No kids unfortunately. It was just me and my ex-wife. We don't have any dependents together, and no one else lived with us. Based on what everyone's saying, looks like I'm stuck with the Single filing status and this huge tax bill. Just wish I'd known about this earlier in the year so I could have adjusted my withholdings.

That's tough, sorry to hear it. Without a qualifying dependent, you're right that Single is your only option. For next year, definitely update your W-4 with your employer ASAP to avoid withholding problems. One thing to consider is whether you might qualify for any tax credits based on your situation. The Saver's Credit could apply if you contributed to retirement accounts and your income isn't too high. There might also be education credits if you paid any tuition or student loan interest.

This is good advice. Also, don't forget about any legal fees specifically related to tax advice during your divorce. Those might be deductible too, even though general divorce attorney fees aren't. My accountant helped me identify about $1,800 in deductible legal fees from my divorce last year that were specifically for tax consultation.

That's a great point! I didn't even think about my scholarship reducing my eligible expenses. I received about $3,500 in scholarships last year. So if my tuition was $5,000, I would only be able to claim $1,500 for the Lifetime Learning Credit?

That's exactly right! You would only be able to claim $1,500 as your qualified education expenses in that scenario. And remember, the Lifetime Learning Credit is calculated as 20% of your qualified expenses, so your potential credit would be $300 ($1,500 × 20%). Then, that potential credit amount gets compared to your remaining tax liability on the Credit Limit Worksheet. If your remaining tax liability is less than $300 (or zero), that's why you'd end up with zero or a reduced credit amount on line 19 of Form 8863.

I used both TurboTax and H&R Block and got the same zero result with the Lifetime Learning Credit. I think different software might do the calculations slightly differently, but the end result should be the same if you're entering the same information. Might be worth double-checking that you input everything identically in both programs.

That's exactly what happened to my parents! They never claimed depreciation on their rental for 12 years, then when they sold it, they got hit with depreciation recapture tax on depreciation they never benefited from. Huge tax bill they weren't expecting.

Form 8949 isn't the right approach here. That form is used when you're reporting the sale of a capital asset, not for catching up on missed depreciation. Form 3115 is specifically designed for changing an accounting method, which is exactly what you're doing when you start claiming depreciation that you previously failed to claim. The 3115 allows you to make this correction without amending prior returns. If you waited until sale to try to address unclaimed depreciation, it would be too late - the IRS would still reduce your basis by the depreciation you should have claimed, essentially taxing you on benefits you never received.

Do you know if this same process works in H&R Block's software? I'm having the same issue there and their support has been useless.

I haven't personally used H&R Block's software recently, but the general principle is the same. You need to make sure you've entered your non-deductible contribution information and completed the equivalent of Form 8606 before you enter the conversion information. The specific navigation and screens will be different, but the sequence is what matters. Most tax software struggles with backdoor Roth conversions if you don't follow the correct order of operations. Try looking specifically for the Form 8606 section in H&R Block's software and complete that first before handling the conversion.

This is such an important point! I got hit with an unexpected tax bill because of this last year. Had a small old IRA with about $12k in it that I forgot about, and it completely changed how my backdoor Roth was taxed.

Thanks for this info! So even if Zelle doesn't report it, I should still be reporting this income? Would I just add it as "miscellaneous income" or would I need to file as self-employed with a Schedule C?

You should definitely report the income regardless of whether Zelle issues a 1099-K. Since you're receiving regular payments for work performed, this would be considered self-employment income, not miscellaneous income. You'll need to file Schedule C to report your business income and expenses, and Schedule SE to calculate your self-employment tax. This is actually better for you in many ways because with Schedule C, you can deduct legitimate business expenses that reduce your taxable income. If you have a home office, use your phone for work, or have any other expenses related to this work, those can potentially be deductible.

Same experience here. I got a 1099-K from PayPal but nothing from Venmo despite making similar amounts on both. I reported everything anyway because I don't want headaches with the IRS, but the inconsistency is frustrating. I think different platforms are interpreting the requirements differently.