Wait, so I need to file both Form 1098 AND Form 1099-INT? That seems redundant. Couldn't I just file one of them? And regarding the amortization - our agreement does specify an interest rate (5%), but not exactly how much of each payment is principal vs interest. Does that mean I need to create an amortization table?

Yes, you may need to file both forms as they serve different purposes. Form 1098 reports mortgage interest that the borrower has paid to you, which they can potentially deduct. Form 1099-INT reports interest you've paid to someone else. However, in your specific case, since this is mortgage interest being received by you (not interest you're paying out), you likely only need Form 1098, not 1099-INT. I apologize for the confusion. Since your agreement specifies a 5% interest rate but doesn't break down each payment, you should definitely create an amortization table. This will help you properly track how much of each payment is interest versus principal reduction. You need this to accurately report your interest income and to provide correct information to your family member for their potential deduction. Most spreadsheet programs have templates for creating these tables.

This is a really good point about installment sales! I did a seller-financed deal last year and completely missed filing Form 6252. Had to file an amended return. The property was actually a rental I sold to a tenant, so I had depreciation recapture to deal with too. That's a whole other can of worms!

Have you ever been audited? I'm terrified of claiming professional gambler status and then getting slammed by the IRS. What kind of documentation do you keep to prove you're a pro?

I haven't been audited, but I'm prepared if it happens. I keep extensive records: a daily log of hours spent researching and betting, all transactions (wins AND losses), a business plan, separate bank accounts for gambling activities, and spreadsheets tracking performance by sport/bet type. The key is consistency and business-like conduct. I bet year-round, not just during certain seasons. I have evidence of pursuing expertise (subscriptions, courses, etc.). I can demonstrate that I approach this methodically, not just as entertainment. The IRS looks at factors like regularity, expertise, time committed, and whether you depend on the income. It's definitely not for casual bettors, but if you're serious and methodical about it, professional status can make financial sense.

This happened to me too! The IRS compared the W-2G from the casino (showing just the wins) without considering my losses. Such a nightmare to fix.

Is there a minimum amount that sportsbooks report to the IRS? I won about $3k total this year across DraftKings and FanDuel but haven't received any tax forms from them.

Are you sure about that 3-year deadline? I thought if you're owed a refund, there's no penalty for filing late and you can do it anytime?

Yes, I'm 100% certain about the 3-year deadline for claiming refunds. The IRS gives you three years from the original filing deadline to submit a late return and still get your refund. After that window closes, any refund you were entitled to becomes government property - you lose it completely. This is different from owing taxes, where there's no deadline to file (though penalties and interest keep accumulating). But for refunds, it's a use-it-or-lose-it situation with a strict 3-year limit. Since 2022 taxes were originally due in April 2023, you have until April 2026 to claim any refund for that year.

That doesn't sound right. Most states only tax you for the portion of the year you were a resident. Did you try filing as a part-year resident?

Does anyone know if this would be different if I was selling things regularly? Like I sell my old electronics every year when I upgrade. Does that make it a "business" for tax purposes?

The distinction between hobby/personal sales and a business depends on several factors, not just frequency. The IRS looks at whether you're trying to make a profit, how much time you spend, how you conduct the activity, and if you depend on the income. If you're just selling your own used personal items (even if you do it yearly), that's generally not a business. You're just recouping some value from your personal property, especially if you're typically selling at a loss compared to what you paid. However, if you start buying items specifically to resell at a profit, that crosses into business territory.

I got a letter from the IRS last year about "unreported income" from a 1099-K. It wasn't a full audit, but I had to explain that it was from selling personal items at a loss. They accepted my explanation after I provided some documentation, but it was still stressful.

What about the Robinhood stuff? I heard investment income makes things more complicated?

The Robinhood with only $1 in earnings would be reported on a 1099-B and possibly a 1099-DIV, but it's extremely simple to incorporate. Most tax software and preparers just input the numbers directly from these forms. It literally adds maybe 5 minutes to the preparation process. Investment income only becomes significantly complicated when you have multiple transactions throughout the year, complex basis calculations, or substantial amounts that might trigger additional taxes like NIIT (Net Investment Income Tax). A single stock with minimal earnings wouldn't justify any meaningful price increase.

Does FreeTaxUSA handle the EV tax credit stuff properly? I'm buying a Tesla next month and worried about screwing that up.