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One thing to watch out for when recording business miles - you can ONLY deduct miles driven while actively working (with an active delivery or driving to pick up an order). You can't deduct miles driving from your home to your first pickup or returning home after your last delivery. Those are considered "commuting" miles. Also, make sure you're tracking ALL your business expenses, not just mileage. Phone bills (% used for work), hot bags, car phone mounts, etc. can all be deducted on Schedule C along with your mileage.
This is such great information! I wish I had known about this years ago. I've been doing Instacart and DoorDash for about 18 months and have been religiously taking the standard deduction but completely ignoring my business expenses. One question though - what's the best way to track mileage going forward? I know some people use apps like MileIQ, but I'm wondering if there are simpler methods that are still IRS-compliant. Also, do you need to track every single trip or can you do periodic sampling and extrapolate? I'm definitely going to look into filing amended returns for last year. Even if I only drove 10,000 business miles, that's still potentially $6,000+ in deductions I missed out on. Thanks everyone for sharing your experiences!
For tracking mileage going forward, you definitely need to be consistent and detailed to stay IRS-compliant. The good news is you don't need anything fancy - even a simple notebook or phone app where you record date, starting/ending odometer readings, and business purpose will work. MileIQ is popular but there are free alternatives like Everlance or even just using Google Sheets. The key is tracking EVERY business trip - the IRS doesn't accept sampling or extrapolation for mileage deductions. Each trip needs to be logged separately. Make sure to record the date, starting location, ending location, odometer readings, and business purpose (like "DoorDash delivery to 123 Main St"). If you use the apps that automatically track based on GPS, just double-check they're only counting actual business miles and not personal driving. With 10,000 business miles at the current rate, you're looking at a significant deduction! Definitely worth getting those amended returns filed. Just make sure you have some way to reconstruct or estimate your past mileage reasonably - delivery app earnings statements can sometimes help with this.
Just wanted to share that I found another way to enter 1099-G Box 6 in H&R Block. If you go to the "search" feature (magnifying glass icon) and type "grants" or "taxable grants," it will take you directly to the right input screen! Saved me a ton of time digging through menus.
OMG THANK YOU!!!! I've been looking for this for an hour!!! The search feature took me right to it. For anyone else - after searching "taxable grants" it took me to a screen under Miscellaneous Income where I could enter the amount. Wish I'd thought of just searching in the first place lol
This thread has been incredibly helpful! I've been struggling with this exact issue for weeks. I tried the search method that Mason suggested and it worked perfectly - just searched "taxable grants" and it took me right to the correct input screen under Miscellaneous Income. For anyone else still having trouble, I also discovered that if you start entering your 1099-G through the normal workflow and get to the section where it asks about unemployment compensation, there's actually a small "What about other income on this form?" link at the bottom of that screen. Clicking that gives you options for other types of 1099-G income including grants. It's frustrating that H&R Block doesn't make this more obvious since grants are becoming more common, especially with all the pandemic relief programs over the past few years. Thanks everyone for sharing your solutions!
This is such a lifesaver! I just tried the "What about other income on this form?" link you mentioned and it worked perfectly. I had been going through the unemployment section thinking that was the only way to handle 1099-G forms, but completely missed that little link at the bottom. It's crazy how many different ways there are to get to the same place in this software - search function, Other Income menu, or that hidden link. Really appreciate everyone sharing their different approaches because what works for one person's version might not work for another's. The pandemic relief programs definitely made this more common - I never had to deal with taxable grants before 2021!
Something nobody's mentioned yet - you need to contact the seller ASAP! In my experience with a similar situation, getting the seller to file their US tax return properly was the fastest solution. If the seller can prove they had little or no gain on the sale (or even a loss), their actual tax liability could be MUCH lower than the 15% withholding amount. They can file Form 1040-NR to report the sale, pay any actual tax due, and get a refund for the difference. This becomes their problem too because the IRS will eventually come after them separately for the same transaction if nobody handles the withholding. Most foreign sellers will cooperate once they understand the situation because they want to avoid problems with the IRS too.
This worked for me! My foreign seller had actually lost money on the property when all improvements and original purchase price were considered. They filed their US tax return showing a loss, and their actual tax liability was zero. The IRS then released me from the withholding obligation since the seller had satisfied their tax requirements.
This is exactly why I always recommend buyers get a pre-closing checklist that specifically includes FIRPTA verification when dealing with ANY seller - you never know someone's citizenship status just by looking at them or their name. For your immediate situation, I'd suggest a three-pronged approach: 1. **Document the title company's failure**: Gather all your closing documents and highlight anywhere the seller's foreign status should have been obvious (foreign address, non-US phone number, etc.). This creates your paper trail for potential E&O claims. 2. **Contact the seller immediately**: As others mentioned, if they file Form 1040-NR showing their actual gain/loss, it could significantly reduce or eliminate the tax liability. Many foreign sellers don't realize they need to file US returns for property sales. 3. **File Form 8288-C for withholding credit**: Even though you missed the 8288-B deadline, you can still file 8288-C to claim credit for any withholding that should have been done at closing. This essentially tells the IRS "we're handling this now" and can pause collection activities. The $42K bill is scary, but remember - this is often the maximum theoretical liability. The actual amount due depends on the seller's real gain, which could be much less. Don't panic and don't ignore it, but know that there are multiple paths to resolution here.
This is really comprehensive advice! I'm definitely going to start with documenting everything from the closing. Looking back at my paperwork, I can see the seller provided a Canadian address and even mentioned they were moving back to Toronto after the sale, but somehow this didn't trigger any FIRPTA discussion. One question about Form 8288-C - can I file this myself or do I need a tax professional? The IRS forms and instructions are pretty confusing, and I'm worried about making things worse by filing something incorrectly. Also, when you say it can "pause collection activities," does that mean they'll stop adding penalties and interest while I'm working on this? I'm also wondering if there's a specific timeframe I should give the seller to respond before moving forward with the title company claim. I don't want to seem like I'm threatening them, but I also can't afford to wait months while this accumulates more penalties.
Has anyone tried specifically classifying themselves as a "job seeker" on their Schedule C? I read somewhere that this might work as a loophole for deducting job search expenses, but it sounds risky.
That's extremely risky and not recommended! The IRS doesn't recognize "professional job seeking" as a business activity that generates income. To file a Schedule C, you need to be engaged in an activity with the intent to make a profit through providing goods or services. Simply looking for a job doesn't qualify - you need actual self-employment income from some type of business activity. Trying to classify yourself as a "professional job seeker" would likely trigger an audit and could result in penalties for filing an incorrect return.
I'm in a similar situation after being laid off from my software engineering role three months ago. What I've learned through research and talking to a CPA is that the tax landscape for job seekers is pretty limited, but there are a few strategies worth considering: 1. **Freelance/Contract Work**: Even small gigs can open the door to legitimate business deductions. I started doing some part-time contract work ($500-1000/month) which allowed me to deduct a portion of my home office setup. 2. **State vs Federal**: Some states still allow certain job search deductions even though federal law eliminated them in 2018. Check your state's specific rules. 3. **Timing**: If you do start freelancing, consider the timing of your equipment purchases. Expenses made after you start earning self-employment income are more clearly deductible. 4. **Documentation**: Keep detailed records of what percentage of your equipment/space is used for income-generating activities vs. job searching. The reality is that pure job search expenses aren't deductible anymore, but if you can legitimately earn some freelance income using that same equipment, it changes the equation entirely. Just make sure any business activity is genuine and not just a vehicle for deductions.
This is really comprehensive advice! I'm curious about the documentation aspect you mentioned. What kind of records should someone keep to show the percentage split between job search vs. income-generating activities? I'm thinking about starting some freelance work while job hunting, but I want to make sure I'm tracking everything properly from the beginning. Should I be logging hours spent on each activity, or is there a simpler way to establish that business use percentage? Also, when you say "timing" matters for equipment purchases - if I buy equipment before I start earning freelance income but then use it for that work, does that completely disqualify it from being deductible?
Great questions! For documentation, I keep a simple spreadsheet tracking hours spent on different activities. For example, if I spend 20 hours/week job searching and 10 hours/week on freelance work, that's roughly a 33% business use ratio for my home office equipment. You don't need to be obsessively precise, but having some reasonable method to show the split is important. For equipment purchases, the timing isn't necessarily a disqualifier, but it's cleaner if you buy after starting freelance work. If you bought equipment before freelancing but then use it for business, you can still potentially deduct based on the business-use percentage from when you started earning income. The key is that the deduction is based on when you actually start using it for business purposes. I'd recommend starting that documentation tracking right away, even before you begin freelancing. It shows good faith effort to properly allocate expenses and gives you a clear paper trail if questions ever arise. My CPA said having contemporaneous records (tracking as it happens vs. reconstructing later) is much stronger from an audit perspective.
Jamal Brown
next year im def paying the fees upfront. This refund transfer stuff is for the birds 🤮
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Fatima Al-Rashid
•fr fr save yourself the headache
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ShadowHunter
Been there! When TurboTax shows "Payment Completed" for the refund transfer, it just means they successfully grabbed their $133 from your refund - not that your money is coming tomorrow. The IRS still has to finish processing everything on their end. Since you filed Jan 18th, you're actually right on track timing-wise. Most people are seeing about 3-4 weeks total processing time this year. Check WMR (Where's My Refund) on the IRS site - that'll give you the real status of when your remaining refund hits your account. The waiting sucks but you should see movement soon! 🤞
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