What app do you use? I've been using MileIQ but wondering if there's something better out there that's specifically good for delivery drivers.

I personally use Everlance which has worked great for me. It automatically detects drives and you just swipe right for business or left for personal. It also calculates the potential deduction amount automatically. Other good options are MileIQ (which you mentioned), Stride, and Hurdlr. They all have slightly different features. Stride is free but more basic, while Everlance and MileIQ have free tiers with limits on how many trips you can log before needing to upgrade. Hurdlr is good if you want to track all business expenses in one place, not just mileage.

I strongly advise against this approach. While it's true that not every return gets audited, the IRS has been increasing enforcement, especially for self-employed individuals claiming excessive deductions. The penalties for disallowed deductions can include paying back taxes with interest and penalties of 20-40% of the unpaid amount. In cases where the IRS determines willful misrepresentation, there can even be criminal penalties. It's simply not worth the risk for a few hundred dollars in questionable deductions.

I had no idea about the business registration requirement! Is this something I can do online or do I need to go to a government office? Does it cost a lot?

Yes, most states let you register online through their Secretary of State or Department of Revenue website. Costs vary widely depending on location - some places charge as little as $25 while others might be $100+ for a basic registration. You'll also want to check your specific county/city requirements as some local jurisdictions have their own permits on top of state registration. I'd recommend starting with a Google search for "[your state] business registration sole proprietor" to find the official government site with the forms you need.

What app do you use? I've been trying to track my mileage for my mobile dog grooming business but I always forget to log it.

That's a great suggestion! Do you know if there are any specific PDF libraries or tools that work well for this kind of automation? Our current system outputs to our own custom forms but I'm willing to change the approach if it means using unmodified IRS forms.

I've had good results with both PDFfiller for smaller operations and DocuSign for larger businesses with more complex needs. For pure automation without manual intervention, several of my clients use Python with the PyPDF2 library to fill forms programmatically from their databases. If you're not comfortable with coding solutions, another option is Zapier which can connect your database to PDF filling tools through their integrations. Whatever route you choose, make sure to implement proper security measures since you're handling sensitive information like SSNs. The benefit of using the official fillable PDF is that you're guaranteed to be using the most current version of the form with all required language intact.

This is actually a really important point. My company had to deal with a data breach a few years ago and the exposure of contractor SSNs created a huge liability issue for us. Make sure whatever system you're using has proper encryption and access controls.

Omg thank you for mentioning this! I totally forgot about those other taxes. Do you know if there's a way to calculate exactly what I'll take home after ALL the withholding? I'm trying to plan what I can spend from this bonus.

You can use an online paycheck calculator like the one on ADP or Paycheckcity. Just enter your bonus as a separate supplemental payment, add your state, and it will calculate all the withholdings including federal, state, Social Security, and Medicare. Most employers will withhold around 30-35% total when you factor in everything, but it varies by state. If you're in a state with no income tax like Texas or Florida, it will be less than if you're in a high-tax state like California or New York.

This is the way! If your 401k is already set up as a percentage of your pay, the contribution should happen automatically with your bonus too. Just check with HR to confirm.

That's a good idea, but since I'm getting a promotion with a significant salary increase, I'm not sure my past paychecks would give an accurate picture. The tax brackets might change with the new income level, right?

You're right about the tax brackets potentially changing with a higher salary. In that case, you could use your current paystub as a starting point and then adjust the calculations. For example, if you're currently making $60,000 and moving to $78,500, you could calculate the percentage increase (about 30.8%) and then apply different increase rates to different deduction types. Federal taxes might increase at a higher rate due to progressive brackets, while something like disability insurance might simply scale proportionally with income.

This is so important! My friend thought her raise would actually make her take home less because she didn't understand marginal tax brackets. She almost turned down a promotion because of this misconception!