Has anyone used the IRS worksheet for calculating taxable amounts of IRA distributions? I'm looking at Publication 590-B but its kinda confusing me with all the different worksheets.

Great question! This is definitely one of those situations that can trip up new preparers. When box 2a is blank, you're essentially doing detective work to figure out the taxable portion. For your code 7 distribution ($42,350 or $89,700 - not sure which is which), this is a normal distribution. It's fully taxable UNLESS your client made after-tax (non-deductible) contributions to the plan. You'll need to ask if they ever filed Form 8606 in previous years or made contributions that weren't deducted on their tax return. For the code 3 distribution, that's typically for disability payments. These are usually fully taxable, but you should verify the nature of the disability and how the plan was funded. The rollover mention is crucial - if your client rolled over one of these distributions to another qualified account within 60 days, that portion wouldn't be taxable. You'll need documentation of the rollover (like a statement from the receiving institution). My advice: Get a detailed conversation with your client about their contribution history, any rollovers completed, and copies of previous years' returns if they have them. Also check if there are any boxes checked for "Taxable amount not determined" or "Total distribution" on the 1099-Rs - these give you additional clues about how to handle the calculations.

Pro tip: Skip TurboTax entirely and use FreeTaxUSA. Federal filing is actually free for almost all tax situations (not just the super basic ones), and state filing is only $15. I've been using it for 5 years after TurboTax tried to charge me $120 halfway through my "free" filing. TurboTax, H&R Block, and TaxAct all pull the same bait and switch tactics. They spend millions on advertising their "free" versions knowing full well most people won't qualify once they're deep into the process.

I filed with TurboTax for 7 years and got hit with these "surprise" fees every single time. This year I switched to Cash App Taxes (used to be Credit Karma Tax) and filed completely free - federal AND state, with investment income and everything. took me like 45 minutes total.

Has anyone looked into setting up an LLC for nursing side gigs? I've heard this can help with deducting these kinds of expenses if you pick up extra shifts through your own business entity instead of as a regular employee.

Just wanted to add my experience as another OR nurse who's dealt with this exact issue. I spent about $200 last year on scrub caps too, and was disappointed to learn they're not deductible for my main hospital job. However, I do some weekend shifts at an outpatient surgery center where I'm classified as an independent contractor, so I was able to deduct a portion of my scrub cap expenses on Schedule C based on the percentage of time I worked there versus my main job. One thing that helped me was keeping detailed records of when I wore specific caps to which job - I actually started taking photos of my work schedule next to my caps just to have documentation. It might seem overkill, but if you do any 1099 work, having that kind of documentation could be really valuable. Also seconding what others said about talking to your employer - my main hospital actually started providing basic surgical caps after we brought up the infection control benefits of standardized, hospital-laundered caps.

Quick question - does anyone know if the tenants themselves could get in trouble for paying rent to someone they know isn't reporting the income? My sister is in a similar situation with her landlord who openly says he doesn't report rental income.

As someone who works in tax compliance, I want to emphasize that reporting suspected tax fraud is actually a civic duty that helps ensure everyone pays their fair share. The fact that this landlord openly admits to not reporting income and keeping things "off the books" makes this a pretty clear-cut case. One thing I'd add to the excellent advice already given - when you file Form 3949-A, be as specific as possible about dates, amounts (if known), and include copies of any evidence like those money order photos the tenants have. The more documented evidence you can provide, the stronger the case will be. Also worth noting that rental income tax evasion often involves other violations too - like not paying proper business taxes, employment taxes if they have maintenance staff, or even local occupancy taxes. The IRS investigation may uncover additional issues beyond just the unreported rental income. Don't feel bad about reporting this - tax evasion hurts everyone by shifting the burden to honest taxpayers and reducing funding for public services we all depend on.

Welcome to the US tax system! As someone who also moved here from overseas, I completely understand your confusion. The displayed prices at stores like Walmart and Target do NOT include sales tax - it's added at checkout, which is why your receipt total is higher than the shelf price. Unlike VAT systems in other countries, US sales tax generally cannot be "reclaimed" by businesses. However, the total amount you pay (including the sales tax) is typically deductible as a business expense on your federal income tax return, so you're not completely out of luck. If you're buying items for resale in your business, you may be able to obtain a resale certificate from your state that allows you to purchase inventory without paying sales tax upfront. Your customers will then pay the tax when they buy from you. This doesn't apply to general business supplies or equipment though. The system varies significantly by state, so I'd recommend checking with your state's department of revenue for specific rules in your area. Good luck navigating this - it's definitely more complicated than most other countries' systems!

As someone who's been helping businesses navigate US tax compliance for over a decade, I wanted to add a few practical tips for your situation. Since you mentioned you're from overseas, you might also want to consider whether your business structure (LLC, corporation, etc.) affects how you handle these sales tax payments and deductions. One thing I always tell new business owners is to set up a separate business checking account if you haven't already - this makes tracking business purchases (including the sales tax portion) much easier come tax time. When you're making purchases at retailers like Walmart or Target, try to keep business and personal purchases completely separate to avoid any confusion with deductions. Also, don't forget about online purchases! Many states now require online retailers to collect sales tax even for out-of-state purchases, so you might see tax being collected on Amazon orders, etc. The same rules apply - if it's a legitimate business expense, you can deduct the total amount including tax. Finally, consider consulting with a local CPA who has experience with your state's specific rules. They can help you determine if getting resale certificates makes sense for your business model and ensure you're maximizing your deductions while staying compliant. The investment in professional advice often pays for itself in tax savings and peace of mind.