Great decision, Sean! This thread has been incredibly educational for everyone involved. As someone who works in financial compliance, I see these types of schemes regularly, and they always follow the same pattern - complex structures that exist primarily for tax avoidance rather than legitimate business purposes. What's particularly valuable about this discussion is how it demonstrates the importance of community knowledge sharing. The collective experiences shared here - from those who nearly fell for similar schemes to those who got audited - create a comprehensive picture that's much more powerful than any single professional opinion. For future reference, the IRS publishes an annual "Dirty Dozen" list of tax scams that often includes these types of abusive tax shelters. They also maintain a list of "reportable transactions" that must be disclosed on tax returns, and many of these software license/LLC arrangements fall into that category. The fact that you trusted your instincts and sought out community input before making a decision shows exactly the kind of due diligence that protects people from financial harm. Your experience will undoubtedly help others who find this thread after being approached by similar companies. Thanks for sharing your story and for the follow-up on your decision. It's a perfect example of how asking the right questions and getting multiple perspectives can save you from very expensive mistakes.

As a tax professional who's been dealing with these schemes for over a decade, I want to applaud everyone who shared their experiences here - this is exactly the kind of community knowledge sharing that protects people from financial predators. Sean, your decision to walk away was absolutely the right call. What strikes me about the My Health CCM pitch is how it hits every single checkbox on the IRS's list of abusive tax shelter characteristics: artificial complexity, disproportionate tax benefits, entity creation solely for tax purposes, and most tellingly, the insistence on using their "approved" professionals. I've represented clients in audits involving virtually identical structures, and the outcomes are consistently bad. The IRS has specific teams dedicated to unwinding these arrangements, and they're very good at it. They'll typically challenge both the inflated valuation of the software licenses AND the business purpose of the entire structure. For anyone else reading this who might be considering similar arrangements, here's my professional advice: if a tax strategy requires you to create new entities, involves transactions primarily with the company selling you the strategy, or promises tax benefits that seem disproportionate to your economic risk, get multiple independent opinions from tax professionals who have ZERO financial relationship with the promoter. The legitimate tax planning world has plenty of genuine opportunities that don't require elaborate schemes or artificial time pressure. Trust your instincts, do your due diligence, and remember that the best tax strategy is one that makes business sense first and tax sense second. Thanks again to everyone who contributed to this invaluable discussion!

Thanks everyone for the incredibly thorough discussion! As someone who's helped dozens of small businesses through address changes, I wanted to add one more consideration that might be relevant for @Liam Fitzgerald and others. If you're moving your business across state lines (not just within the same state), you may also need to consider whether your business registration needs to be updated or if you need to register as a foreign entity in your new state. This is separate from the IRS Form 8822-B but equally important. For example, if you're currently registered as an LLC in California and moving to Texas, you might need to either transfer your registration or register as a foreign LLC in Texas while maintaining your California registration. This affects more than just your address - it can impact your tax obligations, annual filing requirements, and even your business insurance. The timing here is crucial because you want your federal address change (8822-B) to align with any state registration changes. I'd recommend checking with your new state's Secretary of State office or business registration department before finalizing your move timeline. Also, @Liam Fitzgerald, since you mentioned you're in consulting, don't forget to update your professional licenses or certifications if you have any - some are state-specific and may require separate notifications or transfers when you relocate your business.

This has been an incredibly helpful thread! I'm dealing with a similar situation - moving my small marketing agency from Arizona to Oregon next month. Reading through everyone's experiences, I'm realizing I need to plan this much more carefully than I initially thought. The electronic signature discussion is particularly useful since I have a business partner who's currently traveling internationally. Using DocuSign or Adobe Sign for the Form 8822-B makes perfect sense for us - we can both review and sign the form without coordinating schedules across time zones, then print and mail it as required. I'm definitely going to look into the state registration requirements that @Lola Perez and @Yuki Yamamoto mentioned. I hadn't even considered that Oregon might have different LLC requirements than Arizona. The last thing I want is to end up with compliance issues because I missed some state-level notification requirement. One question for the group - has anyone dealt with updating their business bank accounts during an address change? I'm wondering if banks require the IRS address change to be processed before they'll update business account addresses, or if they handle that independently. I want to make sure I can still receive important financial correspondence during the transition period. Thanks again everyone for sharing your experiences - this kind of real-world advice is so much more valuable than trying to decode IRS publications on your own!

When I was audited in 2022, I took a different approach than waiting to see if they'd hold my refund. I estimated what I might owe from the audit (added about 20% for safety) and adjusted my W-4 to have less withheld from my paychecks. This way, I wasn't giving the IRS an interest-free loan they might keep anyway. Then I set aside that money in a high-yield savings account. When the audit concluded, I had the funds ready plus had earned interest on it. Even if your audit results in zero additional tax, this approach gives you more control over your money.

I'm going through something similar right now and wanted to share what I've learned from my tax attorney. The IRS has something called an "offset" process where they can indeed hold your current year refund if there's an ongoing audit that might result in additional taxes owed. However, there are a few key factors that influence this decision: 1. **Timing matters**: If your audit is in the early stages (just requesting documents), they're less likely to hold your refund compared to audits nearing completion where deficiencies are already identified. 2. **Amount at stake**: Larger potential tax liabilities increase the likelihood of a refund hold. 3. **Your compliance history**: If you have a clean record and respond promptly to audit requests, they may be more lenient. My attorney suggested contacting the examining agent directly (their info should be on your audit notice) to ask specifically about refund processing. Also, consider filing Form 911 (Request for Taxpayer Advocate Service Assistance) if the refund hold creates financial hardship - the TAS can sometimes expedite resolution. One last tip: keep making your quarterly estimates as normal unless your audit reveals you've been significantly underpaying. Better to stay current on the current year while sorting out the past!

Watch out for the contribution limits! For 2024, individual coverage limit is $4,150 and family coverage is $8,300, plus an extra $1,000 if you're 55+. Your employer contributions AND your personal contributions both count toward these limits.

Great question! I had the same confusion when I first started with HSAs. Your employer doesn't provide Form 8889 - that's a form you fill out yourself when filing your taxes. Since your W-2 shows the $3,000 in Box 12 with code W, you have everything you need from your employer. Just to add to what others have said - make sure you keep good records of any medical expenses you paid for with your HSA throughout the year. While you don't need to submit receipts with your tax return, you should keep them for your records in case the IRS ever asks. The Form 8889 will ask about any distributions you took from your HSA, so you'll want to have that information handy too. If you used tax software last year, it probably walked you through Form 8889 without you even realizing it was a separate form. Most tax prep software will automatically generate it based on the HSA information you enter.

As someone who's dealt with similar car allowance confusion at my company, I can't stress enough how important it is to get written documentation about the tax treatment. After reading through all these experiences, the pattern is crystal clear - if your employer isn't requiring detailed expense reports, mileage logs, and returns of unused funds, that $650/month will almost certainly be taxable income. I'd recommend taking a two-pronged approach: First, ask HR directly whether the allowance will appear in Box 1 of your W-2 and get their response in writing. Second, start setting aside about 30-35% of each monthly payment immediately for taxes - better to be over-prepared than face a $2,000+ surprise bill next April. Also worth considering: calculate your total vehicle ownership costs (insurance, maintenance, repairs, depreciation) and compare that to what your employer previously covered. Many people discover they're actually worse off financially under these allowance systems, even before factoring in the tax burden. The IRS Publications 15-B and Section 1.62-2 that others mentioned are definitely worth reviewing. Don't let HR's vague language about "reimbursements" fool you - the tax code has very specific requirements for non-taxable vehicle allowances, and flat monthly payments rarely meet them.

This entire discussion has been absolutely invaluable for understanding car allowance tax implications! As someone who's never dealt with this situation before, I'm shocked by how consistently HR departments seem to misunderstand or misrepresent these policies. Based on all the real experiences shared here, it's clear that flat monthly allowances like the $650 mentioned are almost always taxable income unless they meet the IRS's strict accountable plan requirements (business connection, adequate documentation, and return of excess funds). The fact that so many companies call these "reimbursements" while not requiring any expense documentation is misleading at best. The math is sobering - potentially 30-35% going to taxes means setting aside $200+ per month from that $650 allowance, plus taking on vehicle costs that were previously covered. For many people, this could easily be an effective pay cut disguised as a benefit. My key takeaways: 1) Get written confirmation about W-2 reporting, 2) Ignore verbal assurances and focus on whether the policy meets accountable plan requirements, 3) Start setting aside tax money immediately, and 4) Calculate total vehicle ownership costs to see if you're actually better off. The IRS Publication 15-B and Section 1.62-2 references from the tax professionals here are going straight into my bookmarks. Thanks to everyone who shared their real experiences - this thread could save people thousands in unexpected taxes!