Make sure you're also tracking other expenses besides just the locksmith! I'm a dogsitter too and I deduct: - Special leashes/harnesses I buy for work - Poop bags - Treats for clients' dogs - Apps like Rover or Time To Pet subscriptions - Pet first aid certification - Portion of car insurance (business use) - Hand sanitizer and cleaning supplies

Based on what everyone's shared here, it sounds like your locksmith expense should definitely be deductible! I'm also self-employed (freelance photographer) and had a similar situation last year when I locked my keys in my car during a wedding shoot and had to pay for roadside assistance. My tax preparer confirmed it was a legitimate business expense since it happened while I was actively working and was necessary to complete my job. The key is that you were performing your pet sitting duties when it happened, not just hanging out at the client's house for personal reasons. Keep that receipt and maybe write a brief note on it explaining the circumstances (date, which client, that you were actively working). The IRS wants to see that expenses are "ordinary and necessary" for your business, and unfortunately getting locked out is pretty ordinary when you're working at different locations all the time! Also wanted to say thanks to everyone who mentioned the other deduction ideas - I hadn't thought about tracking the business portion of my phone bill before. This thread has been super helpful for all of us self-employed folks!

Code 810 since March is definitely frustrating! The changing "as of" dates are normal system updates but don't indicate actual progress unfortunately. Since you haven't received any letters, I'd suggest calling the taxpayer advocate service at 877-777-4778 - they can sometimes get more specific info than the regular helpline. Also worth checking if you moved recently or if your address is correct with USPS, sometimes verification letters get returned and cause longer delays.

Code 810 since March is definitely a long time! I went through something similar last year and it turned out to be an identity verification issue that I never got a letter for. The changing "as of" dates are just system updates and don't really mean progress unfortunately. Have you tried calling the identity verification line at 800-830-5084? Sometimes they can tell you if that's what's holding things up even if you didn't get the typical CP05A letter. Also might be worth checking if your address is updated with USPS in case any notices got lost in the mail.

Does anyone know if jury duty pay that you give to your employer counts as an above the line deduction? My company requires us to turn over jury duty pay but still pays our regular salary while serving. I thought I saw somewhere this was deductible above the line.

Great question! Above the line deductions are definitely worth understanding, especially with your side business. The key thing to remember is that these deductions reduce your Adjusted Gross Income (AGI), which is line 11 on Form 1040, and you get them regardless of whether you itemize or take the standard deduction. For your situation specifically: Yes, your self-employed health insurance premiums, IRA contributions, and student loan interest are all above the line deductions. Since you have a side business, you'll also want to look into the qualified business income (QBI) deduction under Section 199A - it can be huge for small business owners. One thing people often miss is that your business expenses from the side gig go on Schedule C and reduce your business income before it even gets to your main tax return. Then any remaining self-employment tax gets a 50% deduction above the line. The "above vs below the line" terminology comes from where these appear on your tax return - above the line means they reduce your AGI, while below the line deductions (like itemized deductions) only reduce your taxable income after AGI is calculated. Lower AGI can help you qualify for more credits and deductions that phase out at higher income levels.

Yall are overthinking this. Just keep good records, pay your quarterly estimates based on last year's income (100% of prior year tax is safe harbor to avoid penalties), and let your CPA sort it out at tax time. The 30% rule is fine if you're making decent money, might be overkill if you're just starting out. Use the rest to grow your biz!

As someone who went through this exact same situation when I started my partnership two years ago, I completely understand the stress! The 30% rule felt crushing when we were barely breaking even. Here's what I learned: that percentage includes federal income tax, self-employment tax (15.3%), and potential state taxes. But the actual amount you'll owe depends heavily on your business expenses and personal tax situation. A few things that helped us reduce our tax burden: - Maxing out business expense deductions (software subscriptions, office supplies, professional services) - Setting up a SEP-IRA for retirement contributions (big tax deduction) - Keeping meticulous records for vehicle use, client meals, and home office space - Timing major business purchases strategically Our first year we set aside the full 30% and ended up with a nice refund. Now we're more comfortable with 23-24% because we have a better handle on our deduction patterns. The key is working with your CPA to project your specific situation rather than relying on generic advice. Every partnership is different based on profit splits, other income sources, and expense levels. Good luck with your call tomorrow!

Has anyone ever had success getting the withholding returned directly from the IRA custodian instead of waiting for tax filing? I had a similar situation last year with Fidelity and after enough complaining they actually reversed the transaction completely and reprocessed it correctly as a return of contribution with no withholding.

This is a frustrating situation but definitely fixable! You're right that this should have been processed as a return of contribution rather than a regular distribution. The 20% withholding was unfortunate but standard procedure when custodians process regular withdrawals. A few key points to help you navigate this: 1. **Timing matters**: Since this was a same-year contribution and withdrawal, you have a good case for treating it as a return of contribution, which would avoid the 10% early withdrawal penalty. 2. **Documentation is crucial**: When you file your 2025 return, include a clear statement explaining that this was intended as a return of excess contribution made in the same tax year. Be specific about the dates of both the contribution and withdrawal. 3. **Check your 1099-R**: Look at Box 7 for the distribution code. If it shows "1" (early distribution), you might want to contact your IRA custodian to see if they can issue a corrected form with code "8" (return of contribution). This could save you headaches later. 4. **The withholding will come back**: You'll get that $1,400 back when you file your return - it will be credited as taxes paid, likely resulting in a larger refund. The silver lining is that this is a common enough situation that tax software and preparers know how to handle it properly. Just make sure to document everything clearly!