That's a great idea I hadn't thought of! Have you actually gotten detailed help from them before on how to report specific transactions? I'll definitely give them a call tomorrow if that's the case.

I've gotten basic guidance from them before, but it can be hit or miss depending on who you talk to. Their customer service can usually help clarify what specific codes or entries on your form mean. What they typically won't do is give specific tax advice about how to report things on your return - they'll explain their form but stop short of telling you exactly what to enter on your tax forms. Still worth calling though, as they can often clear up confusion about what certain transactions or adjustments on their statements represent.

I've had mixed results with Reddit. Sometimes you get amazing detailed answers from actual tax pros, and other times you get conflicting advice that leaves you more confused. The challenge is knowing which advice to trust when you get multiple different answers.

Thanks for sharing your experience! That makes me feel better about the situation. Do you remember how long it took for them to send you the letter after you filed your original return?

I think it took about 14 months after I filed my original return. The IRS has been super backlogged the last few years, so it takes them longer to match up 1099s with tax returns. If you're worried, filing an amended return is definitely the safest option. But in my case, the adjustment they made was accurate and the process was pretty painless overall.

That's risky advice. Even if there's a chance the employer didn't file the 1099, it's not worth gambling on. Better to be honest and file the amendment.

15 How do you calculate how much to pay for estimated taxes? Is there some formula or percentage I should be setting aside from each payment I receive?

10 The safe harbor method is to pay either 90% of your current year's tax liability or 100% of last year's tax liability (110% if your income is above $150,000), whichever is lower. For a quick practical approach, I set aside about 30% of all my 1099 income - roughly 15% for self-employment tax and 15% for income tax. This has worked well for me, but your tax bracket might differ. The IRS has Form 1040-ES with a worksheet to calculate more precisely, or you can use tax software that offers quarterly tax calculators.

4 Does that apply even if you're just a freelancer/contractor working for one company? I thought B&O tax was just for actual businesses with multiple clients.

Good point about the improvements! For the first house, I actually did replace the roof ($14k) and installed a new HVAC system ($9k). Would I need receipts for all of these improvements or are there other ways to document these if I can't find all the paperwork?

Receipts are definitely the best documentation, but if you don't have them all, there are other options. Bank or credit card statements showing payments to contractors can work. Even emails confirming quotes that you accepted can help establish the costs. For major improvements like a roof or HVAC system, you might also have permit records with your local building department that can verify the work was done. Some contractors might also have records they can provide if you reach out to them. The IRS knows people don't always keep perfect records, but they do expect you to make a reasonable effort to document these costs.

Not necessarily. The test is whether you lived in it as your primary residence for 2 of the 5 years before selling. Who lives in it during other periods doesn't affect that qualification. If OP had rented it out, there might be some depreciation recapture to deal with, but since no rent was collected, that's not an issue.

That's a really important distinction. How can you tell if your LLC is being taxed as an S-Corp vs a disregarded entity? I filed paperwork when I started my business but honestly don't remember what I selected.

You can tell by looking at what tax forms you've filed in the past. If you've been filing Schedule C with your personal tax return, then your LLC is being treated as a disregarded entity. If you've been filing Form 1120-S and receiving a K-1 from your business, then you elected S-Corp treatment. If you're still unsure, you should be able to check with the IRS. You would have filed Form 2553 to elect S-Corp status. If you never filed that form, then you're most likely a disregarded entity by default. This distinction is crucial for understanding how losses flow through to your personal taxes.

Yes, the rules definitely changed. Starting with tax years after 2020, NOLs can only be carried forward (not back, except for some farming losses). Also, you can only use the NOL to offset up to 80% of your taxable income in any future year. So if you made $10,000 this year, you could only use $8,000 of your NOL, and would have to carry the rest to future years.

Thanks for explaining that! That makes sense why TurboTax was limiting how much I could claim. So I'll have to carry forward part of my loss to next year too. Wish they'd make these tax rules simpler to understand.