Just want to add something no one mentioned yet - if you're self-employed, don't forget about the self-employment tax (15.3% for Social Security and Medicare)! Deducting education expenses on Schedule C doesn't just save you income tax, it also reduces your self-employment tax. Sometimes that makes the business deduction more valuable than education credits, depending on your situation.

This is such a helpful thread! As someone who's also navigating the self-employment + student combo, I wanted to add that timing can really matter here. If you're planning to graduate soon and your income is expected to increase significantly after graduation, it might be worth considering whether to take the business deduction this year (which reduces your current SE tax burden) or save some expenses for next year when you might be in a higher tax bracket. Also, keep really detailed records of which specific courses relate to your consulting work. The IRS likes to see a clear connection between the education and your business activities. I keep a simple spreadsheet noting how each class directly applies to the services I provide - makes it much easier come tax time! One last thing - if you're paying for textbooks, software, or other course materials that you also use for your freelance work, those can often be deducted as business expenses too, separate from tuition.

Just got my Green Dot deposit this morning! My DDD was 2/26 but the funds were available at 4:38am today. The Early Access feature they advertise actually worked as promised. I set up account alerts so I got a text notification as soon as it posted. Such a relief after checking my account practically every hour for the past three days!

Green Dot usually releases funds 1-2 days before the official DDD when the IRS batch releases come through! Since your transcript shows 2/24 as the deposit date, you might see it hit your Green Dot account as early as 2/22 or 2/23. I've been using Green Dot for tax refunds for 3 years now and they're pretty consistent with early access - usually get a notification between 3-6am when it posts. Make sure you have push notifications enabled in the Green Dot app so you don't miss it! The waiting game is rough but Green Dot has been reliable in my experience. Good luck! 🤞

24 Has anyone compared whether it's better to claim ABA therapy under the medical expense deduction instead of the dependent care credit? I heard you can't double-dip and claim the same expenses for both.

Great question about comparing the medical expense deduction vs dependent care credit! I actually ran into this exact dilemma last year with my daughter's speech therapy costs. Here's what I learned: The dependent care credit is usually better because it's a direct credit (reduces taxes owed dollar-for-dollar) vs a deduction (only reduces taxable income). Plus, medical expenses only help if you itemize AND they exceed 7.5% of your AGI. For example, if you're in the 22% tax bracket and claim $3,000 in medical deductions, you save about $660 in taxes. But if you use that same $3,000 for the dependent care credit at 20%, you save $600 directly off your tax bill - and potentially more if you qualify for a higher credit percentage based on income. However, if you already have massive medical bills that put you over the 7.5% threshold anyway, then adding the therapy to medical might make sense. I'd recommend calculating both scenarios to see which gives you better overall tax savings!

I've seen this happen with TurboTax plenty of times. The software is just following the tax code, which says you need to pay throughout the year. What most people dont know is that your inheritance itself isnt taxable income! But if you sold investments or property that you inherited, the gains are taxable. And there's something called "step-up in basis" where inherited assets get valued at the date of death, not the original purchase price. So only gains after that point are taxable. Check if maybe you sold some stocks or something after inheriting them? That would explain the capital gains tax. But either way, the penalty is about WHEN you paid, not IF you paid enough total.

Great thread everyone! I'm dealing with a similar situation and this has been super helpful. One thing I want to add is that you can also use Form 2210 to request a waiver of the underpayment penalty if you had reasonable cause - like a sudden change in income, casualty loss, or other circumstances beyond your control. Also, for anyone making estimated payments, remember that the IRS allows you to pay online through EFTPS (Electronic Federal Tax Payment System) or IRS Direct Pay. Just make sure to keep records of when you made each payment since the timing is so important for avoiding penalties. The safe harbor rules mentioned earlier are really key - if your AGI last year was under $150k, you just need to pay 100% of last year's tax liability through withholding and estimated payments to avoid any penalty, regardless of how much you actually owe this year.

This thread has been incredibly helpful! I'm actually dealing with a very similar situation - S-Corp for my web development business and looking to start a property management LLC. One thing I'm still unclear about after reading through all these responses: if I make the QSub election, does the LLC need its own workers' compensation insurance if I plan to hire employees specifically for the property management side? Or would they be covered under my existing S-Corp policy since it's all treated as one entity for tax purposes? Also, I noticed someone mentioned needing to amend their S-Corp articles of incorporation to include the new business activities. Is this always required, or does it depend on how broadly your original articles were written? My S-Corp was set up pretty generically as "business consulting services" so I'm not sure if property management would fall under that umbrella. The point about the 5-year waiting period for terminating the QSub election is something I definitely need to factor into my decision. I hadn't realized there were restrictions on changing your mind later - that's exactly the kind of detail that could cause problems down the road if not considered upfront.

I've been following this discussion closely as someone who went through a similar decision process last year with my marketing agency S-Corp. One thing I'd add that hasn't been mentioned much is the impact on your business banking relationships. When I set up my QSub structure, my bank initially wanted to treat the LLC as a completely separate customer requiring new account applications, credit checks, etc., even though I explained it was a QSub. It took several conversations with their commercial banking team and providing them with copies of Form 8869 to get them to understand the relationship. Eventually they set it up so the LLC accounts were linked to my existing S-Corp business profile, which made things much smoother. Also, regarding state compliance - make sure to check if your state requires any specific language in the LLC's operating agreement acknowledging the QSub election. My attorney included a clause that specifically references the federal QSub status and states that the LLC won't file separate tax returns. This helped avoid confusion later when dealing with various vendors and financial institutions who weren't familiar with QSub structures. The depreciation tracking that others mentioned is definitely important to get right from day one. I set up separate fixed asset schedules for each entity in QuickBooks even though everything flows to one tax return - this makes year-end much easier and provides clear documentation if you ever need to value the businesses separately for loan purposes or potential sale.