Quickbooks Self-Employed has been a lifesaver for me with this exact problem. It lets you swipe left/right to categorize transactions as business or personal, and you can split transactions too if needed. Way easier than sorting through everything manually at tax time.

I went through this exact same situation with my consulting LLC last year! What really helped me was setting up a formal reimbursement system retroactively. I created expense reports for all the personal funds I'd used for business expenses, then had my LLC "reimburse" me by transferring money from the business account to my personal account. The key is maintaining that paper trail showing these were legitimate business expenses that you temporarily covered. I used a simple Excel template to document each expense with date, amount, vendor, business purpose, and which personal account I used. Then I'd do monthly reimbursements to myself. Your accountant will definitely appreciate that you've been tracking everything - that's honestly the hardest part. The fact that you have receipts and documentation puts you way ahead of most small business owners. Just make sure going forward you try to use business accounts when possible, but don't stress too much about the occasional personal payment as long as you document it properly.

Chiming in as someone who also had a dormant LLC - don't forget about tax software options. I used TaxSlayer last year and it guided me through what I needed for my zero-activity LLC completely. Most of the major tax software options (TurboTax, H&R Block, etc.) have sections specifically for handling business returns, even with no income or expenses.

I went through this exact same situation with my LLC last year! The short answer is yes, you'll likely need to file something even with zero activity. Since you mentioned it's been completely dormant, you'll probably need to file a Schedule C (Form 1040) showing all zeros - this is required for single-member LLCs even when there's no business activity. The key thing to remember is that the IRS wants to see that you're reporting your business status, even if that status is "no activity." It's basically confirming that you didn't have unreported income rather than just ignoring the business entirely. Also, don't overlook your state requirements! Many states have annual filing fees or franchise taxes that are due regardless of business activity. Since you're planning to actually start using the LLC now, you'll want to make sure you're in good standing at both the federal and state level before you begin operations. I'd recommend checking with your state's Secretary of State website for any annual report requirements and deadlines - these are often separate from tax filings and can have penalties if missed.

This situation is unfortunately more common than you'd think in the service industry. Your concerns are absolutely valid - having all these digital payments flow through your personal accounts does create potential tax complications. A few key points to consider: **Immediate documentation needs:** - Keep detailed records of every transaction (date, amount, source, distribution breakdown) - Take screenshots of all Venmo/Cash App transactions showing both incoming payments and outgoing distributions - Get written confirmation from your employer that you're acting as their agent for tip collection **Tax reporting considerations:** Since you'll likely receive 1099-K forms from Venmo/Cash App if you exceed their reporting thresholds, you'll need to report this income but also document the offsetting distributions. This isn't necessarily a Schedule C situation since you're a W-2 employee - you may need to report on "Other Income" with proper documentation of the pass-through nature. **Long-term solution:** Really push your employer to set up proper business accounts for digital tip collection. This system puts unnecessary tax complexity on you as an employee when it should be handled at the business level. The key is having bulletproof documentation showing you're acting as an intermediary, not earning all this income personally. Without proper records, the IRS will assume it's all your taxable income.

The quarterly estimated tax situation you mentioned is actually a really important point that most people overlook! Since Venmo/Cash App will report the gross amount you received on Form 1099-K, the IRS computer systems will expect to see that income reported on your tax return. Here's what I'd recommend for estimated payments: Don't make estimated payments on the full gross amount - that would be overpaying since most of that money isn't actually your income. Instead, calculate your estimated payments based on your actual taxable income (your portion of tips plus W-2 wages). The key is having that rock-solid documentation showing the pass-through nature of the funds. When you file your annual return, you'll report the full 1099-K amount but then show the offsetting distributions with proper documentation. This prevents the IRS computers from thinking you under-reported income. One tip that helped me: I started sending myself a monthly email summary with screenshots of all the tip distributions and running totals. It creates a timestamped record that's hard to dispute later. Also consider having your coworkers sign a simple log when they receive their tip shares - just date, amount, and signature. It's extra documentation that proves you're not keeping all that money. The witness angle is brilliant too - if you ever face an audit, having other employees who can testify they received money from you is incredibly valuable evidence that you were acting as a conduit, not earning it all personally.

Has anyone used one of those tax relief companies that advertise on the radio for an OIC? They claim they can settle for "pennies on the dollar" but I'm wondering if they're worth the fees they charge.

I'm currently in the middle of my OIC process (submitted about 4 months ago) and wanted to share what I've learned so far since you're just getting started. The biggest thing that's helped me is staying incredibly organized with a dedicated filing system for every single document. I created separate folders for initial application materials, correspondence with the IRS, financial documentation, and backup copies of everything. This has been a lifesaver when they've requested additional info. One thing I wish I'd known upfront - the IRS can take 6-24 months to process your offer, and during that time you MUST stay current on all new tax obligations. If you fall behind on estimated payments or filing requirements while your OIC is pending, they'll automatically reject your offer. I almost learned this the hard way. Also, don't let the anxiety get to you too much. Yes, it's intimidating dealing with the IRS directly, but if you're thorough with your documentation and honest about your financial situation, the process is more straightforward than it seems. The IRS agents I've spoken with have actually been professional and helpful when I've had questions. Good luck with your application! Feel free to ask if you have specific questions about the forms - I'm still fresh on all the details.

Have you considered looking into other assistance programs instead of potentially risky tax situations? There are programs specifically designed to help people in your situation while waiting for disability approval. Many states have emergency assistance for families with newborns. Also, there are charities that help with car repairs for people who need transportation for medical reasons. These might be better options than depending on tax strategies that could cause problems later.

I understand you're in a tough financial situation, especially with a new baby and needing reliable transportation for medical appointments. However, I'd strongly encourage you to be very careful about the dependent claiming situation. From what you've described about your previous experience, it does sound like it may not have been entirely legitimate. The IRS dependent rules are strict - your sister would need to provide MORE than half of your total support for the entire year, and you'd need to meet the income requirements. Given that you mentioned having a baby recently, you might actually qualify for some additional tax credits yourself if you file your own return (like the Child Tax Credit), which could be more beneficial than being claimed as someone else's dependent. Before making any decisions, I'd really recommend getting professional advice. You could use one of the free tax preparation services available to low-income individuals, or even contact the IRS directly to understand your specific situation. The last thing you want is to face penalties or have to pay back benefits later when you're already struggling financially. Have you looked into local assistance programs for new parents or people awaiting disability approval? Many communities have emergency assistance funds specifically for situations like yours.