Don't forget about self-employment taxes! Even if your YouTube business has losses that offset your other 1099 income for income tax purposes, you'll still pay SE tax on the net profit from your existing 1099 work. The SE tax is calculated separately for each Schedule C business - losses from one don't offset SE tax on another. Also, have you looked into an S-Corp election for your profitable 1099 business? At your income level, you might save significantly on SE taxes by taking a reasonable salary plus distributions.

One thing I haven't seen mentioned yet is the importance of timing your equipment purchases strategically. Since you're expecting significant expenses in the early years of your YouTube business, consider using Section 179 expensing or bonus depreciation to deduct the full cost of equipment purchases in the year you buy them, rather than depreciating them over several years. This is especially valuable when you have high income from your other sources that the YouTube losses can offset. For example, if you buy $13.5k worth of camera equipment in year one when your YouTube channel has minimal income, you can potentially deduct the full amount against your W-2 and 1099 income that same year. Also, keep in mind that the IRS looks at the totality of circumstances when determining business vs. hobby status. Even if you show losses in the first few years, factors like time and effort devoted to the activity, expertise you bring, success in similar activities, and expectation of asset appreciation all work in your favor. Since you already have successful business experience with your 1099 work, that demonstrates you understand how to run a profitable business. Just make sure you're treating the YouTube venture like a real business from day one - separate accounts, business plan, marketing efforts, etc. The documentation you create now will be crucial if the IRS ever questions your deductions later.

DO NOT IGNORE THIS! Document everything NOW. My ex did this to me and because I didn't respond quickly enough with the right documentation, it created a 2-year nightmare with the IRS. Print out all text messages where you told him not to claim them. Make copies of your court order. Get documentation from the school showing your address as their residence. The most important thing is filing Form 8332 showing you DID NOT release your claim to the children. Even though your return was accepted, his paper-filed return could still cause problems.

I went through this exact scenario two years ago. Your court order is your strongest protection here - the IRS follows legal custody arrangements, not just who pays support. Since you filed first and were accepted, you're in good position. A few practical tips from my experience: - Keep screenshots of those text messages where you explicitly told him not to claim them - If he does try to file, his e-file will likely be rejected immediately due to duplicate SSNs - If he paper files to try to bypass the system, it'll get caught during processing but may take longer to resolve The "tax preparers" he consulted either don't understand custody law or he's misrepresenting what they told him. Paying child support doesn't override a court order that specifically grants you the right to claim the children. Stay calm and document everything, but don't let him pressure you into "releasing" your claim. You have every legal right to claim your kids based on both custody time (more than half the year) and your court order.

Great breakdown on the technical side! As someone who's been through multiple filing seasons, I can confirm the WMR interface really doesn't correlate with actual processing speed. I've noticed that people with similar situations (same credits, filing status, etc.) can have completely different WMR experiences even when filed on the same day. The backend processing seems to depend more on which batch your return gets assigned to rather than anything you can control. It's frustrating that the IRS doesn't provide more granular status information, but understanding that it's essentially a "black box" until completion helps manage expectations. Thanks for bringing some actual analysis to this topic instead of the usual speculation!

This is incredibly helpful! I'm a newcomer here and filed my return 3 weeks ago with Schedule C income (freelance graphic design work). My WMR has been stuck on one bar the entire time and I was starting to panic reading all the conflicting advice online. Your explanation about the RTF updating independently from WMR makes perfect sense - it's like the difference between what's actually happening in the kitchen versus what the order tracking app shows you. Really appreciate you sharing actual technical knowledge instead of just anecdotal experiences. Do you know if there's any pattern to how gig worker returns get batched? I'm wondering if the additional verification you mentioned for Schedule C filers happens at a specific stage in the process.

Just to clarify something I'm seeing in some of the responses - the key date is December 31st of the tax year. If your son turned 18 in December 2023, that means he was 17 at the beginning of 2023 and turned 18 during the year. For Child Tax Credit purposes, he needed to be under 17 at the end of the year (December 31, 2023) to qualify. I had a similar situation when my daughter turned 17 in November a couple years back. I remember being disappointed to lose that credit, but was still able to claim her as a dependent for other purposes. Double-check your son's birthdate against these requirements just to be certain.

I went through this exact situation two years ago when my son turned 18 in November. The age cutoff rules can be really frustrating, especially when you're used to getting certain credits year after year. Just want to add one thing that helped me - make sure you keep detailed records of his college expenses if he's starting school. Even though you lose the Child Tax Credit, education credits like the American Opportunity Tax Credit can actually be more valuable (up to $2,500 vs the $2,000 CTC). You'll want to save all tuition statements, book receipts, and required fee documentation. Also, if your son has any part-time job income, make sure he understands whether he needs to file his own return. The IRS gets copies of his W-2s regardless, so coordination between your returns is important to avoid any complications with dependent claims. The silver lining is that this is typically a one-time adjustment year. Once you navigate it this time, you'll know exactly what to expect going forward!

Something important that hasn't been mentioned yet - check your sale agreement carefully. Often there are tax provisions specifically addressing this situation. In my case, we had a "tax true-up" clause that required the company to make a distribution to departing shareholders specifically to cover tax liabilities attributable to undistributed profits. If your agreement has language about tax distributions, tax true-ups, or tax withholding related to shareholder exits, you may have contractual recourse against your former partners.

The timing of your sale creates a unique issue. If you sold mid-year 2024 but the transaction completed in 2025, there's a possibility that your income allocation on the K1 isn't properly pro-rated for the period you actually owned shares. S Corps are required to allocate income based on per-share, per-day calculations when ownership changes mid-year. Did your K1 reflect owning shares for the entire year or just the portion you were an actual owner?