Has anyone used QuickBooks for tracking these mixed payment situations? I'm trying to figure out how to properly record business expenses paid with store credit cards so my tax reporting is correct at the end of the year.

Great question! As someone who's dealt with similar situations, I can confirm that Amara's advice is spot-on. Since you're using accrual accounting, you can deduct those expenses in the year you incurred them, regardless of when you pay off the credit cards. One additional tip: make sure to keep detailed records of what percentage of each store card is used for business vs personal expenses if you ever use them for non-business purchases. The IRS loves clear documentation, especially for credit card transactions. Also, don't forget that if you're claiming the computer as a business expense, you might want to look into bonus depreciation or Section 179 expensing for that $2,200 Best Buy purchase. Depending on your business income, you might be able to deduct the full amount this year rather than depreciating it over several years. The 20% discounts you got from signing up for the store cards are just reductions in your business expenses - they don't create any additional tax complications. Your deductible amount is simply the actual price you paid after the discount.

Has anyone tried FreeTaxUSA? Federal is always free and state is only $15. It's way cheaper than TurboTax and H&R Block even if you have to pay for state.

As someone who's been through the free filing maze multiple times, I'd definitely recommend starting with the official IRS Free File portal at irs.gov/freefile since you qualify with your $42k income. But here's a pro tip that saved me last year: before you commit to any service, take a screenshot of the "free" promise on the first page. I got burned by TaxAct in 2022 when they tried to charge me $39 for state filing after I'd already entered all my info, even though I accessed it through the IRS portal. Also, if you're in a state that doesn't participate fully in Free File (like I am), check if your state has its own free e-filing system. My state offers completely free e-filing directly through their revenue department website for anyone making under $60k. It's a separate system from the federal filing but totally worth the extra 20 minutes to save $30-50. One last thing - if you do hit any snags with the free systems, don't give up and pay for a premium service right away. The IRS Taxpayer Advocate Service has a hotline that's helped me troubleshoot free filing issues before, and they're actually pretty responsive during tax season.

Just want to add that when you call the IRS, also ask them to put a "correspondence hold" on your account while they're processing the address change and reissuing the check. This prevents them from sending any other notices or correspondence to the old address during this period. Also, if you have access to your online IRS account, you can check the "Get My Payment" tool to see the status of your refund - it should show if the check was issued and potentially if it's been cashed. This can give you some peace of mind while you're waiting for the phone call to go through. One more tip: if the 800-829-0922 line is too busy, you can also try calling your local Taxpayer Assistance Center. They can help with the same issues and sometimes have shorter wait times than the main line.

Quick heads up - if you've moved recently, the IRS might still be processing your address change even if you filed Form 8822. I had this exact issue where my CP21B went to my old apartment. When you call Monday, also ask them to verify what address they have on file for you currently. Sometimes there's a lag between when you submit the address change and when it actually updates in their system, especially if you filed it close to when they processed your return. If they still show your old address, you can update it over the phone during the same call where you request the stop payment. Just have both your old and new addresses ready to confirm. This saved me from having to file another form and waiting weeks for it to process. Also, once you get this sorted out, consider setting up direct deposit for future refunds if you haven't already. Even if you move, your bank account usually stays the same and it's much faster than waiting for checks to be reissued.

Something important nobody's mentioned yet - if you're getting income through these apps that will now be reported on 1099-Ks, you probably need to be making quarterly estimated tax payments throughout the year, not just paying at tax time. I got hit with an underpayment penalty last year because I wasn't doing this with my side gig income. The IRS expects you to pay taxes as you earn income, not all at the end of the year. If you're going to owe more than $1,000 at tax time, you should be making quarterly payments. This whole $600 reporting change means a lot more people will need to be thinking about this!

This is such a helpful thread! I'm in a similar boat with my freelance graphic design work - been using Venmo and PayPal for client payments and had no idea about this $600 threshold change. One thing I wanted to add that might help others: if you're scrambling to get your records organized like I was, your bank statements can be a lifesaver for tracking business expenses. I went through mine and found tons of deductible purchases I'd forgotten about - Adobe subscription, stock photo purchases, even mileage to client meetings. Also, for anyone doing this kind of side work, consider opening a separate business checking account if you haven't already. Makes tracking so much easier and looks more professional to clients. Some banks even offer free business accounts for small operations. It's one of those things I wish I'd done from the start instead of mixing everything with my personal account. Thanks everyone for sharing your experiences - this whole thread has been incredibly informative!

Something nobody's mentioned - in Michigan specifically, you still need to file annual statements with the state for LLCs even if they had no activity. It's only $25 per LLC, but if you miss it, Michigan can technically dissolve your LLC and there are penalties for late filing. So while your federal tax situation might be fine as others have said, make sure you're current with Michigan's Department of Licensing and Regulatory Affairs (LARA) requirements too!

Your accountant is likely being overly cautious or may not be familiar with LLC tax requirements. Based on what the IRS told you directly, you're probably in the clear. Here's why: For single-member LLCs that are "disregarded entities" (the default), they're reported on your personal tax return via Schedule C. If there was no activity, you'd report zero income and zero expenses. The penalties your accountant mentioned ($295/month per LLC) sound like they're referencing partnership return penalties (Form 1065), but those only apply if you elected to be taxed as a partnership. Since you never received penalty notices and the IRS confirmed you don't owe anything for the LLC without an EIN, I'd trust their word over your personal tax preparer who admittedly only does individual returns. My recommendation: If you're not planning to use these LLCs, properly dissolve them with Michigan and file final "zero activity" returns to close them out with the IRS. This prevents any future confusion. Don't pay $7,080 in penalties without getting a second opinion from someone who specializes in business taxes - that amount seems completely disproportionate for dormant entities that never operated.