I'm dealing with a very similar situation right now! My accountant missed several obvious deductions and I'm out about $2,200. What I've learned so far is that you definitely have options, but timing matters a lot. First, definitely file those amended returns (Form 1040-X) as soon as possible. You generally have 3 years from the original filing date, but don't wait - the sooner you file, the sooner you get your refund. Second, document everything. Get written opinions from the other accountants about what was wrong with your original returns. This becomes crucial evidence if you need to pursue your original accountant for compensation. Third, many states have licensing boards for tax preparers that handle complaints about professional negligence. If your accountant is licensed (CPA, EA, etc.), filing a complaint can sometimes motivate them to resolve the issue quickly. The $3,800 you mentioned is significant enough that it's worth pursuing aggressively. Even if their engagement letter limits liability, gross negligence or clear professional errors often override those protections. Don't let them off the hook too easily - that's a lot of money to just write off as "oops.

I've been following this thread and wanted to share my experience from a few years back when I discovered my tax preparer had been making errors for THREE years running. I ended up recovering over $6,000 through amended returns, but the process taught me some valuable lessons. Here's what I'd recommend based on your situation: 1. **Get everything in writing** - When you approach your original accountant, don't just have a phone conversation. Email them a detailed list of the specific errors the other professionals identified. This creates a paper trail. 2. **File amended returns yourself or with a new accountant** - Don't wait for your original accountant to "make it right." The clock is ticking on those 3-year deadlines, and you want to get your refunds processed ASAP. 3. **Consider the preparer penalty angle** - If your accountant is a paid preparer who made obvious errors, they might be subject to IRS penalties themselves. Sometimes mentioning this (professionally) can motivate them to be more cooperative about covering your costs. 4. **Keep track of ALL your costs** - Document the fees you're paying other accountants for reviews, amendment preparation, etc. Even if you can't recover the overpaid taxes from your original accountant, these costs might be deductible as tax preparation expenses. The fact that MULTIPLE professionals identified the same issues suggests these weren't judgment calls but actual errors. $3,800 is absolutely worth fighting for - that's real money that belongs in your pocket, not the government's.

This thread has been incredibly helpful! As someone who was in almost the exact same situation last year, I can't stress enough how important it is to get this right the first time. The biggest misconception (which I almost fell for too) is thinking that "exemption from withholding" is meant for first-time workers. It's not - it's specifically for people who won't owe ANY federal income tax for the entire year. At your income level of $13.50/hour for 25-30 hours weekly, you'll definitely exceed the standard deduction and owe taxes. I made the mistake of claiming exemption my first few months because someone told me "new workers don't have to pay taxes." Big mistake! I ended up owing about $1,800 plus penalties when I filed. Had to work extra shifts just to pay it off. My advice: Fill out your W-4 normally. Yes, you'll have less in each paycheck, but you'll avoid the nightmare of owing money you don't have next April. Plus, if they withhold too much, you get it back as a refund - which feels like a nice bonus when you're a broke college student! Trust me, that extra $80-100 per paycheck isn't worth the stress and financial burden of owing thousands later. You're smart to ask about this upfront rather than learning the hard way like I did.

I went through this exact same confusion when I started my first job at 17! The exemption from withholding sounds like it's made for people like us who've never worked before, but it's actually a completely different thing. Here's the reality check: exemption is only for people who expect to owe ZERO federal income tax for the entire year. At $13.50/hour working 25-30 hours weekly, you're looking at around $17,500-$21,000 annually. That puts you well above the standard deduction (around $14,000), so you'll definitely owe some federal taxes. I almost made the same mistake you're considering, but thankfully my older sister warned me after she got burned with a $2,200 tax bill plus penalties when she claimed exemption incorrectly. My recommendation? Fill out the W-4 normally and let them withhold taxes. You'll still get most of your paycheck, and if they take out too much, you get it back as a refund. Much better than scrambling to find money you don't have next April while juggling college expenses. The extra $50-80 per paycheck from claiming exemption isn't worth the potential nightmare of owing thousands later. Trust me on this one - play it safe!

Accounting professional here. My firm handles dozens of grantor trusts, and we generally take the conservative approach and issue 1099-NECs for service providers paid over $600, even to family members. Here's why: 1) The penalty for not filing a required 1099 can be substantial ($280 per form for 2025) 2) Filing a 1099 doesn't create additional tax implications if the income would be reported anyway 3) The IRS has been increasingly strict about information reporting requirements If you're uncertain, issuing the 1099-NEC is the safer approach. It documents the payment properly and doesn't create any negative consequences if it turns out it wasn't strictly required.

This thread has been incredibly helpful! As someone new to trust taxation, I've learned so much from reading through everyone's experiences and insights. From what I'm gathering, the key factors seem to be: 1) Whether the services are truly professional/business-like vs. informal family help, 2) The $600 threshold, 3) How the trust document is structured, and 4) Whether the recipient has fiduciary responsibilities that could qualify for the trustee fee exception. The conservative approach of issuing the 1099-NEC when in doubt makes a lot of sense, especially given the penalties for non-compliance. And knowing about the trustee fee exception for SE tax purposes is a game-changer - it seems like you can satisfy the IRS reporting requirements while still protecting the recipient from unnecessary self-employment tax if they qualify. Thanks to everyone who shared their experiences and cited specific regulations. This is exactly the kind of practical guidance that's hard to find elsewhere!

Wait, I'm confused. If you were working as a consultant, wouldn't you get a 1099-NEC from your old employer? Then I think that would go on Schedule C. Did you receive any tax forms from them or were you just paid directly?

This definitely sounds like a processing error on the IRS's part. Schedule C income should never be reclassified to "Other Income" on Line 8 - that's completely incorrect. Schedule C is specifically designed for business income from sole proprietorships, and the net profit flows to Schedule 1 and then to your main 1040. I'd recommend taking a multi-pronged approach here: 1. **Immediate response**: Call the IRS business tax line (not the general number) and explain that this appears to be a processing error where they didn't properly recognize your filed Schedule C. 2. **Documentation**: Gather copies of your original return showing the Schedule C was properly filed, along with any 1099-NEC forms you received from your former employer. 3. **Written response**: Send a formal written response before their deadline explaining that the income was correctly reported as business income on Schedule C, not as "other income." The fact that they're trying to move the entire revenue amount (not just disallowing expenses) strongly suggests this is a data processing mistake rather than a hobby vs. business classification issue. If they were challenging it as a hobby, they'd typically allow the income on Schedule C but disallow the business deductions. Don't panic - this is fixable, but definitely respond promptly to avoid additional penalties and interest while they sort out their error.

I went through this exact situation two years ago and can share what I learned. Your accountant is incorrect - you cannot file as "Single" for 2024 taxes if you're still married on December 31, 2024, even if the divorce is finalized in early 2025. Here's what I'd strongly recommend: File "Married Filing Separately" and don't let your ex pressure you into joint filing. Yes, you'll both be required to use MFS if you choose it, and yes, you might pay slightly more in taxes. But the peace of mind and financial protection is absolutely worth it. I made the mistake of filing jointly during my divorce to "save money" and it created so many additional complications - we had to coordinate on every single deduction, share sensitive financial information, and I remained liable for any issues with his portion of the return. The $800 we "saved" wasn't worth the stress and ongoing financial entanglement. Also, make sure you understand the timing - whatever status you choose for 2024 taxes only affects that tax year. Once your divorce is final, you'll be able to file as Single for 2025 taxes (filed in 2026). Trust your instincts about keeping things clean during this transition. Your financial independence starts with your tax filing decisions.

Another important consideration during divorce - make sure you update your withholdings and estimated tax payments if you decide to file separately! When I switched from joint to separate filing mid-divorce, I didn't realize my withholdings were still calculated based on the married filing jointly tax brackets. I ended up owing an additional $2,100 at tax time because my employer was withholding too little for my new filing status. The IRS has a withholding calculator that can help you adjust your W-4 once you decide on your filing status. Also, if you have any estimated tax payments due for the current year, you'll need to make sure those are calculated correctly for separate filing too. Just another reason to get your filing status decision locked in sooner rather than later so you can adjust everything accordingly.