Word of warning from someone who's been mining for 3 years - keep EXTREMELY detailed records of when you started using each piece of equipment. I got audited last year because my electricity deductions seemed high, and I had to prove when each GPU was put into service for proper depreciation. The IRS agent also wanted to see pictures of my setup to verify it was actually used for business. Not trying to scare anyone, just emphasizing good record keeping!

Great thread everyone! As someone who just started mining last month, this is incredibly helpful. I wanted to add that if you're using multiple mining pools (like I am with NiceHash and Ethermine), make sure to track which coins came from which pool since they may have different fee structures that affect your deductions. Also, for those asking about solar panels - I'm in the planning stages for a solar setup specifically for mining. From what I've researched, you can potentially stack the federal solar tax credit (30%) with business deductions for the mining portion, but definitely get professional advice on this since it's complex. The IRS has specific rules about how to allocate costs between personal and business use of solar installations. One more tip: if you're mining in a state with net metering, keep detailed records of how much power you're feeding back to the grid versus consuming for mining. This affects both your tax calculations and potential income reporting if you're getting credits from the utility company.

Important heads up - if you're renting rooms in your house, check if you need a local permit or business license! I got hit with a $500 fine from my city because a neighbor complained and I didn't have the proper rental permit. Each city has different rules. Some places classify renting rooms differently than a full house rental. And some HOAs prohibit it entirely, so check your CC&Rs too.

Great thread everyone! As someone who's been doing the room rental thing for about 3 years now, I wanted to add a few practical tips that might help: 1. **Separate bank account**: Open a dedicated checking account just for rental income and expenses. Makes tracking SO much easier at tax time and shows clear separation between personal and rental finances if you ever get audited. 2. **Document everything**: Take photos of the rooms in their rented condition, keep copies of rental agreements (even informal ones with friends), and track when roommates move in/out. This helps establish your rental percentage if questioned. 3. **Quarterly estimated taxes**: Don't forget you might need to pay estimated taxes on your rental income throughout the year, especially if you're making decent money from the rooms. I learned this the hard way my first year and owed a penalty. 4. **Insurance considerations**: Check with your homeowner's insurance about renting rooms. Some policies require notification or additional coverage. Mine was fine but they wanted to know about it. The tax stuff gets easier once you establish a good system. Good luck with your rental venture!

For what it's worth, I think your accountant dropped the ball here. If he knew he needed your authorization to file an extension, he should have proactively reached out for it rather than just letting the deadline pass. Every accountant I've worked with automatically files extensions if they think there's any chance of missing a deadline. I'd seriously consider finding a new accountant who specializes in small business/partnership returns. A good accountant should have warned you about the March 15 deadline for partnerships (it's different than individual returns) and should be helping you with the penalty abatement rather than just shrugging it off.

I went through this exact situation with my LLC last year and successfully got the penalty waived. Here's what worked for me: I called the IRS using the number on the penalty notice (not the general 1-800 number). Yes, I was on hold for about 90 minutes, but it was worth it for the immediate resolution. When I got through, I was polite but direct: "I'm calling to request First-Time Penalty Abatement for notice [penalty notice number]. This was my first partnership return, I have a clean filing history, and I was unaware of the March 15th deadline." The representative pulled up my account, confirmed I had no prior penalties, and removed the entire $820 penalty on the spot. No paperwork, no waiting weeks for a response. The key is being specific about "First-Time Penalty Abatement" - don't just ask them to "waive the penalty." One tip: call early in the morning (8 AM EST) when they open. Hold times are typically shorter then. And definitely consider switching accountants - yours should have filed an automatic extension or at minimum warned you about partnership filing deadlines being different from individual returns. Good luck! This is very fixable.

You might want to report them to the IRS. Employers who pay cash and don't send 1099s are usually evading taxes themselves.

Been through this exact situation! Here's what worked for me: 1) Document everything - screenshot your attempts to contact them, keep records of when you worked and how much you were paid. 2) You can report the income on your tax return even without the 1099 - use Schedule C-EZ if it was simple freelance work. 3) The IRS actually has a form (SS-8) to determine worker classification if you're unsure whether you were an employee or contractor. Don't stress too much - being honest about your income is what matters most, and the IRS understands these situations happen.

Has anyone used FreeTaxUSA? Is it good for reporting both W-2 and gig work? I'm in a similar boat as OP and don't want to pay a ton for tax prep.

I went through something really similar last year! One thing that helped me was keeping track of all my expenses from the gig work - gas, car maintenance, phone bill (if you used it for deliveries), even the insulated bag I bought. Those deductions ended up saving me quite a bit on the self-employment tax. Also, since you're 23 and your parents might claim you as a dependent, double-check with them first. If they do claim you, you still have to file your own return, but you can't claim the standard deduction for yourself. It doesn't change whether you need to file (you definitely do with that gig income), but it affects how much you might owe or get back. Don't stress too much about not having "official paperwork" for the cash tips - the IRS expects you to report all income regardless. Just keep good records of what you earned and when. Most tax software will handle the Schedule C form for your gig work pretty smoothly.