Don't forget that even though you filed an extension, you still need to submit your return by October 15th to avoid late filing penalties! Extension season always goes by faster than people expect.

Just wanted to chime in with my experience - I switched from TurboTax to FreeTaxUSA after filing an extension and it worked perfectly! The key thing to remember is that your extension (Form 4868) is completely separate from your actual tax return filing method. I was in a similar boat with TurboTax trying to charge me $89 for federal plus state fees. FreeTaxUSA ended up costing me only $15 for state filing (federal was completely free) and walked me through everything step by step. The interface isn't as fancy as TurboTax but it gets the job done and their support was actually more helpful when I had questions. One tip: make sure you have all your documents organized before you start with any new service since you'll be entering everything fresh. Also double-check that any estimated tax payments you made with your extension are properly reflected in the payments section of your return. Good luck!

Just be careful about NOT forming your business in certain states. I was in exactly this position last year but in California. Started making money before i officially formed my LLC and the state hit me with a $800 minimum tax for the CURRENT year even tho i only formed it in november! Total scam. Make sure you research your state's rules before rushing to form an LLC.

I went through this exact same situation two years ago! You definitely need to pay quarterly taxes on that income even without the LLC formed yet. The IRS doesn't care about your business structure - they care about the income you're earning. With $3,500 so far this year, you're likely looking at owing around $500-700 in self-employment tax alone (that's the Social Security/Medicare tax at 15.3%), plus regular income tax on top of that. If you expect to make more throughout the year, you could easily hit that $1,000 threshold that triggers the quarterly payment requirement. My advice: don't wait until you form the LLC. Calculate your estimated taxes now using Form 1040-ES and make the payment. You can always adjust future quarters once your LLC is formed. The penalties for underpayment can be way more expensive than just paying a bit extra now to be safe. Also, keep those spreadsheets organized! You'll need them for Schedule C when you file, whether you're still a sole proprietor or have formed the LLC by then.

Man, the IRS needs to get with the times. In this day and age, we should be able to access all this info online easily. SMH 🤦‍♂️

Pro tip from someone who's been through this nightmare - if you applied online, try logging back into the IRS website with the same credentials you used. Sometimes the EIN is still visible in your application history. Also, check your bank statements from around that time - if you paid any fees, it might help you narrow down the exact date you applied, which could help when you call the IRS. They can search by application date if you have it!

Does anyone know if I can still do this recharacterization thing for my 2024 contribution? I contributed to a Roth earlier this year but just realized my income will be too high.

Just wanted to add another perspective on this situation. I had a very similar mess with my 2023 Roth contribution and recharacterization timing, and what really helped me was understanding that the IRS treats the recharacterization as if you had made the correct choice from the beginning. The key insight that wasn't immediately obvious to me: when you recharacterize in 2024 for a 2023 contribution, you're not making a new 2024 contribution - you're retroactively changing what type of contribution you made in 2023. This is why your 2024 Roth contribution is completely separate and valid. Make sure when you're entering the 1099-R information in your tax software that you're categorizing it correctly. The recharacterization 1099-R should be coded as "N" and the conversion should be coded as "2". If your software is still showing over-contribution after entering these correctly, you may need to manually override the calculation or seek help from a tax professional who understands backdoor Roth conversions. Also double-check that your custodian reported everything with the correct tax year designations on the 1099-Rs. Sometimes they get confused about which year a recharacterized contribution should be attributed to.

One detail no one has mentioned yet: Coverdell ESAs have an annual contribution limit of $2,000 per beneficiary. If your CD is maturing and you want to add more money beyond just reinvesting the existing balance, that $2,000 annual limit will apply. 529 plans, on the other hand, have much higher contribution limits - technically up to the projected cost of education in your state, which is usually $300,000+ per beneficiary. So if you're planning to add more funds for future education expenses, the 529 might give you more flexibility there. Also worth noting that Coverdell contribution eligibility phases out based on your income (starts phasing out at $190,000 for joint filers), while 529s have no income limitations.

Another consideration that hasn't been mentioned is state tax benefits. Many states offer tax deductions or credits for contributions to their 529 plans, but not for Coverdell ESAs. Since you're looking at potentially rolling over $7,200, you should check if your state offers any tax incentives for 529 contributions. For example, some states allow you to deduct up to $10,000 or more annually from your state taxes for 529 contributions. Even though this would be a rollover rather than a new contribution, some states still allow the deduction. This could provide immediate tax savings that might outweigh keeping the money in the Coverdell. Also, since your son is in 10th grade, you have time to take advantage of multiple years of potential state tax benefits if you do decide to make additional contributions to a 529 plan after the rollover.