Does anyone know how the new tax law changes for 2025 will affect these credits? I heard they were expanding something but not sure if it affects the dependent age limits.

This is such a helpful thread! I'm dealing with a similar situation with my 18-year-old who graduated high school last year but decided to take a gap year before college. He's working part-time and living at home. From what I'm understanding here, since he's over 17 and not a student, he can't be a qualifying child. But if his income is under $4,700 and I provide more than half his support, he could qualify as a qualifying relative for the $500 Credit for Other Dependents, right? The tricky part is calculating whether I'm providing "more than half" his support. He pays for his own gas and some personal expenses, but I cover housing, food, health insurance, and his phone. Does anyone know if there's a specific worksheet or method the IRS recommends for calculating this support test?

16 Something that's helped me with cash purchases is taking a video of the transaction when possible (with seller's permission). I buy a lot from flea markets and estate sales, and a quick video showing the items, the money changing hands, and even a verbal confirmation of the price creates pretty solid documentation. I also created a simple "receipt book" app on my phone where I take a photo of the item, note the price, and have the seller digitally "sign" with their finger if they're willing. It's saved me so much hassle at tax time.

20 Don't forget about tracking your mileage when you're driving around to pick up inventory! That's a legitimate business expense that many resellers miss. I use an app that tracks my drives to source inventory, and it adds up to a significant deduction by year end. Also, if you're storing inventory in your home, you might qualify for a home office deduction for that space. Just make sure the area is used exclusively for your business inventory.

For future reference - KEEP 👏 DETAILED 👏 RECORDS! This is the easiest way to protect yourself. I use a dedicated credit card for all gambling deposits and a spreadsheet tracking every bet. Takes maybe 5 minutes after each session. When tax time comes, I have perfect documentation of my actual profits/losses. Also a small tip - if you're using multiple betting platforms, be strategic about withdrawing from sites where you're down vs. sites where you're up. This can sometimes help with the documentation side.

This is exactly why I always tell people to treat sports betting like a business from day one. The tax implications are brutal if you're not prepared. Here's what I learned after going through a similar situation: DraftKings and other sportsbooks are required to report ALL your winning bets as gross winnings on Form W-2G, regardless of your overall profit/loss. It's not their fault - that's literally what the IRS requires them to do. The key thing to understand is that you're not stuck paying taxes on money you didn't actually win. You can deduct your gambling losses, but ONLY if you itemize deductions. This means you'll need to add up all your potential itemized deductions (gambling losses, mortgage interest, state/local taxes, charitable contributions, etc.) and see if they exceed your standard deduction. If your total itemized deductions are less than the standard deduction ($13,850 for single filers in 2023), then unfortunately you're in a tough spot where you might pay taxes on phantom income. This is one of the most unfair aspects of gambling taxation. For documentation, your bank statements showing deposits/withdrawals are helpful, but the IRS really wants to see detailed records of individual bets. Most sportsbooks let you download your complete betting history - I'd recommend doing this ASAP before you lose access to older records.

I've been dealing with this nightmare for 3 months now! What finally worked for me was calling the practitioner priority line (if you have a tax pro helping you) or trying the Spanish language line - I heard they sometimes have shorter wait times and can transfer you to English speakers. Also, try calling on Wednesdays around 10 AM - seems to be less busy than Mondays/Fridays. The whole system is absolutely broken though. We shouldn't have to jump through hoops just to talk to the agency that handles our tax money! 😤

I feel everyone's pain here! After reading through all these suggestions, I'm going to try a combination approach: calling the tax advocate service number that Freya shared (1-877-777-4778) on a Wednesday morning around 10 AM like Kaitlyn suggested. If that doesn't work, I might actually consider that claimyr.com service Yara mentioned - $20 is annoying to pay, but honestly after weeks of wasted time, it might be worth it just for my sanity. Has anyone else had success mixing these different strategies? It's crazy that we need a whole battle plan just to reach the IRS! 😩

Don't forget property taxes too! Texas has no state income tax but some of the highest property taxes in the country (2-3% of home value annually). Florida's are lower but still significant. New York's property taxes can be high too, especially in suburbs. With your income level, I'm guessing you'll buy rather than rent, so factor this in!

Something else to consider - if you're coming from a zero-tax country, you might also need to look into whether your home country has any tax obligations for residents abroad. Some countries tax worldwide income regardless of where you live, which could complicate things. Also, at your income level ($525k), you'll definitely want to work with a tax professional who understands international relocations. The interplay between federal/state taxes, potential foreign tax credits, and various deductions can get complex quickly. A good CPA who specializes in high-income earners and international moves will save you way more than their fees in optimized tax planning. One more tip - if you do choose a no-income-tax state like Florida or Texas, make sure you establish proper residency there (driver's license, voter registration, etc.) to avoid any questions from high-tax states about where you're actually domiciled for tax purposes.