Does anyone know if you can claim this credit if you pay a family member to watch your kids? My mother-in-law watches my kids while I work on my freelance projects (all 1099 income), and I do pay her, but it's cash. Can I still claim the dependent care credit?

I'm dealing with a similar situation and wanted to share what I learned after doing some research. Your tax preparer is definitely incorrect about needing W-2 income for the dependent care credit. What really helped me was looking up IRS Publication 503 directly - it clearly states that self-employed individuals can claim this credit. The key is that you need to have "earned income" which includes net earnings from self-employment (your 1099 income). One important thing to keep in mind though - if your business expenses are high and you end up with a loss or very low net earnings from self-employment, that could limit your credit amount. But based on what you're saying about paying $8,000 in childcare expenses, it sounds like you're actively working and should definitely qualify. I'd strongly recommend getting a second opinion from a tax professional who has more experience with self-employment taxation. You shouldn't have to miss out on credits you're legitimately entitled to claim!

Has anyone checked if the issue might be state taxes? I had a similar problem when I moved from Texas (no state income tax) to California. My federal withholding was normal but California was taking a HUGE chunk. Worth looking at your pay stub breakdown to see exactly where the money is going. Could also be health insurance or retirement contributions that you didn't account for when calculating take-home pay.

This is a really common issue! First thing I'd recommend is getting a detailed breakdown of your pay stub to see exactly where that $800 is going. It's not just federal income tax - you've got Social Security (6.2%), Medicare (1.45%), state taxes (varies by state), and possibly local taxes too. At $3,200 weekly ($166,400 annually), you're in a higher tax bracket so the withholding can feel brutal. But here's the thing - if you're single with no dependents, that withholding rate might actually be close to correct for avoiding a big tax bill next April. Before adjusting your W4 further, I'd suggest running your numbers through the IRS withholding calculator someone mentioned above. It'll show you exactly how much you should be having withheld based on your actual tax situation. You might find that getting your take-home to $2,800 would leave you owing thousands next year. Also check if your employer is withholding for benefits, 401k, or other deductions you might have forgotten about. Sometimes what feels like "too much tax" is actually pre-tax deductions that are actually saving you money!

I've been through this 3 years in a row now. The trick is to call the IRS at 7:01am Eastern time on Tuesday or Wednesday (their least busy days) and use option 232 when prompted. Usually gets you to a human within 20-30 mins.

I'm in almost the exact same situation! Filed February 15th, accepted the next day, have cycle code 20250705, claimed CTC for my daughter, and WMR has been stuck on "processing" for weeks now. It's so frustrating seeing everyone with different cycle codes getting their refunds while we're still waiting. I've been checking my transcript every Friday like someone mentioned and still just see the same cycle code with no updates. Really hoping we see some movement soon - I was counting on this refund for some home repairs that I've had to put off. Thanks for posting this, at least now I know I'm not alone in this weird limbo!

I just went through this same nightmare and found another solution! • Online verification completed March 5th • No updates for 3 weeks • Couldn't get through on the phone AT ALL • Went to my local Taxpayer Assistance Center in person • Completed verification same day • Refund processed within 5 business days I had NO IDEA the online verification wasn't enough! The IRS website is so misleading! 😡 The in-person option was actually faster than waiting on hold for hours.

This is really helpful information! I'm currently stuck in what sounds like the exact same situation - completed online verification 2.5 weeks ago and my transcript still shows the same codes with no movement. I've been calling the main IRS number but keep getting disconnected after hours on hold. For those who successfully got through by phone, what time of day did you call? And did they transfer you to a specific department or were you able to complete the additional verification with the first person you spoke to? I'm trying to figure out if there's a better strategy than just repeatedly calling the main number. Also wondering if anyone knows - does the additional phone verification typically happen the same day you call, or do they schedule a callback? Thanks for sharing your timeline, it gives me hope that there's actually an end to this process!

Did anyone consider that the $275 might actually need to be depreciated rather than expensed if the sunglasses are expected to last more than a year? I got flagged on this in an audit once for some equipment. Just something to consider.

I actually had this exact situation come up in an audit a few years ago. I'm also in real estate in a sunny state (Nevada) and claimed similar polarized sunglasses as a business expense. The IRS agent focused on three main things: 1) Could I prove these were primarily for business use, 2) Were they substantially different from personal sunglasses I might buy anyway, and 3) Was the cost reasonable for the business purpose. What saved me was having documentation showing I already owned regular sunglasses for personal use, plus I had photos of me wearing the business ones during property showings and client meetings. The polarization feature was key - I could demonstrate it was specifically needed for reducing glare when showing properties with large windows or outdoor spaces. The $275 cost was actually fine because I could show similar professional-grade polarized glasses in that price range. Just make sure you can articulate the specific business need beyond general sun protection. Keep detailed records of when and how you use them for work.