I use H&R Block and did something similar last year. The interface is different but the concept is the same. You need to create two separate K-1 forms and split the income between them. The tricky part in H&R Block is you have to manually go to the forms view and find the right schedule to enter the rental real estate portion.

Thanks for the guidance! Do I need to do anything special to make sure the basis calculations carry forward properly in H&R Block? And should I be entering any tax credits on the first or second K-1 entry?

You actually can edit the TXF file directly if you're comfortable with text editing! I tried this approach too. TXF files are basically formatted text files, and you can open them with Notepad or any text editor. Look for the sections related to your K-1, and you'll see entries for each box. You can create a duplicate of the partnership entry with a slightly different name, then remove line 2 from the original and remove everything except line 2 from the copy. It's a bit technical but doable if you're careful.

Thanks for mentioning this, but no, it was just empty desert land that nobody lived on. No structures at all. It literally sat empty for decades until someone decided it was valuable because of the highway exit nearby.

Good to confirm. One other thing to consider - check if your state has different rules for inherited property taxes. Some states have their own tax treatment that might be more favorable than federal. For example, some states might use their own version of stepped-up basis or have special provisions for long-held family property.

This wouldn't trigger gift tax because it's a sale at fair market value, not a gift. The inheritance portion already happened when OP's mother passed away, and that would fall under estate tax rules (though with only a 15% interest in land worth $800K, it would be well below the estate tax threshold). The sale itself is just converting an asset to cash at market value - no gifting involved. OP and their sister would just each report their portion of capital gains based on their stepped-up basis.

Does it handle tips well? My dog walking clients sometimes tip in cash and sometimes in the app, and I'm worried about mixing them up. Also, is there a way to mark certain expenses as "office supplies" vs "pet supplies" so I can track which deductions are for what?

It handles tips perfectly! You can create separate income categories for "service income" and "tips" and then further categorize as "cash tips" vs "app tips" if you want that level of detail. This makes it easy to reconcile against what shows on your 1099 vs. what you received in cash. For expenses, yes, you can create custom categories beyond the standard ones. I have categories for "cleaning supplies" and "office supplies" since they're different types of business expenses. For your situation, "pet supplies" would be a great custom category to track those specific deductions separately.

You should consider making quarterly estimated tax payments if you expect to owe $1,000 or more in taxes. For self-employment income, you need to pay both income tax and self-employment tax (15.3% for Social Security and Medicare). At $3,200 since October, you're looking at around $490 just in self-employment tax, plus whatever income tax applies based on your total annual income. If you have other income with tax withholding (like a regular job), that withholding might cover your tax obligation from pet sitting.

3 I did this last year. You can request it online through the IRS website or by calling. No setup fee, but you still pay interest and the failure-to-pay penalty during those 120 days. It was straightforward - I just needed to specify how much I owed and that I'd pay within 120 days. No financial statements needed.

Really helpful breakdown! My transfer would be to North Carolina. Any idea where that falls on the state tax spectrum? And is there a good online calculator you'd recommend that lets me input all these factors?

North Carolina is actually pretty straightforward with a flat 4.75% state income tax rate - so middle of the road compared to other states. Not as high as California or New York, but not tax-free like Texas or Florida. For calculators, I recommend using the ADP Salary Paycheck Calculator (just Google it) - it lets you input your salary, state, filing status, and deductions including 401k and health insurance to get a realistic take-home estimate. SmartAsset's paycheck calculator is another good one that shows the breakdown of all taxes. Both are free and pretty accurate based on my experience relocating employees to various states.

This is so important - I got hit with unexpected taxes from my home country after my transfer. Do you need to file Polish tax returns every year even after moving to the US? How does that work?