


Ask the community...
This happened to me too. The issue is that TurboTax asks about your children in multiple places. Even if you say your ex is claiming them as dependents, there's another section where it asks about qualifying children for Earned Income Credit. If you put their info there, your return will get rejected with that error code.
OMG thank you!! I just checked and you're right - I had their info in the EIC section even though I answered "no" to claiming them as dependents. Deleted their info from that section and resubmitted. Finally went through! Can't believe TurboTax doesn't make this clearer.
Glad it worked out! TurboTax does this annoying thing where it treats the dependent section and the EIC qualifying child section as separate things (which technically they are according to tax law), but they don't make it obvious to normal people. For next year, just remember that if you're not claiming them at all, you generally shouldn't enter their info anywhere in the return.
Has anyone actually called the IRS about this? Their official guidance might be different from what we're all guessing here.
I called them last year about this exact error. 3 hours on hold only to be told I needed to mail in a paper return because their system couldn't handle my specific situation. Complete waste of time.
Just a quick tip based on my experience - when entering 1099-MISC from brokerages in TurboTax, make sure you don't enter it in the self-employment section! It will mislead you into paying self-employment tax (an extra 15.3%) on that bonus money. Instead, look for the "Uncommon Income" section or search for "other income" in TurboTax. Then choose "Other reportable income" and enter it there. This ensures it's reported correctly on Line 8 of Schedule 1 as Other Income without the self-employment tax. I made this mistake last year with a similar promotion and had to file an amended return to get that self-employment tax back.
What about state taxes? Do you have to report the bonus on state returns too? I'm in California and their tax system is even more confusing than federal.
Yes, you generally need to report this bonus income on your state tax return as well. For California specifically, their state return follows the federal categorization, so if you report it as "Other Income" on your federal return, it will flow through to your California return in the same category. Most tax software will automatically transfer this information to your state return once you've entered it correctly on the federal portion. Just make sure when you're reviewing your California return that the income appears in the correct section and isn't somehow being double-counted or miscategorized.
Anyone know if it matters whether the bonus was in cash vs. stock? Robinhood gave me their bonus as fractional shares rather than cash. I got a 1099-MISC too, but wondering if I should report it differently since it was stock not cash?
It doesn't matter whether they gave you cash or stock as the bonus - it's still reported the same way on your taxes (as "Other Income"). However, there's an important difference: when they give you stock, the value reported on the 1099-MISC becomes your cost basis for those shares. So if you later sell those shares, you'll only pay capital gains tax on any increase from that initial value.
Thanks for explaining! So I'll report the full amount on the 1099-MISC as Other Income for this year, and then if I sell the stock later, I only pay capital gains on whatever it grew beyond that initial value. That makes sense and actually seems fair.
Don't forget about other deductions beyond just gas/mileage! I do Uber/Lyft part-time and was able to deduct: - Phone mount for car ($25) - Portion of cell phone bill (20% business use) - Car chargers - Dashcam - Snacks/water for passengers (I keep receipts) - Special seat covers to protect from wear and tear - Spotify subscription (for passenger entertainment) Made a big difference on my Schedule C!
Thanks for this list! I hadn't thought about the phone mount or dashcam. Can you really deduct Spotify though? I use it while driving but isn't that kind of a gray area?
You can deduct Spotify if you're using it specifically for your business - like providing music for passengers as part of your service. It's considered a business expense if it's primarily for your customers' experience. If you're just listening to it yourself while doing DoorDash deliveries, that would be much harder to justify as a business expense since there are no passengers benefiting from it. It's all about whether it's necessary for your business operations versus personal enjoyment.
Something I learned the hard way - if you choose standard mileage the first year you use your car for business, you can switch between standard and actual expenses in future years. BUT if you choose actual expenses the first year, you're STUCK with that method for the life of that vehicle in your business. Also, don't forget you can deduct business parking fees and tolls IN ADDITION to the standard mileage rate! Those aren't included in the $0.67/mile.
Yup, this is super important! I made that mistake with my first delivery car. I used actual expenses the first year when the car was new and had higher value for depreciation. When the car got older and needed fewer repairs, standard mileage would have been better but I was stuck with actual expenses. For parking and tolls - gig drivers should use apps that track these separately! I use the Stride app for mileage and the Everlance app to snap photos of parking receipts. Makes tax time way easier.
Thanks for pointing this out! I didn't realize that choosing actual expenses would lock me in for the life of the vehicle. That's definitely something to consider since I might keep this car for several years. And I had no idea about the parking fees and tolls! I've probably spent around $200 on parking in downtown areas for pickups/deliveries. Good to know I can deduct those on top of the standard mileage.
Did you file an extension earlier this year? Sometimes when you file an extension and then try to submit your actual return, you can get weird reject codes if there's any discrepancy between the information on the extension and your final return.
This happened to me! I had filed an extension and when I finally did my taxes, I got rejected because I had typed my SSN wrong on the extension form. Had to call the IRS to sort it out. Super annoying.
Another possibility for this error code is if you've been a victim of identity theft. If someone has already filed a fraudulent return using your SSN, you'll get rejected when you try to file the legitimate one. Might be worth checking if you have any other signs of identity theft.
Dmitri Volkov
Has anyone noticed the refund tracker is totally inaccurate sometimes? My status was stuck on "received" for 3 weeks, then suddenly the money just appeared in my account without the tracker ever updating to "approved" or "sent"! Only updated to show "sent" two days AFTER I already had the money.
0 coins
Gabrielle Dubois
β’Same thing happened to me last year! Was checking the tracker obsessively and then boom, money in my account while the tracker was still on the first step. Seems like their systems don't always talk to each other properly.
0 coins
Tyrone Johnson
I filed on Feb 4th and got my refund on Feb 18th, so exactly 2 weeks. But my brother filed on the same day and he's still waiting (almost 4 weeks now). The difference? He claimed the Earned Income Credit and I didn't. They definitely prioritize simpler returns.
0 coins
Miguel HernΓ‘ndez
β’That's good context, thanks! Mine doesn't have any special credits like that so hopefully it won't be too long. It's amazing how much the timeline can vary based on what's in your return. Makes sense that they'd need more time to verify certain credits though.
0 coins