Don't forget to track ALL your business expenses to offset some of that self-employment income! As a teacher doing curriculum work, you can likely deduct: - Home office space (if used regularly and exclusively for work) - Office supplies - Professional development materials - Reference books - Software subscriptions - Portion of internet bills - Mileage for any work-related drives (not to your teaching job) - Professional organization memberships I learned this the hard way by paying way too much my first year as a 1099 worker.

Has anyone used a SEP IRA to reduce their self-employment tax burden? I'm teaching part time and doing consulting work, making about the same as you ($42K from 1099s) and my accountant suggested I open one to shelter some income.

Just want to add one important thing about the Head of Household requirements that hasn't been mentioned clearly. For divorced parents with 50/50 custody, the IRS actually has a tiebreaker for determining where a child lived "more" nights when it's very close: If your child spends exactly the same number of nights with each parent (like in a perfect 50/50 split with no extra days), the IRS considers the parent with the higher Adjusted Gross Income (AGI) as the custodial parent for determining where the child lived. So if you and your ex have exactly 182/183 nights each, and your AGI is higher, you'd be considered the custodial parent for HoH purposes - even if your agreement says your ex claims the dependent exemption. Some tax software doesn't explain this nuance well, so it's worth knowing!

Don't forget about the other requirements for Head of Household! Besides having a qualifying person who lives with you more than half the year, you also need to pay more than half the cost of keeping up your home for the year. This includes rent/mortgage, property taxes, utilities, repairs, food eaten in the home, and other household expenses. You don't count clothing, education, medical expenses, or things like that. I got audited last year because I filed HoH but couldn't prove I paid more than half of these costs. Make sure you keep good records of what you spend on housing expenses!

Just to add some practical advice from someone who's been through the AMT credit process: KEEP DETAILED RECORDS! I exercised ISOs in 2016, paid AMT, then had issues claiming my credit in 2018 because I couldn't properly document everything. Make sure you keep: 1. Copy of Form 6251 from the year(s) you paid AMT 2. Documentation of your ISO exercise (statements from your company/broker) 3. Records of when you sell the shares (this matters for when credits become available) 4. Copies of any Form 8801 you file in subsequent years

Has anyone here used TurboTax to handle the AMT credit from ISOs? I'm having a hard time figuring out if it's tracking my credits properly.

Just to add something that hasn't been mentioned - this kind of setup makes me wonder if you're being properly classified as an employee versus an independent contractor. If you're getting a W-2, they're classifying you as an employee, which means they should be handling payroll properly with pay stubs, accurate reporting, etc. Some businesses try to avoid payroll taxes by paying "under the table" while still issuing tax forms that make it look legitimate. The fact that your boss "guessed" at your hours instead of having an actual time tracking system is super sketchy and unprofessional.

I'm wondering if the situation might be even worse than what's apparent. If your boss is reporting 495 hours but only paying you for 412, that's 83 hours of labor they're claiming for tax purposes without actually paying you. Some shady businesses do this to inflate their business expenses (your labor cost) to reduce their taxable business income, while simultaneously not actually paying out those wages. It's a form of tax fraud that unfortunately happens in cash-heavy businesses. The big question is: is your employer paying taxes on the full $8,925 they reported to the IRS, or only on the $7,416 they actually paid you? Either way, something's not right, and you deserve to have this straightened out.

Have you checked to see if your tips are "allocated tips"? Look at box 8 on your W-2. If there's an amount there, these are tips your employer assigned to you based on sales, and they don't withhold social security tax on these. You're responsible for paying the full social security tax on allocated tips yourself, which could explain the huge drop in your refund.

From what I can tell after reading your situation, I think FreeTaxUSA might be calculating something called "excess social security tax withheld." When you have multiple jobs and your combined income has had too much social security tax withheld (above the 6.2% on the maximum wage base), you get a credit for the excess. When you enter only your full-time W-2, the software might be calculating a refund of excess social security withholding. Then when you add the part-time W-2, it realizes you haven't actually exceeded the wage base, so that "excess" disappears. Try this: enter BOTH W-2s, then look at the detailed tax calculation in FreeTaxUSA and check the line for "Excess social security tax withheld" to see if it changed.