This is definitely concerning since your W-2 shows significantly less than what you were actually paid. A $7,170 discrepancy is substantial and needs to be resolved before you file your taxes. Here's what I'd recommend doing in order: 1. **Contact your former employer's payroll/HR department immediately** - Be polite but direct. Explain that you're preparing your taxes and noticed the W-2 shows $28,450 while your bank records show $35,620 in deposits from them. Ask them to review their records and explain the discrepancy. 2. **Document everything** - Keep records of all your communications with the employer, your bank statements showing the deposits, and any other proof of payment you have. 3. **Give them a reasonable timeframe** - Ask when you can expect a response or corrected W-2 if there was an error. Most payroll departments can investigate this pretty quickly. 4. **If they don't respond or refuse to correct it** - You can file Form 4852 (Substitute for Form W-2) with the IRS using your actual income figures. The IRS will then investigate and contact your employer directly about the discrepancy. The fact that they're underreporting your income could mean they're also not paying the correct employer taxes on your behalf, which is a problem for them with the IRS, not just you. Most employers will want to fix this quickly once they realize the issue. Don't file your taxes with the incorrect W-2 amount - always use your actual income figures.

This is a serious issue that needs immediate attention. A $7,170 discrepancy where your W-2 shows LESS than what you actually earned is very concerning and suggests your employer may not be properly reporting all of your income to the IRS. Here's what you should do: **Step 1: Contact your former employer immediately** - Reach out to their payroll or HR department with your bank statements showing the actual deposits. Ask them to explain why Box 1 on your W-2 shows $28,450 when you received $35,620 in payments from them. **Step 2: Request a corrected W-2** - If they confirm there was an error, ask for a corrected W-2 (Form W-2c) to be issued. They're required to provide this if there was a mistake. **Step 3: If they're unresponsive or refuse to correct it** - File Form 4852 (Substitute for Form W-2) with the IRS using your actual income amount. This tells the IRS there's a discrepancy and they'll investigate. **Important:** Never file your taxes using the incorrect lower amount. Always report your actual income. Underreporting income can cause problems with the IRS later, even if it wasn't your fault. This situation could indicate your employer isn't paying their proper share of payroll taxes either, which makes it their problem with the IRS, not just yours. Most employers will want to fix this quickly once they understand the implications. Keep detailed records of all communications and don't let them drag this out - you have tax deadlines to meet.

This is exactly the kind of question that trips up so many business owners! The key difference is that S corps and C corps have opposite reasonable compensation concerns from the IRS perspective. With your S corp, you're absolutely right to be careful about maintaining adequate salary vs distributions. The IRS wants to see reasonable compensation because S corp distributions aren't subject to payroll taxes, so they're watching for owners who try to minimize salary to avoid Social Security and Medicare taxes. But here's where it gets interesting with C corps - the IRS actually worries about the opposite problem. Since C corp salaries are deductible at the corporate level (reducing corporate taxable income) while dividends face double taxation, the IRS is more concerned about unreasonably HIGH compensation in C corps. Owner-employees have an incentive to take excessive salaries to avoid the corporate tax, so that's what triggers IRS scrutiny. You technically could take minimal salary and maximum dividends from a C corp, but the double taxation on dividends usually makes this a poor strategy from a total tax perspective. Plus, if you're actively working in the business, the IRS still expects some reasonable compensation for your services - just like any other employee performing similar work would receive. The "reasonableness" test considers factors like your role, industry standards, time commitment, qualifications, and company performance - regardless of entity type.

One thing that often gets overlooked in this S corp vs C corp compensation discussion is the impact of your long-term business goals. If you're planning to reinvest profits back into the business for growth, a C corp structure might actually work better even with the double taxation concern. Here's why: With an S corp, all profits flow through to your personal return whether you take distributions or not - meaning you pay personal income tax on retained earnings. With a C corp, you only pay the 21% corporate rate on retained profits, which could be lower than your personal rate if you're in higher tax brackets. So while the reasonable compensation rules do flip between entity types (S corps worry about too little salary, C corps about too much), your decision should factor in your overall business strategy. If you're taking most profits out annually, S corp probably still wins. But if you're planning to keep significant profits in the business for expansion, equipment purchases, or building cash reserves, the C corp might be worth considering despite the compensation complexity. The reasonable compensation requirements exist in both structures - they just point in opposite directions based on the underlying tax incentives each entity type creates.

I'm dealing with a very similar situation and this thread has been incredibly enlightening! I've been stressing about keeping every single investment statement from my 403(b) and traditional IRA going back years, but it sounds like I'm creating unnecessary work for myself. One thing I'm still a bit unclear on - when people mention tracking "contributions," are we talking about just the total amount I put in each year, or do I also need to track things like employer matching contributions separately? My employer matches 50% of my contributions up to 6% of my salary, and I wasn't sure if that matching amount needs special tracking. Also, I've done a couple of in-service withdrawals from my 401(k) for hardship reasons over the years. I assume those would count as "distributions" that I need to keep records of, even though I didn't fully cash out the account? Just want to make sure I'm not missing anything important while I'm simplifying my record keeping!

This is exactly the kind of question I had when I first started getting serious about retirement planning! You're definitely not alone in feeling overwhelmed by all the paperwork. The consensus here is absolutely correct - for most retirement accounts, you only need to track contributions and distributions, not individual investment performance within the accounts. I learned this the hard way after keeping every single trade confirmation for years thinking I needed them for taxes. One thing I'd add that hasn't been mentioned yet: if you're considering consolidating some of your old accounts, now might be a good time while you're organizing everything. I had three different 401(k)s from previous employers just sitting there, and rolling them into a single IRA made my record-keeping so much simpler. Just make sure to do direct rollovers to avoid any tax complications. For your self-directed 401(k) question - go for it! The investment flexibility is amazing and as others have confirmed, it doesn't create any additional tax paperwork burden. You'll still just track money in and money out, regardless of whether you're picking individual stocks or just buying index funds. The key insight that changed everything for me was realizing that the account TYPE determines the tax treatment, not what's inside the account. Once you get that, retirement account taxes become so much more manageable.

Don't panic! This is way more common than you think - I went through the exact same thing last year and it all worked out fine. First thing to do is check if your employer has an online portal (like ADP or Workday) where you can download your W-2 electronically. Most companies do this now and it's the fastest solution. If not, just call or email your HR/payroll department - they can usually get you a new copy within a day or two. I was stressing about this too but it turned out to be super straightforward. As a backup plan, you can always file Form 4852 (substitute W-2) using your last paystub from December, which should have all your year-to-date totals. The IRS is totally fine with this when you can't get your actual W-2. Also, pro tip for keeping track of important documents - I now scan everything important to Google Drive right when I get it. No more panic cleaning sessions ruining my taxes! You've got this!

Hey Eva! Take a deep breath - you're definitely not screwed and this is SO much more common than you think. I work in tax prep and we see this situation literally dozens of times every tax season. Here's your game plan: 1. Check if your employer has an online employee portal (ADP, Paychex, Workday, etc.) - you might be able to download your W-2 right now! 2. If not, contact your HR/payroll department ASAP. Most can email or print a new copy within 24-48 hours. 3. If your employer is unresponsive, you can request a wage transcript from the IRS by calling 1-800-908-9946 (this line is specifically for wage transcripts and usually has shorter wait times than the main number). And honestly? Your "disaster zone apartment" comment made me laugh because I literally did the exact same thing two years ago - lost my W-2 in a pre-visit cleaning frenzy for my parents. You're in good company! The most important thing is don't wait - start with option 1 or 2 today. You have plenty of time before the filing deadline, and this will be resolved way faster than you think. Adult life is mostly just figuring out systems to prevent exactly this kind of panic (speaking from experience 😅).

I've been researching this exact question for weeks and this thread has been incredibly helpful! Based on everyone's experiences, it's clear that Jackson Hewitt's free classes are really just an introduction to basic tax prep, not the comprehensive business tax education I'm looking for. The hybrid approach that keeps coming up makes a lot of sense - using JH for practical client experience while getting real business tax education elsewhere. I'm particularly intrigued by the IRS Annual Filing Season Program that several people mentioned as a better foundation. One thing I'm wondering about is the timing of making this transition to more serious tax work. For those who started at JH and moved to better opportunities - did you find it was worth staying multiple seasons to build more experience, or was one season sufficient to demonstrate competency to better employers? I'm trying to balance gaining enough experience to be marketable while not getting stuck in a low-paying situation longer than necessary. Also curious about networking opportunities - did working at JH help you make connections in the local tax prep community, or were you pretty isolated within their system? I'm wondering if there are better ways to start building professional relationships in this field. The reality check about pay has been sobering but helpful. It sounds like treating this as an educational investment rather than expecting significant income is the right mindset, at least initially.

I've been following this discussion closely as someone in almost the exact same situation as the original poster. The consensus here is really clear - Jackson Hewitt's free classes are more about basic individual returns and software training than comprehensive business tax education. What strikes me most is how many people found success with the hybrid approach: using JH for practical client experience while getting real business tax knowledge through the IRS Annual Filing Season Program or community college courses. The AFSP keeps getting mentioned as free, self-paced, and much more thorough for actual tax law understanding. For those considering this path, the timeline that seems to work best based on everyone's experiences is: complete AFSP first for solid foundation → potentially do JH training and work one season for client interaction skills → use that combined experience to transition to better opportunities at local CPA firms. The pay reality check has been sobering but valuable - it sounds like treating this as paid training (emphasis on training) rather than expecting significant income is the right mindset. But the skills in handling difficult clients and working under pressure apparently translate well when applying to better positions. One question for those who made the transition from chains to local firms: did you find that having both the formal tax education (AFSP/college courses) AND the practical client experience was what made you competitive, or would strong knowledge alone have been sufficient? Trying to decide if the JH step is truly necessary or just one possible path among many.