Good point! My state (CA) has a higher interest rate than the IRS, so I definitely paid that one first. Does anyone know if state tax payments are still deductible on federal returns? That might affect the calculation too.

State and local tax payments (SALT) are still deductible but limited to $10,000 total for most filers. This includes property taxes too, not just income taxes. The timing of state tax payments can get tricky for deduction purposes. Generally, you can only deduct state taxes in the year you actually pay them. So if you're trying to maximize deductions, when you pay could matter from that perspective too. But with the $10,000 SALT cap, many people don't benefit from timing strategies anymore unless they have very low property taxes.

TurboTax Premium has an audit risk assessment that highlights potential penalty situations. It also calculates estimated tax payments for the next year to help avoid underpayment. Not cheap but saved me from the same mistake twice.

1 I've thought about switching, but I've been with my current guy for 5 years and I worry about starting fresh with someone new. How did you find your specialized CPA? Did you interview multiple people? Was the transition difficult with all your previous tax history?

22 I found my CPA through a manufacturing industry association, which was great because she already understood my business model. I interviewed three different CPAs and asked each the same questions about their experience with R&D credits and multi-state filing. The differences in their answers made the choice clear. The transition was actually smoother than I expected. I provided my new CPA with the last three years of returns, and she did a free initial review to identify opportunities before I fully committed. She found nearly $12,000 in missed deductions in just the previous year. We filed amendments and her fee was more than covered by the refunds. Most good accountants have systems for onboarding new clients effectively.

9 I've used QuickBooks Self-Employed for the last couple years and it's been pretty decent for tracking expenses and estimating quarterly payments. But once you get into R&D credits or multi-state filing, it falls short. I now use it alongside my accountant - I handle the bookkeeping and basic stuff, then let the pro deal with the complex credits and deductions.

Thanks for pointing this out! I am using the 2024 standard deduction amount ($13,850) in my calculations. And I think I'm applying the tax brackets correctly with the marginal approach - only applying the higher rate to the portion of income that falls within that bracket. I'm starting to understand that my main issue is likely how I'm treating the different pre-tax deductions for FICA vs federal income tax. That would explain the discrepancy.

Glad to hear you're using the correct standard deduction! And it sounds like you're applying the marginal tax rates correctly too. Yes, the distinction between how deductions are treated for federal income tax versus FICA is almost certainly the source of your calculation discrepancy. Once you separate those calculations in your spreadsheet - one for federal income tax (where most pre-tax deductions apply) and another for FICA (where fewer deductions apply) - you should get much closer to matching those online calculators. It's a common source of confusion even for people who are otherwise tax-savvy.

This is great advice, but keep in mind that withholding tables are just approximations based on your W-4. If you have other income sources or deductions that aren't factored into your W-4, your actual tax liability could differ significantly from what's being withheld.

Most IRS Taxpayer Assistance Centers require appointments now - you can't just walk in. And the appointment availability can be weeks out during tax season. I tried this route last year and the earliest appointment was 3 weeks away. Just something to keep in mind!

Thanks for that info! I had no idea they required appointments now. That's really good to know, would've been frustrating to drive there only to be turned away. Do you know if there's a special procedure for emergency situations like missing W2s, or do you still have to wait for an appointment regardless? I actually ended up getting through on the phone after multiple attempts, but it took almost 2 hours of waiting. The person I spoke with was helpful though.

I second this. Had an employer with similar "payroll correction" excuses and late paychecks. Six months later they shut down with no notice and owed everyone 3 weeks of back pay. Get your resume updated now while dealing with the W2 issue.

17 This is actually great advice. How detailed should their explanation be? My preparer just keeps saying "trust me, I know what I'm doing" without giving specifics.

3 They should be able to point to specific IRS rules or forms that apply to your situation. For instance, if they're claiming business expenses, they should explain which expenses qualify and how they determined the amounts. If they're claiming credits, they should walk you through the eligibility requirements and confirm you meet them. A good preparer will show you where on your tax documents (W-2s, 1099s, etc.) they're getting figures from, and explain any calculations. Vague answers or dismissing your questions with "trust me" is definitely concerning. Tax preparation isn't magic - it follows specific rules that can be explained clearly.

20 I'm not sure what software she uses, I just know she has her own office with her name on the door. Does the type of software make that big a difference in the final refund amount?