I'm in a similar unmarried situation and just had a consultation with a CPA about this. Here's what might help: 1) Have you calculated the difference between what you'd gain by filing HOH vs what your boyfriend might lose in healthcare subsidies? Sometimes the higher-earning parent filing HOH and claiming the kids provides more overall family benefit even if there's a small premium increase. 2) Make sure you're considering the Child Tax Credit which is up to $2,000 per qualifying child for 2024 tax year. This could be significant with two kids. 3) Look at childcare expenses if applicable - the Child and Dependent Care Credit might be more valuable to you as the higher earner. The best solution is usually to run the numbers both ways (you claim kids vs. he claims kids) and see which produces the best overall result for your household.

Did either of you use those Premium Tax Credits for the Obamacare plan? If so, be super careful about changing who claims the kids because it can cause major headaches with the Form 8962 reconciliation. My partner and I did this wrong one year and ended up owing $3200 back to the IRS because the subsidy was calculated based on different info than what we filed.

Here's what I did with my S-Corp for home office: I set up a rental agreement where my S-Corp pays me $800/month to rent my home office space. I report this as rental income on Schedule E, but then I deduct all the expenses related to that space - utilities, internet, cleaning, repairs, insurance, plus depreciation on that portion of the home. My accountant said this approach is better than the accountable plan for my situation because I can still claim depreciation on my personal return. The rental income and expenses mostly offset each other, but I still show a small profit to avoid raising red flags about a consistent rental loss. For your old $11k from Schedule C years, that's already "used up" as far as current deductions, but it does affect your basis when you sell. Make sure you keep those old returns!

Has anyone actually gotten audited over the transition from Schedule C to S-Corp with home office deductions? I'm in the same situation, had about $9k of accumulated Form 8829 depreciation, then formed an S-Corp last year. My tax guy says not to worry, but I keep hearing horror stories about S-Corp audits.

The thing that most people miss with RSUs is the basis reporting on Form 8949. When your RSUs vest, the FMV becomes your W-2 income AND becomes your cost basis for those shares. If you sold shares to cover taxes, you need to report those sales with the adjusted basis. Here's how to fix this: 1) Get your original Form 8949 that you filed 2) Create a corrected version showing the proper basis for each RSU transaction 3) Include a statement explaining the connection between your W-2 RSU income and the 1099-B transactions 4) Reference IRS Publication 525 which specifically addresses RSU taxation The most important part is proving that you're not trying to avoid taxes - you already paid them through your W-2 withholding at vesting.

I had almost the EXACT same situation last year! My CP3219A was for $12,450 in supposedly unreported income from RSUs. Here's what worked for me: 1. I called my broker and had them create a special statement that specifically showed which 1099-B transactions were from RSU vesting events 2. Got a letter from my employer confirming the exact RSU value included in my W-2 Box 1 3. Created a spreadsheet matching each RSU transaction to the corresponding vesting date and W-2 income 4. Wrote a cover letter explaining the double-counting mistake 5. Filed Form 8949 with a statement in column (f) for each transaction saying "BASIS ALREADY REPORTED AS INCOME ON W-2" The IRS accepted everything and closed the case. Don't panic - this is fixable!

Something important to consider - there's a specific IRS Form 8948 for "Reasonable Cause" waiver requests. Given your health situation, you might qualify. The IRS takes illness seriously as a reasonable cause for failing to make estimated payments, especially if you can document that your condition prevented you from managing your tax obligations. When you file, attach a detailed letter explaining your medical situation and why it prevented you from handling your tax withholding or making estimated payments. Include any relevant documentation like doctor's notes or hospital records (with personal details redacted). You might still owe the tax, but the penalties could be waived completely.

One thing to consider is making an estimated tax payment NOW before filing season starts. It won't eliminate all penalties since it's late, but it will stop them from continuing to accrue. The 4th quarter estimated payment deadline for 2024 is January 15, 2025.

Just to simplify AGI calculation: 1. Start with ALL income (wages, 1099, interest, dividends, capital gains, etc) 2. Subtract ONLY "above-the-line" deductions: - Traditional IRA contributions - Student loan interest - HSA contributions - Self-employed health insurance - SEP/SIMPLE/401k contributions for self-employed - Alimony paid (for pre-2019 divorces) - Educator expenses - Some business expenses Taxes withheld throughout the year have NOTHING to do with AGI. And standard/itemized deductions come AFTER AGI calculation.

One thing that helped me understand AGI is looking at the 1040 form itself. If you look at the first page of your 1040, everything above the "adjusted gross income" line (line 11 on recent forms) is part of the AGI calculation. This includes all your income sources at the top, then all those adjustments/deductions in the "Income" section. Anything listed in the "Adjusted Gross Income" section gets subtracted to arrive at your final AGI. Standard/itemized deductions and qualified business income deductions all come AFTER the AGI line, so they don't affect AGI calculation at all.