This is really helpful information! I'm a veteran who transferred my GI Bill benefits to my twin sons, and I've been contributing to 529 plans for both of them. I was hesitant to use both benefits simultaneously because I wasn't sure if it would create any tax complications. Reading through everyone's experiences here gives me confidence that this is a legitimate strategy. It sounds like the key is keeping good documentation of the school's published room and board costs and making sure the education savings account withdrawals don't exceed those amounts. One thing I'm curious about - do any of you know if there are any restrictions on timing? For example, if my son receives his GI Bill housing allowance on the 1st of each month, does it matter when during the month I take the Coverdell/529 distribution for his housing expenses? Or is it more about the total amounts for the academic year staying within the qualified expense limits? Also, has anyone dealt with summer semesters? I know the GI Bill housing allowance is prorated for summer terms, but I'm not sure how that affects the qualified education expense calculations for the savings accounts.

As someone who works as a tax preparer specializing in education benefits, I can confirm that everything discussed here is accurate. The interaction between Coverdell ESAs/529 plans and GI Bill benefits is one of the most commonly misunderstood areas I see. The key point that bears repeating is that these are governed by completely different sections of the tax code. The GI Bill housing allowance (under Title 38 USC) is a veterans benefit that's entirely separate from education tax benefits (under Title 26 USC). There's no "coordination of benefits" requirement like you might see with some other programs. What I tell my clients is to think of it this way: the GI Bill housing allowance is compensation for military service, while the Coverdell/529 funds are pre-tax or after-tax savings specifically earmarked for education. Using both simultaneously is no different than a student receiving a scholarship while also having their parents pay for room and board - perfectly legitimate as long as you stay within the qualified expense limits. One additional tip I'd add: if you're using both benefits, consider having the education savings account pay for the larger, more predictable expenses (like rent) while using the GI Bill housing allowance for variable costs (groceries, utilities, transportation). This makes record-keeping much cleaner and provides a clear paper trail showing how the Coverdell/529 funds were used for qualified expenses.

@Mia Roberts - I went through this exact same situation two years ago! The transition from married filing jointly to head of household can definitely be confusing. Here are the key things that helped me: 1. **Head of Household**: You likely qualify since you're providing more than half the cost of maintaining a home for your kids. This gives you better tax rates than filing single. 2. **Child Tax Credit**: With two kids under 17 and your $58k income, you should definitely claim the full credit. Put $4,000 in Step 3 of your W4 ($2,000 per child). 3. **Don't forget about childcare**: If you're paying for daycare or after-school care so you can work, look into the Child and Dependent Care Credit. This won't affect your W4 but will help at tax time. 4. **Consider quarterly estimated payments**: If you have any side income or irregular earnings, you might need to make estimated payments to avoid underpaying. The biggest mistake I made my first year was not adjusting my withholding enough to account for losing the "married filing jointly" benefits. Better to have a little extra withheld than owe a big chunk next April! You've got this - being a single mom is tough but you're taking all the right steps by asking for help.

@Mia Roberts - As someone who went through a similar transition last year, I wanted to add a few practical tips that really helped me navigate the W4 as a newly single parent: **Double-check your qualifying dependents**: Make sure your divorce decree specifies who claims the kids each year. Even if you have physical custody, sometimes there are agreements about alternating years for tax purposes. **Consider your new marginal tax rate**: At $58k as head of household with two kids, you're likely in the 12% bracket, but it's worth running the numbers. The child tax credit will significantly help, but don't forget about the earned income credit if you qualify - it phases out around $50k for HOH with 2 kids, so you might still get some benefit. **Timing matters for mid-year changes**: Since you started this job after your divorce, make sure your withholding accounts for the partial year. If you worked part of the year under different circumstances (married, different job, etc.), your annual withholding calculation needs to reflect that. **Keep good records**: Start tracking any work-related childcare expenses, as these can be deductible. Also, if you're paying health insurance premiums for the kids, those might be deductible too. The learning curve is steep, but you'll get the hang of it! Feel free to ask if you have specific questions about any of these points.

Does anyone know if TurboTax handles Form 8949 and Schedule D correctly for loss carryovers? Last time I used it, it seemed confused by my carryover amount.

Just wanted to add my experience since I was in almost the exact same situation last year. I had $4,200 in long-term capital losses from just 3 stock sales and was also confused about the forms. You definitely need both Form 8949 AND Schedule D - there's no way around it. Form 8949 is where you list each individual transaction with all the details (purchase date, sale date, cost basis, proceeds, etc.), and Schedule D is where you summarize everything and calculate your total loss. For your $4,500 loss, you'll deduct $3,000 against ordinary income this year and carry forward $1,500 to next year. The carryover works indefinitely until you use it all up - doesn't matter if you don't trade stocks in 2025, you can still claim that $1,500 loss. One tip: double-check that your 1099-B shows the correct cost basis. My broker had the wrong purchase date on one of mine, which would have messed up my long-term vs short-term classification. Caught it just in time!

This is really helpful information! I'm in a similar situation and had no idea about the online payment options. One thing I'm wondering about - when you make the initial 1040-V payment through IRS Direct Pay, does it automatically set up your monthly payments too, or do you have to manually make each monthly payment? Also, for anyone still struggling with this - I found that calling the IRS early in the morning (like right at 7 AM when they open) gives you a much better chance of getting through. I tried for days calling in the afternoon with no luck, but got through on my second try calling first thing in the morning. The agent was able to confirm my installment agreement was active and gave me all the payment details I needed. The key thing seems to be not waiting around for the mail - just start making payments as scheduled even without the official paperwork. Better safe than sorry when it comes to the IRS!

Just wanted to chime in with my recent experience since I went through this exact same situation a few months ago! You absolutely can pay your 1040-V payment online - I used IRS Direct Pay and it was so much easier than dealing with checks and mail. Just make sure when you're on the Direct Pay site to select "Installment Agreement" as your payment reason and enter your SSN and other identifying info carefully so it gets applied correctly. For the timeline question - mine took about 6 weeks to get the official installment agreement letter, which was longer than I expected but seems pretty normal based on what others are saying here. The important thing is your agreement is already active in their system even without the paperwork. One thing I wish someone had told me earlier: you can actually view your installment agreement details in your IRS Online Account once it's processed (took about 4-5 weeks in my case). It shows your payment schedule, remaining balance, and due dates. Way more convenient than waiting for paper statements in the mail. Don't stress too much about the delay - just make sure to start making payments according to the schedule you agreed to when you filed, even without the official letter. The IRS expects you to stick to those dates regardless of when their paperwork arrives!

Regarding the 401k question - the $23,000 employee contribution limit for 2025 is shared across all your 401k accounts. But don't forget that the employer contribution portion of a Solo 401k is separate and follows different rules! As a self-employed person, you can contribute up to 25% of your net self-employment earnings as an "employer" contribution, up to a combined total limit of $69,000 for 2025 (or $76,500 if you're over 50). This can get really advantageous for high-earning 1099 contractors because you can potentially put away MUCH more for retirement than you could as just a W2 employee.

This is such a timely question! I just went through this exact transition last year and learned some hard lessons about tax planning. One thing I wish I had done earlier was run quarterly estimated tax payments once I started the 1099 work - don't wait until year-end like I did! A few practical tips from my experience: 1. Set up a separate business checking account for your 1099 income and expenses - makes tracking so much easier 2. Track ALL business expenses meticulously (home office, equipment, software subscriptions, etc.) - these can significantly reduce your net SE income 3. Consider making your Solo 401k contributions early in the year rather than waiting until tax time - gives you more flexibility with cash flow Also, since you're dealing with SSTB income as a software consultant, you might want to explore whether any of your work could potentially be classified differently. Sometimes the line between "consulting" and other types of services isn't crystal clear, and it could make a big difference for your QBI eligibility. Good luck with the transition! The tax complexity is definitely a shock at first, but the flexibility and earning potential usually make it worthwhile.