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Just to add some practical advice from someone who files hundreds of 1099s every year: If you're filing paper forms, you definitely need a new 1096 for any additional 1099-NECs you're sending in. This isn't a correction - it's a new submission. If you're e-filing through a system like the IRS FIRE system, the process is different and the software handles the transmission details for you. Most modern tax software is designed for e-filing these days, which might explain why ATX is handling it the way it is.
Do you know if there's a limit to how many additional submissions you can make? I feel like I'm constantly finding new contractors that need forms throughout January and February.
There's no limit to how many submissions you can make. I've had clients who end up making 3-4 separate submissions as they discover missed contractors. The IRS just wants the information reported - they don't penalize you for making multiple submissions. Just make sure all your 1099-NECs are filed by the deadline (typically January 31st). After that date, any new filings could be subject to late penalties regardless of how many previous batches you submitted on time.
Something nobody has mentioned yet is that if you're correcting information on a previously filed 1099-NEC (like changing the amount or the contractor's information), that's when you'd check the "CORRECTED" box on the 1099-NEC itself. The 1096 accompanying these corrected 1099s doesn't get marked as corrected though. Adding a brand new contractor is completely different - that's just a new submission with its own 1096, like others have said.
I'd recommend looking at Sage Fixed Assets if they can afford it. It's what I've used with several non-profit clients. It's more expensive than some options (around $2k for a perpetual license), but it's specifically designed for organizations that need to track physical location alongside depreciation. The reason I like it for non-profits is the grant management features - you can tag assets purchased with restricted funds and generate the specialized reports donors often require. The physical inventory module with barcode scanning has been a lifesaver during audits.
Is the Sage option cloud-based or desktop only? Our non-profit has staff in multiple locations and need something accessible from anywhere. Also, does it integrate with accounting systems other than Sage products?
Sage Fixed Assets is primarily a desktop solution, though they do have a cloud-hosted option that costs more. For multi-location access, you'd want the cloud version or would need to set up remote access to a central installation. As for integration, it works reasonably well with QuickBooks and several other accounting systems beyond just Sage products. They have standard import/export functions for most major platforms. The data flows aren't always completely seamless, but they're reliable. We typically set up monthly or quarterly synchronization processes rather than real-time integration, which works fine for most non-profits' reporting needs.
Has anyone tried the free option of using Google Sheets with a fixed asset template? We're a small non-profit with about 50 assets and can't justify the cost of dedicated software. We found a pretty good template online that calculates depreciation automatically.
I've done this for smaller non-profits. Works fine if you have under 100 assets. Here's what I use: start with a template from vertex42.com, add columns for physical location, asset condition, and maintenance schedule. Then use Google Forms linked to the spreadsheet for staff to update asset info from the field. It's not fancy but it's free and gets the job done for basic tracking.
One thing nobody has mentioned - check if your dad's previous employer correctly calculated his withholding as well. I've seen cases where the first employer didn't withhold enough either, but it wasn't obvious until the combined income pushed into a higher tax bracket. Look at his total federal withholding from the first W-2 and divide by his gross income from that job. If it's less than about 10-12%, that might be part of the problem too. Sometimes the issue isn't just with the new employer but with how both jobs handled withholding.
That's a good point. I just checked and his withholding from the first job was about 8.5% of his gross income. That does seem a bit low now that you mention it. Could that be contributing to the problem as well?
Yes, 8.5% is definitely on the low side for federal withholding. For someone making around $38,000, you'd typically expect to see closer to 10-12% withheld for federal taxes, assuming standard deduction and no special circumstances. This confirms that both employers were under-withholding. The first wasn't withholding quite enough, and then the second one withheld almost nothing because of the single paycheck issue. When combined, this created the unexpected tax bill. For 2025, he should definitely update his W-4 with his current employer to request additional withholding - maybe an extra $20-30 per paycheck to make up for the shortfall.
Similar thing happened to my husband last year. The trick is to look at box 2 on both W-2s (Federal income tax withheld) and compare it to the total income. For that small paycheck from the new company, they should have withheld at least $85-100 if they were accounting for his total annual income, but they had no way of knowing about his other job. Something to watch for next time - whenever someone changes jobs, especially late in the year, they should fill out their W-4 to account for the income from the previous job. There's actually a specific worksheet for multiple jobs on the W-4 form now.
You could also consider section 179 deduction for the improvements you made to the yard instead of including it in home office calculation. Things like the special fencing, turf, washing station etc might qualify as business equipment/improvements. Might be a cleaner deduction than trying to include outdoor space in home office square footage.
I hadn't even thought about Section 179 for the yard improvements! Would that be instead of including the square footage in my home office calculation, or could I possibly do both? The improvements cost about $4,800 total.
You generally can't double-dip by claiming the same expenses two different ways. The home office deduction would let you deduct a percentage of all household expenses including utilities, insurance, mortgage interest, etc. based on square footage used for business. If you instead use Section 179 for the improvements, you could potentially deduct the full $4,800 immediately rather than depreciating it over time, but you wouldn't include that outdoor space in your home office square footage calculation. It often comes down to which method gives you the better deduction in your specific situation.
Has anyone used Schedule C for this instead of Form 8829? I've heard the simplified option ($5 per square foot up to 300 sq ft) is easier but obviously doesn't work well for outdoor space.
The simplified option is definitely easier but it's generally not great for this situation. It's capped at 300 sq ft which is probably less than your combined indoor office and outdoor dog area. Plus, as you mentioned, there's no provision for including outdoor space. I'd stick with the regular Form 8829 if you want to include that yard space.
Skylar Neal
Have you considered that you might benefit from amending your return to use Married Filing Separately? In some cases, if one spouse has an issue that's pushing the joint return over a threshold, filing separately might preserve benefits for at least one spouse. I'm not saying it will definitely work better in your situation, but it's worth running the numbers both ways. Sometimes the EIC calculations work differently when split, especially if one spouse earned significantly more than the other.
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Vincent Bimbach
ā¢Unfortunately, you cannot claim EIC if your filing status is Married Filing Separately. That's one of the basic requirements for the credit. So that strategy wouldn't help in this specific situation with the Earned Income Credit.
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Skylar Neal
ā¢You're absolutely right, and I apologize for the misinformation. I was confusing EIC with some other credits that can sometimes be optimized with different filing statuses. The EIC specifically cannot be claimed by anyone using Married Filing Separately status. This is a good reminder for everyone to verify tax advice, even from well-meaning people online. Thanks for the correction!
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Kelsey Chin
This is why I always run my return through multiple tax software programs before filing. Last year I found a $1,700 difference between two major programs because one correctly identified my disaster payment as non-taxable while the other classified it as miscellaneous income. Also, don't forget to check if your state has any special provisions for assistance payments. Some states have different rules than the federal government for how these payments are treated for state tax purposes.
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Norah Quay
ā¢Which tax software programs do you recommend? I've been using TurboTax but I'm wondering if there are better options for handling these complex situations with unusual income types.
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