Do I need to keep physical receipts for all the supplies I buy or are digital records okay? My CPA is pretty old school and I'm not sure what's actually required.

Digital records are perfectly acceptable for the IRS! I take pictures of all my receipts with my phone and organize them by month in Google Drive. Many CPAs now prefer digital because it's easier to search and organize. That said, if your CPA prefers physical copies, you might want to print them out just to make the process smoother on their end. But legally speaking, digital receipts have the same validity as paper ones as long as they clearly show the date, vendor, amount, and what was purchased.

Be careful with home office deductions though. You need a space used EXCLUSIVELY for business, not just your kitchen table where you also eat dinner. That's where a lot of people get in trouble.

This sounds like a fantastic idea! Did you have any specific way you tracked everything? I'm worried about making it too complicated but love the real-world application.

Nothing fancy! We just use a simple chart on the refrigerator with magnets. Each kid has a section with their weekly "income" from chores, then two columns showing taxes collected and take-home pay. The family fund is a jar on the counter where the tax money goes. You definitely want to keep it simple - the point is just to visualize the concept, not create an accounting nightmare for yourself! My kids actually get excited on "budget day" when we decide how to spend the family fund. Sometimes they even vote to save it for something bigger. It's been a great lesson in collective decision-making too.

This is such a creative idea! Did you find that it made them more negative about taxes or did they see the benefits too?

That's good to know! Have you heard if there are any specific reasons for the delays this year? I remember reading something about new security protocols at the IRS.

I heard from my tax preparer friend that the IRS implemented some new fraud detection systems this year that are creating additional verification steps for many returns. They're apparently doing more automated checks before sending acceptance notifications. Also, they've apparently changed how they batch process returns, so sometimes a return can be accepted but the notification gets held until the entire batch is processed. These changes were meant to help with security but are causing these notification delays for many people.

Actually yeah, I've had weird glitches with TurboTax this year too. The mobile app kept crashing when I tried to upload my W-2 photo, and the website was super slow. Maybe they're having server issues that are affecting their notification system too?

What about wash sales? My 1099 has some adjustments in a column labeled with a "W" and I'm not sure what to do with those.

Wash sales happen when you sell a stock at a loss and then buy the same or a substantially identical stock within 30 days before or after the sale. When this happens, you can't immediately claim the loss for tax purposes. The "W" column on your 1099 indicates the amount of loss that was disallowed due to wash sale rules. The cost basis of your replacement shares is increased by this amount, which means you'll eventually get the tax benefit of that loss when you finally sell the replacement shares (assuming you don't trigger another wash sale). When entering this information into tax software, make sure you include the wash sale adjustment exactly as shown on your 1099. Most tax programs have specific fields for this. If you have multiple wash sales, it can get complicated quickly, which is why some people use specialized tax software or services for investment income.

Do you have to report every single transaction or can you just report the summary totals? I made like 50 trades last year and don't want to enter them all individually.

Thank you so much for this checklist! I definitely didn't realize I needed my bank statements showing interest. How much interest needs to be reported? My savings account only earned like $25 last year.

You should report all interest income, even small amounts. Your bank should have sent you a 1099-INT form if you earned more than $10 in interest. Even if it's only $25, it's technically required to be reported. Don't stress too much about small amounts though. The IRS is mainly concerned with larger discrepancies. Just enter what you have documented and keep good records going forward. Tax software makes it really easy to enter these small amounts.

It depends on your situation, but generally if you're single and earned less than $12,950 in 2022, you're not required to file. HOWEVER, you should probably file anyway because you'll likely get back all the federal taxes that were withheld from your paychecks!