The deal paid me $310 and my tax prep bill went up more than that

Small one, but it cost me real money and nobody warned me.

Put $6k into a crowdfunded equity deal, first year went fine, distributions totaled about $310. Happy enough with that for a first try while I build the service side of things.

Then March came. The deal is structured as a partnership, so instead of a simple form I got a K-1, and it arrived in the middle of March rather than January. The property sits in a state I have never set foot in, and because the partnership generated income sourced to that state, my preparer told me there was a nonresident filing question to work through. She also told me she couldn't file my return until the K-1 landed, so I extended.

All in, the extra preparation work and the additional state piece added a few hundred dollars to what I paid her, more than the $310 the deal distributed. The deal itself is performing fine. My net for year one was negative because of friction I didn't know existed.

I'm not saying this makes crowdfunded equity a bad idea. On a $30k position the same friction is noise. On a $6k position it ate the whole year. And how state filing works depends entirely on which state and on your own situation, so that's a question for a licensed tax preparer before you fund rather than after, which is the mistake I made.

What I'd do differently: ask two questions before funding. What tax form will I receive and roughly when, and which states will this deal generate income in. Then ask my preparer what that adds to my bill, and compare it to the first year of expected distributions. If the answer is negative, either size up or pick something that reports on a simpler form.