17 Do you know how long it typically takes for amended returns to be processed? I'm in a similar situation and worried about how long I'll be in tax limbo.

5 Right now amended returns are taking approximately 16-20 weeks to process according to the IRS website. However, in my experience with a similar situation, it took closer to 6 months because they had to process both years together. I recommend filing the amendments electronically if possible because paper amendments take even longer. Also, make sure you don't file your actual 2020 return until the amendments are fully processed, or it might create further confusion. You can request an extension if needed to give time for the amendments to clear the system.

9 I used the Taxpayer Advocate Service last year for a similar issue. You need to demonstrate that you're facing "significant hardship" as a result of the IRS delay. In my case, I was being denied a mortgage because of the incorrect tax filing. The advocate was helpful, but it still took about 2 months to resolve after they got involved. You can request assistance through Form 911 or by calling them directly.

2 Thanks for sharing your experience. My situation might qualify as a hardship since I'm unable to get approved for student loans because of this tax filing mess. I'll look into Form 911. Did you submit yours online or did you have to mail it in?

I used QBSE for 2 years and switched to FreshBooks. Much better interface and their expense tracking is more intuitive. Plus it doesn't do that thing where QB tries to upgrade you constantly.

Does the 30% usually cover everything? My brother mentioned something about additional self-employment tax on top of regular income tax...

The 30% is usually enough to cover both income tax and self-employment tax for most income levels. Self-employment tax is about 15.3% (covers Social Security and Medicare that an employer would normally pay half of), and then your income tax rate depends on your total earnings. If you're making over $90k or so, you might want to set aside closer to 35% to be safe. I've found 30% works well for me earning between $60-80k annually. The first year is the hardest - after that you'll have a better idea of your actual tax rate based on your specific situation and deductions.

They never really explained it clearly. When I called back to ask questions, they just quickly said they'd cancel everything and deactivated my account. That's what made me most suspicious - like they knew they got caught doing something they shouldn't have been doing. I think I'm definitely going to do my own taxes from now on. I only went to them because a friend recommended them, but now I'm wondering if my friend actually had a good experience or if they might have had something similar happen without realizing it.

Did your son have to repay the entire refund or just the portion that was related to the fake business? I've always been curious what happens in these situations.

That's really helpful info! My AGI is around $95k so it sounds like I would qualify. Do I need to do anything special to claim these losses, or does it happen automatically when I file Schedule E?

It should flow through automatically when you complete Schedule E and Form 1040. The key is that you need to be "actively participating" in rental management decisions (which it sounds like you are). The tax software should handle this calculation, but just make sure the loss from Schedule E is being applied against your other income on your 1040. One caveat - if you use a property manager and aren't making most of the management decisions yourself, you might not qualify as "actively participating," so keep that in mind.

And remember that if you do keep part of the pet deposit for damages when a tenant moves out, you can offset that income with the actual cost of repairs! So if you keep $300 of a deposit but spend $300 fixing chewed baseboards, it's a wash for tax purposes.

3 Do you need to make a certain amount from freelance work to claim the home office deduction? I only make like $2000-3000 a year from occasional design projects while my kid is at preschool a few hours a week. Is it even worth claiming?

9 There's no minimum amount required to claim a home office deduction for freelance work. Even with just $2000-3000 in annual income, it's definitely worth claiming if you have a dedicated space for your design work. The key requirement is that the space must be used "regularly and exclusively" for business. If you have a desk or corner that's only used for your design projects, you can deduct a percentage of your home expenses (rent/mortgage, utilities, etc.) based on the square footage of that space. You can also deduct business-specific expenses like design software, equipment, etc. For someone in your situation, this could easily save you several hundred dollars on your taxes.

21 I use Mint for tracking all our family expenses and just tag childcare-related stuff with a specific category. Makes it super easy at tax time to pull a report of all those expenses. There's also apps specifically for co-parenting expense tracking like Splitwise that work well even if you're not separated/divorced.