Double check that you didn't accidentally check a box on your Schedule C or other tax forms indicating you had employees or paid wages. I made that mistake once and started getting all kinds of employment tax forms.

I've dealt with this exact situation before! As a sole proprietor myself, I got a 941 reminder out of nowhere and panicked thinking I had done something wrong. Here's what likely happened: Someone else may have mistakenly used your SSN when applying for an EIN, or there could be a data entry error somewhere in the IRS system that's associating your SSN with employer responsibilities. The good news is this is fixable, but you absolutely need to address it promptly. When you call the IRS (and I'd recommend trying the services others mentioned to actually get through), have your SSN ready and be very clear that you are a sole proprietor who has never had employees, never applied for an EIN, and have never been required to file Form 941. They should be able to remove the employment tax filing requirement from your account. Just make sure to get a confirmation number or case number when they fix it, so you have proof if this happens again. Don't stress too much - this is more common than you'd think, and the IRS can usually resolve it quickly once you get someone on the phone!

Wait, I'm confused about something else. You mentioned you're in school full-time - are you receiving any financial aid or scholarships? Some of those might be taxable too, and you might qualify for education credits like the American Opportunity Credit or Lifetime Learning Credit. Those could be worth looking into even if you don't have much other income!

I've been following this thread and wanted to share my experience as someone who went through a similar situation. I was a stay-at-home parent receiving various benefits and was completely overwhelmed by the tax implications. What really helped me was creating a simple checklist of all my income sources and benefits for the year - disability payments, any unemployment, financial aid, even small freelance work I'd forgotten about. Then I gathered all the tax documents (1099s, W-2s, 1098-T from school, etc.) before trying to figure out what was taxable. The key thing I learned is that even with very low income, filing can often get you money back through credits you didn't know you qualified for. In my case, I got refunds from education credits and the Child Tax Credit even though I thought I wouldn't owe or get anything back. Also, if you're unsure about anything, don't hesitate to reach out to a tax professional or use some of the resources others have mentioned. The peace of mind of knowing you've filed correctly is worth it, especially when you have kids depending on you. Good luck!

Don't forget about state taxes too! I caught up on my federal returns and completely forgot I needed to do state returns as well. Had to go back and do the whole process again. Most states have similar rules for prior year returns (paper filing only).

Great advice in this thread! One thing I'd add that helped me when I caught up on my back taxes - consider filing in chronological order (oldest first) rather than all at once. This can help avoid potential processing delays or confusion at the IRS, especially if there are carryover items like net operating losses or credits that might affect multiple years. Also, if you discover you made errors on returns you've already filed while working on the older ones, you can file amended returns (Form 1040X) to correct them. Just keep in mind the 3-year deadline for claiming additional refunds applies to amended returns too. The IRS actually has a pretty helpful "Get Transcript" tool on their website where you can see what they have on file for you for each year. It's worth checking before you start to see if they've already processed substitute returns for any years (they sometimes do this when people don't file). If they have, you'll want to file your actual returns to replace their estimates, which are usually not in your favor.

Has anyone used the new state reciprocity feature in TurboTax for handling W2G forms? I can't figure out if I'm supposed to report my out-of-state lottery winnings as "gambling winnings" or as "other income" when it asks about sources of income from other states.

Great question about multi-state lottery winnings! I went through something similar last year with winnings from Ohio and Kentucky. One thing I learned the hard way - make sure to keep detailed records of exactly where each winning ticket was purchased, not just where you claimed the prize. I had a situation where I bought a ticket in Kentucky but claimed it at an Ohio retailer near the border, and initially reported it to the wrong state. Also, double-check that the state withholding amounts on your W2Gs match what was actually deducted. I found discrepancies on two of my forms where the withholding was calculated incorrectly by the lottery commission. Getting corrected W2Gs before filing saved me from having to amend my returns later. The good news is that Ohio's tax credit system works really well for preventing double taxation on out-of-state gambling winnings. Just make sure you file your Pennsylvania non-resident return first, then use those results when completing your Ohio resident return to claim the proper credit.

Important note about the Safe Harbor Rule that a lot of people miss: the 110% threshold is based on your AGI from the previous year. So if your AGI was over $150k in 2023, you need to have paid at least 110% of your 2023 tax liability through withholding or estimated payments to be protected in 2024. If your AGI was under $150k in 2023, you only need to have paid 100% of your 2023 tax through withholding to qualify for Safe Harbor protection. Based on your numbers, you're well above either threshold, so you shouldn't have any penalty.

Hey I had this exact problem last year with TurboTax. It showed a penalty until I reached the very end of the return. Then suddenly during the final review it applied the Safe Harbor exception and removed the penalty. It's just a quirk with how the software calculates things before it has all the information.