


Ask the community...
Has anyone else had their earned income credit amount change when they amended their tax return? I originally filed with just my W-2 income but then realized I needed to add my DoorDash earnings from last year, and it actually increased my EIC.
Just wanted to add that you should definitely keep good records of all your gig work expenses throughout the year! Things like phone bills (portion used for work), insulated bags for food delivery, and of course your mileage can all be deducted. Since you're getting the earned income credit, you want to make sure you're not missing out on legitimate deductions that could save you even more money. I use a simple spreadsheet to track everything monthly - makes tax time so much easier. Also, don't forget that as a student, you might qualify for education credits too if you paid tuition or had other qualifying education expenses!
Am I the only one who thinks its ridiculous that we have to jump through so many hoops just to get our own money back? š The system is broken.
Just went through this same nightmare last month! Here's what worked for me: I called the IRS early morning (like 7:30 AM) when the lines first open - way better chance of getting through. They were able to stop the check from being mailed and reissue it to my new address. The whole process took about 3 weeks total. Also, definitely file that Form 8822 that Luca mentioned - it'll save you from this headache in the future. Hang in there, it'll work out! š¤
One thing I haven't seen mentioned yet - make sure you understand the first-year depreciation rules if you do choose the actual expenses method. With Section 179 and bonus depreciation, you might be able to deduct a huge chunk of your vehicle's cost in year one, but there are some important limitations for vehicles. The Section 179 deduction for vehicles used over 50% for business is capped at $12,200 for 2025 (plus potential bonus depreciation). So even though your car cost $18,000, you couldn't deduct the full amount immediately. Also, if your business income isn't high enough, you might not be able to use the full deduction anyway. Given your high mileage situation (18,000+ business miles annually), I'd definitely echo what others said about starting with the standard mileage rate. It's so much simpler and likely more beneficial. You can always crunch the numbers both ways next year to see if switching to actual expenses makes sense as your car depreciates further. Just make sure whatever method you choose, you're consistent and keep detailed records from day one!
This is really helpful context about the Section 179 limitations! I had no idea there was a cap specifically for vehicles. So if I understand correctly, even if I went with actual expenses and tried to use Section 179, I'd only be able to deduct $12,200 maximum in the first year instead of getting to write off the full $18,000 purchase price? That definitely makes the standard mileage rate look even more attractive for my situation. Thanks for breaking down those details - it's exactly the kind of stuff that would have tripped me up later!
As someone who went through this exact confusion when I started contracting, I'd strongly recommend keeping it simple with the standard mileage rate for your first year. With 350-400 miles weekly, you're looking at around $12,000-13,500 in deductions, which is likely going to be better than the actual expenses method anyway. Here's what saved me a ton of headaches: get a simple mileage tracking app or even just use a basic logbook. Record date, starting/ending odometer, destination, and business purpose for every trip. The IRS loves detailed records for vehicle deductions. One tip nobody mentioned - if you're doing delivery/courier work, make sure you understand what counts as "business miles." Generally, it's from your first business stop to your last business stop of the day. The commute from home to your first delivery and back home from your last delivery typically doesn't count unless your home is your official business location. Also, don't stress too much about Section 179 - it's way more complex than you need right now and the standard mileage rate will likely save you more money anyway. Focus on keeping good records and you'll be fine!
This is such great practical advice! The point about what actually counts as "business miles" is super important and something I definitely wouldn't have thought about. So if I'm understanding correctly, if I drive from home to my first delivery location, that's just regular commuting and not deductible? But once I'm out doing deliveries, all the miles between stops would count as business miles? What about if I have to drive to pick up supplies or go to the company office - would those trips count as business miles too?
Just want to add another bit of info regarding the 100% safe harbor (or 110% if your AGI is over $150k) - it applies to your TOTAL tax liability from the previous year, not just what you paid through withholding last year. So if you owed $10k total last year (including any amount you had to pay with your return), then you need to have withholding+estimated payments totaling at least $10k this year to qualify for safe harbor. That trips up a lot of people who think it's just about matching last year's withholding.
Does that mean I need to include the self-employment taxes I paid last year too? Or just the income tax portion?
Yes, you need to include ALL tax from last year, including self-employment taxes. The safe harbor is based on your total tax liability from the previous year - Line 24 on Form 1040 for 2022 returns, which includes income tax, self-employment tax, and any other taxes you paid. Many people make the mistake of only looking at their income tax, but for safe harbor purposes, the IRS looks at your total tax bill. That's why it's important to look at the actual line from your previous tax return rather than just remembering what you paid.
One more thing to consider - if your income was significantly higher in 2023 than in 2022, you might want to verify if you need to meet the 110% threshold rather than just 100%. If your AGI was over $150,000 in 2022 (or $75,000 if married filing separately), you need to have paid in at least 110% of your prior year tax liability to qualify for that safe harbor.
The 110% rule confused me last year. Does the $150k threshold apply to the CURRENT tax year or the PREVIOUS tax year?
The $150,000 threshold is based on your PREVIOUS tax year AGI. So if your 2022 AGI was over $150,000, then you need to pay 110% of your 2022 total tax liability during 2023 to qualify for the safe harbor. It doesn't matter what your 2023 income ends up being for this calculation - it's all about what you earned in the prior year.
Oliver Schulz
This is such a relief to read! I'm currently in week 3 of the 570/971 waiting game (filed Feb 15th, codes appeared March 1st and March 3rd respectively) and was starting to panic that something was seriously wrong with my return. Seeing your timeline and everyone else's experiences gives me hope that this might resolve itself soon without me having to call and wait on hold for hours. The way you described it as "tax jail" made me laugh - that's exactly how it feels! I've been obsessively checking my transcript twice daily like it's going to magically change between morning and afternoon. Thanks for sharing your success story and giving the rest of us stuck in processing limbo some much-needed optimism! š¤
0 coins
Mateusius Townsend
ā¢I'm so glad to see I'm not the only one going through this exact situation! I filed on February 20th and got my 570 code on March 5th, then the 971 appeared on March 7th. I've been checking my transcript obsessively too - sometimes even at 3am when I can't sleep because I'm worried about it! š Reading everyone's experiences here is honestly the first time I've felt hopeful in days. The "tax jail" description is perfect - that's exactly what this feels like. Fingers crossed we both see those magical 571 codes soon!
0 coins
Ezra Beard
This gives me so much hope! I'm currently on day 16 of my own 570/971 journey - filed January 30th, got the 570 on February 18th and 971 on February 25th. I've been checking my transcript religiously and starting to worry that maybe my situation is different from everyone else's. What really resonates with me is your description of checking the mailbox religiously for a notice that never comes - I've been doing the exact same thing! My mail carrier probably thinks I'm stalking them at this point š The "tax jail" and "processing purgatory" descriptions are spot on. It's wild how the IRS can just freeze your refund without any real explanation and then magically release it weeks later. Thanks for sharing your timeline - it helps to know that even after 3+ weeks, things can still resolve on their own. Hoping to join the "571 club" very soon!
0 coins