Great question about TurboTax's flagging capabilities! I can share some specifics from my experience that might help you decide. The taxr.ai analysis caught a mix of both forgotten expenses and genuinely complex categorization issues. About 60% were things I had simply forgotten to track - like a business dinner from early in the year, some software subscriptions I paid annually and forgot about, and mileage for a few business trips. But the other 40% were more sophisticated catches: it properly categorized some equipment purchases for depreciation instead of immediate expensing, identified home office expenses I was handling incorrectly, and caught some consulting fees that should have been 1099-MISC reportable. Regarding TurboTax's flagging system - yes, it's actually quite good at identifying potential issues even when it can't solve them completely. In my multi-state case, I had done some work for clients in two other states, and TurboTax flagged that I might have nexus obligations in those states for income tax purposes. It couldn't tell me exactly what to do, but it clearly explained what nexus means and suggested I consult a tax professional. That heads-up probably saved me from missing some compliance requirements. For single-state operations like yours, TurboTax should handle everything smoothly, but it will still flag things like whether you need to file additional forms based on your business activities, equipment purchases, etc. The peace of mind knowing it's scanning for potential issues is honestly worth a lot. The combination approach (document analysis + premium software + accountant backup) ended up costing me about $400 total but saved thousands in proper deductions and potential compliance issues.

As someone who just went through this exact decision process last month, I wanted to add my perspective on the software comparison and some practical tips that might help. I ended up choosing H&R Block Premium & Business after comparing all three options mentioned. While it doesn't get talked about as much as TurboTax or TaxAct, I found it hit the sweet spot between user-friendliness and cost. The interface is intuitive enough for a first-timer but doesn't have the premium price tag of TurboTax Business. What really sold me on H&R Block was their "Tax Pro Review" feature - for an additional $50, you can have an actual CPA review your return before filing. This gave me confidence that I hadn't missed anything critical without paying for a full accounting service. One thing I learned the hard way: regardless of which software you choose, make sure you understand the difference between your business tax return (1120S) and your personal return (1040). The software handles the business side, but you'll need to properly report your K-1 distributions on your personal return too. H&R Block's personal software integrates well with the business version, which simplified this process for me. Also, start gathering your documentation NOW if you haven't already. You'll need your business bank statements, all receipts, any 1099s you received, payroll records if you paid yourself a salary, and documentation for any major equipment purchases. Having everything organized before you start will save hours of frustration. With your $87k revenue and $32k expenses, you're in a very manageable range for DIY software filing. Just make sure you're properly categorizing those expenses and not missing any depreciation opportunities on equipment purchases.

I've been following this discussion and wanted to add a perspective that might help simplify things for anyone still feeling overwhelmed by all the options mentioned. While tools like taxr.ai and services like Claimyr can definitely be helpful for complex situations, don't overlook the free resources that are often sufficient for straightforward cases like yours. The IRS Tax Withholding Estimator really is quite good, and for a single person with one main job plus a side gig, it should get you very close to that ideal "break even" target. Here's what I'd suggest as a simple action plan: Start with just Steps 1 and 5 on your W-4 (the basic info), then use your first paycheck to run the IRS estimator with real numbers. At that point, you can add your $7,200 annual side gig income and see what adjustments it recommends. The beauty of this approach is that you're not trying to predict everything perfectly upfront - you're using actual data to make informed adjustments. And remember, owing $200-500 at tax time isn't a failure, it's actually optimal money management since you kept that cash earning interest or invested throughout the year instead of giving the government an interest-free loan. Don't let the complexity paralysis keep you from starting. Get something reasonable submitted, then refine as you learn more about your actual withholding patterns.

This thread has been incredibly helpful! As someone who just went through the W-4 process myself a few months ago, I want to echo what others have said about not overthinking it initially. One thing that really helped me was keeping a simple spreadsheet to track my withholding vs. estimated tax liability as the year progressed. Every few months, I'd plug my year-to-date earnings and withholding into the IRS estimator to see if I was still on track. This made adjustments feel less scary because I could see the impact of small changes before they became big problems. For your delivery gig income specifically, don't forget you can deduct business expenses like gas, phone bills (partially), and vehicle maintenance. These deductions can reduce the tax impact of that side income, so factor them in when calculating how much extra to withhold. I track my delivery expenses in a simple app and it usually saves me a few hundred dollars at tax time. The "break even plus or minus $300" target that several people mentioned is spot-on. I ended up owing $180 last year and felt great about having that extra cash flow throughout the year instead of waiting for a refund. Good luck with your new job!

Pro tip: If your regular job income makes up most of your earnings, you can also increase your W-4 withholding at your main job instead of dealing with quarterly 1040-ES payments for your smaller side gig. I do photography on weekends and just have my employer take out an extra $75 per paycheck to cover the taxes on that income. Just calculate roughly how much extra tax you'll owe for the year from your side hustle, then divide by the number of paychecks from your main job. Ask your HR department to withhold that additional amount.

Welcome to the world of freelance taxes! It's definitely overwhelming at first, but you'll get the hang of it. Just to clarify a few things based on what others have shared: The quarterly estimated tax payments using Form 1040-ES are separate from your 2024 tax debt. Think of it this way - the $3,800 you owe is for income you already earned in 2024, while the quarterly payments are advance payments for taxes on income you'll earn in 2025. Since this is your first year with significant freelance income, the estimates might be a bit high if you're not sure your photography work will be consistent. You can always adjust your payments throughout the year if your income changes. The key is to avoid underpayment penalties by paying either 90% of this year's tax or 100% of last year's tax (whichever is smaller). Also, don't forget to track ALL your photography expenses - equipment, software, mileage to shoots, even a portion of your phone bill if you use it for business. These deductions can significantly reduce your quarterly payment amounts. The learning curve is steep, but once you understand the system, it becomes much more manageable!

Anna, I've been through almost the exact same situation and can totally relate to the frustration with confusing explanations! Let me break down your specific numbers to help clarify: Your timeline: 9.5 years total ownership (Aug 2013 to Jan 2023), with 5 years as primary residence (Aug 2013 to July 2018) and 4.5 years rented out. Here's the good news: Since you moved out for work, those 4.5 years of rental DON'T count as "non-qualified use" under Publication 523. This is huge because it means if your total gain exceeds your partial exclusion, you won't have additional taxes on the portion attributable to those rental years. Your $63k partial exclusion calculation appears correct (roughly 6 months out of 60 months = 10% of $250k, though the exact formula might give you slightly more). So let's say your total gain was $150k. You'd exclude $63k, leaving $87k potentially taxable. But since the rental period doesn't count as non-qualified use thanks to your work-related move, that entire $87k would be treated as regular capital gains rather than having a portion subject to different tax treatment. The key takeaway: your work-related relocation actually saved you from much higher taxes than if you'd just decided to move out and rent the place. Document that job move well - keep your employment records, offer letter, anything showing the relocation was work-related.

Anna, I completely understand your frustration with this topic - the qualified vs non-qualified use rules are genuinely confusing even for tax professionals! The explanations here have been excellent, but let me add one more perspective that might help tie everything together. Think of it this way: you're dealing with TWO separate but related rules: **Rule #1: The 2-out-of-5 year test** - This determines how much exclusion you get. Since you only lived there 6 months in the 5 years before selling, you get a partial exclusion (your ~$63k figure). **Rule #2: Non-qualified use allocation** - This determines what portion of any remaining gain (above your exclusion) gets special tax treatment. But here's the key: your work-related move means those 4.5 rental years DON'T count as non-qualified use. So if your total gain was, say, $120k, you'd exclude $63k and have $57k of taxable gain. Normally if you had non-qualified use periods, some of that $57k might face restrictions on exclusion eligibility. But since your rental period doesn't count as non-qualified use, you're in a much better position. The work-related exception is actually pretty broad - it doesn't require that your employer mandated the move, just that the change in employment location made the move reasonable. Keep your job offer, employment records, and any documentation showing the timeline of your relocation. You definitely need a new accountant who can explain this clearly without getting frustrated. This is standard real estate tax territory!

Just received my CP21B notice yesterday and honestly feeling so relieved to find this thread! I was starting to panic thinking something was wrong with my return. The 2-3 week timeline everyone's mentioning is super helpful - gives me something concrete to expect instead of just wondering if I'll ever see my refund. Already set up direct deposit through WMR so hopefully that speeds things up. Thanks for asking this question @Freya, clearly a lot of us needed to hear these experiences! 🙏

Just got my CP21B notice this week too and was freaking out until I found this thread! So reassuring to see the 2-3 week timeline is pretty consistent across everyone's experiences. I've been refreshing WMR every few hours like it's going to magically update faster lol. Definitely going to check out that taxr.ai tool - seems like several people here had good results with it and honestly $5 is worth it for some peace of mind instead of driving myself crazy with the unknown. Thanks @Freya for posting this, clearly touched a nerve for all of us in CP21B limbo! 😅