Ah crap I didn't even think about self-employment tax! The side gig was graphic design work I did for a local business. They just needed some logos and paid me directly, no tax withholding. So I'm guessing that would count as self-employment? Does that mean I need to file some additional form besides just the 1040-X?

Yes, you'll definitely need to pay self-employment tax on that income. Since it's over $400, you're required to pay the 15.3% SE tax. You'll need to include Schedule SE with your amended return to calculate the self-employment tax, along with Schedule C to report the business income and any related expenses. This is where you might find some deductions to offset the income - did you use your own computer, software, or have any other expenses related to the graphic design work? Those can be deductible business expenses on Schedule C.

The IRS says 16 weeks is currently the normal processing time for amended returns, but mine took almost 6 months last year! The "Where's My Amended Return" tool on IRS.gov was completely useless too - just kept saying "processing" the entire time.

Six months?? That's insane! I was hoping to use my refund for summer tuition. Guess I better make other plans. Thanks for letting me know though - at least I won't be anxiously checking every day now.

That's actually really smart! If they're in the middle of the 22% bracket with W2 income of $150k, then using 401k contributions to drop down could push some of that SE income into the 12% bracket. Could save thousands.

That's interesting! I hadn't thought about doing more frequent payments. My SE income does tend to be somewhat consistent monthly, so this could help with budgeting. Is there any downside to making monthly payments instead of quarterly?

No real downside to making monthly payments. The IRS will credit you for whatever you've paid by each quarterly due date. The only minor inconvenience is having to make more payment transactions, but that's easy with EFTPS (Electronic Federal Tax Payment System). The biggest advantage is psychological - setting aside smaller amounts more frequently is easier than coming up with a big payment every three months. Just make sure you keep good records of all payments. I use a simple spreadsheet to track payment dates, confirmation numbers, and running totals for the year.

Thank you for mentioning the Head of Household status! We hadn't considered that. Do you know if my partner would need any specific documentation to prove he's been supporting my oldest? We don't have formal custody arrangements since the biological father isn't in the picture at all.

You don't need formal custody arrangements in this case since there's no other person claiming the child. The key is being able to show that your partner maintained the household and supported the child if ever questioned. It's good practice to keep records showing your partner paid household expenses (rent/mortgage receipts, utility bills in their name) and child-specific expenses (school records, medical bills, childcare receipts). Also helpful are any documents showing the child's address matches yours (school records, medical records). The IRS doesn't require you to submit these with your return, but they're good to have if you're ever audited or questioned.

The EITC is huge! But be really careful with the rules there. When I claimed my niece who lived with me, I messed up some paperwork and got audited. Took forever to resolve. Make sure every detail is perfect on that one.

Thanks for sharing your experience! Neither of us has any tax debts or child support, so it sounds like joint is probably the way to go for us. Did you use any particular tax software that was helpful for comparing the two options?

We used H&R Block's online software which made it pretty easy to compare. We entered all our info for a joint return first, noted the refund amount, then created a new return and selected married filing separately to see the difference. TaxAct also has a good comparison feature that's a bit more straightforward - it can show you both scenarios side by side after you enter all your information once.

That's actually a common misconception. The married filing separately brackets aren't the same as single brackets - they're exactly half of the married filing jointly brackets. So there's usually no tax bracket advantage to filing separately if both spouses have similar incomes. The only exception is if one spouse has significant itemized deductions that would be limited by the other spouse's income. But with the higher standard deduction now, that's rare for most people.

That's a really smart idea I hadn't thought of! I just checked our business account online and can see the check was deposited at First National Bank, but I'm not seeing any account details. Is there something specific I should ask our bank for to get more information?

You'd want to contact your bank and ask for the "deposit information" from the cleared check. Sometimes they can provide the routing and account number where it was deposited. Not all banks will share this, but many business accounts give you access to this information. Once you have that, you still won't have their TIN, but you'll have more documentation to show the IRS that this was indeed a real vendor who received payment. The bank info combined with their name, email and phone gives you a stronger paper trail.

This is good advice. Also mention that if they refuse to provide a W-9, you're required to do backup withholding at 24% of any FUTURE payments and report them to the IRS. Even though you can't do that for past payments, just knowing you're aware of the requirements might make them reconsider.