Has anyone actually found a tax form where self-employed people can claim sick days? I have TurboTax and don't see anything like this mentioned.

Just to add some clarity here - I went through this exact confusion last year when I started freelancing! The accountant was likely referring to the old FFCRA credits that ended, but there are still some things worth knowing as a self-employed person. While there's no federal "sick day" program currently, don't forget about these legitimate self-employment deductions that can help offset income loss when you're unable to work: - Health insurance premiums (huge deduction if you're not covered elsewhere) - HSA contributions if you have a qualifying high-deductible plan - Home office expenses (a portion of rent, utilities, etc.) - Professional development and training costs - Equipment and software purchases Also, some cities and counties have their own programs - worth checking your local government website. And definitely consider setting up a separate "sick fund" savings account where you put aside 5-10% of each payment for those inevitable down days. It's frustrating that we don't have the same safety net as W-2 employees, but building these habits early in your freelancing career will really pay off!

Has anyone used the annualized income method instead? I'm in a similar situation but my income is VERY uneven throughout the year, so paying equal installments seems like it would create cash flow problems for me.

I'm in a very similar boat - just started freelancing in March and was totally confused about estimated payments! Reading through all these responses has been super helpful. One thing I'd add is to make sure you're also setting aside money for self-employment tax (the additional 15.3% for Social Security and Medicare) on top of your regular income tax. That caught me off guard my first year since as a W-2 employee, half of that was paid by my employer. Also, don't forget that you can deduct half of the self-employment tax when calculating your adjusted gross income, which can help reduce your overall tax burden. It's not huge but every bit helps when you're navigating this for the first time! The safe harbor route definitely seems like the way to go for peace of mind, especially in your first year when you're still figuring out your income patterns.

I went the EA route before pursuing my CPA and want to share a tip about the exam itself. The Prometric testing experience can be jarring if you're not prepared for it. They have strict security procedures - expect to empty your pockets, roll up sleeves, get wanded with a metal detector, and be under camera surveillance. You can't bring anything into the testing room except your ID, and they provide a small whiteboard or scratch paper. The computer interface for the SEE exam is also pretty dated - nothing fancy like the CPA exam software. Make sure you do the sample test on the Prometric site to get familiar with it. And lastly, don't underestimate Part 3 (Representation). Many people focus on the tax law parts (1 & 2) but neglect studying the procedural rules and representation practices which can be quite technical and specific.

Great question about becoming an EA! I actually just completed my enrollment last year and can share some practical insights from the process. One thing I'd add to the excellent advice already given is to consider your timeline carefully. Since you're in Houston, you might want to check out local tax firms that value the EA credential - many of the larger practices here really appreciate having EAs on staff for representation work. Regarding study materials, I used a combination of Gleim and the IRS's own Publication 17 and Circular 230. Don't overlook the free resources from the IRS website - they have sample questions and detailed content outlines for each part that are invaluable for focusing your studies. Also, once you pass and get enrolled, consider specializing in a particular area like international tax or estate planning. The EA credential opens doors, but having a specialty can really set you apart in a competitive market like Houston. Good luck with your studies! The EA is definitely worth pursuing alongside your CPA - they really do complement each other well in practice.

Kind of off-topic but this is why I always do a "paycheck checkup" a couple times a year using the IRS withholding calculator. I had a similar issue at a previous job and caught it after my third paycheck because the net amount seemed too high. Saved me from a huge surprise at tax time. OP, for the future, always check your first few paystubs at any new job to make sure taxes are being withheld correctly. The IRS has a good withholding estimator tool that can help you figure out approximately how much should be coming out.

This is a really frustrating situation, and I feel for you having to deal with this mess. As others have mentioned, employers are absolutely required to withhold federal income tax based on your W4 - they can't just decide not to do it. Since you have your original W4 showing you claimed 0 exemptions and your 2024 W-2 shows $0 federal withholding in Box 2, you have solid documentation that this was their error, not yours. The fact that they withheld correctly in 2023 but not 2024 suggests something changed in their payroll system or process. A few things to consider while you're waiting for HR to respond: 1. Request a copy of what W4 they have on file for you currently - sometimes forms get lost or replaced incorrectly 2. Ask for detailed payroll records showing how your withholding was calculated (or not calculated) 3. Document all your communications with HR about this issue Even though you'll still need to pay the taxes you owe, having this documentation could be important if the IRS assesses any penalties. You might also want to look into whether your employer could be liable for any interest or penalties you incur due to their mistake - that would probably require talking to a tax professional though. Definitely keep pushing HR for answers. This kind of payroll error affecting someone's entire tax year is a serious issue they need to address and prevent from happening to other employees.

I went through this exact situation last year with a similar bonus amount. Here's what worked for me: I calculated how much extra withholding I could claim on Line 4(b) of the W-4 to temporarily reduce my federal withholding for that pay period. For a $36k bonus, you're looking at roughly $8k in withholding at 22%. I was able to reduce mine to about $3k by claiming additional deductions. The key is timing - submit your adjusted W-4 at least 2 weeks before your bonus processes, then immediately submit a new one after to return to normal withholding levels. I also increased my regular paycheck withholding slightly for the rest of the year to ensure I still met the safe harbor requirements. One important note for your income level: since you're over $150k AGI, you'll need to hit either 90% of current year tax or 110% of prior year tax to avoid underpayment penalties. Keep careful track of your total withholding throughout the year. The extra cash flow helped me tackle some high-interest debt immediately rather than waiting for a refund. Just make sure you're disciplined about setting aside money for any additional tax owed when you file.

Maya, what surprises me is that you HAVE lingering debt with an annual income of $215k and a bonus over $30k in the first place! Maybe start setting aside a little savings in a high yield savings acct and use that to pay them off during the year?