This might be silly, but doesn't the short timeframe mean this could be considered "dealer property" (meaning you're in the business of flipping houses)? I thought if you buy, renovate and sell quickly without renting, the IRS might classify you as a dealer and tax the gains as ordinary income plus self-employment tax...

Just wanted to add one more important point that hasn't been mentioned - make sure you understand the timing of when you can claim these renovation expenses. Since you never actually placed the property in service as a rental (you sold it before renting it out), you can't depreciate any of the improvements. However, you can absolutely add all the renovation costs to your cost basis for calculating capital gains, which is exactly what you want in this situation. Also, don't forget about the soft costs during renovation - things like property taxes, insurance, and loan interest you paid during the 6-month rehab period. These can also be added to your basis. Many people overlook these "carrying costs" but they can add up to several thousand dollars. One last tip: if you used a credit card for any renovation expenses, those statements can serve as excellent documentation even if you don't have the original receipts. Credit card companies are required to keep detailed transaction records that the IRS generally accepts as valid proof of expenses.

17 Has anyone used TurboTax to file their 1099-NEC? I'm trying to figure out which software handles independent contractor income the best without making me feel like I need a business degree to file my taxes.

One thing to keep in mind about the 1099-NEC classification - make sure you're setting aside money for taxes throughout the year if you continue this type of work. Since no taxes are withheld, you'll likely need to make quarterly estimated tax payments to avoid penalties. The general rule is to set aside about 25-30% of your 1099 income for taxes (this covers both income tax and self-employment tax). You can make these payments online through the IRS website or mail them in. The due dates are usually mid-April, mid-June, mid-September, and mid-January. Also, don't forget that as a contractor, you're paying both the employee and employer portions of Social Security and Medicare taxes (the 15.3% self-employment tax), but you can deduct half of that on your tax return. It's one of those things that seems unfair at first, but the deduction helps offset some of the burden. Keep good records of all your work-related expenses throughout the year - it'll make tax time much easier!

I'm confused about the $600 reporting threshold mentioned earlier. I get reimbursed through Venmo for club expenses that add up to around $1,200/year. Does this mean Venmo will send me a 1099-K? I don't want to accidentally commit tax fraud!

This is a really common concern, and you're smart to be thinking about it proactively! The short answer is that true reimbursements for expenses you paid on behalf of the LLC generally aren't taxable income to you. Since you're getting paid back exactly what you spent (no markup or profit), keeping detailed records with receipts, and the payments are made within a reasonable timeframe, this fits the definition of an accountable plan arrangement. The LLC is essentially just returning your own money that you fronted for their business purposes. However, there are a couple of things to watch out for: 1. **Payment app reporting**: With the $600 reporting threshold for payment apps, you might receive a 1099-K from PayPal even though these transactions aren't taxable income. If this happens, don't panic - it's just a reporting requirement, not a determination of taxability. 2. **LLC's handling**: Make sure the LLC isn't issuing you a 1099 that includes these reimbursements. They shouldn't, since these aren't payments for services rendered. Your documentation sounds excellent - that spreadsheet tracking system and receipt collection will be crucial if there are ever any questions. The $38k total might seem high, but as long as you can match each reimbursement to a legitimate business expense with proper documentation, you should be fine. Keep doing what you're doing with the record-keeping, and consider having a brief conversation with the LLC about their reimbursement policies to make sure you're both on the same page!

did anyone have issues with paypal counting personal payments in their 1099? my brother paid me back for our parents anniversary gift through paypal and it was like $1200 and im pretty sure paypal counted it in my 1099-k even tho its not income?

This is a really common concern with multiple income streams! The key thing to remember is that PayPal's 1099-K threshold is based on aggregate payments received for goods and services, not individual transaction amounts. From what you described, only your $1,600 in client invoice payments would likely count toward PayPal's 1099-K reporting since those were processed as business transactions. Your crypto transfer, marketplace sales, fantasy sports winnings, and reward site deposits are typically handled differently: - Crypto exchange transfers are just moving your own money (the exchange reports the actual trading activity) - Marketplace sales should be reported by the marketplace itself on their own 1099 - Fantasy sports and reward sites have their own reporting thresholds Since your business payments through PayPal are only $1,600, you're well below the $5,000 threshold for 2024, so you likely won't receive a 1099-K from PayPal at all. The most important thing is to track each income source separately and report each one only once on your tax return, regardless of how many 1099 forms mention it. Keep detailed records of all your side gigs - dates, amounts, and sources - so you can properly categorize everything when tax time comes.

You're absolutely correct about the per-recipient rule! It sounds like you've got everything figured out properly. Since your largest gift to any single person was $12,000 (well under the $18,000 annual exclusion), you definitely don't need to file Form 709. Just to put your mind completely at ease - the IRS won't come after you for this. Their systems are sophisticated enough to distinguish between people who have actual filing requirements and those who simply filed extensions out of caution. Extensions are meant to give taxpayers time to properly evaluate their situation, which is exactly what you did. The fact that you're being so careful and thorough about this shows you're handling your tax obligations responsibly. You can safely ignore the extension you filed and move on - no further action needed!

I had a very similar situation two years ago! Filed Form 8892 for an extension thinking I needed to report some large gifts to family members, but then realized I was well under the annual exclusion limits. I was really worried about it at the time. I ended up calling the IRS directly (after waiting on hold forever) and the agent confirmed that filing an extension and then not filing the actual form is completely normal and won't cause any issues. She said they see this all the time - people file extensions out of caution while they're figuring out their obligations. The key thing is that you correctly determined you don't have a filing requirement. The IRS systems don't automatically flag people who file extensions but don't follow up with the actual form, especially for gift tax where many people aren't sure if they need to file. You're being very responsible by double-checking everything. Based on what you've described (staying under $18,000 per recipient), you're totally in the clear. No need to stress about this anymore!