Is Cash App Taxes actually reliable though? I'm nervous about using something connected to a payment app for my taxes. Has anyone had issues with accuracy or audits?

Thanks for this heads up! I was completely unaware of the Credit Karma/Intuit situation and almost got stuck paying for TurboTax. I've been using Credit Karma for taxes for the past few years and was shocked when they redirected me to a paid service. Just successfully filed through Cash App Taxes and you're absolutely right - it's the exact same interface I remember from Credit Karma. All my previous year information was there, and it walked me through everything step by step. Filed federal and state completely free, even with my rental property income and deductions. It's frustrating that this change isn't more widely publicized. I only found out about Cash App Taxes through your post after spending an hour confused about why Credit Karma was suddenly charging me. The IRS Free File website should really be updated to reflect these changes more clearly.

Quick question - I'm using TurboTax for this situation. Where exactly do I enter Venmo income that didn't get reported on a 1099? Do I just add it as "Other Income" somewhere or do I need to do something with Schedule C?

This is a really common situation that trips up a lot of people! The key thing to remember is that the IRS cares about the income you received, not whether you got the proper paperwork. Since you earned over $10,000 from this contract work, you definitely need to report it. I'd recommend reaching out to the business owner to ask if they filed a 1099-NEC for you - sometimes businesses file these directly instead of relying on payment platforms. But even if they didn't, you still need to report the income on Schedule C as self-employment income. One thing to keep in mind is that you'll owe self-employment tax on this income (around 15.3%) in addition to regular income tax. Since no taxes were withheld from your Venmo payments, you might also owe estimated tax penalties if this pushed you into owing more than $1,000 at filing time. For next year, consider making quarterly estimated payments to avoid this. Document everything you can - keep those Venmo transaction records, any messages with the business owner about the work, and receipts for any business expenses you incurred. Good record-keeping will protect you if there are ever any questions down the road.

dont listen to half these people. turbo tax just wants to know about the car for sales tax deduction. if ur taking standard deduction (which most ppl do now with the higher amounts) then it doesnt even matter. u can skip it completely if ur not itemizing. i did.

Just wanted to share my experience from last year - I had the exact same confusion with my Honda financing! What helped me was looking at my loan documents more carefully. There's usually a section that breaks down the total amount financed, which includes the vehicle price, taxes, fees, and sometimes extended warranties or other add-ons. For TurboTax purposes, you want just the actual vehicle purchase price (not the total loan amount) and the sales tax you paid. The sales tax might be rolled into your loan, but it's still considered "paid" for tax purposes. My dealership actually had this broken out clearly on the purchase agreement - look for something called a "buyer's order" or "sales contract" that shows the vehicle price separate from taxes and fees. One thing that caught me off guard was that some dealerships include things like extended warranties or service packages in the financing, but those aren't part of the vehicle purchase price for tax reporting. Make sure you're only reporting the actual car price and applicable taxes/fees, not the total financed amount.

Quick tip from someone who's been through this: keep REALLY good records of this whole process. Save all statements showing your original contribution, the exact earnings calculation from your broker, and the full withdrawal. The IRS sometimes sends automated notices for retirement account distributions even when you've reported everything correctly. Having clear documentation makes it much easier to respond if you get a letter. I learned this the hard way and had to dig through old emails to find confirmation of exactly when I made the correction.

Just wanted to add my experience since I went through this exact same situation last year as a married filing separately filer. The advice here is spot-on, but I'll share a few additional details that might help. When you call your broker for the earnings calculation, ask them to provide it in writing (email is fine). Some brokers can be slow to respond or give you different numbers if you call multiple times. Having it documented helps ensure consistency. Also, don't panic if your tax software doesn't have a specific category for "excess Roth contribution earnings" - many don't. You'll manually enter it on Schedule 1, Line 8z as others mentioned. I used TurboTax and had to override some of their automated suggestions because it kept trying to categorize it as a regular early distribution. One thing that surprised me was that my state (Texas) didn't have any additional requirements, but definitely check your state's rules as others have mentioned. The whole process was much less scary than I thought it would be once I got organized with the documentation. Good luck with your filing - you caught the mistake and you're handling it correctly, which is the important part!

Don't forget to check if your state offers tax benefits for education expenses too! I'm in New York and was able to claim a state tax deduction for my tuition payments even after I graduated.

This is such a helpful thread! I'm in a similar boat - graduated in 2022 but still making payments on my undergrad loans through my school's payment plan. One thing I learned the hard way is to make sure you're keeping detailed records of ALL your payments throughout the year. I use a simple spreadsheet to track the date, amount, and what the payment was for (tuition vs fees vs interest). This made it so much easier when I needed to prove my qualified education expenses. Also, if you're considering the Lifetime Learning Credit vs the tuition and fees deduction, run the numbers both ways. Depending on your tax situation, sometimes the deduction can be more beneficial than the credit, especially if you're in a higher tax bracket. The deduction can reduce up to $4,000 of taxable income, while the LLC maxes out at a $2,000 credit. Good luck with your filing!