How much did TaxAct charge for each prior year? And did you have any issues with the 2017 filing from the accountant?

TaxAct charged around $60-70 per year for their business editions when I used them, though prices may have changed. I found it reasonable considering the alternatives. For the 2017 return, the accountant charged me $350, which was actually less than I expected. There weren't any issues with the filing itself, but they discovered I had been calculating depreciation incorrectly on some equipment, which affected the subsequent years. This meant I had to make some adjustments to my 2018-2020 returns as well. If you have depreciating assets, make sure you're tracking them consistently across all tax years - that's something the software won't necessarily flag for you.

UltraTax is professional-grade software used mostly by accounting firms, not really meant for individuals. For DIY, stick with TaxAct, TaxSlayer or H&R Block's prior year versions as others suggested. Much more user-friendly and way cheaper.

Can you explain more about the mega backdoor Roth through an S corp? My accountant mentioned this but didn't explain how it actually works with the S corp structure specifically.

Sure thing. The key is setting up your Solo 401k plan with the right provisions. Your plan needs to specifically allow for both after-tax contributions (beyond the normal $22,500 employee limit) and in-plan Roth conversions. With an S corp, you wear two hats - employee and employer. As employee, you contribute up to the standard limit ($22,500 for 2023, plus catch-up if over 50). As employer, your S corp can contribute up to 25% of your W-2 wages. Then, if your plan allows it, you can make additional after-tax contributions up to the total annual limit ($66,000 for 2023 combining all sources), then immediately convert those after-tax dollars to Roth. This gives you way more Roth conversion potential than just the standard backdoor Roth IRA.

Does your S corp pay for these directly, or do you pay personally and get reimbursed? I've heard conflicting advice on the best approach.

7 Does VITA actually help with learning business tax prep though? I thought they only do basic 1040s and don't handle Schedule C filers?

20 You're right that VITA primarily focuses on basic returns, though some sites do handle simple Schedule C returns with limitations on income amounts and deductions. It won't give you comprehensive business tax experience, but it does provide excellent training in the fundamentals and client interaction skills. For business tax experience specifically, you might consider trying to work part-time at a local CPA firm during tax season. Many firms hire seasonal preparers and will train you on their procedures. Another option is finding a mentor through your local chapter of the National Association of Tax Professionals (NATP) or the Texas Society of Enrolled Agents.

13 I started out charging by form and it was a DISASTER. Clients hated the uncertainty and I had to have awkward conversations when additional forms were needed. Now I do tiered flat fees based on return complexity (basic W-2 only, itemized deductions, Schedule C, etc) and both me and my clients are much happier.

Isn't the home office deduction really complicated though? I heard it's a big audit trigger and not worth the hassle for most people. And I thought you had to itemize to deduct donations now?

You're right that the home office deduction itself can be tricky - you need a space used exclusively for work. What I was referring to is more for self-employed people who can deduct business expenses without needing a dedicated home office. For charitable donations, you're correct that you typically need to itemize to deduct them. However, for 2021 there was a special provision allowing a small deduction even with standard deduction, but that expired. So for most young people, the standard deduction is still better than itemizing for small donations.

What tax software do you recommend? There are so many options and I'm confused about which one would be best for a first-timer.

I second this about withholdings! I was so excited about my $3,000 refund until my friend pointed out that's just my own money I could have had in my paycheck all year. Adjusted my W-4 and now I get about $115 more in each biweekly paycheck which helps a lot with bills.

Thanks for the suggestion! I just dug up my final paystub and compared it to my W-2. The reimbursements don't appear to be included in my W-2 Box 1 amount, which I guess means they were handled correctly as non-taxable. That's a huge relief! Do you think I should still try to get some kind of documentation from the employer stating it was an Accountable Plan for my records? I'm always nervous about potential audits.

That's great news! If the reimbursements weren't included in your W-2 Box 1 wages, then your employer definitely treated them as non-taxable reimbursements under an Accountable Plan. While it's not strictly necessary, it never hurts to have additional documentation. If you can get a simple statement from your former employer confirming their reimbursement system meets the Accountable Plan requirements, it would be good to keep with your tax records. However, the fact that they didn't include these amounts in your taxable income already indicates they considered their plan to be an Accountable Plan. For extra peace of mind, keep any emails or documents you have related to their reimbursement policy, even if they're just instructions on how to use the system. These can help demonstrate the business purpose and accountability requirements if questions ever arise.

This is a really important point! When I worked as a healthcare contractor, my agency just lumped all my reimbursements into my 1099-NEC, which meant I had to pay taxes on them initially. I had to file Schedule C and deduct the business expenses myself. Cost me a bunch in self-employment taxes I shouldn't have had to pay.