I went through this exact same nightmare last year with my RSUs from work! What helped me was creating a spreadsheet to track everything. I listed all my vesting dates, the FMV on each date, which shares were sold to cover taxes, and which ones I sold myself. The key insight that finally clicked for me: your RSU income on your W2 already includes the value of ALL vested shares, including the ones automatically sold for taxes. So when TurboTax imports your 1099-B with $0 cost basis, it's trying to tax you again on money you already paid taxes on. Here's what I did: I went through each transaction in TurboTax after the import and manually entered the FMV from vesting date as the cost basis. For sell-to-cover transactions, this usually results in little to no capital gain since they're typically sold immediately at vesting. For shares you held and sold later, you'll have either a gain or loss based on the difference between sale price and vesting day value. It's tedious but once you get the hang of it, it goes pretty quickly. The $5k difference you're seeing between your W2/1099-B and actual cash received is probably exactly those sell-to-cover transactions.

I've been dealing with this exact same issue for the past three years with my company RSUs through E*Trade. What finally solved it for me was understanding that the problem isn't really with TurboTax - it's that E*Trade (and most brokerages) simply don't have the complete cost basis information for RSUs. Here's my step-by-step approach that works every time: 1. **Identify your vesting events first** - Go to your employer's equity portal (like Equity Edge, Shareworks, etc.) and pull up your vesting history. This shows the exact FMV on each vesting date. 2. **Match transactions to vesting dates** - Compare your 1099-B transactions with your vesting schedule. Sell-to-cover transactions almost always happen on the same day as vesting or within 1-2 days. 3. **Calculate the real cost basis** - For each transaction on your 1099-B, the cost basis should be: (FMV on vesting date) × (number of shares sold). NOT zero. 4. **Manual entry in TurboTax** - After importing, go through each transaction and update the cost basis. Don't worry about it not matching the 1099-B exactly - this is expected and correct. The key insight is that your W2 already includes tax on the full value of vested shares. The 1099-B is only supposed to capture any additional gain/loss from the time of vesting to the time of sale. Most people miss this and end up paying double tax on the vesting value. Keep all your documentation - vesting statements, pay stubs showing RSU income, and your manually adjusted TurboTax entries. This is completely legitimate and the IRS expects these corrections for RSUs.

This is such a common confusion for LLC owners! You're absolutely right to question whether quarterly payments are needed during inactive periods - they're not required if there's no income to report. However, I'd strongly recommend getting clarity on your specific situation before assuming you can skip everything. The filing requirements can vary based on how your LLC is classified for tax purposes and your state's rules. A single-member LLC has different requirements than one elected to be taxed as an S-Corp, for example. One thing that caught my attention in your post is that you mentioned you were "previously making estimated quarterly tax payments." If you had significant tax liability in prior years, you might still need to make payments to avoid underpayment penalties, even during inactive periods. The IRS has safe harbor rules that sometimes require payments based on prior year taxes. I'd suggest reviewing your previous year's tax liability and checking if you fall under any safe harbor payment requirements. Also, don't forget that even inactive LLCs often need to file annual returns to report the lack of activity - it's counterintuitive but true in many cases. Getting professional guidance for your specific situation might save you from surprises down the road!

Just want to add a perspective from someone who's been through multiple inactive periods with my consulting LLC over the past 5 years. The key thing I learned is to be very intentional about how you handle the transition to inactive status. When I first went inactive, I made the mistake of just... stopping. Didn't formally document anything, left some subscriptions running, and created a messy situation for tax filing. Now I have a proper "shutdown checklist" that includes: 1. Final client invoicing and collections 2. Canceling all recurring business expenses 3. Documenting the exact date business activity ceased 4. Making a final quarterly payment if needed 5. Notifying my accountant of the status change For your specific question about quarterly payments - you're right that you don't need them with zero income, but definitely verify you don't have safe harbor payment requirements from prior years. I got caught by this once and owed a small underpayment penalty even though my current year liability was zero. The annual filing is still required in most cases. Think of it as telling the IRS "yes, I still exist but had no activity this year" rather than leaving them guessing about your status. This is especially important if you plan to reactivate later - you want a clean paper trail showing the business was properly maintained during the inactive period. State requirements are the wild card here. Some states are very forgiving of inactive businesses, while others (looking at you, California) charge the same fees regardless of activity level. Definitely research your specific state's rules before making any decisions about dissolution vs. maintaining the LLC.

As a newcomer to this community, I've been reading through this extensive discussion and am amazed by how comprehensive everyone's responses have been. This conversation has really opened my eyes to just how complex property transfer decisions become when you're dealing with aging parents and potential long-term care needs. What I find most valuable about this thread is how it's evolved from the original question to cover so many interconnected issues that most people (myself included) wouldn't initially think about - from the step-up in basis implications to homestead exemption loss to family dynamics and documentation needs. The tools and resources mentioned throughout this discussion seem really helpful for initial research. The taxr.ai tool for personalized analysis and Claimyr for actually reaching IRS agents could save a lot of time in the information-gathering phase. But what's become crystal clear is that the state-specific nature of so many of these rules makes professional consultation essential rather than optional. I'm particularly struck by the timing pressures everyone has mentioned - the need to start the Medicaid lookback clock while also taking enough time to fully understand all implications. For those of us dealing with parents whose health is declining, this creates real urgency around decisions that could have decades-long financial consequences. Thank you to everyone who has shared their experiences and expertise. This discussion has given me a much better framework for approaching similar decisions with my own family, even though it's also made clear just how much professional guidance we'll need to navigate all these complexities successfully.

As a newcomer to this community, I've been following this incredibly thorough discussion and wanted to express my gratitude for how comprehensive and helpful everyone's responses have been. This thread has really illustrated the complexity of property transfer decisions when dealing with aging parents and potential healthcare costs. What's particularly valuable is how this conversation has revealed so many interconnected considerations that aren't immediately obvious - the step-up basis implications, Medicaid lookback periods, state-specific property tax consequences, homestead exemptions, and even the family dynamics aspects that could create long-term issues. The resources shared here seem genuinely useful for initial research. The mentions of taxr.ai for personalized analysis and Claimyr for reaching IRS representatives could save significant time during the information-gathering phase. However, what's become abundantly clear is that the state-specific nature of these rules makes professional consultation absolutely critical. I'm also dealing with similar decisions regarding my elderly mother's property, and this discussion has helped me understand both the urgency created by Medicaid planning timelines and the importance of not rushing into decisions that could have major financial consequences for decades to come. The advice about finding professionals who understand both tax planning AND Medicaid asset protection (rather than just one area) seems particularly important, as does the suggestion about having formal family meetings to document expectations before proceeding. Thank you to everyone who has shared their experiences and expertise. This has been one of the most educational discussions I've encountered on these complex family financial decisions.

This is a great discussion thread! I'm dealing with a very similar situation - I have a 4BR house where I live in one room and rent out the others (2 long-term, 1 short-term rental). One thing I'd add based on my experience is to make sure you're keeping separate bank accounts for your rental income if possible. It makes tracking so much easier when tax time comes around. I use one account for all rental income and pay all rental-related expenses from that same account. Also, don't forget about the QBI (Qualified Business Income) deduction if your rental activity qualifies as a business rather than just passive rental income. With short-term rentals especially, if you're providing substantial services (cleaning, providing linens, etc.), the IRS might consider it a business activity, which could make you eligible for the 20% QBI deduction on your rental profits. Has anyone here dealt with the QBI deduction for their mixed rental situation? I'm still trying to figure out if my activities qualify.

I've been dealing with a similar mixed-use situation for three years now, and I wanted to share a few key lessons I've learned that might help you avoid some headaches: First, create a simple room allocation chart early on and stick to it consistently across all tax years. I use a spreadsheet that shows each room's square footage, primary use, and percentage allocation. This becomes your baseline for all expense calculations and helps if you ever get audited. Second, for your Airbnb portion, track your "material participation" hours carefully. The IRS has specific tests for whether short-term rental activity qualifies as a business vs. passive investment, and this affects both your QBI eligibility and your ability to deduct losses against other income. If you spend more than 100 hours per year AND more than any other person managing the Airbnb (cleaning, guest communication, maintenance), you might qualify for more favorable tax treatment. Third, consider setting up a simple bookkeeping system now rather than trying to reconstruct everything at tax time. Even just separate folders for long-term rental receipts vs. Airbnb receipts vs. shared property expenses will save you hours later. The mixed-use property rules are definitely complex, but once you establish a consistent system, it becomes much more manageable. Good luck with your taxes!

Has anyone here actually been audited while taking this position? I've been thinking about this exact scenario but I'm terrified of an audit. My tax person says this is a "gray area" even with good documentation.

Your interpretation of the IRS publications is correct, but there are several practical considerations your CPA is likely concerned about that are worth discussing. You're right that Publication 936 specifically addresses this scenario - when mortgage proceeds exceed the $750k limit but are used for investment purposes, the excess interest can potentially be deducted as investment interest expense. The key phrase is "potentially" because of the limitations involved. First, the tracing requirement is strict. You'll need to demonstrate that the funds went directly from mortgage proceeds to investments. This typically means same-day or next-day transfers with clear documentation. I'd recommend opening a separate investment account funded solely by the mortgage proceeds to create an unambiguous paper trail. Second, investment interest deductions are limited to your net investment income for the year. This includes interest, non-qualified dividends, and short-term capital gains - but NOT long-term capital gains or qualified dividends unless you make a specific election to treat them as ordinary income (giving up the preferential tax rates). Third, your CPA's caution about Publication 550 is valid - it specifically excludes qualified home mortgage interest from investment interest treatment. However, the portion over $750k that you're allocating to investments wouldn't qualify as "qualified home mortgage interest" anyway. The election to treat debt as not secured by your home is another option, but it's an all-or-nothing choice for the entire loan, not just the excess portion. Given current interest rates and the limitations on investment income, run the numbers carefully to ensure the strategy makes economic sense beyond just the tax benefits.