3 Yes, this is related but slightly different. With backdoor Roth, you make a non-deductible Traditional IRA contribution first, then convert it to a Roth. You'll need to file Form 8606 to report the non-deductible contribution. For basis calculation: your basis in the Traditional IRA is what you've contributed after-tax (non-deductible contributions). When you convert to Roth, you'll pay taxes on any earnings plus any pre-tax money in ANY Traditional IRA accounts you have (pro-rata rule).

10 Thanks! I didn't realize I needed to file Form 8606 for the backdoor Roth. And I completely forgot about the pro-rata rule. I have an old Traditional IRA from a 401k rollover that would definitely complicate things.

1 That's really helpful to know! I wonder if I can still call Fidelity now about my 2023 distribution and have them update the coding retroactively? Has anyone tried this?

Thanks for bringing this up - I'm a bit confused now. Would it create problems if he specifically wants the money to go toward my business but doesn't want anything in return? He genuinely just wants to help me get started, not become a business partner or lender. What documentation would make the most sense in this case?

If he truly wants nothing in return and is giving the money to you personally (not to your business entity), then a gift is still appropriate. Have him write the check to you personally, not to your business name. Create a simple gift letter that clearly states it's a gift with no expectation of repayment, ownership, or any other benefit. After receiving the gift personally, you then make the decision to invest that money into your business as a capital contribution. This two-step approach makes it clearer that the money was first a personal gift to you, which you then chose to put into your business. Maintain separate documentation for each step - the gift from friend to you, and your capital contribution to your business. This separation helps establish that it was truly a personal gift that you independently decided to use for business purposes.

This happened to my brother! His college roommate "gifted" him $10k to start his landscaping business but then started showing up at client meetings and telling people he was a "partner." Total nightmare that ended their friendship. Definitely get crystal clear documentation.

Thanks for the advice! Did you use any specific resources to learn about the S-corp requirements when you first started? And approximately how much extra time did it add to your tax preparation compared to just doing personal returns?

When I first started, I found the IRS's "Tax Information For S Corporations" publication really helpful, along with some YouTube videos from CPAs. The Small Business Administration website also has good resources. As for time commitment, my first year doing S-corp returns took about an extra 8-10 hours beyond my normal personal returns. There was a lot of learning and double-checking. Now I can knock it out in about 3-4 extra hours each year. The key is keeping good records throughout the year - that makes tax time so much easier! If your husband's businesses have clean bookkeeping, you're already halfway there.

I had the opposite experience! Paid an accountant $1,800 for S-corp returns that weren't very complicated. Learned how to do it myself the next year and saved a ton. Just needed to read up on the rules first.

Would you recommend attaching some kind of profit projection or business plan to my return? I did have one when I started, showing how I planned to monetize once I hit certain view thresholds. Just wasn't sure if that would help or draw more attention to the loss.

I wouldn't attach the full business plan to your return as that might actually draw unnecessary attention. Instead, keep it with your tax records in case of an audit. What can be helpful is a brief statement with your return explaining the nature of your business, that you operated with an intent to profit, and mentioning that you have documentation of your business plan and efforts. This shows you're aware of the requirements without overwhelming the initial filing with extra documents.

This is actually a common misconception. Schedule C losses don't reduce your Social Security wages from W2 employment. Your W2 income is still fully reported for Social Security purposes regardless of Schedule C losses. The losses might reduce your overall income tax, but your Social Security contributions and credits remain based on your W2 earnings.

Thanks for bringing this up! The letter they gave me does say "donation to support school fundraising activities" and doesn't specifically mention raffle or prize. So I'm guessing that's the right wording? Should I request any additional documentation from them before filing?

That wording sounds perfect! It acknowledges your charitable intent while not specifically tying it to the raffle mechanism. You should be good to go with that documentation. I wouldn't request additional paperwork as that might just complicate things. Just make sure you have your receipts showing your costs alongside the donation acknowledgment letter. For business expenses under $250, the documentation requirements aren't as strict, but since your total was $275, having both the letter and receipts provides the complete documentation package you'd need in case of questions.

There's no minimum for business deductions. But honestly for $50, you might spend more time documenting it than it's worth in tax savings. If your tax rate is say 20%, you're talking about saving $10. But if you're already tracking all expenses carefully anyway, might as well include it!