This is really helpful! I just checked and it's definitely an S-corporation, so sounds like I should be expecting a K-1. Any idea when they typically send these out? The business manager is kind of disorganized and I'm worried they might miss sending it to me.

S-corporations must file their tax returns (including all K-1s) by March 15th, unless they file for an extension. So you should receive your K-1 by mid-March in most cases. However, many smaller businesses do get extensions, which can push the deadline to September 15th. If you're concerned about the manager being disorganized, I'd recommend reaching out to them directly in early March to remind them that you'll need your K-1 for your personal tax filing. You can always file an extension for your personal return if you don't receive the K-1 in time, but it's better to be proactive and make sure they have your current address and contact information.

Be careful with estimating though! If you underestimate by too much, you'll still get hit with underpayment penalties. I learned this the hard way last year with my first K-1 situation.

Wait, I'm confused now. My 1099-R shows the same amount in box 1 and 2a (the full $38,000), so does that definitely mean I don't need the Simplified Method? The software still keeps asking me about it.

If box 1 and box 2a show the same amount ($38,000), then yes, your entire distribution is taxable and you do NOT need to use the Simplified Method Worksheet. This indicates you only had pre-tax contributions in your 401k. The tax software is likely programmed to ask about the Simplified Method for all retirement distributions as a precaution, but you can confidently select "No" or "Not applicable" for that question. The software is just covering all bases - it doesn't know your specific contribution history until you provide that information.

There's no specific age requirement for the Simplified Method itself. It's all about whether you had after-tax contributions, not your age. The age factor comes into play when determining the "expected return" (basically how long the IRS expects you to receive payments), which affects the calculation within the worksheet. But you only need to worry about that if you actually need to use the method in the first place.

Thank you for this suggestion! I hadn't even thought about paper filing as an option. Do you know if there's any additional form I need to fill out since the electronic extension was rejected? And how long does it typically take for the IRS to process a paper extension?

You don't need any additional forms - just the standard Form 4868 for extension. Write a brief note in the margin referencing the electronic rejection if you want, but it's not required. Paper processing is taking about 3-4 weeks right now according to what I've heard, but the postmark date is what matters for filing on time, not when they process it. Just be sure to estimate your taxes properly and include payment if you owe. The extension gives you more time to file, but any taxes owed were still due on April 15th. Keep a copy of everything and the certified mail receipt in your records.

YES! TurboTax kept rejecting my roommate's return for "duplicate filing" but when he called, they admitted it was a glitch in their system, not the IRS. They had to escalate it to their tech team and it took 3 days to fix. Might be worth calling TurboTax support directly to see if it's a known issue.

This is terrible advice. The IRS expects ALL income to be reported regardless of amount or whether you received a form. Intentionally not reporting income is tax evasion. The penalties for getting caught are way worse than just paying the tax you owe now.

That's just what my tax preparer told me. I'm not saying it's for everyone. Obviously if you're worried about it, go ahead and report it. I'm just saying from a practical standpoint, the IRS isn't conducting audits over small amounts especially when there's no paper trail. They focus their limited resources on bigger fish. But everyone should make their own decision based on their comfort level with risk.

I honestly have no idea what he did with his business taxes. We haven't really talked much since I stopped helping out. I'm guessing he probably didn't report it since he specifically mentioned it was "under the table" when I asked about tax forms.

The friend could also get in trouble for not properly classifying workers and paying employment taxes. So many small business owners don't realize they can't just pay people cash without consequences. They need to either treat them as employees and withhold taxes or properly document independent contractors with 1099s.

Can you still do a Solo 401k if you have another W2 job with a 401k already? I thought there were limits to how much you could contribute across all your accounts.

You can absolutely have both a Solo 401k and an employer 401k, but you're right that there are some limitations. The $23,000 employee contribution limit (for 2025) applies across ALL your 401k accounts combined. So if you've already maxed out your employer 401k, you can't make additional employee contributions to your Solo 401k. However, the employer contribution portion of your Solo 401k is completely separate and not affected by your W2 job's 401k. You can still contribute up to 25% of your net self-employment income as the "employer" portion to your Solo 401k, even if you've maxed out your other 401k.

Does Quickbooks handle calculating the home office deduction well? I've heard that's one of the trickier deductions to get right and I don't want to raise audit flags.