Direct File is only for simple personal returns right now, not for business returns or extensions. For your 7004, you'll need to either use commercial tax software, have your accountant e-file it, or mail in a paper form. I've been using FreeTaxUSA for my S Corp returns for years - they handle the 7004 extension filing too and it's pretty straightforward.

Thanks for clarifying! I'll stick with my regular tax software then. Wish the IRS would expand these services to small businesses too.

Most COVID-related tax provisions have expired now. For the 2025 filing season (2024 tax year), things have largely returned to pre-pandemic rules. Employee Retention Credits ended, PPP loan forgiveness is old news, and the special sick leave credits are gone. The only lingering effects might be if you're still carrying losses forward from the pandemic years, but the special expanded rules for those have mostly reverted to normal too.

Thanks for the reminder about Schedule SE! I actually did factor that in when I increased my withholding. I calculated roughly what I'd owe for both income tax and self-employment tax on the $18,500 and that's how I came up with the $320 per paycheck increase. Do you know if there's an easy way to check if I'm on track to meet the safe harbor requirement? I'm still a bit nervous about whether I've withheld enough.

You can use the IRS Withholding Estimator on their website. It will let you input both your W2 income/withholding and your 1099 income, then tell you if you're on track. Another simple approach is to look at your last paystub from 2024 and add up the federal withholding. Then add what you expect to have withheld for the rest of 2025 based on your current withholding rate. If that total is at least $16,300 (your tax from last year), you'll meet the safe harbor requirement.

But aren't you basically losing money by giving the government an interest-free loan? You could be investing that money throughout the year instead. I set calendar reminders for estimated payments and it's not that bad.

Do you know if there's a limit to how many conferences you can attend and deduct each year? I've gone to like 4 already this year and wondering if that looks suspicious.

There's no specific limit on the number of conferences you can attend and deduct. The key test is whether they're "ordinary and necessary" for your business. If you can justify why each conference provides value to your specific business operations, then multiple conferences can be legitimate. However, if the conferences all cover very similar content, or if some seem only tangentially related to your business, that might raise questions. The IRS might look more closely if the pattern suggests the conferences are primarily for personal enjoyment rather than business development. Quality documentation of the business purpose for each one becomes even more important when you attend multiple events.

Yes, you'd need to allocate. If you would have gotten a single hotel room anyway, you can deduct the full room cost. But their flight, their meals, and any increase in room cost for double occupancy wouldn't be deductible.

What's the difference between refundable and non-refundable credits? And can you really get more money back than you paid in taxes??

A refundable credit means you can receive the full amount of the credit even if it's more than what you owe in taxes. So yes, you can absolutely get back more money than you paid in! For example, the Earned Income Tax Credit (EITC) is refundable, so even if you owe zero taxes, you could still get money back if you qualify. Non-refundable credits can only reduce your tax liability to zero, but not below zero. So if you have $500 in tax liability and a $1,000 non-refundable credit, your tax bill goes to $0, but you don't get the extra $500 back.

Yes, that's exactly right! If you make $5,000, you'd take the standard deduction (about $14,600 for 2025) and your taxable income would be $0. If you make $20,000, you'd take the same standard deduction and only pay taxes on $5,400 ($20,000 - $14,600). It definitely can seem complicated, but the standard deduction actually simplifies things by ensuring people with lower incomes don't have to pay income tax. Think of it as the government saying "everyone gets their first $14,600 tax-free.

omg thank you for explaining it that way!! "everyone gets their first $14,600 tax-free" makes way more sense to me than all the technical jargon. i think i finally get it now.

That's interesting! What state are you in? We're in Texas and my daughter sells art online too, but we never got any kind of business license. Now I'm worried we're breaking some rule...

Wow, I didn't know you could open retirement accounts as a teenager! That's actually really cool to think about. I'll definitely talk to my parents about this too. Thanks for the suggestion!