Just curious - what are you planning to replace it with? I'm shopping for a business vehicle and trying to figure out if it makes sense to go for something over 6000 lbs again for the tax benefits, or if those advantages aren't worth it anymore.

Sofia, I completely understand your frustration with that Range Rover! I've been in a similar situation with a heavy business vehicle that turned into more of a financial burden than benefit. One thing to consider that might help with the depreciation recapture burden - if your business has had a particularly good year, the recapture income (which gets taxed as ordinary income) might actually be beneficial for smoothing out your tax liability across years. Sometimes it's better to take the hit in a year when you can handle it rather than waiting and potentially facing it during a year with even higher income. Also, make sure you're tracking every single business expense related to the vehicle through the end - maintenance, insurance, registration fees, etc. These can help offset some of the recapture income. And if you're financing the replacement vehicle, the interest on that loan will be deductible for the business portion. The mental relief of getting rid of a vehicle you hate is worth a lot too. Sometimes the best financial decision isn't just about the numbers on paper!

Something important no one's mentioned - the Child Tax Credit amount phases out at higher income levels. Since your ex makes more than you ($78k vs $59k), you might actually benefit more from the credit than he would. For 2024, the phase-out begins at $75,000 for single filers. So your ex is already in the phase-out range while you're still under it. Depending on his exact income, he might not get the full benefit of the credit. If you're trying to maximize the total benefit between both households, it might make financial sense for you to claim both children in some years, especially if his income continues to rise. You could then work out some other financial arrangement to make things fair.

You're absolutely right to want to handle this fairly! As someone who went through a similar situation, I can confirm that splitting the Child Tax Credit with 50/50 custody is completely doable and legitimate. Since your divorce decree doesn't specify who claims the children for tax purposes, you have flexibility. The two most common approaches are: 1) Each parent claims one child every year, or 2) Alternate years where one parent claims both children. Given that you mentioned covering most of their healthcare costs, you might want to factor that into your negotiation with your ex. You could propose that you claim one child each year, or even suggest alternating who gets to claim both kids with the understanding that whoever doesn't claim them that year contributes more to certain expenses. The key is getting any agreement in writing - even a simple email or text exchange works. This prevents the "he said, she said" situations that can happen at tax time. Also, keep detailed records of your custody schedule and any expenses you pay for the children. While the IRS doesn't require you to prove who spent more money on the kids for the Child Tax Credit (unlike the dependency exemption rules), having documentation helps if there are ever questions. Don't let what happened last year repeat itself. Have this conversation now so you both know the plan going forward!

Has anyone used FreeTaxUSA for prior year returns? Their software lets you prepare previous year returns for free and tells you exactly what forms to print and mail. That's what I did for my 2022 return with capital losses, and it was pretty straightforward. Just wondering if others had good experiences with it.

Just to add another perspective - I had a similar situation last year where I needed to establish capital loss carryover from 2022. I ended up going to a local VITA (Volunteer Income Tax Assistance) site and they helped me prepare the prior year return for free. The volunteer was really knowledgeable about capital gains/losses and made sure I had everything correct before mailing it in. They also helped me understand exactly how the carryover would work for my current year taxes. If you have a VITA site near you, it might be worth checking out - especially since you mentioned being new to tax stuff. They're specifically trained to help with these kinds of situations and it doesn't cost anything. You can find locations on the IRS website. Just make sure to bring all your documents (1099s, any previous year tax returns you have, etc.).

I'm in the same boat with TaxAct! One thing nobody mentioned - check your email spam folder. I found an email from the IRS with instructions about my payment plan that got filtered out. It had a link to set up my online account and explained the whole process. Also the letter confirming your payment plan approval (with all the details) comes separately from your tax return confirmation, so watch for that too. Once I got that letter and set up my online account, everything showed up correctly and I could manage my payments there.

Great to see this got resolved! Just wanted to add for anyone else in this situation - if you're still having trouble finding that IRS email or it never came through, you can also call the IRS automated line at 1-800-829-0922 and use the automated system to check your installment agreement status. You'll need your SSN and the exact amount you owe, but it can confirm if your payment plan was approved and when your first payment is due. I had a similar issue where the email never came (even checked spam) and this automated line saved me from waiting on hold. It also gives you the option to speak to a representative if you need to make changes, though as others mentioned, services like Claimyr can help you get through faster if the wait times are crazy.

Does anyone know if tax software like TurboTax automatically calculates the Social Security tax overpayment refund? Or do I need to manually enter something specific?

This is such a relief to read! I'm in almost the exact same boat - left my job in July after hitting the SS tax cap, then started a new position where they've been withholding SS tax for the rest of the year. I've been losing sleep over whether I'd have to deal with separate payments and refunds. Based on what everyone's saying here, it sounds like the IRS will just net everything out on my 1040, which makes way more sense than having to juggle multiple transactions. The safe harbor rule explanation was especially helpful - I definitely paid over 110% of last year's tax through withholding, so that should protect me from penalties. Thanks to everyone who shared their experiences and tools. It's nice to know this is a common situation and there are resources to help navigate it!