Was in your exact shoes last year with $38k self-employment and two kids over 18. Thought I was going to owe thousands, but you know what? After claiming my legitimate business deductions (home office, mileage, supplies, health insurance premiums), the QBI deduction, and finding out my 19-year-old still qualified as my dependent because she was a full-time student, I only ended up owing $2,100. Not great, but way better than the $7k I was panicking about! Set up an IRS payment plan and now I'm making quarterly payments for 2024. Doesn't the whole self-employment tax system seem designed to trip us up?

I'm in almost the identical situation - self-employed with around $36k income and two adult kids (19 and 21). What I learned from my tax preparer last year is that the key factors are: 1) Whether your daughters qualify as dependents (the college student rule for the 20-year-old is crucial), 2) Tracking every possible business expense you can legitimately claim, and 3) Don't forget about the QBI deduction which can reduce your taxable income by up to 20%. Based on similar situations I've seen in this community, you're probably looking at owing somewhere between $3,000-$5,000, but it could be significantly less with proper deductions. The good news is the IRS offers reasonable payment plans if you can't pay it all at once. Have you been keeping receipts for business expenses throughout the year?

Has anyone here used TurboTax for their home office deduction? I've been using it for years but it seems like it doesn't handle Form 8829 well when there's a business loss. I'm wondering if FreeTaxUSA or others do a better job with this specific situation.

Just wanted to share my experience with the home office deduction as someone who went through the exact same situation! I have a small freelance writing business that I run from a dedicated room in my house while working my regular W-2 job. One thing that really helped me understand the Form 8829 vs Schedule C confusion was learning that Form 8829 is specifically for expenses related to the physical space of your home office, while Schedule C is for general business expenses. So your mortgage interest and property taxes definitely go on Form 8829 as indirect expenses (since they benefit your whole house), and then Form 8829 calculates what portion can be deducted based on your 15% usage. The carryforward aspect was a game-changer for me. Even though my business showed a loss the first year, I still completed Form 8829 because those unused deductions carried forward to the next year when I became profitable. My tax software (I use FreeTaxUSA too) automatically tracked this, but I also kept my own spreadsheet just to be safe. One tip: make sure you're measuring your office space correctly for that percentage calculation. The IRS can be picky about this, so I actually drew a floor plan with measurements to document it properly.

Has anyone used any good tax software to make the learning curve easier? I'm starting VITA training next week and already dreading it based on what I'm hearing here.

Former VITA volunteer here - I totally get the yawning! I almost quit during training because it felt like memorizing a phone book. But honestly, once you start working with real taxpayers, everything changes. The "aha moments" when you help someone discover they qualify for the Earned Income Tax Credit or when you explain why they're getting a bigger refund than expected - those moments make all that boring code memorization worth it. Plus, you'll be surprised how much you retain once you start applying it practically. My biggest tip: don't try to memorize everything. Focus on understanding the concepts and knowing where to look things up. Most VITA sites have great resources and supervisors to help when you get stuck. The goal isn't to become a walking tax code - it's to help people navigate their tax situations with confidence. Stick with it through at least one volunteer season before deciding if tax work is for you. The training is definitely the worst part!

Just wanted to add - check the notice carefully for the tax period it's referring to. I once got a CP503 for a tax year where I was SURE I'd paid everything, and it turned out they had applied my payment to the wrong year. Had to send proof of payment (bank statement showing the withdrawal) to get it sorted.

I went through something very similar with a CP503 notice about 6 months ago. The key thing to understand is that this isn't about filing an amended return - it's about an unpaid balance that the IRS says you owe from your 2023 taxes. Before you panic, double-check a few things: Did you make estimated tax payments that might not have been properly credited? Did you have any 1099s or other income documents that came in after you filed? Sometimes the IRS receives income information that doesn't match what you reported. The "intent to levy" language is serious - they can start garnishing wages, bank accounts, or placing liens on property. But you have time to respond. Contact them ASAP to either pay the balance, dispute it if it's incorrect, or set up a payment plan. Even if you can only pay $50/month, getting on a payment plan will stop the collection process. Don't ignore this - I made that mistake initially and it just made everything more complicated. The IRS is actually pretty reasonable to work with once you get them on the phone, despite what everyone says about their customer service.

Honestly these transcript codes are like trying to read hieroglyphics without the rosetta stone 🤣

Just went through the same thing with my cycle 20250604! The confusion is totally understandable - these IRS codes are like a foreign language 😅 From what I learned after dealing with this exact situation: the "04" in your cycle code means Wednesday processing day, and with your return already processed on 02-24-2025, you should see that $9,527 hit your account pretty soon. The April dates you're seeing are just tax year reference dates, not your actual deposit date. One thing that really helped me was using taxr.ai to decode my transcript - it breaks down all these confusing codes and gives you a clear timeline. Saved me from refreshing WMR every 5 minutes lol. For $1 it's totally worth the peace of mind, especially when you've got bills coming up like you mentioned. Hope this helps and you get your refund soon! 🤞