IRS
CommunityGovernment Services
Pay nothing until a live IRS agent is on the phone with you.
Can't reach IRS? Claimyr calls for you, so you don't have to wait on hold.
$0 upfront. We only hold your card.
No live agent, no charge.
$9.99 is charged only once a live IRS agent is on the phone with you.
Using Claimyr will:
- Connect you to a human agent at the IRS
- Skip the long phone menu
- Call the correct department
- Redial until on hold
- Forward a call to your phone with reduced hold time
- Give you free callbacks if the IRS drops your call
Ask the community...
- DO post questions about your issues.
- DO answer questions and support each other.
- DO post tips & tricks to help folks.
- DO NOT post call problems here - there is a support tab at the top for that :)
Need advice on Foreign per diem deductions - Two CPAs giving opposite advice on IRS rules?
Hey tax folks, I've run into a weird situation with my tax advisors and could really use some guidance on finding the actual IRS rules. I run a small photography business (single-member LLC filing as S-corp) where I travel internationally for wedding shoots and commercial work. I spend about 3-4 months each year overseas for various gigs. My previous accountant (who retired last year) always had me document my international travel days with dates, cities, and countries. Then we'd use the State Department's published per diem rates for those specific cities as my business deduction. The big advantage was not needing to keep every single meal and taxi receipt from places where I might not even get a receipt. As long as I had my contracts, airline tickets, and hotel bookings to prove business purpose, we were good. My new accountant is saying that's completely wrong and I can ONLY deduct actual expenses with receipts for everything while traveling internationally. She's insisting there's no per diem option for foreign travel. I've tried searching online and found some articles suggesting my old CPA was right, but I can't find the specific IRS citation that would confirm it. I'm not trying to fake vacation expenses - these are legitimate business trips where I'm working 12+ hour days. Any tax pros here who can point me to the actual IRS rules on foreign per diem rates for self-employed S-corp owners? Thanks in advance!
Join the conversation
Deductions I can claim as a part time freelancer with a home office
I work a full time W2 job but I've also been doing freelance web design on the side and made about $13k this year. I know I can deduct business expenses on my Schedule C like office supplies and software subscriptions I use for my freelance work, but I'm confused about my home office situation. If I have a dedicated home office space, can I deduct part of my mortgage and utilities as business expenses? I'm trying to figure out if that's allowed and how to calculate it properly. Without claiming any deductions on my Schedule C, I'm looking at owing around $1,600 in taxes. I'm filing married jointly, taking the standard deduction, and we don't have any dependents. Also, I didn't realize I needed to pay quarterly taxes on my freelance income since I wasn't sure how much I'd make this year. Was I supposed to be making quarterly tax payments? Will I get penalized for not doing that? Any advice would be really appreciated!
Join the conversation
Don't forget about self-employment tax! That's an extra 15.3% on top of regular income tax for your freelance earnings. That's probably why you're owing $1600 - it's not just income tax. The good news is you can deduct 50% of the self-employment tax on your 1040, which helps a bit. And PLEASE make sure you're tracking all business miles if you ever drive for your freelance work - those add up fast at 65.5 cents per mile for 2023!
Thanks for mentioning this! I had no idea about the self-employment tax being that high. Do I get any credit for the social security/medicare taxes I'm already paying through my W2 job? And for the mileage deduction, does driving to client meetings count?
There's a cap on Social Security tax (not Medicare) - if your W2 job already withholds the max Social Security tax ($9,932 for 2023, which happens at $160,200 of income), then you won't owe additional Social Security tax on your freelance income, just the Medicare portion. Driving to client meetings absolutely counts as deductible business mileage! Keep a log with dates, starting/ending mileage, and purpose of each trip. Commuting to a regular workplace isn't deductible, but since your freelance clients aren't a regular workplace, those trips qualify. You can also deduct trips to buy business supplies, attend work-related conferences, etc.
Pro tip: get a separate credit card just for your business expenses. Makes tracking SOOO much easier at tax time! I did this and it cut my prep time in half.
This is the best advice! I started doing this last year and it's been amazing for keeping things organized. I also set up a separate checking account for all my freelance income. My accountant was super impressed with how clean my books were.
Form 8615 - Must I File This Form if My Child is Filing Returns to Reclaim Taxes?
I'm confused about the Form 8615 filing requirements and hoping someone can clarify this for me. I've read through the instructions but the wording is tripping me up, especially on condition #2. Here's our situation - my daughter had around $3,200 in unearned income (interest and some taxable scholarship money). She's not technically required to file taxes because her earned income is under $14,600, her unearned income (excluding scholarships) is under $1,300, and her gross income doesn't hit the filing threshold. However, she wants to file anyway to get back the taxes that were withheld from her summer job. Looking at the Form 8615 requirements: 1. Unearned income more than $2,600? Yes, she meets this with the interest and taxable scholarships. 2. Required to file a return? No, she's not required but is choosing to file. 3. Age/student status? Yes, she's 20, full-time college student, and doesn't earn enough to cover half her support. 4. Parent alive? Yes, both of us are. 5. Not filing jointly? Correct, she's single. Since she's not "required" to file (condition #2), but is filing voluntarily, does she still need to submit Form 8615 with her return? This kiddie tax form stuff is making my head spin!
Join the conversation
A quick tip about scholarships and Form 8615 that might help others. Remember that only the TAXABLE portion of scholarships counts toward the $2,600 unearned income threshold. If your child's scholarship money went directly to qualified education expenses (tuition, required fees, books), that portion isn't taxable and doesn't count toward the $2,600. Only amounts used for room, board, or other non-qualified expenses are taxable and count as unearned income for Form 8615 purposes. This distinction helped us avoid having to file Form 8615 for our daughter last year, even though her total scholarship was substantial.
Wait, I thought scholarships used for room and board counted as earned income, not unearned? This is why tax stuff makes my head explode. Can anyone clarify this? I might have filed wrong last year.
That's a common confusion. For general tax purposes, taxable scholarships (amounts used for room, board, etc.) are considered earned income. However, specifically for the Form 8615 "kiddie tax" rules, these same taxable scholarships are counted as unearned income when determining if the child meets the $2,600 threshold. It's frustrating that the same money is classified differently depending on which tax rule you're looking at. For filing requirement purposes, taxable scholarships are earned income, but for kiddie tax purposes, they're unearned income. This dual classification is exactly why so many people get confused about Form 8615.
Has anyone used TurboTax to handle this Form 8615 situation? My daughter has about $3,400 in taxable scholarship money and $700 in interest from her savings account. She worked part-time but made under $10k. We're trying to figure out if the software handles this correctly?
I used TurboTax for my son's return with almost the exact same situation. The software asked if he was required to file (not if he wanted to file, but if he was required). I answered no, and it correctly didn't include Form 8615. Just make sure you answer the "required to file" question accurately based on the thresholds, not based on whether you're actually filing. TurboTax also correctly included the taxable scholarship as income but didn't trigger the kiddie tax form since he wasn't required to file.
Can I deduct coffee purchases as an independent contractor during my workday?
So I'm a freelancer and I've been wondering about this tax situation. When I was employed at a company before, they always had free coffee in the break room. Now that I'm an independent contractor and essentially running my own one-person business, I'm curious about the tax implications. If I owned a regular business with employees, I could write off coffee I provide in the office as a business expense. As an independent contractor where I'm basically both the boss and the employee, can I deduct the coffee I buy for myself during my workday? Like if I work at a cafe for 4 hours and buy a couple lattes, is that a legitimate business expense I can write off on my taxes? It seems like it should be since it's during my working hours and helps me stay productive, but I'm not sure where the IRS draws the line between personal and business expenses in this situation.
Join the conversation
Another angle to consider: if you have a legitimate home office deduction (which many ICs do), you might be able to deduct coffee as part of your home office utilities or supplies. I've been doing this for years - not itemizing each coffee purchase, but including coffee supplies as part of my overall home office expense calculation.
Do you have any documentation on this approach? I've never heard of being able to include coffee as part of home office expenses and want to make sure I don't get audited.
I don't have official documentation, just what my CPA advised me. The key is not to list "coffee" as a line item but to incorporate reasonable office supplies/consumables into your overall home office deduction. The regular home office deduction already accounts for things like this. My approach is just making sure that my home office is legitimate (dedicated space, regular use for business, etc.) and then taking the standard deduction for it. I don't specifically break out coffee as a separate expense - it's just considered part of the overall home office usage.
Just a practical tip as someone who's been audited before: keep in mind that even if you technically CAN deduct something, you have to ask if it's worth the potential scrutiny. $500/year in coffee deductions could trigger questions that end up costing you thousands in accounting fees or time spent defending the deduction.
This is really good advice that people overlook. What was your experience with the audit like? Did they focus on small deductions or bigger issues?
What is this mythical LLC tax benefit everyone keeps talking about?
I'm losing my mind seeing all these posts about LLCs and "special tax benefits" (as someone who works with taxes daily). People seem to think an LLC is some kind of magical entity that unlocks secret tax deductions out of thin air. Let me clear this up: when you form an LLC, you've simply created a business with a specific legal structure. If you're the only owner, the IRS literally doesn't care about your LLC. For real - the IRS acts like your LLC doesn't even exist! You report all business income and expenses on Schedule C or E regardless of whether you have an LLC or not. The LLC structure doesn't allow you to claim ANY extra deductions that wouldn't be available to you as a sole proprietor. The ONLY reason an LLC exists is to potentially provide some personal liability protection (and even then, you can absolutely still be held personally liable in many situations, especially if you're providing personal services). It has ABSOLUTELY ZERO impact on what goes on your personal tax return. Now, things only change tax-wise if your LLC has multiple owners (note: married couples in community property states count as a single owner). Then you've got a partnership (or a corporation if you elected that tax treatment), which requires a separate tax return.
Join the conversation
One thing that doesn't get mentioned enough is that LLC status CAN affect your taxes in certain states even if it doesn't at the federal level. In my state, we have to pay an annual LLC fee of $800 regardless of whether the business makes any money. That's a real tax consequence of having an LLC! Also, some states tax LLCs differently than sole proprietorships at the state level. Worth looking into your specific state's rules before deciding whether to form an LLC.
Are you in California by any chance? That $800 minimum tax is brutal. Do you think the liability protection is worth that annual fee for a small side business making maybe $15k a year?
Yep, California's $800 LLC tax is exactly what I was referring to! For a business only making $15k annually, I personally don't think the LLC is worth it unless you're in a high-liability industry. That $800 represents over 5% of your gross revenue before any other expenses. Many small business owners don't realize they can get decent liability protection through good business insurance policies without the LLC structure and fees. A general liability policy might only cost $500-700 annually compared to the $800 state fee plus LLC formation costs.
Random question but how does all this LLC stuff affect my taxes if I'm a single-member LLC but drive for uber part time and also sell stuff on etsy? Do I need separate LLCs or can I just have one for everything?
You can have a single LLC that covers multiple business activities if you want. On your Schedule C, you'd either need to: 1) file separate Schedule Cs for each substantially different business activity or 2) use the primary business code that represents your main activity. For tax purposes, it's more about properly categorizing and reporting the different income streams than about having multiple LLCs.
Emma Olsen
One important detail I haven't seen mentioned yet - there's a difference between being self-employed and being an S-corp owner who's technically an employee of their own corporation. If you're operating as an S-corp (as you mentioned), technically your corporation would establish an accountable plan that reimburses you, the employee, for travel expenses using the per diem rates. The corporation then deducts these amounts. This is slightly different from how sole proprietors handle it. Just worth noting since your business structure matters for exactly how you implement this.
0 coins
Nina Fitzgerald
AuthorThat's a great point I hadn't thought about. So should I be submitting some kind of expense report to my own S-corp for reimbursement? Or is it enough to just document everything in my company records?
0 coins
Emma Olsen
You should definitely be submitting formal expense reports to your S-corp for reimbursement. This creates the proper documentation that shows you're following an "accountable plan" which is critical for this arrangement to work properly with the IRS. The expense report should include the business purpose, dates of travel, locations, and calculation of the per diem amounts based on the State Department rates. Your S-corp should then reimburse you directly for these expenses. In your company records, these would be logged as business travel expenses, and on your personal taxes, the reimbursements wouldn't be considered income since they're under an accountable plan.
0 coins
Lucas Lindsey
Has anyone used H&R Block or TurboTax for situations like this? I'm in a similar situation but don't have an accountant and wondering if the tax software can handle foreign per diem calculations.
0 coins
Sophie Duck
I tried using TurboTax for this last year and it was a nightmare. The software doesn't have clear guidance on foreign per diems. I ended up manually calculating everything and entering it as "other business expenses" with detailed notes. Not ideal but it worked.
0 coins