Don't forget to also check if your change in marital status affects your eligibility for certain tax credits and deductions! Many have income phase-out limits that differ for single vs. married filing jointly. For example: - Student loan interest deduction - IRA contribution deductions - Child tax credits - Earned Income Credit - Education credits A good tax pro or tax software can help you run the numbers both ways (filing separate vs joint) to see which is more advantageous in your specific situation.

Just wanted to add that you should also consider doing a "paycheck checkup" using the IRS withholding calculator on their website (irs.gov/W4App) once you update your status with HR. It's free and will help you determine if you need to make any additional adjustments to your withholding for the rest of the year. Since you got married in October 2023, you'll likely want to file as married for your 2023 taxes (you can choose married filing jointly or married filing separately - joint is usually better but not always). The calculator will help you figure out if you're on track for 2024 withholding too. Also, don't forget that marriage can affect other things like your FSA/HSA contribution limits if you both have accounts, and whether you're eligible for certain employer benefits. It's worth reviewing all of that while you're updating your HR records!

Just want to add that the threshold for receiving a 1099 from these platforms has changed. Underdog and PrizePicks now issue a Form 1099-MISC if you win $600 or more in a calendar year. But even if you don't receive a form, you're still legally obligated to report ALL winnings. Also, watch out for the sessions reporting requirement. Each time you log in and play could potentially be considered a separate session. So don't just report the net amount for the year - you technically need to report each winning session separately.

One thing I haven't seen mentioned yet is the importance of keeping your account statements from these platforms for at least 3 years after filing. The IRS can audit gambling income up to 3 years after you file, and they're particularly scrutinizing fantasy sports platforms now. I'd also recommend setting aside about 25-30% of your winnings throughout the year for taxes, especially if you're not having taxes withheld from other income. Getting hit with a big tax bill plus penalties for underpayment can be brutal. Another tip: if you're consistently profitable, consider making quarterly estimated tax payments. The IRS expects you to pay as you earn, not just at the end of the year. Missing this can result in underpayment penalties even if you pay your full tax liability by April 15th.

Does anyone know what code CP11 means? Just got a letter with this code and I'm freaking out a bit.

I've been dealing with IRS codes for years as a small business owner, and I wanted to add a few more important ones that haven't been mentioned yet: **Adjustment Codes:** - TC 290: Credit adjustment (usually good news - means you're getting money back) - TC 300: Debit adjustment (additional tax owed) - TC 420: Examination changes (audit adjustments) **Payment Codes:** - TC 610: Estimated tax payment - TC 670: Penalty assessed - TC 672: Failure to file penalty - TC 270: Account adjustment (can be positive or negative) **Pro tip:** If you see multiple transaction codes with the same date, they're usually related to the same action. For example, you might see a TC 290 (credit adjustment) followed by a TC 971 (notice sent) on the same date - this means they made an adjustment in your favor and sent you a notice about it. The key is not to panic when you see codes you don't recognize. Most of the time, if the IRS made an error in your favor, you'll see credits (TC 766, TC 768, TC 290). If they found issues, you'll typically see debits (TC 300) along with penalty codes. Always read the actual notice that accompanies the codes - the codes just tell you what type of action was taken, but the notice explains why.

I think everyone's missing something important here - the interest on shareholder loans can actually be beneficial in the right situation. If your business is profitable and you're in a high personal tax bracket, having the business pay you interest (which is deductible for the business) can be an effective way to extract money from the company without triggering employment taxes. The business gets a deduction for the interest payments, reducing its taxable income. You'll pay ordinary income tax on the interest received, but no self-employment or payroll taxes. Just make sure the interest rate is reasonable (at least the AFR) and that everything is documented properly.

Great question about the tax implications! You're right that this decision can have significant long-term consequences. One additional consideration I haven't seen mentioned is the timing flexibility. With shareholder loans, you have much more control over when you take the money back out. You can repay yourself when it's most tax-advantageous - perhaps in a year when your personal income is lower or when the business has better cash flow. With equity contributions, you're essentially locked into taking distributions when the company declares them (if it's profitable enough to do so), or you'd need to find a buyer for your shares to get your money back. Also, if your business ever faces financial difficulties, shareholder loans typically have priority over equity in terms of repayment. So from a risk perspective, the loan structure offers some protection. That said, make sure you're not creating a situation where the loan balance becomes so large that it affects your ability to take advantage of other tax benefits. For S-Corps especially, your stock basis and debt basis calculations can get complex when you have large outstanding shareholder loans. I'd recommend running the numbers both ways with your tax professional to see which approach minimizes your overall tax burden based on your specific situation and timeline for getting the money back.

Just a heads up on those cutting machines - I made the mistake of putting similar equipment ($250 range) under Section 179 last year, and my tax preparer said it created unnecessary complication. She had to go back and reclassify them as simple expenses under the de minimis rule, which apparently is much cleaner for audit purposes. For the utilities question, I use a Kill-A-Watt meter to track exactly how much electricity my craft equipment uses. I can literally show the difference in usage between when my machines are running vs not. My accountant said this is perfect documentation to justify claiming more than just the square footage percentage for electricity.

Great questions about Schedule C categorization! As someone who's been through this confusion before, here's my take based on experience and professional guidance: Your vinyl sheets are definitely COGS Materials and Supplies since they directly become part of your finished product. This is the clearest categorization you have. For those $230 cutting machines, you're overthinking it! Since they're under the $2,500 de minimis threshold and have short useful lives, just expense them immediately under Operations Expenses - Supplies. No need for Section 179 or depreciation headaches for relatively inexpensive equipment. Packaging materials should go under COGS Materials and Supplies too - they're essential for delivering your finished product to customers, so they're part of your cost of goods sold. For utilities, if you track actual usage (like with a power meter), you can definitely claim more than just the standard home office percentage. Document your machine usage patterns and put the business portion under Operations Expenses - Utilities. Phone/internet business usage goes under Operations Expenses - Utilities at whatever reasonable percentage you can document. Those Costco storage bins are definitely just Operations Expenses - Supplies. At $12, they're way below any capitalization threshold. The key is reasonable documentation and consistency in your categorization approach!