Has anyone tried just structuring this as a gift instead of a loan? I know there are annual limits but doesn't each person get a lifetime exemption that's pretty high?

Just to add another perspective - don't forget about state tax implications too! Some states have different rules for reporting large cash transactions or loans, especially from foreign sources. In California, for example, they sometimes require additional documentation for large deposits that don't match your reported income, even if it's properly documented as a loan at the federal level. Also, since you mentioned your husband has an LLC, consider which entity should actually take the loan - personal vs business. If the LLC is buying the investment property, having the loan go directly to the LLC might simplify things, but you'll want to make sure the foreign relatives are comfortable lending to a business entity rather than individuals. The rental income and loan repayment structure could also affect your business vs personal tax situation depending on how you set it up.

One thing to keep in mind is that TurboTax's recommendation system is generally pretty solid when it comes to standard vs itemized deductions. The software runs both calculations in the background and automatically selects whichever gives you the lower tax liability (or higher refund). Since you mentioned your itemized deductions were around $15,900 last year and the 2024 standard deduction is $14,600 (single) or $29,200 (married filing jointly), there might be other factors at play. Did you have any changes in your filing status, income level, or maybe some deductions that no longer qualify? Also worth noting that some people find their itemized deductions naturally decrease over time - mortgage interest decreases as you pay down principal, and sometimes charitable giving patterns change. The "sweet spot" for itemizing has definitely shifted upward with the higher standard deduction amounts. If you want peace of mind, you can always manually override TurboTax's recommendation and force it to itemize, then compare the final tax amounts side by side. But in most cases, the software is making the mathematically correct choice for your situation.

Just want to add another perspective here - I'm a tax preparer and see this situation constantly during tax season. The switch from itemized to standard deductions has become incredibly common since the Tax Cuts and Jobs Act significantly increased the standard deduction amounts. What many people don't realize is that it's not just about the dollar amount - it's also about simplicity and audit risk. When you take the standard deduction, there's virtually no documentation required and much lower chance of IRS scrutiny since you're not claiming specific expense categories. For your situation specifically, if you were at $15,900 itemized last year and now the standard deduction is better, you're probably in that "borderline" zone where small changes in your expenses can tip the scales. This is actually a good position to be in because it gives you some control - you could potentially bunch certain deductible expenses (like charitable donations or medical expenses) into alternating years to maximize your benefit. One final tip: keep your itemized deduction records even if you take the standard deduction. You might have large medical expenses or other deductible items later in the year that could change the calculation, and you'll want those records if you need to amend your return.

You should look into filing as an S-Corp if your business continues to grow. I switched from sole proprietor to S-Corp once I was consistently making over $40K in profit, and it saved me thousands in self-employment taxes. You pay yourself a reasonable salary (which is subject to FICA taxes) and can take the rest as distributions (which aren't). There are additional costs like incorporation fees and more complex tax filings, but the tax savings can be substantial once you reach a certain income level.

Connor, based on your numbers ($6,500 in sales), you'll definitely need to file taxes if your net profit exceeds $400. The key word here is "net" - so you'll subtract all your legitimate business expenses (materials, workspace costs, etc.) from that $6,500. Here's what you'll need to do: • File Schedule C (Profit or Loss from Business) with your Form 1040 • If your net profit is over $400, also file Schedule SE for self-employment tax • Keep meticulous records of ALL business expenses - they're your friend for reducing taxable income • Consider setting up a separate business bank account to make tracking easier going forward Don't worry about not being formally registered - the IRS considers you self-employed regardless of business structure. Start gathering those receipts now and consider using accounting software like QuickBooks or even a simple spreadsheet to track everything. Better to be over-prepared than caught off guard!

I'm in almost exactly the same boat! Filed my 2020 and 2022 returns together in March, got my 2022 refund back in about 5 weeks, but I'm still waiting on my 2020 return after nearly 4 months now. I was getting really worried that something had gone wrong with my filing until I read through all these responses. It's honestly such a relief to know that so many people are experiencing these same delays with prior year returns! I had no idea the IRS processes older returns through completely different systems that are much slower and require more manual review. The Where's My Refund tool has been totally useless - just shows "processing" with no timeline or useful details. Reading everyone's experiences here makes me feel so much better about the wait. Sounds like 6+ months is pretty standard for these older returns, so I guess I need to be more patient. Thanks for posting this question - it's exactly what I needed to see to stop stressing about whether my return got lost somewhere in the system!

I'm going through the exact same thing! Filed my 2020 and 2022 returns together back in January, got my 2022 refund in early March, but I'm still waiting on my 2020 return after almost 6 months now. I was getting really anxious about it until I found this thread - it's such a relief to see so many people with identical experiences! The explanation about different processing systems makes perfect sense now. I had no idea that prior year returns require so much more manual review and go through completely separate channels. The Where's My Refund tool has been absolutely useless - just shows "processing" for months with no timeline or updates. What's really helped my peace of mind is seeing that 6+ months seems to be the standard wait time for these older returns, not an indication that something went wrong. I was convinced my return had gotten lost in the system! Thanks to everyone who shared their experiences - it's exactly what I needed to hear to stop worrying about the delay.

Regarding the 401k question - the $23,000 employee contribution limit for 2025 is shared across all your 401k accounts. But don't forget that the employer contribution portion of a Solo 401k is separate and follows different rules! As a self-employed person, you can contribute up to 25% of your net self-employment earnings as an "employer" contribution, up to a combined total limit of $69,000 for 2025 (or $76,500 if you're over 50). This can get really advantageous for high-earning 1099 contractors because you can potentially put away MUCH more for retirement than you could as just a W2 employee.

This is such a timely question! I just went through this exact transition last year and learned some hard lessons about tax planning. One thing I wish I had done earlier was run quarterly estimated tax payments once I started the 1099 work - don't wait until year-end like I did! A few practical tips from my experience: 1. Set up a separate business checking account for your 1099 income and expenses - makes tracking so much easier 2. Track ALL business expenses meticulously (home office, equipment, software subscriptions, etc.) - these can significantly reduce your net SE income 3. Consider making your Solo 401k contributions early in the year rather than waiting until tax time - gives you more flexibility with cash flow Also, since you're dealing with SSTB income as a software consultant, you might want to explore whether any of your work could potentially be classified differently. Sometimes the line between "consulting" and other types of services isn't crystal clear, and it could make a big difference for your QBI eligibility. Good luck with the transition! The tax complexity is definitely a shock at first, but the flexibility and earning potential usually make it worthwhile.