Don't overthink this. I was in your EXACT situation in college. You're already a sole proprietorship by default. Just keep good records and use Schedule C when you file taxes. For your car: if client reimburses some miles but not all, track EVERYTHING with an app like MileIQ or Everlance. Deduct only non-reimbursed business miles. LLCs cost money to form + annual fees in most states. Usually not worth it for students unless you have liability concerns or plan to scale up significantly.

As someone who went through this exact situation during my graduate program, I'd echo what others have said about already being a sole proprietorship by default. The key is getting your recordkeeping system down now before tax season hits. One thing I wish I'd known earlier: you can also deduct a portion of your home expenses if you use part of your home regularly and exclusively for business (like a dedicated workspace for administrative tasks, client calls, etc.). Even as a student, if you have a corner of your room that's primarily used for your contractor work, that could qualify for the home office deduction. Also, don't forget about other potential deductions beyond mileage - things like professional development courses, business-related software subscriptions, phone bills (business portion), and even some of your internet costs if you use it for work. These smaller deductions can really add up. The quarterly estimated tax payments are crucial too. Since you're setting money aside already, make sure you're actually making the quarterly payments to avoid underpayment penalties. Many students miss this and get hit with extra fees even when they have the tax money saved.

This exact same thing happened to me last year! My 846 code showed $2,847 but only $1,961 actually deposited. I was panicking for days thinking the IRS made some huge mistake. Turns out I had completely forgotten about an old debt from my college days that went into default. The Treasury Offset Program had taken $886 to pay it off. The notification letter explaining the offset arrived about a week AFTER my refund deposited, which is why I was so confused at first. My advice would be to call the Treasury Offset Program at 800-304-3107 first thing Monday morning. They can tell you immediately if any portion was offset for debt collection. It's usually much faster than trying to reach the IRS directly, and they have access to all the offset information in real time. Also double-check your transcript for any 971 notice codes that might indicate an adjustment was made to your return. Sometimes those are easy to miss when you're focused on the 846 code. Really hoping it's just a bank processing issue and the full amount shows up when it posts!

I'm going through something very similar right now! My 846 code shows one amount but my bank is showing a pending deposit that's $600 less. Reading through all these responses has been super helpful - I had no idea about the Treasury Offset Program or that banks sometimes show partial amounts during pending. I'm definitely going to wait until my deposit actually posts before I start panicking, but if the full amount doesn't show up, I'll call that Treasury Offset number that Vince mentioned. The 800-304-3107 seems like it could save a lot of time compared to trying to get through to the IRS directly. Also going to go through my transcript line by line this weekend to look for any codes I might have missed. It's crazy how many different reasons there could be for a discrepancy like this. Thanks everyone for sharing your experiences - makes me feel less alone in dealing with this stress!

Does anyone know if TurboTax automatically applies your loss carryover from the previous year if you used TurboTax for both years? I swear it used to do this automatically but now I cant find where its pulling that data from.

I went through this exact same struggle last year! The Capital Loss Carryover Worksheet can be really confusing at first. Here's what helped me get through it: First, you definitely need your 2023 tax return - specifically Schedule D and Form 8949 if you filed one. Look for line 21 on your 2023 Schedule D, which shows your net capital loss for that year. For your situation with $4,300 in losses, you're right that there's a $3,000 annual limit for deducting capital losses against ordinary income. So if your net loss last year was more than $3,000 after accounting for any gains, the excess carries forward. The worksheet asks for your prior year AGI to determine if you need to use the Capital Loss Carryover Worksheet or if you can use a simpler method. Most people with straightforward situations can just enter the carryover amount directly on Schedule D. One thing that tripped me up initially - make sure you're looking at your NET capital loss from last year, not just the gross losses. TurboTax should have calculated this for you on last year's Schedule D. If you can't find your 2023 return, you can get a transcript from the IRS website or call them. Don't stress too much - once you have the right numbers, it's actually pretty straightforward!

This is exactly the situation I found myself in two years ago! Yes, unfortunately your capital gains DO count toward determining which bracket you fall into. With your $337.5K salary plus $1.01M in gains, you'll definitely be pushed into the 20% capital gains bracket for most of those gains. Here's how it works: Your ordinary income gets taxed first at regular rates, then your capital gains get "stacked" on top. The portion of gains that fits between your salary and the $492,300 threshold (about $154,800) gets the 15% rate, and everything above that gets hit with 20%. But here's what really caught me off guard - don't forget about the 3.8% Net Investment Income Tax that kicks in at your income level. So you're looking at an effective rate of 23.8% on most of those gains (20% + 3.8%). My advice: definitely make sure you're doing quarterly estimated payments if you haven't already. The underpayment penalties on gains this large can be brutal. I learned that lesson the hard way!

I went through this exact same situation last year with large capital gains from company stock, and yes, unfortunately the gains do push you into the higher bracket. The way it works is your ordinary income gets taxed first, then capital gains get "stacked" on top to determine which rates apply. With your $337.5K salary plus $1.01M in gains, you'll be well into the 20% capital gains bracket for most of those gains. Only about $155K of your gains (the portion that fills the gap from your salary to the $492,300 threshold) will qualify for the 15% rate. One thing that really helped me was using tax-loss harvesting to offset some gains. If you have any losing positions, consider realizing those losses this year to reduce your overall tax burden. Also, don't forget about the 3.8% Net Investment Income Tax that applies at your income level - so you're really looking at 23.8% effective rate on most gains. Definitely recommend making quarterly estimated payments if you haven't already. The penalties on underpayment for gains this large can be significant. The safe harbor rule (paying 110% of last year's tax) might be your best bet to avoid penalties while you figure out the exact amount owed.

Just a tip that helped me with my small Etsy business income - keep a separate spreadsheet tracking ALL your income and expenses throughout the year. Update it monthly at minimum. PayPal's reporting is okay but not great for tax purposes. I export my PayPal activity every month to CSV, clean it up in Excel, and add it to my tracking spreadsheet. This makes tax time so much easier because I'm not scrambling to figure out what all these random deposits were from 10 months ago.

This is such a common situation and you're definitely not alone in feeling confused! The good news is that even though you didn't receive a 1099-K, you absolutely can and should report this income. A few key points to add to what others have said: 1. **You're absolutely right to report it** - The IRS expects you to report ALL income, regardless of whether you receive tax forms. The $5K threshold just determines whether PayPal has to send you a 1099-K, not whether you owe taxes. 2. **Schedule C is the way to go** - Your affiliate income is considered self-employment income, so you'll file Schedule C (Profit or Loss from Business). In TurboTax, look for the self-employment or business income section. 3. **Don't forget about deductions** - Since this is business income, you can deduct legitimate business expenses like: - Website hosting and domain fees - Equipment used for your blog (cameras, kitchen gadgets for reviews) - Portion of internet/phone bills used for business - Software subscriptions (photo editing, etc.) - Business meals (if you're reviewing restaurants) 4. **Keep good records going forward** - Start tracking everything now for 2025. A simple spreadsheet with monthly income and expenses will make next year's filing much easier. The self-employment tax threshold is indeed $400 in net earnings, so you'll likely owe that in addition to regular income tax. But don't let that scare you - it's all manageable once you get organized!