One important detail that hasn't been mentioned yet - make sure you have your Form 1095-A from the marketplace when you file. This form shows exactly how much advance premium tax credit you received and your actual premium amounts, which you'll need to calculate the correct deduction. Also, keep detailed records of all your premium payments throughout the year. If you pay monthly, save those payment confirmations or bank statements showing the $240 payments. The IRS can ask for documentation of the amounts you're deducting, especially since you're dealing with both marketplace credits and self-employment deductions. Another tip: if you're married and file jointly, but only you are self-employed, you can still take the self-employed health insurance deduction for the entire family's coverage as long as the policy is in your name (the self-employed spouse's name). This is different from regular itemized medical deductions and can save you quite a bit.

This thread has been incredibly helpful! I'm also self-employed and had no idea I could deduct the portion of premiums I pay out-of-pocket after marketplace credits. I've been missing this deduction for two years now. One question I haven't seen addressed: if I started my business mid-year and was employed for the first half of the year (with employer health insurance), can I still take the self-employed health insurance deduction for the months I was paying for marketplace coverage while self-employed? Or does having employer coverage for part of the year disqualify me entirely? I switched to marketplace coverage in July when I left my job to go full-time freelance, so I've been paying out-of-pocket premiums for 6 months of the year. Want to make sure I can claim this before I file!

One important thing I didn't see mentioned - if you're applying online for an EIN, you can only do it during the IRS's business hours (7am-10pm Eastern time, Monday-Friday). I tried doing mine on a Saturday and got so confused when the system wouldn't let me submit!

I just went through this exact process last month and wanted to share what I learned. You absolutely can get your EIN first without having a DBA filed - just leave that field blank on the application. The key thing to understand is that your EIN is tied to your tax identification (your SSN if you're a sole proprietor), not your business name. So whether you operate under your legal name or a DBA later doesn't affect your EIN itself. I'd recommend getting your EIN first since you need it for so many things - opening business bank accounts, getting business licenses, etc. You can always file your DBA later when you're ready. Just make sure to use your DBA name consistently on all business documents once you have it registered. One tip: when you do file for your DBA, keep a copy of the certificate handy. Some banks and vendors will want to see it when you're doing business under that name, even though your EIN application didn't require it.

If you're worried about getting in trouble for not paying the penalty, you should make the payment ASAP through the IRS Direct Pay system. Just select "estimated tax" as the reason for payment. I did this after a similar situation and printed the confirmation as proof I paid. Better safe than sorry with the IRS!

You're absolutely right to be confused - this is actually a common issue that trips up a lot of people! The $1,900 penalty is real and you do need to pay it, even though you already received your refund. Here's what's happening: TurboTax calculated the 10% early withdrawal penalty and included it in your total tax liability, but it was treated separately from your regular income tax refund. Think of it as two different buckets - your regular taxes (which resulted in a refund) and the penalty tax (which you still owe). To pay the $1,900, go to IRS.gov and use their Direct Pay system. You don't need a special form or voucher - just select "Form 1040" as the form type and enter the amount. Make sure to keep a record of the payment confirmation. The reason you don't need Form 5329 is because TurboTax already calculated the standard 10% penalty and included it on Schedule 2 of your Form 1040. Form 5329 is only required if you qualify for certain exceptions to the penalty or have other special circumstances. Don't wait on this - the IRS will eventually catch up and you could face additional interest and penalties if you delay payment.

Just want to add one more thing that helped me when I dealt with a similar multi-state W2 situation - make sure to check if either Colorado or Arizona offers any tax credits for taxes paid to other states. When I had income in multiple states, I discovered that my new state of residence gave me a credit for taxes I paid to my previous state, which helped reduce any potential double taxation. This is especially important if both states end up taxing some of the same income period around your move date. Also, don't forget to update your address with both state tax departments after you move! I learned this the hard way when important tax notices were still being sent to my old address months later. Most states have online portals where you can update this information quickly. The whole process seems overwhelming at first, but once you get through it the first time, you'll realize it's much more straightforward than it initially appears. Good luck with your filing!

I went through this exact same situation when I moved from New York to Florida in August! Your instinct about the continued withholding being wrong is probably correct - that happened to me too. Here's what I learned: You'll definitely need to file part-year resident returns in both states. Colorado will tax your income from January through your move date in July, and Arizona will tax from July through December. The good news is that when you file your Colorado return, you can get a refund for any taxes they withheld after you moved. One thing that really helped me was keeping a detailed log of my exact move date and the pay periods before and after. Your employer should have only been withholding Colorado taxes on wages earned while you were actually living there. If they kept withholding after July, that's money you can get back. TurboTax handled my situation just fine - when you get to the state section, you'll mark that you moved during the year and it walks you through everything step by step. The key is being precise about your move date so the software can correctly allocate your income between the two states. Don't stress too much about Box 16 not matching Box 1 - that's totally normal because federal and state tax calculations can be different. Focus on making sure each state gets the right portion of your income based on when you actually lived there!

The IRS actually has a really helpful Interactive Tax Assistant tool on their website (irs.gov) that walks you through filing status questions step by step. I used it when I was in a similar situation - living with family but financially independent - and it clearly showed me that Single was the correct status. The tool asks specific questions about your living situation, who you support, and what expenses you pay. It's free and comes directly from the IRS, so you know the guidance is accurate. It helped me understand that paying rent to my parents (even if it's substantial) doesn't make me the head of their household - I'm essentially a tenant. Your parents filing as HOH shouldn't be affected as long as they have a qualifying dependent (your sister) and pay more than half the household costs. The key thing is that HOH requires both maintaining a household AND having qualifying dependents - you can't claim it just based on paying expenses without dependents.

I went through this exact same situation when I was 25 and living with my parents while saving for a house! I was also paying them rent and covering my own expenses, so I thought I might qualify for HOH. After doing a ton of research and even consulting with a tax preparer, I learned that the key thing about Head of Household is that you need to be the "head" of a household that includes qualifying dependents - not just financially independent while living in someone else's home. Even if you paid your parents $1,200/month in rent (which would be more than half of many household expenses), you still wouldn't qualify for HOH without having dependents like children or elderly parents that you support. The good news is that filing as Single won't cause any issues for your parents' HOH status with your sister. The IRS doesn't care that multiple people at the same address have different filing statuses - what matters is who actually qualifies based on the specific requirements. Your parents can continue filing HOH as long as they support your sister and pay more than half the household costs. It's frustrating because HOH does give you a higher standard deduction and better tax brackets, but it's definitely not worth risking an audit by claiming a status you don't qualify for!