This 1099-K situation is such a headache! I'm dealing with something similar but with Stripe instead of PayPal. I received a 1099-K from Stripe for $15,000, but only about $8,000 of that came from clients who also sent me 1099-NECs. The other $7,000 was from smaller clients who didn't send separate forms. My question is: for the clients who didn't send 1099-NECs, do I still need to worry about double reporting? It seems like the Stripe 1099-K might be the only record of those payments. Also, has anyone had luck getting payment processors to amend their 1099-K forms when there are date discrepancies? I'm wondering if it's worth the hassle or if I should just follow the constructive receipt rule that Sean mentioned. The whole payment processor reporting system really needs to be simplified. It's causing way more confusion than it's solving!

I'm dealing with a very similar situation and wanted to share what I learned from my tax preparer. The key insight is that the IRS matching system is designed to handle these overlapping forms - they expect to see both the 1099-K and 1099-NECs reported. Here's the approach my CPA recommended: Report all forms exactly as received, but on your Schedule C, only include your actual business income once. Most tax software will ask you to reconcile any discrepancies between the forms you've entered and your Schedule C totals. For your January 1st payment timing issue, I faced something similar. We decided to report the income in 2025 (when I actually received access to the funds) and attached a brief explanation to my return noting the PayPal 1099-K date discrepancy. My preparer said this is becoming increasingly common and the IRS has guidance for these situations. One tip that really helped me: I created a simple Excel sheet listing every payment, which form(s) reported it, and which year I'm claiming it as income. This made it much easier to explain everything clearly on my return and gave me confidence that I wasn't missing or double-counting anything.

I'm new to this community and just wanted to say thank you to everyone who shared their experiences with IBKR prediction contract reporting! I'm in the exact same situation as Keisha - made a small profit on prediction contracts but got confused by the 1099-MISC showing gross proceeds instead of net profit. Reading through all these responses has been incredibly educational. I was initially planning to just report the full gross proceeds amount to avoid any potential issues, but now I understand that would mean paying taxes on income I never actually received. The explanations about why brokers report gross proceeds (regulatory requirements) versus what we actually owe taxes on (net profit) really clarified things for me. I'm going to follow the approach that multiple people here have used successfully: report my actual net profit on Schedule 1, Line 8z with a simple explanatory statement, and keep all my transaction documentation. It's so helpful to hear from people like CosmicCommander and Yara Haddad who went through this process and had their returns accepted without issues. Thanks again to this community for providing such detailed, practical advice based on real experiences!

I'm new to this community and just wanted to add my voice to thank everyone for this incredibly helpful discussion! I'm in a very similar situation with IBKR prediction contracts - made about $750 profit but the 1099-MISC shows the full gross proceeds, which had me completely confused about how to report it correctly. Reading through all these detailed responses from people who have actually been through this process successfully has been so reassuring. I was initially worried about reporting a different amount than what's on the 1099-MISC, but now I understand that reporting just the net profit is actually the correct approach, not "changing" anything. The explanations about why IBKR reports gross proceeds (regulatory requirements) versus what we actually owe taxes on (net profit) really helped me understand the bigger picture. I'm definitely going to follow the approach that multiple people here have used successfully: Schedule 1, Line 8z for the actual profit amount, plus a simple explanatory statement and keeping all my transaction documentation. It's such a relief to hear from people like CosmicCommander, Yara Haddad, and others who went through this exact process and had their returns accepted without any issues. This community is amazing for providing practical, experience-based advice!

Just wanted to add something that might help others - when you're dealing with excess FICA from multiple employers under the same parent company, make sure to check if any of the companies issued corrected W-2s after year-end. I had a similar situation where one of the three entities my spouse worked for automatically issued a W-2c (corrected W-2) in March that reduced the Social Security wages to account for the excess. This actually reduced our excess FICA amount by about $800, so we had to recalculate our Form 843 before submitting. Also, if you're using tax software like FreeTaxUSA, TurboTax, etc., most of them will automatically calculate excess FICA and include it as a credit on your regular tax return if the software detects it. But this only works if you had two employers max - if you had three or more employers like in your case, you'll likely need to file the separate Form 843. The IRS processing center addresses are definitely state-specific, so don't just use a generic IRS address. For most states, you'll be mailing to either Ogden, UT; Kansas City, MO; or Austin, TX depending on your location.

I had to deal with this exact situation last year when my company restructured and split payroll between different subsidiaries mid-year. The excess FICA refund process through Form 843 was actually pretty straightforward once I figured out the correct procedures. A few important points that haven't been mentioned yet: 1. **Timing matters** - You generally have 3 years from the date you filed your original return (or 2 years from when you paid the tax, whichever is later) to claim a refund for excess FICA. Don't wait too long! 2. **Interest on refunds** - The IRS actually pays interest on Form 843 refunds if they take longer than 45 days to process. It's not much, but it's something. 3. **Amended returns vs Form 843** - Some tax professionals will tell you to file an amended return (Form 1040X) instead of Form 843 for excess FICA, but Form 843 is specifically designed for this situation and tends to process faster. 4. **Record keeping** - Keep detailed records of when you mailed Form 843, including copies of everything. If there are any issues or delays, having this documentation will be crucial when you need to follow up. The processing time really varies - I've seen people get refunds in 6 weeks and others wait 4+ months. The key is making sure your form is filled out completely and accurately the first time to avoid any back-and-forth with the IRS.

Just a heads up - I do similar advantage play and got audited last year. The biggest issue wasn't the gambling itself but that I wasn't filing quarterly estimated tax payments. Since there's no withholding on gambling winnings (unlike a regular job), the IRS expects you to make quarterly payments if you're going to owe a significant amount. If you're making $40K profit, you definitely need to be making estimated tax payments throughout the year. Otherwise, you'll get hit with underpayment penalties on top of the taxes you owe.

This is a really complex situation and I appreciate everyone sharing their experiences. As someone who's dealt with similar tax issues, I want to emphasize a few key points: First, the distinction between hobby gambling and professional gambling is crucial for your tax strategy. If the IRS considers you a professional gambler (based on factors like regularity, time invested, expertise, and profit motive), you'd report your income on Schedule C and could deduct business expenses like travel, equipment, and even home office costs. However, you'd also pay self-employment tax. Second, for advantage play specifically, the IRS has been paying more attention to this activity recently. The systematic nature of bonus hunting and arbitrage betting can actually work in your favor for establishing professional status, but it also means you need bulletproof documentation. Third, regarding the services mentioned here - while they might be helpful, make sure any tax professional you work with understands the specific nuances of advantage play. Not all CPAs are familiar with how promotional offers, cashback, and arbitrage betting should be categorized. Finally, consider setting aside 25-30% of your profits for taxes from the start. Gambling income is taxed as ordinary income, so depending on your bracket, you could be looking at a significant tax bill. The quarterly payment advice mentioned earlier is spot-on - don't wait until next April to deal with this. Good luck with your tax planning!

Has anyone used TurboSelf-Employed for tracking these kinds of expenses? My accountant charges me a fortune and I'm wondering if I could DIY with the right software.

Great question! I've been self-employed for about 5 years now and have dealt with this exact situation multiple times. The key thing to remember is that you can't deduct the value of your time, but you absolutely can deduct legitimate business expenses incurred during client acquisition. Since you mentioned spending 80 hours over two weeks, I'd suggest going back through that period and documenting every actual expense you had. This might include gas/mileage if you drove to meetings, any materials you purchased for the proposal, software subscriptions you used, coffee/meals during client meetings (50% deductible), and even a portion of your home office expenses if you qualify. One thing that helped me was creating a simple spreadsheet to track all expenses by potential client, even when deals don't close. That way I have documentation ready at tax time. The IRS allows these client acquisition costs as ordinary and necessary business expenses on Schedule C, but good record-keeping is essential. Also, since this client did sign the contract, all those expenses are clearly legitimate business costs that led to actual revenue. Make sure to keep copies of your SOW, meeting notes, and any receipts from that period.