Don't forget that your daughter might qualify for the Qualified Business Income Deduction (QBI) on her Schedule C income! This could reduce her taxable income by up to 20% of her qualified business income. Also, make sure you're tracking all her legitimate business expenses to reduce her taxable self-employment income. Things like: - Mileage if she drives to clients' homes - Any supplies she purchases for the dogs (treats, toys, etc.) - Portion of cell phone if used for business - Business cards or advertising - Any special clothing just for dog sitting These deductions will lower her self-employment tax liability while still counting as earned income for Roth IRA purposes!

I think everyone is overlooking something important - if your daughter is a dependent on your tax return, her standard deduction is much lower than the regular standard deduction. It's limited to either $1,250 or her earned income plus $400, whichever is greater (but not more than the regular standard deduction). So with $2,700 in earned income, her standard deduction would be $3,100 ($2,700 + $400), which means some of her capital gains might be taxable! Make sure FreeTaxUSA is calculating this correctly.

THE IRS IS A JOKE!!! I've been dealing with their incompetence for 3 years straight. Every. Single. Year. Some new stupid problem that takes months to resolve. I feel your pain OP 😤

This is definitely frustrating! A blank transcript with incorrect filing status usually means your return is stuck somewhere in the IRS processing pipeline. Since you e-filed through TurboTax and got acceptance confirmation, the issue is likely on the IRS side. A few things to check: - Log into your IRS online account to see if there are any notices or alerts - Make sure both you and your wife's SSNs match exactly what's on file with the Social Security Administration - Check if either of you received any mail from the IRS that might have been missed The fact that both your transcripts show the same issue suggests it's a systematic problem with how your joint return was processed rather than individual account issues. This often happens when returns get flagged for manual review. Your best bet is probably getting through to an actual IRS representative who can see what's happening behind the scenes. I know the phone system is terrible, but they're really the only ones who can tell you exactly why your return is in limbo and what steps you need to take to resolve it. Hang in there - these processing issues are unfortunately common but they do get resolved eventually!

Anyone else notice they only seem to call during work hours when ur busy? Like thanks for making this even more stressfull IRS 🤡

The control number is basically your case tracking ID - without it they can't pull up your file quickly. Also pro tip: when they call, ask them to repeat the number back to you to make sure you're both looking at the same thing. Sometimes there's confusion between different notice numbers and it can waste a lot of time!

Quick tip that helped me: Make sure you're also considering the annual Section 179 expense deduction dollar limit ($1,160,000 for 2025) and the phase-out threshold ($2,890,000 for 2025). These limits apply before you even get to the business income limitation. Also, don't forget that taking Section 179 is optional - you can always just take regular depreciation instead if it makes more sense for your tax situation. Some years it's better to spread the deduction out rather than taking it all upfront.

Just be careful with how you document this. I took the full Section 179 deduction counting my W2 income last year and got a CP2000 notice questioning it. Had to send in explanations and reference the exact regulation. Make sure you keep excellent records including invoices for all equipment, proof of payment, business use percentage documentation, and placed-in-service dates.

I highly recommend pulling your credit reports too! I had a similar situation where I owed $12k in taxes suddenly, and it turned out someone had stolen my identity, gotten a job using my SSN, and never paid taxes on the income. The IRS thought that income was mine. You can get free credit reports at annualcreditreport.com - look for any accounts or employers you don't recognize. If you do find evidence of identity theft, the IRS has a special department that handles these cases and they can help clear it up.

I went through something very similar last year - $8k surprise tax bill that made no sense. Here's what I learned from my experience: First, don't panic about owing the full amount right away. The IRS is actually pretty reasonable about payment plans if you communicate with them proactively rather than ignoring the situation. Second, there are really only a few common reasons for surprise tax bills like this: 1. Unreported income (1099s you didn't know about, employer reporting issues) 2. Filing status problems (like the dependent/married situation you mentioned) 3. Identity theft or fraudulent filing 4. Stimulus payment mix-ups from 2021 Before you spend money on professional help, I'd suggest doing some detective work first. Get your wage and income transcript like Anna mentioned, pull your credit reports to check for identity theft, and call the IRS to get a basic explanation of what they think you owe and why. In my case, it turned out a previous employer had filed a corrected W-2 that reported additional income I'd never been told about. Once I understood what happened, I was able to work directly with the IRS to set up a manageable payment plan. The key is getting that initial conversation with the IRS to understand exactly what's on their records. Then you can figure out if it's legitimate debt you need to pay or an error you need to dispute.