Oh crap, that's exactly what I'm afraid of. Did they charge her a lot of interest? And did she try to contact them first or did she just wait until they noticed?

They charged her about 4% interest which added up to around $37 on a $900 refund over 8 months. Not terrible but still annoying since it wasn't her mistake. She didn't contact them because she genuinely thought it was a legit second refund from some credit or adjustment. When she got the notice she called and explained this, but they still required repayment with interest. They were nice about setting up a payment plan with no additional penalties though. Definitely worth being proactive to avoid even this situation.

This is really good advice. My state (MN) does this with property tax rebates and also had some special energy credits last year that came as separate payments even though they were part of the tax processing.

Thanks for sharing your experience. I've been keeping all the transfer receipts from my ex showing the $300 monthly payments. So on Schedule 8812, should I just report that I'm claiming one child and am entitled to that portion of the credit? I'm mainly worried because the letter makes it look like I already received the full amount.

Yes, on Schedule 8812 you'll report that you're claiming one child and are entitled to the Child Tax Credit for that child. The form will ask about advanced payments received. The important part is that from the IRS perspective, the payments were issued based on your 2020 joint return. Even though the letter shows the full amount, when you file as Head of Household claiming just your daughter, you're essentially telling the IRS "I'm only claiming one child now, not all the children from the joint return." The form is designed to handle this reconciliation.

The Update Portal was pretty limited. It worked for some basic changes, but it didn't really address complex situations like divorce and split custody well. I tried using it too and ended up just having to handle everything on my actual tax return instead.

Thanks for this! Quick question - what about things bought while on vacation in another state and brought back? Like if I buy clothes in Oregon (no sales tax) and bring them home to California?

That's exactly what use tax is designed for! If you buy clothes in Oregon (no sales tax) and bring them back to California, technically you owe California use tax on those items. This is one of the most common situations where use tax applies, but also one of the hardest for states to enforce. Generally speaking, if you bought something significant (like expensive electronics, jewelry, furniture, etc.) while out of state and didn't pay sales tax, you should report it on your state return and pay the use tax.

That's what I do! I just use the lookup table amount on my state return. Not worth the headache of tracking every little purchase. Though I did separately report a laptop I bought online tax-free since it was over $1000.

Thanks for bringing this up - I don't have employees right now but I'm planning to hire a part-time assistant next quarter. Would the non-discrimination rules apply even for part-time workers? Or is there a hours-worked threshold?

For health insurance specifically, the non-discrimination rules generally apply to employees working 30+ hours per week (considered full-time under the ACA). Part-time employees working fewer hours typically don't need to be offered the same health benefits. However, if you establish a health reimbursement arrangement (HRA) or other formal health benefit plan, different rules might apply. With a QSEHRA (Qualified Small Employer HRA), for example, you'd need to offer the same benefits to all eligible employees, but you can exclude part-time workers.

That's actually incorrect and could get you in trouble during an audit. Health insurance for >2% S Corp shareholders can't be handled through an accountable plan. It must be included on your W-2 as income (though not subject to FICA) and then deducted on your personal return. The IRS has specific rules for this situation outlined in Notice 2008-1. Using an accountable plan for health insurance reimbursement for a >2% shareholder is incorrect treatment and could result in the deduction being disallowed plus potential penalties.

That's a good point I hadn't thought about! The pharma company has my old address actually since I moved in June. Will this cause problems? Should I contact them for a corrected form or is there a way to note this on my return?

You don't necessarily need to get a corrected form. When you enter the 1099-MISC information on your tax return, you'll just use the exact information that's on the form including the payer's EIN number. The IRS matching system is primarily looking at the amounts and the taxpayer identification numbers to match things up. Just make sure your current address is correct on your actual tax return. If you're worried, you can keep a copy of the 1099-MISC with your tax records in case there are any questions later. The mismatch happened to me because I made a typo in the amount, not because of the address difference.

FreeTaxUSA is the way to go! I switched to them after years of TurboTax increasing their prices. Their free version handles all federal forms and I just pay $15 for state filing. Way better than the $100+ other services want.