Dumb question but do personal checks from clients who didn't send 1099s count as "under the table" income? My tax guy said i don't need to report income without a 1099 but that sounds wrong to me.

This is exactly the kind of mixed income situation that trips up a lot of freelancers! The good news is that having personal reimbursements mixed with business income in your bank account isn't inherently problematic - you just need to be able to document the difference. Here's what I'd recommend: Create a simple spreadsheet with three columns - Date, Amount, and Type (Business Income vs Personal Reimbursement). Go through your bank statements and categorize each deposit. For the reimbursements like your dad's utility bills or friend payments, keep any supporting documentation (texts, emails, original receipts) that show these were reimbursements rather than income. The IRS cares about accuracy, not perfection in your banking setup. As long as you can substantiate which deposits were actual income versus personal transactions, you'll be fine. That said, definitely consider opening a separate account for future business income - it makes everything so much cleaner come tax time. One last thing - make sure you're setting aside money for quarterly estimated tax payments if you haven't been doing that already. Self-employment tax can be a nasty surprise if you're not prepared!

Has anyone tried just setting up a separate sole proprietorship for the equipment rental part? I'm wondering if I could invoice clients separately - one invoice from my service business and another from an equipment rental business with a different name and EIN.

I've been dealing with this exact issue for the past three years as a freelance DP who rents out my RED camera package. What I learned from my CPA is that the key isn't necessarily how your clients issue the 1099s, but how you can substantiate separate business activities. The IRS Publication 535 actually covers this - if your equipment rental is "incidental" to your services (meaning you primarily rent to clients you're also providing services to), then it's all considered one business subject to SE tax. However, if you can show that you have a separate equipment rental business (renting to other operators, production companies you don't work for, etc.), then you might qualify to report that portion on Schedule E. I started tracking every equipment rental separately in QuickBooks and made sure to actively market my gear rental independently. Now about 30% of my equipment income comes from rentals where I'm not providing services, which helps establish it as a separate business activity. The documentation is crucial if you get audited. Your current QuickBooks setup is a good start, but make sure you're also tracking which rentals include your services versus equipment-only rentals. That distinction could save you significant money in self-employment taxes down the road.

Has anyone compared Free Tax USA to TurboTax for business filers? I've been using TurboTax for years but the price keeps creeping up every year. Now they want $170 just for the basic self-employed version before adding state filing!

I've been using Free Tax USA for my consulting business for two years now and it's been solid. One thing I'd add to what others have said - if you're worried about making mistakes, their customer support is actually pretty responsive via email. I had questions about how to handle some equipment depreciation and they got back to me within a day with clear guidance. The learning curve isn't too steep if you have your records organized. I keep a simple spreadsheet throughout the year tracking income and expenses by category, so when tax time comes I just reference that while filling out the forms. Takes me about 3 hours total now, compared to the 2-hour meeting + back-and-forth with my old CPA that cost 10x more. One heads up - make sure you understand the difference between business expenses and personal deductions before you start. The software will ask about both, but it's on you to categorize things correctly. When in doubt, err on the conservative side or do a quick Google search about what's deductible for your type of business.

17 One thing nobody has mentioned yet - if you do decide to file jointly, you need to include a statement signed by both you and your spouse agreeing to be taxed on your worldwide income. This is in addition to getting the ITIN. My tax preparer missed this last year and it caused a huge headache with our return getting flagged for review.

7 Just to add a bit more info - I've been in this situation for 3 years with my Brazilian husband. If you choose Married Filing Separately, be aware that you'll lose some tax benefits like education credits, child tax credits, earned income credit, etc. You also can't contribute to a Roth IRA if your income is above $10,000. Filing jointly with the election usually results in lower taxes overall, but then you have the hassle of getting an ITIN and reporting foreign income. It's worth calculating both ways if you can.

I've been using FreeTaxUSA for 5 years now. The state returns are usually available by mid-January, sometimes earlier depending on your state. For your estimated payment, you can probably just use the same method you used for Q3 unless your income has changed significantly.

I made the switch from TurboTax to FreeTaxUSA two years ago and it was one of my best financial decisions! A few tips for your transition: 1. **State returns timing**: California forms are usually available by late January, but you're right to be concerned about the January 15th deadline. I'd recommend calculating your estimated payment based on your Q3 method or using 110% of last year's tax liability to be safe. 2. **Data entry**: Since this is your first year with FreeTaxUSA, gather all your previous tax documents beforehand. The interface is clean and intuitive, but you'll need to manually enter everything this first time. 3. **Features you might miss**: FreeTaxUSA doesn't have some of TurboTax's bells and whistles like the mobile app for document photos, but honestly, I found those features more gimmicky than useful. 4. **Import capabilities**: You can import W-2s and 1099s directly from most major employers and financial institutions, which saves a ton of time. The $15 state fee is still a steal compared to what TurboTax was charging me ($120+ for state). You'll love not being constantly upsold to premium versions you don't need!