The IRS has a Tax Withholding Estimator on their website that's pretty good. TaxCaster by Intuit is also decent for quick calculations. Just google "tax bracket calculator" and you'll find several options.

This is so important! I got a 3% raise last year and was worried about moving into a higher bracket, but then realized the brackets themselves had adjusted by about the same amount. My marginal rate stayed the same even though my income went up.

Thank you for mentioning health insurance - I totally forgot about that! The company did say something about a stipend for health coverage, but I should definitely calculate what that would really cost me vs. employer-provided insurance. Do you have any recommendations for tracking all those business expenses? Is it just like a spreadsheet or should I use some kind of app?

I started with a spreadsheet but quickly found it too tedious to maintain. Now I use an app called QuickBooks Self-Employed that lets me connect my bank accounts and credit cards, then swipe left or right to categorize transactions as business or personal. It automatically calculates my quarterly tax payments too. If you're just starting out and don't want to pay for software yet, even something as simple as taking photos of receipts and saving them to a dedicated folder can work. Just make sure you have some system in place from day one - it's much harder to reconstruct everything at tax time if you haven't been tracking throughout the year.

This is super important advice. I got misclassified as a contractor when I was really doing employee work and ended up paying thousands in taxes I shouldn't have had to pay. The IRS has a form called SS-8 you can file if you think you're misclassified.

Do those charitable deductions really offset the taxes they would have paid though? I always assumed the math wouldn't work out since you're giving away the whole asset value to save a percentage in taxes.

You're right that the pure math doesn't work out if you're only thinking about tax savings - you'll always have more money if you just pay the taxes instead of donating the entire asset. The charitable deduction typically saves you your marginal tax rate (37% federal for top earners) plus potentially state taxes. However, the strategy makes sense when combined with genuine philanthropic goals. By donating appreciated stock, you avoid capital gains tax (up to 23.8% federal) that would have been due if you sold first and then donated cash. You also get the deduction for the full market value. So while you're giving away the asset, you're doing it in the most tax-efficient manner possible.

Don't they have to pay taxes on those perks though? I thought if a company pays for personal expenses it counts as compensation and is taxable?

I went back through everything and you're totally right! There was a question that asked "Did you receive all Economic Impact Payments you were eligible for?" and I must have clicked "No" by accident. When I changed it to "Yes" the huge credit disappeared and now I owe $3,275 like I originally expected. Thank you! Do you know if I would have gotten in serious trouble if I had filed with that error?

Glad you found it! That question trips up so many people. Since it was clearly just a mistake on a confusing question, you probably wouldn't have faced fraud penalties, but the IRS definitely would have caught it, rejected the credit, and you'd end up owing the correct amount plus interest for the late payment. You might have also had your return flagged for additional review, which could have delayed any legitimate refunds on other parts of your return. Always better to catch these things before filing!

This is such good advice. I never look at the actual forms cuz all the tax software just asks questions instead. Where exactly do you find the forms view in TurboTax? Is it obvious or hidden in some menu?

In TurboTax, you can usually find the forms view by looking for "Tax Tools" in the left sidebar and then selecting "View Tax Forms." If you're using the web version, it might be under a menu called "Tools" or there's sometimes a "Preview" button near the end of the filing process. It's definitely worth checking before filing. The software is generally accurate, but only if all the questions are answered correctly. Looking at the actual forms helps catch errors like this $10,000 credit that shouldn't be there.

Wait, so if we take the depreciation on this roof for my wife's business portion, we'll have to pay some kind of extra tax when we eventually sell our house? That sounds concerning. How exactly does that work?

Yes, that's exactly right. When you sell your house, you'll need to recapture the depreciation you've claimed on the business portion. For example, if you claimed $1,776 in depreciation over the years for that 12% of your roof, you'll pay a 25% tax on that amount when you sell, even if you qualify for the $250,000/$500,000 capital gains exclusion on your primary residence. It's still usually financially beneficial to take the depreciation deduction now (and you're technically required to take it even if you choose not to claim it), but you should be aware of this future tax implication. It's a surprise many home business owners don't anticipate.

I used TurboTax last year for my home office deduction with some renovations. It does ask the right questions and walks you through the depreciation calculations for home improvements, but you need the Home & Business version. The lower versions don't handle Schedule C and Form 4562 properly. Just make sure you know the square footage of your office and total home before you start.