Do these calculators take into account things like income phase-outs and other limitations? Sometimes I worry those online tools are oversimplified and miss the details.

Most of the good ones do factor in phase-outs and limitations! The Virginia one specifically asks for your income and filing status, then applies any phase-outs automatically. I've found them to be pretty accurate. The one limitation I've noticed is that some calculators don't handle multiple beneficiaries well. So if you're contributing to 529 plans for multiple people and your state allows credits for each, you might need to do some additional calculations yourself.

Great point! I misunderstood this for years and was excited about my state's "$5,000 529 benefit" until I realized it was a deduction, not a credit. At my tax rate that's only saving me about $250, not $5,000!

Exactly! The terminology makes a huge difference. I've found that states with deductions often allow much higher amounts ($10,000+ in some cases) while states with credits usually have lower limits but they're worth more dollar-for-dollar. It's also worth checking if your state allows carryforward of excess contributions. Some states let you carry forward contributions beyond the annual limit to get the deduction/credit in future years.

Do student loan interest and the lifetime learning credit work together too? Or is that a different thing entirely?

Student loan interest deduction and the Lifetime Learning Credit are separate tax benefits and yes, you can claim both in the same year if you qualify for both! The student loan interest deduction allows you to deduct up to $2,500 in interest paid on qualified student loans, and it's also an "above-the-line" deduction that you can take regardless of whether you itemize or take the standard deduction. So potentially, you could take the standard deduction, deduct student loan interest, AND claim the Lifetime Learning Credit all on the same return.

I used FreeTaxUSA last year and it handled my Lifetime Learning Credit perfectly fine without trying to upsell me. They have a totally free federal filing option that includes education credits. You only pay if you want state filing.

That's a really good point I hadn't considered! My property taxes are around $8k, and with state income tax on top of that, I'm definitely hitting that $10k SALT cap. Maybe that's partly why my mortgage interest doesn't seem to be helping at all with my taxes. Would you say it made sense for you to keep your mortgage or are you considering paying it off too?

I'm in a similar position to you - considering whether to keep or pay off my mortgage. For me, the math works out that I'm getting very minimal tax benefit from the mortgage interest. I'm getting maybe a $1,000 extra deduction from itemizing versus taking the standard deduction. At a 24% tax bracket, that's saving me about $240 in taxes while I'm paying far more in interest. I'm actually planning to pay off a significant chunk of my mortgage this year. Not the whole thing, but enough to reduce my interest to the point where I'll just take the standard deduction going forward. The psychological benefit of having a much smaller mortgage outweighs the tiny tax advantage for me.

That's actually a really good point about inflation. I never thought about it that way. $300k today will be worth a lot less in purchasing power 20 years from now, but you're still paying it back with those cheaper future dollars.

Wait I didn't even think about state taxes! Do I need to file a separate form for that or is it all part of the same tax return?

It depends on your state. Most states have their own version of Schedule C that you'll fill out along with your state tax return. You'll generally use the same income and expense information that you report on your federal Schedule C. Some states also have a lower threshold for filing requirements than the federal $400 self-employment threshold, so even if you somehow made less than $400, you might still need to file a state return. Check your specific state's tax department website for the exact requirements and forms you'll need.

Most tax software can definitely handle self-employment income. I used TurboTax last year for my tutoring side gig and it walked me through everything step by step. It asked about expenses and calculated all the self-employment tax automatically. Just make sure you get the Self-Employed version, not the basic one.

Does it cover more recent tax law changes like the TCJA and SECURE Act? I've found many tax books become outdated quickly when tax laws change.

It does cover TCJA changes pretty thoroughly, especially how they impact real estate investors with the new QBI deduction and business interest limitations. The SECURE Act coverage is more limited though, mainly focusing on the elimination of the stretch IRA and changes to RMD ages. The publisher does offer annual updates on their website that cover more recent changes, which helps keep the content relevant even as tax laws evolve. I've found this combination of the book plus the online updates works better than waiting for completely new editions.

I've used both. They're good for filling out forms but terrible for actually understanding the tax code. They just tell you what to do without explaining why or how things work together. Fine if you just want to file, useless if you want to learn and optimize.