Do you know if a 2-unit building would even be considered an "association" under those rules? And would choosing 1120-H vs 1041 affect how much we pay in taxes?

Yes, a 2-unit building can still qualify as an association under IRC 528 as long as it meets the other criteria. There's no minimum unit requirement in the tax code for this purpose. The IRS looks at how the entity operates rather than its size. Regarding taxes, Form 1120-H allows the association to exclude income from member dues completely, taxing only "nonexempt function income" like interest earnings or commercial rental income at a flat 30% rate. For small associations with minimal interest income, this often results in zero tax liability or a very small amount. Form 1041 trusts calculate taxes differently, potentially subjecting more income to taxation depending on how the trust is structured. For a simple pass-through arrangement like yours with minimal bank interest, the 1120-H is usually advantageous.

I switched to TurboTax Business for our condo trust and found their interview process much more straightforward. They have specific questions designed for small residential associations that made the whole process less confusing.

Did you do the dual status return yourself or hire someone? I'm worried my green card might be approved in the middle of this tax year and I hear dual status returns can't be e-filed.

I ended up hiring a tax professional for the dual-status year because it got pretty complicated. You're right that you can't e-file a dual-status return - it has to be paper filed. The preparer essentially had to prepare both a 1040NR for the part of the year I was a nonresident and portions of a 1040 for when I became a resident. If your case is simple (just W-2 income), you might be able to handle it yourself, but I had scholarships, some investments, and a side gig, so I didn't want to risk making mistakes. The peace of mind was worth the cost, especially since tax issues can potentially affect immigration cases.

This is super important! My university payroll department automatically started withholding FICA taxes when I told them about my green card APPLICATION (not approval), and it took months to fix. Is there a specific form to request a refund for incorrectly withheld FICA?

Yes, if your employer incorrectly withheld FICA taxes while you were still on an F-1 visa (and within your 5-year exemption period), you need to first try to get a refund from your employer. If they refuse or are unable to refund you, you'll need to file Form 843 "Claim for Refund and Request for Abatement" along with supporting documentation. Make sure to include a statement from your employer showing the amount of incorrectly withheld Social Security and Medicare taxes, a copy of your visa documentation, and a statement explaining why you're exempt. This is another area where Sprintax can help - they generally have guidance on completing these forms for international students.

It's a standard brokerage account, not retirement or anything special. She's owned it for about 12 years. The original investment was around $165k and it's grown to about $270k now. No special conditions other than she had to keep it for 10 years minimum per some agreement with the investment company.

Thanks for clarifying - that makes a huge difference! Since it's a standard brokerage account, she'll only pay capital gains tax on the growth portion (about $105k based on your numbers), not the entire $270k. If she's held it over 1 year (which she has at 12 years), she'll pay long-term capital gains rates, which are much lower than ordinary income tax rates - likely 15% for most people. Instead of withdrawing everything and then gifting cash, she could consider transferring shares directly to her children (in-kind transfer). This passes the tax obligation to the kids, who might be in lower tax brackets. They'd inherit her cost basis but could sell according to their own tax situations.

Good point. I ended up using both an advisor AND some tax software to model different scenarios when distributing my dad's investment account last year. The advisor cost me $400 but saved us about $8k in taxes by structuring the withdrawals properly.

What accounting software would you recommend for someone just starting out? I'm running into the same issues as OP but don't want to spend a fortune on QuickBooks or something if there are cheaper options that would work for a small operation.

For someone just starting out, I'd recommend Wave Accounting - it's free for basic accounting and receipt tracking, which is perfect for a small operation. You only pay if you use their payroll or payment processing features. It's what I used for my first two years before upgrading. If you want something with a bit more features but still affordable, FreshBooks has a starter plan that's reasonable and very user-friendly. Xero is another good option that's more affordable than QuickBooks but still robust enough for a growing business. All of these will let you categorize your income and expenses properly, which makes Schedule C preparation much easier come tax time.

This is super interesting - I never thought about it from the model's perspective! So if I understand correctly, if I'm paying my manager a percentage of my earnings, I should technically be sending them a 1099-NEC? Is that something most models actually do? And does it matter if I'm paying through Cash App vs direct deposit?

That's a great tip about trying a browser instead of the app! Just tried it and it actually worked - I can access my partially completed 2022 return. Looks like everything is still there, I just need to finalize and submit it. Do you think there's any benefit to explaining my situation to the IRS about thinking I had submitted but didn't? Or should I just file and pay the penalties?

Glad the browser trick worked! In my experience, simply filing and paying what you owe plus penalties is the cleanest approach. The IRS generally doesn't waive penalties for "I thought I filed" situations since they consider filing to be your responsibility. However, if this is your first time having penalties, you might qualify for First-Time Penalty Abatement. You can request this after you file and pay. It's worth trying since the worst they can say is no. Just make a phone call after everything is processed and specifically ask about "First-Time Penalty Abatement" for your 2022 return.

I tried the reasonable cause route for my late filing (medical issues) and it was denied. First-time penalty abatement worked though! Much easier process and no documentation needed.