But isn't getting a big refund a good way to save? I know I'd probably just spend that extra money in each paycheck if I adjusted my withholding.

I totally understand that concern - many people do use tax refunds as a forced savings method. If you struggle with saving, you might want to try setting up automatic transfers on payday so the money goes directly to savings before you can spend it. The disadvantage of using tax refunds as savings is that you can't access YOUR money during emergencies throughout the year, which is exactly when many people end up taking out predatory refund advance loans or other high-interest debt. Having savings you control gives you more financial flexibility without paying those high fees.

I used one of those "no fee" advance services last year at a major tax chain. While technically there wasn't a specific "fee" for the advance itself, they charged me $395 for tax preparation for a very simple return that should have cost about $150. When I questioned it, they said the higher prep fee was "standard" but I'm pretty sure it was inflated to cover the "free" advance. Plus, they gave me the advance on their prepaid debit card which had all kinds of usage fees. I ended up paying about $30 in ATM and transaction fees before I used up the advance amount.

What about vehicle advertising? I have my business logo and info on my vehicle. Is that deductible separately or is it considered part of the vehicle expense?

Vehicle advertising is absolutely deductible as a separate marketing expense, not as part of your vehicle costs. This includes permanent signage, vehicle wraps, magnetic signs, or even custom paint jobs with your business info. Save all receipts from the sign company or wrap installer. This is a great strategy because these advertising costs are separate from your vehicle deduction method. So even if you choose the standard mileage rate (which bundles most vehicle expenses together), you can still deduct the advertising separately as a marketing expense.

What mileage tracking app do you recommend? I've tried a couple but they drain my battery or forget to track sometimes.

Thanks for the tip! I hadn't even thought about my state return. Will the IRS forward the information to my state tax agency or do I need to handle that completely separately?

The IRS doesn't forward information to state tax agencies for amended returns. You'll need to file a separate amended return with your state tax department using their specific amendment form (each state has its own version). Most states have a form similar to the federal 1040-X, but the exact name varies by state. For example, California uses Form 540X, New York uses Form IT-201-X, etc. Check your state's tax department website for the correct form and filing instructions.

You should talk to your company's payroll department. That's not normal and something is definitely wrong with their process if it happens repeatedly. Maybe ask them to hold your W-2 until they're absolutely sure the numbers are final.

Thanks for mentioning this! Do you know roughly what revenue threshold typically triggers the country-by-country reporting requirement? And how did you handle the permanent establishment issue in Germany - did you have to create a legal entity there or was there another solution?

The country-by-country reporting threshold is generally €750 million (about $800 million) in annual consolidated group revenue for most countries following OECD guidelines. But there are local variations, and some countries have additional reporting requirements at lower thresholds. For our German permanent establishment issue, we ended up creating a formal subsidiary since we were planning expansion there anyway. But there are other approaches depending on your situation - some companies use a third-party employer of record, limit employee time in-country, or restructure responsibilities. The key is addressing it proactively rather than waiting for tax authorities to come knocking. In our case, we faced some back taxes and penalties before we got everything properly structured.

The OECD Transfer Pricing Guidelines have a whole chapter on intangibles including software. But honestly it's super technical. I found the book "Transfer Pricing and Intellectual Property" by Abdallah and Murtuza more digestible - it has software examples. Software is tricky because you need to separate the value of the core IP from the local customization and support.

Do you think you would have been audited if you'd used a local preparer from the start? I've heard the IRS is less likely to audit returns done by professionals.

I don't think using a local preparer would have prevented the audit because it was triggered by a specific issue with a 1099-K from my side gig that didn't match what I reported. The preparer told me these "document matching" audits happen regardless of who prepares the return. What would have been different is catching the error before filing. The software didn't flag the discrepancy, but a human preparer likely would have questioned me about it during the preparation process. So while it wouldn't have prevented the audit trigger, it might have prevented the error that caused it.

This is absolutely true. I worked at a tax prep chain in college and was disgusted by how we targeted low-income people with "instant refunds" that were just high-interest loans. The fees would eat up a significant portion of their refund, but they needed money immediately and couldn't wait for the IRS processing time.