Make sure to check if you're claimed as a dependent on your parents' taxes before filing! This matters a lot. Ask them directly if they're claiming you. If they are claiming you (which is likely if they provide more than half your support), you still should file, but you'll need to check the box that someone can claim you as a dependent. This affects which credits you can claim. Also remember to file state taxes too! If your state has income tax and you had state taxes withheld (box 17 on W-2), you'll want that money back too!

@Anastasia Sokolov - Absolutely file! Even though you're not required to with $6,700 income, you'll likely get a nice refund if any taxes were withheld from your paychecks. A few quick tips for first-time filers: - Check box 2 on your W-2 - if there's money there, that's what you'll probably get back - Don't forget about education credits! The American Opportunity Tax Credit can be worth up to $2,500 and is partially refundable - Ask your parents if they're claiming you as a dependent - you'll need to check that box if they are - Use free filing software since your situation is simple (IRS Free File, FreeTaxUSA, or Cash App Taxes) The whole process should take about 30 minutes and the software walks you through everything step by step. You've got this! Better to file and get money back than leave it on the table.

I work in payroll and see this mistake ALL the time. The 2020 form change has created so much confusion. Your best bet is to contact whoever is handling the payments (likely HR or the benefits department) and explain that beneficiary payments should go on 1099-MISC Box 3, not 1099-NEC. Most companies actually want to get this right because incorrect filing causes problems for them too!

This is exactly the kind of frustrating situation that highlights how confusing the 2020 form changes have been! As others have mentioned, you're absolutely right to question this - beneficiary payments should NOT be on a 1099-NEC since you didn't perform any services. I'd recommend taking a two-pronged approach: First, contact the company's benefits or payroll department with a clear explanation that these are beneficiary payments from your father's retirement package, not contractor work. Reference IRS guidelines that beneficiary payments should be reported on 1099-MISC Box 3. Second, once you get the corrected forms, definitely file amended returns (Form 1040-X) for the years you incorrectly paid self-employment tax - that money should come back to you. Document everything in writing when you contact the company. Many payroll departments are still figuring out the post-2020 form requirements, so being clear and specific about the nature of the payments will help them get it right going forward.

Don't forget you might need to pay state taxes on that crypto sale too, depending on where you live! My state treated my crypto gains as regular income and I got surprised with an extra tax bill after thinking I was done with just the federal return.

Quick tip: if ur using tax software like TurboTax or H&R Block, they usually have specific sections for crypto now. just search for "bitcoin" or "cryptocurrency" in the search bar. Makes it way easier then trying to figure out which forms to fill out manually.

This is maybe a dumb question but what if i start a small side business just to be able to deduct my phone? like selling stuff on ebay once a month or something? would that work?

Great question! I dealt with this exact situation last year when I was trying to figure out phone deductions. As others have mentioned, the Tax Cuts and Jobs Act really changed the game for W-2 employees - those miscellaneous itemized deductions are off the table until at least 2025. Since you mentioned you're a regular W-2 employee, your best bet is definitely to approach your employer about reimbursement first. Many companies are willing to provide a monthly stipend once they understand the business need - especially if you can document how much you're using your phone for work calls, emails, and navigation. If that doesn't work out, you might want to consider if you have any side income that could qualify as self-employment. Even small amounts of freelance work, consulting, or selling items online could potentially allow you to deduct the business portion of your phone expenses on Schedule C. Just make sure any side business is legitimate and profit-motivated, not just set up for tax purposes. The separate phone plan idea is smart for keeping things organized, but unfortunately won't change the deduction rules for your W-2 employment. Hope this helps clarify things!

Has anyone considered using Section 179 instead of bonus depreciation? In some cases it might be more advantageous, especially if you have a mix of business vs personal use that might change over time.

This is such a helpful thread! I'm in a similar situation - bought a used pickup truck in December 2024 for $22,000 and started using it for my landscaping business in January 2025. Based on what everyone's saying here, it sounds like I can take the 80% bonus depreciation on the business portion. One question though - I use the truck about 85% for business and 15% personal. So would I calculate 85% of $22,000 = $18,700, then take 80% bonus depreciation on that $18,700 amount? That would be about $14,960 in first-year depreciation? Also really appreciate the heads up about the future sale implications. I hadn't thought about how taking all this depreciation now would affect taxes if I sell the truck down the road. Definitely something to factor into the decision.