I feel you on the stress! Code 570 hit my transcript last month and I was freaking out too. From what I've learned lurking here, it's usually just the IRS being extra careful with their reviews. Mine actually cleared after about 5 weeks with no action needed on my part. The waiting is brutal but try to stay positive - most people get their refunds eventually, just takes longer than expected. Keep checking your transcript every Friday when it updates!

Code 570 is actually pretty routine - it just means they're doing additional verification on your return. I know it's scary when you need the money, but try not to panic! The most common reasons are income verification, checking for identity theft protection, or quality assurance reviews. Since you mentioned claiming EIC, that's probably why - they automatically review those more carefully. Most 570 holds resolve in 4-8 weeks. Keep checking your transcript every Friday for updates, and if you don't see any movement after 8 weeks, definitely call the Taxpayer Advocate Service. Hang in there!

Dont forget about the difference between qualified and disqualified dispositions for ESPP! If u hold the stock for at least 1 yr from purchase date AND 2 yrs from offering date, its a qualified disposition and part of your gain gets taxed as long term cap gains instead of ordinary income. could be BIG tax savings!!

Great question! Yes, you can absolutely use tax loss harvesting from your regular investments to offset ESPP capital gains - they're treated the same way by the IRS for offsetting purposes. Just to clarify the ESPP tax treatment since there seems to be some confusion in other comments: The 15% discount you received is indeed treated as ordinary income and should appear on your W-2. Your cost basis for capital gains purposes is the discounted price you actually paid ($85 in Emma's example), so you only pay capital gains tax on appreciation above that amount. One thing to watch out for - make sure you understand whether you had a qualified or disqualified disposition. Since you mentioned selling after about 3 years, you likely met the holding period requirements (1 year from purchase AND 2 years from grant date), which could make part of your gain eligible for more favorable long-term capital gains treatment. Also be careful about wash sale rules if you're still participating in the ESPP program - continuing to buy company stock through payroll deductions while selling at a loss could potentially disallow those losses. You might want to double-check your 1099-B and W-2 to make sure the tax reporting aligns with your actual transactions before finalizing your tax loss harvesting strategy.

One thing nobody mentioned - if your son is under 27, could you possibly cover him under YOUR health insurance instead? Might be cheaper than what he's paying, and then this whole deduction issue becomes moot. Just a thought!

Just to add one more perspective to this great discussion - make sure your son keeps detailed records of when employer health coverage was available versus when it wasn't. The IRS can be pretty strict about this if they audit. I'd recommend creating a simple spreadsheet showing each month of the tax year, which employers he worked for, whether health insurance was offered (even if he declined it), and the premiums he paid. This documentation will be invaluable if there are ever questions about the deduction. Also, don't forget that if he does take the self-employed health insurance deduction, it goes on Schedule 1 (Line 17) and reduces his adjusted gross income, which can have other beneficial effects on his overall tax situation - like potentially qualifying for other income-based deductions or credits.

One thing nobody mentioned yet - if your brothers self-employment income is really small (like under $400 net profit) he doesn't have to pay self-employment tax on it, but still has to report the income. Saved me some $$$ when I was just starting my side gig!

Another important thing to consider is recordkeeping! For your brother's freelance work, he needs to track EVERYTHING - receipts, mileage, client payments, business equipment purchases, even home office expenses if he works from home. The IRS requires good documentation for all business deductions. I learned this the hard way when I couldn't find receipts during an audit. Now I use a simple spreadsheet or app to track expenses monthly rather than scrambling at tax time. For mixed-use expenses like his phone or internet, he'll need to calculate the business percentage based on actual usage. The key is being able to prove the business purpose if ever questioned. Also, since he has both W-2 and 1099 income, he should definitely consider making quarterly estimated tax payments for the freelance portion. The IRS expects you to pay taxes throughout the year, not just at filing time, and there can be penalties if you owe too much in April.

Don't forget to also deduct cleaning, repair and maintenance costs for your costume! If you're paying to dry clean, mend, or preserve these work clothes, those are legitimate business expenses too. I've been deducting my historical costume maintenance for years.

Great thread everyone! As someone who's dealt with similar deductions for specialized work clothing, I wanted to add that documentation is absolutely crucial. Beyond just keeping receipts, I'd recommend: 1) Taking photos of yourself wearing the costumes at work events 2) Saving any written requirements from faire organizers about costume standards 3) Keeping a simple log of when/where you wore each item for work Also, if you're borderline between W-2 and 1099 status, it might be worth reviewing your actual working relationship with the faire organizers. Many performers think they're employees when they're actually independent contractors (or vice versa), which completely changes your deduction eligibility. One last tip - consider whether you can structure some of these purchases through a small business entity if you're doing this work regularly. Sometimes forming an LLC and having the business purchase costumes can provide additional tax advantages beyond just deducting the expenses.