Does anyone know how this Box 6 issue works with tax software like TurboTax? When I enter my 1099-NEC info, it seems to automatically assign the income to the state listed in Box 6, but that's not where I live or work.

This is such a helpful thread! I'm dealing with a similar situation where I live in Oregon but work remotely for a company in New York. My 1099-NEC has New York listed in Box 6, but I've never even been to New York - all my work is done from my home office in Oregon. From what I'm reading here, it sounds like I should report this income to Oregon since that's where I physically performed the work, regardless of what Box 6 says. But I'm worried about getting audited if I don't follow what's printed on the form. Has anyone had experience with state audits over this kind of discrepancy? Should I reach out to my client to get a corrected 1099-NEC, or is it safe to just allocate the income to Oregon when I file?

Just want to add my experience - I was in an almost identical situation last year. Had 3 years of unfiled taxes with both W-2 and 1099 income. I decided to DIY with tax software and regret it now. I thought I was saving money, but I missed several deductions that would have saved me thousands. I also messed up the estimated tax penalty calculations which caused more issues. Then I tried amending the returns myself which created an even bigger mess! Finally hired a tax pro who had to fix everything. Cost me way more in the end than if I'd just hired them at the beginning. Just my 2 cents, sometimes trying to save money costs more in the long run.

I want to share some practical advice from someone who went through a very similar situation recently. First, don't panic - this is absolutely manageable even though it feels overwhelming right now. For your unfiled returns (2015, 2018, 2020), the most important thing is getting them filed ASAP to stop the failure-to-file penalties from growing. These penalties are typically much higher than failure-to-pay penalties. Since you mentioned your returns are relatively straightforward, you could potentially handle the preparation yourself using prior year tax software. However, given that you have over $20k in total tax debt between your back taxes and unpaid 2023 estimated payments, I'd lean toward getting professional help for a few key reasons: 1. **Penalty abatement opportunities** - A tax pro can often get first-time penalty abatements or reasonable cause waivers that could save you hundreds or thousands 2. **Maximizing deductions** - Even "simple" 1099 work often has more deductible expenses than people realize (home office, mileage, equipment, etc.) 3. **Payment plan strategy** - They know how to structure installment agreements to get the best terms and can handle both your back taxes and 2023 shortfall in one comprehensive plan The $450 per year might seem expensive, but if they can reduce your tax liability by even 10-15% through proper deductions and penalty abatement, that fee pays for itself many times over. Plus, having everything handled correctly the first time prevents costly amendments later. For immediate next steps: gather all your tax documents for those years, and consider getting quotes from a few different tax professionals who specialize in tax resolution, not just basic tax prep.

One major tip I learned the hard way - don't just check the box in Step 2(c) on all your W4 forms! I did this with my 3 jobs and ended up having WAY too much withheld. That box basically tells each employer to withhold as if that job's income was your only income but at a higher single rate. The multiple jobs worksheet is much better but still not perfect. Personally, I'd recommend using the IRS tax withholding estimator online and updating your W4s quarterly if your income fluctuates.

This is such a common problem with multiple jobs! I went through something similar last year with 3 jobs. Here's what I learned that might help: First, you're absolutely right that the new W4 is way more complicated than the old allowance system, but it's actually more accurate once you figure it out. For your situation with 4 jobs where 2 weren't withholding anything, you definitely need to update ALL of them. My recommendation would be to start with the IRS Tax Withholding Estimator (it's free on the IRS website). It's specifically designed for multiple job situations and will give you exact instructions for each W4. You'll input all 4 jobs' expected income, and it calculates how much should be withheld from each. One thing to watch out for - if your jobs have very different pay rates, the calculator might suggest putting most of the extra withholding on your highest-paying job rather than spreading it equally. This actually works better for cash flow. Also, don't stress too much about getting it perfect right away. You can always adjust your W4s again if needed after a few paychecks. The key is getting something reasonable in place so you're not hit with another big tax bill next year!

One important thing that confused me about the 1095-C - it's different from a 1095-B! My spouse got a 1095-B from their insurance company and I got a 1095-C from my employer and they contain different information. Just wanted to point this out in case anyone else has both forms in their household.

Just want to chime in with a simple summary for anyone still confused! Your 1095-C form is basically just proof that your employer offered you health insurance coverage. You DON'T need to mail it in with your tax return or enter specific numbers from it into tax software. Think of it like a receipt - keep it with your tax records in case you ever need to prove you had qualifying health coverage. The main thing it helps with is showing the IRS that you met the health insurance requirement and shouldn't be penalized. If you're using tax software like TurboTax or H&R Block, they might ask if you had employer-sponsored health insurance, and you can just answer "yes" based on having this form. But you won't need to type in the specific codes or dollar amounts from the 1095-C itself.

I'm dealing with this exact same situation with my S-Corp that I started in 2023! Reading through all these responses has been incredibly eye-opening - I had no idea the IRS was so strict about the salary requirement even when you're not taking distributions. Like you, I've been reinvesting everything back into growing the business and haven't taken a penny out personally. I was actually hoping I could avoid the whole payroll setup complexity until I started taking money out, but it sounds like that's not an option. The documentation aspect that several people mentioned really resonates with me. I think that's been my biggest mistake - not keeping records of my decision-making process around compensation. I've been so focused on just running the business that I haven't been thinking about creating that paper trail for potential IRS scrutiny. Based on all the advice here, it sounds like I need to: 1) Research comparable salaries in my industry and area, 2) Set a reasonable but affordable salary (maybe 60-70% of market rate given cash flow constraints), 3) Document my reasoning with a formal board resolution, and 4) Set up proper payroll processing. This thread has been a huge wake-up call. Better to get compliant now than deal with potential reclassification and penalties later. Thanks everyone for sharing your experiences - this kind of real-world guidance is so much more helpful than trying to parse through IRS publications!

This is such a great thread - I've learned so much from everyone's experiences! I'm in a similar situation with my S-Corp (started in 2022, sole owner, reinvesting everything) and had been putting off the salary question hoping it would somehow resolve itself. What really stands out to me from all these responses is the consistency of the message: the IRS doesn't care whether you take distributions or not - if you're actively working in the business, you need reasonable compensation as an employee. The documentation aspect everyone mentions makes total sense too. I think the key insight for those of us in cash-tight growth phases is that "reasonable" doesn't necessarily mean "full market rate." It sounds like you can justify a lower salary based on business financial constraints, but it needs to be genuinely reasonable - not artificially low to dodge payroll taxes. For the OP's situation with $33k in profit after expenses, setting aside $25-30k for salary (as several people suggested) seems like a good balance between compliance and cash flow management. The remaining amount stays in the business for growth, and you can always increase the salary as revenue grows. Thanks to everyone who shared their real experiences - especially those who dealt with IRS audits or got professional guidance. This kind of practical advice is invaluable for navigating S-Corp compliance!