Oh that's good to know! My wife did change her name after we got married. Does the name on the tax return need to match her W-2 or her updated Social Security card? Her W-2 still has her maiden name.

The name needs to match what's on her Social Security card. The IRS systems check against the Social Security database, not her W-2. So if she's already updated her name with Social Security, use her new name on the tax return even if her W-2 still shows her maiden name. If she hasn't updated her Social Security card yet, you should either do that before filing or use her maiden name on the tax return this year. You don't need to delay filing if her SS card still has her maiden name - just file with whatever name is currently on her Social Security card and make the update for next year.

What software did you use to figure that out? We're trying to decide between TurboTax and H&R Block and wondering which is better for figuring out deductions for newly married homeowners.

That's scary! What app or method do you recommend for tracking mileage properly now? And did they go after previous tax years too or just the one where you took the big deduction?

I now use MileIQ which automatically tracks all my drives and lets me categorize them as business or personal. It creates IRS-compliant reports that show all the details they want. Some other good ones are Everlance and Stride. They only examined the year I took the big deduction, thankfully. But the audit was still a nightmare that lasted 8 months. The agent explained that these large vehicle deductions are a "red flag" that often trigger extra scrutiny. If you do claim the deduction, just make absolutely sure your documentation is bulletproof from day one. Start the mileage log the very first day you put the vehicle in service.

What about insurance costs? My business insurance agent told me rates would be MUCH higher if I register a luxury SUV as a business vehicle versus personal use. Did you see a big insurance premium increase?

The insurance cost increase was definitely significant. My commercial auto policy for the Mercedes GLS is about 40% higher than it would be as a personal vehicle. However, the business portion of the insurance is also tax-deductible as a business expense. One thing my accountant pointed out is to look at the total cost of ownership compared to the tax benefits. In my case, even with higher insurance costs, the tax savings from the Section 179 deduction still made it worthwhile. But it's something you should definitely factor into your calculations before making a decision. The other consideration is that I had to make sure my business entity owned the vehicle (LLC in my case) rather than owning it personally to maximize the benefits.

Thanks for that additional info! I didn't even think about the state tax implications if I had chosen a different state. If I do something similar in the future and pick a state WITH income tax, how long would I need to work there before I'd have to file a tax return for that state?

It varies significantly by state. Some states require you to file a nonresident return from day one, regardless of how little you earn there. Others have minimum thresholds like working more than 30 days or earning above a certain amount. For example, New York technically requires nonresident income tax filing for any work performed in the state, even for a single day. Other states might have a 15-30 day grace period. Some have minimum earning thresholds ranging from $1,000 to $3,000 before you need to file. There are also a few states with reciprocity agreements where you might only pay tax to your home state.

This is a really good point! Seattle has that head tax thing that even non-residents have to pay sometimes. OP should check on local taxes for wherever they worked.

Wait, so not only do I pay income tax on my side gig money, I also have to pay this additional self-employment tax? Is there a minimum amount I need to make before this kicks in? And what's this about deducting half of it?

You need to pay self-employment tax if your net earnings from self-employment are $400 or more. So yes, it kicks in pretty quickly. This tax is basically covering the Social Security and Medicare taxes that an employer would normally withhold from your paycheck (plus the employer portion too, which is why it's 15.3%). The silver lining is that you can deduct half of your self-employment tax on your 1040 as an adjustment to income. This is because if you were an employee, your employer would pay half of these taxes. So the IRS allows you to deduct that "employer portion" to make things more equitable. It's automatically calculated when you file Schedule SE.

Totally agree! I use FreeTaxUSA and while I love it for the price, the explanations about business deductions vs itemized personal ones were super confusing. I nearly mixed them up completely until I found a YouTube video explaining the difference.

Omg I didn't even think about that! I don't know much about tax credits tbh. Is there an income limit for the Earned Income Credit? And do I need any special documentation to claim it beyond what I'd need for claiming my nephew as a dependent?

Yes there's an income limit but at $42k with a qualifying dependent you should be under the threshold. For 2025 filing season the limit is around $46,000 for Head of Household with one qualifying dependent. You don't need any additional documentation beyond what you'd already gather for claiming your nephew as a dependent. The same proof that he lives with you and that you provide more than half his support works for both. Just make sure when you file your amended return you complete Schedule EIC along with your 1040-X. The credit could be worth anywhere from $1,500-$3,500 depending on your exact income and situation.

This is great advice! And another thing - amended returns can't be e-filed. You have to print and mail them, which means they take forever to process (like 4+ months minimum). Just be prepared for a wait.