I've never heard of this safe harbor rule before. Does this apply even for relatively small amounts like $900 in interest? That seems like overkill for the IRS to expect quarterly payments on such small amounts.

Yes, technically the safe harbor rules apply regardless of the amount. However, in practice, for relatively small amounts like $900 in interest resulting in under $200 in additional tax, the penalty would be very minimal - we're talking maybe a few dollars at most. The IRS calculates the penalty based on how much you underpaid and for how long. Since the interest is usually earned throughout the year, the penalty isn't on the full amount for the full year. Many people with smaller amounts of interest income don't worry about making quarterly estimates because the potential penalty is so small, but technically you're supposed to cover your tax obligations as you earn income.

I used TurboTax to amend my return last year when I forgot about a 1099-INT. It was pretty straightforward - I just logged back into my account, selected "amend return," and followed the prompts to add the missing info. The downside is they charge extra for amendments, I think it was like $50 when I did it.

Thanks for sharing! That $50 fee is still less than what most tax preparers charge, so that might be worth it. Did TurboTax handle submitting the amendment electronically or did you still have to print and mail it?

This is bad advice and could get the OP in trouble. You can't just form an LLC to deduct volunteer work expenses. For a home office deduction, you need actual business income and profit motive. Volunteer work for a charity explicitly doesn't qualify, and trying to create a business structure around volunteer work could be seen as tax fraud if there's no legitimate business activity.

You're right, I should have been more specific. I wasn't suggesting creating an LLC just for volunteer work - that would definitely be problematic. What I was thinking was if OP had actual animal care services they provided separately from their volunteer work (like dog walking, pet sitting, etc.), then forming a legitimate business around those paid services might allow for some deductions that wouldn't be available otherwise. But you'd need genuine business income and operations, not just restructuring volunteer activities.

Thank you! This is really helpful - I hadn't even thought about things like utilities or cleaning supplies. Do you track the mileage to vet appointments with a specific app or just write it down somewhere?

I just use the notes app on my phone! Nothing fancy. I record the date, where I went, mileage, and purpose (like "Foster dog Bella - vet appointment for vaccines - 12.4 miles"). My tax guy said the IRS appreciates that level of detail. For things like utilities, I calculated the square footage of my foster room as a percentage of my total apartment, then applied that percentage to my utility bills. Keep all your receipts for supplies too - I use a separate folder in Google Drive just for foster expenses and take pictures of everything.

Thanks for this explanation! Yes, the site did take a small fee during the conversion to ETH. Should I be including that fee in my calculations somehow? Sorry if that's a dumb question, I'm still trying to wrap my head around all this.

That fee is important! It should be factored into your cost basis. For example, if you withdrew $1000 worth of winnings but only received $950 in ETH after the fee, your cost basis should be $950, not $1000. When you eventually sell that ETH, you'll calculate your gain/loss based on the $950 figure. The $50 fee isn't deductible separately - it's just part of the transaction cost of acquiring the ETH. This is likely contributing to why your software is showing a capital loss.

How did you figure out the exact price when you received it though? The price can change like every minute and im never sure what exact value to use.

Wait seriously? I had no idea about Form 1096! Is that something I can just download from the IRS website? And does it need to be mailed or can I submit it electronically somehow?

Yes, Form 1096 is required when submitting paper 1099s to the IRS. It's essentially a cover sheet that summarizes all the 1099s you're submitting. You can download it from the IRS website, but it needs to be the official red-ink scannable version - a regular printout won't be accepted. For your situation, you might want to consider e-filing instead. If you e-file your 1099, you won't need the 1096 at all. There are several IRS-approved e-filing services that make the process pretty straightforward, and it's generally faster and eliminates the risk of mail delays. Plus, you get confirmation when the IRS receives your submission.

Does the contractor copy have the same deadline? Like, are you penalized separately for sending it late to the contractor versus sending it late to the IRS?

Thank you! I had no idea about Schedule R - will definitely look into that. Do you know what the income limits are roughly? She's on Social Security plus a small pension. And good point about state tax breaks, I'll check our state tax department website.

For Schedule R, the income limits for 2024 filing (2025 tax season) are around $17,500 for single filers and $25,000 for joint returns in adjusted gross income. Social Security sometimes isn't fully counted in this calculation depending on her total income. Most states with income tax have some form of additional relief for seniors. Some even have specific deductions for medical expenses that don't make it past the federal 7.5% threshold. Your state's department of revenue website should have a section for senior tax benefits or you can call them directly.

I thought Medicare doesn't cover incontinence supplies? How did you get her Medicare Advantage plan to cover them?

Thanks for sharing your experience! I'm going to ask her doctor for a Letter of Medical Necessity at her next appointment. And you make a good point about the standard deduction - I need to look at her overall tax situation to see if itemizing would even help. Really appreciate the advice.