my sister used direct express last year took exactly 19 days hope this helps

I'm also waiting on my Direct Express refund! Filed on 1/6 and still showing "received" on WMR. The waiting game is brutal but from what I've read here and other forums, Direct Express follows the same timeline as regular DD. Just hang tight - you filed super early so you should be in one of the first waves. Keep checking your transcript too, sometimes it updates before WMR does.

Does anyone know if you can split the expenses? Like could I put $3000 in the FSA and claim $3000 for the tax credit (with my $12000 total daycare cost)? Would that be better than maxing out the FSA first?

@Andre Moreau - I was in almost the exact same situation last year! With one child and $12k in daycare costs, here's what I learned: Since you have one child, the dependent care tax credit is limited to $3,000 in expenses. If you put the full $5,000 in your FSA, you've already exceeded that $3,000 limit, so you won't be able to claim any tax credit. Here's what might work better for you: Put $3,000 in the FSA and keep $3,000 available for the tax credit. Whether this is optimal depends on your income level. The FSA saves you money at your marginal tax rate plus FICA (about 29.65% if you're in the 22% bracket), while the dependent care credit ranges from 20-35% based on income. If you're at higher income levels, the FSA might give you better savings. If you're at lower income levels, the credit percentage could be higher than your tax savings from the FSA. Given that you mentioned your husband makes more than you and you've had IRS issues before, I'd definitely recommend running the numbers both ways or consulting with a tax professional to make sure you're maximizing your benefit without any complications!

This entire discussion has been incredibly helpful! I'm dealing with a hybrid situation where my business does both product sales and services, so I've been completely confused about when to use Form 1125-A versus just putting everything on Schedule C. Reading through everyone's experiences, I think I finally understand the key distinction. For my business, I sell handmade jewelry (physical products with inventory) AND offer custom design consultations (pure service). For the jewelry side, materials like silver wire, beads, clasps, and even the small jewelry boxes I put finished pieces in would go on Form 1125-A since they're directly incorporated into the final products I sell. But my design software subscription, business cards, website hosting, and consultation fees would all be Schedule C operating expenses. Melina's "100 more units" test is perfect for this - if I made 100 more necklaces, I'd need 100 more sets of materials and packaging, but I wouldn't need 100 times more website hosting or business insurance. The real lightbulb moment for me was Yara's point about service businesses often not needing Form 1125-A at all. For my consultation work, there's no inventory or direct production costs, so those revenues and related expenses stay entirely on Schedule C. Thank you everyone for sharing your real-world examples - this has been way more helpful than any official IRS publication I've tried to read!

This has been such an enlightening discussion! As someone who just started a small business this year, I was completely overwhelmed by Form 1125-A and had no idea what qualified for Line 5 "Other Costs." The real-world examples from Melina's furniture business and Cass's jewelry/consultation hybrid really drove home the core concept for me. I keep coming back to that "100 more units" test - it's such a practical way to distinguish between direct production costs (Form 1125-A) and general operating expenses (Schedule C). What I found most valuable was learning that many service-based businesses don't even need Form 1125-A at all. I was stressing about this form for my tutoring business, but since I don't have any physical inventory or raw materials, all my expenses (books, supplies, software subscriptions) just go on Schedule C as regular business expenses. For anyone else feeling overwhelmed by this form, I'd definitely recommend starting with the inventory question that several people mentioned: Do you track raw materials or finished goods from year to year? If not, you might be able to skip 1125-A entirely and focus on properly categorizing expenses on Schedule C instead. The documentation point from CyberSiren about keeping detailed records is also crucial - especially if you do have legitimate "Other Costs" for Line 5. The last thing anyone wants is an audit because of unclear expense categorization!

I know this is slightly off topic from the exemption card, but has anyone else noticed that some online retailers don't charge sales tax even when they're supposed to? Not complaining obviously, but wondering if this is legal or if they're just breaking the rules?

Just to add some context to all the great information here - I work in state tax compliance and wanted to clarify a few things about sales tax exemptions. The diplomatic cards mentioned earlier are indeed real and legitimate, but they're very specific to foreign diplomatic personnel under international treaties. For regular citizens, the most common legitimate exemptions are actually medical-related. Many states offer sales tax exemptions on prescription medications, medical devices, and sometimes even over-the-counter items if you have certain qualifying conditions. Some states also have exemptions for clothing under a certain dollar amount or during specific tax-free weekends. If you're curious about what exemptions you might qualify for, your state's Department of Revenue website usually has a comprehensive list. It's much more limited than what diplomats get, but there are legitimate ways to reduce your tax burden without needing special cards!

Is there any expiration on capital loss carryovers? I've been carrying some for almost 4 years now.

One thing I'd add to the great advice already shared - make sure you're applying your capital loss carryover in the correct order! The IRS requires you to use the oldest carryover losses first (FIFO - first in, first out). Since you had a $20,000 loss in 2022, that entire amount should be applied against your 2023 gains before you can use any losses from 2023 itself. This shouldn't affect your calculation (you'll still net $30,000), but it's important for record-keeping purposes. Also, double-check that you actually filed your 2022 return and properly reported that $20,000 loss. If for some reason it wasn't properly documented on your 2022 Schedule D, you might run into issues when the IRS processes your 2023 return. The carryover amount needs to have a paper trail from your previous filing.