with it for ALL clients. Also, I've found it helpful to have a brief conversation about payment processing during the initial client onboarding. I explain upfront that I'm a single-member LLC taxed as a sole proprietor, so payments can go to either name, but the important thing is using the correct tax ID. Most clients appreciate the transparency and it prevents awkward conversations later when they're trying to cut checks. One last tip: keep really good records of which clients paid using which name format. Even though the IRS systems can handle it, having your own documentation makes tax prep much smoother and gives you confidence if any questions come up later. A simple spreadsheet tracking client, payment method, and name used has saved me hours during tax season.

Great question about depreciation! One important thing to add - since you purchased the property in November 2024, you'll need to use the mid-month convention for your first year of depreciation. This means you can only claim 1.5 months of depreciation for 2024 (November counts as a half month, plus December). So instead of a full year's worth, you'd calculate your annual depreciation amount and multiply by 1.5/12. Also, keep detailed records of when you move out completely and convert to 100% rental use. The IRS considers this a "change in use" and you'll need to document the exact date for your depreciation calculations going forward. Take photos showing the property is ready for rental and keep records of when you start advertising or get your first tenant - this helps establish the conversion date if you're ever audited. One more tip: consider getting a professional appraisal that breaks down land vs building value. It's worth the cost for a $1.35M property to ensure you're maximizing your depreciable basis correctly.

Don't forget about the Section 199A deduction (QBI deduction) for rental real estate! Since you'll be operating a rental property business, you may qualify for up to a 20% deduction on your rental income. However, there are income limitations and the property needs to qualify as a "trade or business" rather than just passive investment activity. To qualify, you'll generally need to spend at least 250 hours per year on rental activities (advertising, maintenance, tenant screening, etc.) and keep detailed records of your time. Given that you're doing renovations and actively managing the property conversion, you're likely already meeting the activity requirements. Also, since you mentioned this is a high-value property in a presumably good area, consider whether you'll hit the income phase-out limits for the QBI deduction. The deduction starts phasing out at $191,950 for single filers in 2024. If your total income is above this threshold, the deduction calculation becomes more complex but could still provide significant tax savings. This deduction can be substantial - on $50k of rental income, it could save you up to $10k annually in taxes if you qualify fully. Definitely worth discussing with a tax professional alongside your depreciation strategy!