As someone who's dealt with this exact scenario multiple times, I can confirm that the wash sale situation with RSUs is incredibly frustrating. Here's what I've learned from experience: The key insight is that the sell-to-cover transaction happens automatically and you typically can't control which specific shares are used. Most brokers use FIFO, so if you have shares with adjusted cost basis, there's a good chance some of them were used in the sell-to-cover. What I do now is contact my broker immediately after each vesting event to get a detailed breakdown of: 1. Which shares were actually sold for tax withholding 2. The specific cost basis of those shares 3. Which of my remaining shares have wash sale adjustments This information isn't always obvious in the standard account statements, but most brokers can provide it if you ask specifically. One thing that really helped was setting up automatic alerts 35 days before each vesting date to remind myself not to sell any company stock at a loss. It's not perfect given trading window restrictions, but it's prevented most of the wash sale headaches. Also worth noting - if you're in a high tax bracket, sometimes it's actually better to just hold the RSUs long-term rather than trying to optimize around these wash sale rules. The long-term capital gains treatment can be more valuable than the short-term tax loss harvesting, especially when you factor in the time and complexity involved.

I've been through this exact situation and found that the most practical approach is to work backwards from your Form 1099-B to understand what actually happened. Your broker is required to report the wash sale adjustments, and this will show you exactly which shares had adjusted basis and whether any of those were used in the sell-to-cover transaction. In my experience with similar RSU programs, the 240 shares sold for taxes are typically processed as a separate transaction from your 360 remaining shares, but the wash sale adjustment applies to specific tax lots based on FIFO ordering (unless you've changed your default method). Here's what I'd recommend: Contact your broker's tax department and ask for a "wash sale detail report" for the transactions around your Sep 28 vesting. This will show you exactly which of your remaining shares carry the $8/share cost basis adjustment. One key thing I learned - you don't necessarily need to sell all 360 shares to claim the loss. You only need to sell the specific 250 shares (or whatever subset) that have the adjusted basis. But identifying which ones those are requires getting the detailed lot-level information from your broker. Given the complexity and your trading window restrictions, you might also want to consider whether the tax benefit is worth the administrative headache. Sometimes simplifying your approach (like holding RSUs long-term or avoiding loss harvesting near vesting dates) provides better peace of mind even if it's not perfectly tax-optimized.

6 What about payment processing? I'm starting a similar business and trying to decide between Square, PayPal, and traditional merchant services through my bank. Any recommendations for handling client payments for tax prep services?

As a new tax preparer myself, I've found that Wells Banco Business Choice Checking has worked well for my startup. No monthly fee if you maintain a $500 minimum balance, and they offer 100 free transactions per month which should cover your expected volume easily. One thing I'd add to the great advice already given - consider setting up automatic transfers to move a percentage of each payment into that separate tax savings account. I set mine to transfer 30% of every deposit, and it's been a lifesaver for quarterly payments. Also, don't overlook the importance of having a good relationship with your banker. When tax season gets busy and you need quick answers about deposits or account issues, having someone you can call directly makes a huge difference. Good luck with your new business!

I've been through this exact same situation with my small consulting business! The good news is that you're absolutely allowed to use the same depreciation method for both your books and taxes - there's no legal requirement to keep them separate. Here's what I learned: if you're a small business without outside investors or complex financing arrangements, using tax depreciation (like MACRS) for your books actually makes a lot of sense. It simplifies your record-keeping, reduces accounting costs, and eliminates the risk of making mistakes by tracking two different schedules. The main downside is that accelerated tax depreciation can make your profits look lower on paper in the early years, but for most small businesses, this isn't a real problem. Your bank cares more about cash flow than depreciation methods anyway. My advice: start simple by using the same method for both. You can always change to separate schedules later if your business grows and circumstances change. Don't overthink it - keeping things simple when you're starting out is usually the right approach!

This is such a common concern for small business owners! I went through the same confusion when I started my landscaping business. The key thing to understand is that using the same depreciation method for both books and taxes is perfectly acceptable and often the smartest choice for small businesses. I've been using MACRS for both my financial records and tax returns for three years now, and it's worked out great. My CPA actually recommended this approach because it keeps things simple and reduces the chance of errors. The only time you really need to consider separate schedules is if you have investors who need to see financials that reflect economic reality rather than tax-optimized numbers. For your situation, I'd say stick with the simple approach - use your tax depreciation schedule for your books too. You can always adjust later if your business grows and you need more sophisticated financial reporting. The time and money you'll save on accounting fees will be worth it!

One thing nobody has mentioned yet - be careful about timing your distributions around tax time. I made the mistake of taking a large distribution in early January after a profitable December, but my accountant pointed out it would have been much better to take it in December of the previous tax year because of how it affected my basis calculations. Definitely talk to your CPA about the timing of larger distributions. The actual transfer is simple, but the tax implications can get complex depending on your specific situation and the profitability of your S corp in a given year.

Just want to add my perspective as someone who's been through this learning curve! You're absolutely right that the actual distribution is just a simple bank transfer, but I'd emphasize getting your documentation system set up right from the start. I use a simple Google Sheet to track all my distributions with columns for date, amount, running total, and notes about what triggered the distribution (quarterly profit-sharing, year-end bonus to myself, etc.). This makes it super easy to provide a clean summary to my accountant at tax time. One mistake I made early on was not coordinating with my accountant about distribution timing. Now I send a quick email before any distribution over $10K just to make sure there aren't any tax implications I'm missing. Takes 5 minutes and has saved me headaches. The fact that you're asking these questions upfront shows you're being smart about it. The mechanics are simple, but the tax planning around distributions can get nuanced, especially as your business grows.

Has anyone dealt with a situation where the property was used as a rental for part of the time? I'm in a similar situation with joint tenancy and quitclaim deeds, but my property was also rented out for about 5 years, which seems to complicate things even more with depreciation recapture.

This is exactly the kind of complex property situation that can trip people up on their taxes. From what you've described, here are the key points to understand: Since your grandfather quit claimed his share to your grandmother in 2004 and they held the property as joint tenants, your grandmother owned 100% when he passed in 2005. When she quit claimed 50% to you in 2006, you would typically receive a "carryover basis" - meaning your basis would be 50% of what your grandparents originally paid in 1990, plus any documented improvements they made. The tricky part is your uncle's share. If he received his 50% through inheritance when your grandmother died in 2023, he should get a "stepped-up basis" to the fair market value of that portion at the time of her death. However, if he received it through a quit claim deed before she died, he would also get a carryover basis. You'll want to gather all the documentation you can: the original 1990 purchase documents, all quit claim deeds with dates, death certificates, and any records of property improvements over the years. The exact timing and method of each transfer will determine the basis calculation. Given the complexity and potential tax implications, I'd strongly recommend consulting with a CPA who has experience with inherited and transferred property. They can review all your documents and ensure you're calculating everything correctly to avoid issues with the IRS.