I took a different approach that might be worth considering - I use UltraTax CS which is definitely more expensive than Drake or ATX, but I was able to get started with their "pay-per-return" model which let me grow gradually without a huge upfront cost. Now that I'm bigger I switched to the unlimited package. The software is top notch and feels much more polished than some of the budget options.

Great question! I went through this exact transition about 4 years ago. Started with TaxSlayer Pro when I was around your client count and it served me well for the first couple seasons. The pricing was really reasonable and the client portal worked fine for basic document collection. However, as I grew past 75 clients, I ended up switching to Drake because the workflow features are much better for higher volume. The batch processing and bulk e-filing capabilities became essential when I hit busy season with 100+ returns. One thing I'd suggest is don't just look at the software cost - factor in your time savings too. Even if something costs a few hundred more per year, if it saves you 2-3 hours per week during tax season, that pays for itself quickly when you're charging $200+ per return. Also, whatever you choose, make sure it has good technical support during filing season. Nothing worse than being stuck with a software issue when you have 20 returns due the next day!

Wait I'm still confused. So if my wife and I file separately, does that mean our combined standard deduction is LESS than if we filed jointly? Like do we lose money by filing separately?

I can definitely understand the confusion! As several others have mentioned, you get the full $13,850 standard deduction each when filing separately - you don't split it. The math works out to the same total as joint filing ($27,700). But here's something I haven't seen mentioned yet: if you're considering MFS because you think it's simpler or safer, be aware that it actually makes your tax situation more complex in many cases. You'll need to coordinate with your spouse on certain decisions (like whether to itemize), and you might need to file in the same state if you live in different states. Also, one practical consideration - if you use tax software, most programs will automatically calculate both MFJ and MFS scenarios for you and show the difference. This can be really helpful to see the actual dollar impact of the credits and deductions you'd lose with MFS. Sometimes seeing those numbers side by side makes the decision much clearer than trying to figure it out from IRS publications alone.

I went through this exact thing with my consulting business last year. The UK subsidiary ended up being its own corporation that paid UK taxes, but we still had to deal with US tax implications. The most annoying part was filling out Form 5471 - it's super complicated and the penalties for doing it wrong are insane (like $10k+ per form)!

This is exactly the kind of complex international tax situation where getting professional help early can save you thousands down the road. Based on what others have shared here, it sounds like your uncle and aunt will definitely need to understand CFC rules, Form 5471 requirements, and how the US-UK tax treaty applies to their specific situation. One thing I'd add is to consider the timing of when they set up the UK subsidiary. If they're expecting losses in the first year or two (which is common with international expansion), the branch vs subsidiary decision becomes even more important for tax planning. With a branch, those UK losses might be deductible against US income immediately, while with a subsidiary they'd be trapped until the subsidiary becomes profitable. Also, make sure they understand the compliance deadlines - some of these international forms have earlier due dates than regular corporate returns, and the penalties for missing them are brutal. The IRS takes foreign reporting requirements very seriously.

I think there's some confusion in this thread. An ITIN doesn't actually "expire" the way people think. The IRS may deactivate ITINs that haven't been used on a tax return for 3 consecutive years, but that's different from expiration. If you've been using your husband's ITIN on your returns regularly, it may still be valid even if the physical card shows an "expiration" date. You should check the actual status with the IRS before assuming it's invalid.

I went through this exact situation last year and want to share what I learned after consulting with a tax professional. The key thing to understand is that you can absolutely continue using your husband's expired ITIN on your tax return when filing as Married Filing Separately. The IRS uses the ITIN primarily for identification purposes to link you as married, not for any tax calculations since you're filing separately. Here's what I recommend: 1. File as Married Filing Separately (not Head of Household, since you don't qualify without a dependent) 2. Use your husband's expired ITIN in the spouse section - this is completely acceptable 3. Don't include any of his income or claim any benefits related to him 4. Keep documentation showing you're married but living apart I was worried about the expired ITIN causing issues too, but my return processed normally with no delays. The IRS agent I spoke with confirmed that expired ITINs can still be used for identification when the non-filing spouse has no US tax obligations. The most important thing is getting your filing status right - MFS is typically the correct choice for your situation unless you have qualifying dependents that would allow Head of Household under the "considered unmarried" rules.

My accountant told me that the IRS has a first-time penalty abatement policy! If you haven't had any penalties in the past 3 tax years, you can often get the underpayment penalty waived completely. You have to specifically request this though - they don't offer it automatically. Worth a shot if this is your first time with this issue.

I went through this exact same situation last year! My income jumped from about $45k to $82k due to some freelance contracts that came in late in the year. Here's what I learned: First, don't panic - the penalty isn't as scary as it seems. For most people it ends up being a few hundred dollars, not thousands. Second, definitely look into the annualized income method that Beth mentioned. Since your big income jump happened late in the year, this could significantly reduce your penalty. The IRS basically recalculates what your quarterly payments should have been based on when you actually earned the money. Also check if you had any withholding from other sources (like a W-2 job earlier in the year, or backup withholding). The IRS treats all withholding as if it was spread evenly throughout the year, which can help reduce the underpayment for earlier quarters. One thing I wish I'd known - if your total tax liability is under $1,000 after subtracting withholding and credits, you don't owe the penalty at all. Worth double-checking your math on that. The form is intimidating but if you take it step by step, it's manageable. And paying now definitely helps stop the interest from growing, even if it doesn't eliminate the penalty completely.