Do health savings account (HSA) contributions work the same way? I put like $200 per month into mine through payroll deductions but don't know if that's pre-tax or post-tax.

Yes, HSA contributions made through payroll deductions are pre-tax and work exactly the same way. Your $200/month ($2,400/year) wouldn't be included in Box 1. It's one of the best tax advantages out there since HSA money is never taxed if used for qualified medical expenses - it goes in pre-tax, grows tax-free, and comes out tax-free for medical costs.

This is brilliant advice! Just checked my December paystub and it has a "YTD Fed Taxable Wages" column that matches Box 1 perfectly. Never thought to look there. My paystub even breaks down all the pre-tax deductions with YTD totals which explains the exact difference between my gross salary and Box 1.

But what if you really need that money in the meantime? Not everyone can afford to overpay by 20%. Wouldn't it be better to try to get it right?

That's a totally valid point. It really depends on your financial situation. If cash flow is tight, then absolutely try to be more precise with your estimate. Use your previous year's return as a guide and adjust for any major changes in income or deductions. For those who can swing it though, overpaying provides a stress-free extension. Another approach is to aim for that 90% threshold mentioned earlier - pay enough to cover 90% of your expected tax, which should protect you from the more significant penalties. Either way, the key is making a reasonable effort to estimate correctly based on the information you have at the time.

This is so important! I made this mistake with California taxes and ended up with penalties. Does anyone know a good resource that breaks down the requirements by state?

Thank you for this advice! The preparer definitely made multiple errors - that's why I got audited in the first place. I'll definitely ask for written confirmation about the withholdings. Do I need to wait until after the audit is completely closed to request the First Time Penalty Abatement, or can I mention it to the auditor now?

You should wait until the audit is fully closed before requesting First Time Penalty Abatement. Auditors typically don't handle penalty abatement requests during the audit process. Once everything is settled and you've paid the adjusted amount, then submit your penalty abatement request. If you've had a clean compliance history for the past 3 tax years (no penalties), you have an excellent chance of getting the penalties removed. Just be aware this only applies to certain penalties like failure-to-file and failure-to-pay, not all audit-related penalties.

This is important advice. I've been through an audit where information "got lost" between departments. Always get everything in writing and create documentation trails.

Did you actually use the review service with TurboTax MAX? I'm wondering if they just glance over everything quickly or if they actually do a thorough job looking for missed deductions and credits?

I did use it, but honestly was a bit disappointed. The "review" seemed pretty superficial - they mostly just verified that I had documentation for everything I claimed rather than proactively looking for things I might have missed. For basic returns it's probably fine, but if you have investments, self-employment income, or other complex situations like it sounds like you do, you'd likely benefit from a more thorough review by someone who's looking specifically for missed opportunities.

Good point. Do amended returns really trigger audits more often? I'm finding conflicting info online about this.

Is this something I could do myself or would I need my CPA to handle it? And do you know how long the process typically takes? I'm worried about interest continuing to build while I wait for a decision.

You can certainly do it yourself using the IRS's Form 656 Booklet which includes instructions, but having your CPA help might increase your chances of success since they understand what the IRS is looking for in terms of documentation and financial hardship proof. The process typically takes 6-12 months for the IRS to evaluate and make a decision. Interest and penalties do continue to accrue during this time, which is a downside. However, if you're approved, those additional amounts would be included in the settlement. If you're rejected, you'd still have the option to set up a payment plan for the full amount. Many people start with a payment plan and then apply for an Offer in Compromise if they realize they truly can't manage the payments.

Don't forget about the Qualified Business Income deduction (Section 199A)! For most freelancers, you can deduct up to 20% of your net business income. Saved me thousands last year.