


Ask the community...
Don't overthink this. I've been self-employed for 7 years and built a similar home office structure. The simplest approach is to take the home office deduction based on square footage. Less paperwork, less complexity. Yeah, depreciation might give you more deduction over time, but the recordkeeping headache isn't worth it for many small business owners. Plus, when you eventually sell your home, depreciated business structures create complications with capital gains exclusions. Sometimes the "technically correct" tax approach isn't the most practical one for real-world business owners who want to focus on their actual work instead of becoming tax experts.
I appreciate all the detailed responses here! As someone who just went through a similar situation with a detached workshop build, I wanted to share what I learned from my tax preparer. The key thing that helped me was getting the contractor to break down costs on the final invoice - structural components (foundation, framing, roofing) vs. business-specific installations (electrical panels, dedicated internet lines, specialized lighting). This made it much clearer what qualified for different depreciation schedules. Also, don't forget to consider the "placed in service" date - the IRS generally uses when the structure is ready for its intended use, not when construction started. This affected my first-year depreciation calculation since I completed mine mid-year. One more tip: take lots of photos during construction showing the business-specific elements. My preparer said this documentation could be valuable if there are ever questions about the classifications down the road.
This is really helpful advice about breaking down the costs! I wish I had known about getting the contractor to itemize everything separately before I started the project. My invoice just shows one lump sum for the whole build, which is going to make the depreciation classification much more complicated. Do you think it's worth going back to my contractor now to see if they can provide a breakdown after the fact? Or would the IRS be suspicious of documentation that wasn't created during the original construction process? Also, when you mention the "placed in service" date - I finished construction in March but didn't actually start using it for business until May when I moved all my equipment in. Which date should I use for tax purposes?
@dec2424ba17f That's a great question about getting a breakdown after the fact. I actually had to do something similar when my accountant pointed out the same issue. My contractor was able to provide a reasonable cost breakdown based on their records and typical material/labor allocations for similar projects. The key is making sure it's based on actual construction records, not just rough estimates. The IRS generally accepts post-construction breakdowns as long as they're documented and reasonable - contractors often have to provide these for insurance or warranty purposes anyway. Just make sure your contractor provides it on their letterhead with specific line items. For the "placed in service" date, you'd typically use May when you actually started conducting business activities in the space. The IRS looks at when the asset is ready and available for its intended business use, not just when construction is complete. So if you moved your equipment and started working there in May, that's likely your placed-in-service date for depreciation purposes.
I'm so grateful for this community! When my refund was stuck last year I was panicking about how it would affect everything else in my financial life. The advice here saved me SO MUCH stress! β€οΈ One thing I learned that might help you - keep filing on time even with the previous year unresolved. The worst thing you can do is let one delayed return cause you to be late with the next one. That creates ACTUAL problems instead of just potential ones. Sending good vibes that both your returns get processed soon!
I can relate to your anxiety about this situation! I went through something similar two years ago where my refund was delayed for almost 8 months. What I learned from that experience is that the IRS processing systems are actually quite compartmentalized - each tax year really does get handled separately in most cases. One thing that helped ease my mind was ordering my tax transcripts online. The transcript will show you exactly what's happening with your 2023 return - whether it's just in a backlog queue or if there's actually an issue that needs resolution. Sometimes the "Where's My Refund" tool just shows generic status messages while the transcript reveals more specific information. Also, definitely don't delay filing your 2024 return because of this. Filing on time (or by extension deadline) is crucial regardless of what's happening with previous years. The penalties for late filing are much worse than any potential complications from having overlapping processing periods. Have you tried calling the Taxpayer Advocate Service? They can sometimes help expedite cases that have been delayed unreasonably long. After 11 months, you'd definitely qualify for their assistance. Just document everything - dates you called, reference numbers, etc. It becomes really important if you need to escalate later.
This is really helpful advice! I'm actually in a similar boat - my 2023 refund has been "processing" for about 7 months now. I hadn't thought about the Taxpayer Advocate Service as an option. Do you happen to know what their typical response time is? I'm worried that if I start that process now, it might interfere with filing my 2024 return in the next few weeks. Also, when you ordered your tax transcripts, did you use the online system or mail? I've heard the online version can be tricky to access if you don't have certain types of accounts or credit history.
The reciprocity agreement point is crucial! Since you mentioned you're in Illinois for college and have income from both states, you should definitely check if there's a reciprocity agreement between Illinois and your home state. Also, one thing that might help clarify your situation: the fact that you're registered to vote and have a driver's license in Illinois are strong indicators that Illinois is your tax domicile, regardless of where your parents claim you or where your mail goes. Most states consider these the primary factors for establishing residency. If there's no reciprocity agreement, you'll likely file as an Illinois resident (reporting all income) and as a non-resident in your home state (reporting only income earned there). The Illinois return should give you a credit for taxes paid to your home state to avoid double taxation. One last tip - if you're using tax software, most programs like TurboTax or TaxAct have specific workflows for multi-state situations that walk you through exactly this scenario. They'll ask about your residency indicators and income sources and determine your filing requirements automatically.
This is really helpful! I had no idea about reciprocity agreements - that could potentially save me from having to file two returns. Since the original poster mentioned Illinois, do you know if Illinois has reciprocity agreements with other common states where students might be from? Also, the point about tax software handling multi-state situations automatically is reassuring. I've been putting off doing my taxes because I was intimidated by the whole multi-state thing, but it sounds like the software can guide me through it step by step.
The reciprocity agreement information is really valuable! Since you mentioned Illinois specifically, I can help clarify: Illinois has reciprocity agreements with Iowa, Kentucky, Michigan, and Wisconsin. This means if you're an Illinois resident who worked in any of these states (or vice versa), you typically only file in your state of residence. However, since you've established legal residency in Illinois through voter registration and driver's license, you'd file there as a resident regardless. The reciprocity would help if you had summer income from Wisconsin, Iowa, Kentucky, or Michigan - you'd only need to file the Illinois return. For tax software, I'd definitely recommend going that route for multi-state situations. TurboTax, FreeTaxUSA, and H&R Block all handle this really well. They'll ask you questions like "Did you live in more than one state?" and "Did you earn income in multiple states?" then guide you through each state's requirements. Much less overwhelming than trying to figure it out manually! One thing to keep in mind - even if you end up needing to file in both states, you're not necessarily paying double tax on the same income. The resident state (Illinois in your case) will give you a credit for taxes paid to the non-resident state, so you're only paying the higher of the two tax rates.
Uber actually provides a yearly tax summary in your driver account even if you don't get a 1099. Just go to the tax information section in your account and you should find a detailed breakdown of all your earnings, Uber's cut, fees, etc. Just use those numbers on Schedule C.
This is it right here! I was stressing over the same thing last month until I found the tax summary in my account. It has everything you need to fill out your taxes properly without a 1099.
Just to add to what others have said - don't forget about tracking your vehicle expenses beyond just mileage! As an Uber driver, you can deduct things like car washes, phone mounts, phone chargers, and even a portion of your car insurance if you use the actual expense method instead of the standard mileage rate. Also, keep in mind that since you're reporting self-employment income, you'll likely owe self-employment tax (Social Security and Medicare taxes) on top of regular income tax. This is about 15.3% of your net earnings, so factor that in when planning. You might want to make estimated quarterly payments next year if you continue driving to avoid owing a large amount at tax time. The good news is that with proper deductions, your actual tax liability on that $638 might be quite small. Just make sure to keep detailed records of all your driving-related expenses!
Miguel HernΓ‘ndez
Based on everyone's responses, it sounds like you should have your money by April 3rd as expected! The key thing is that TurboTax handles everything automatically once the IRS releases your refund. Since you filed March 12th and WMR shows April 3rd, that gives you 2 days before the kids' activities start on April 5th - should be plenty of time. Just keep an eye on WMR and maybe check your bank account on April 2nd/3rd. The process is really seamless once it gets going. Good luck with the spring activities!
0 coins
Bruno Simmons
β’This is really helpful to know as someone new to the whole tax filing process! I was worried I'd need to do something on my end when TurboTax takes their fees, but it sounds like it's completely hands-off. The timeline breakdown everyone's sharing makes me feel much more confident about budgeting for those spring activities. Thanks for breaking it down so clearly - definitely bookmarking this thread for next year!
0 coins
Diego FernΓ‘ndez
Just wanted to add my experience to help with your budgeting! I used TurboTax's refund deduction option for the first time last year and was nervous about the timing too. Here's what happened: my WMR showed "refund sent" on a Thursday, and the money (minus TurboTax fees) hit my account early Saturday morning. The whole temporary account thing happens behind the scenes - you literally don't have to do anything except wait. One tip: make sure your bank account info is 100% correct in TurboTax because if there's an error, it can delay the whole process by weeks. Since you filed March 12th and have an April 3rd date, you should be totally fine for the April 5th activities! The system works pretty smoothly once the IRS releases your refund.
0 coins