Does that calculator thing work for people with multiple jobs or side gig income? I always struggle with getting my withholding right because I have my main job plus some freelance stuff.

Yes, it definitely works for multiple jobs and side gig income! The calculator has specific sections where you can enter income from different sources, including self-employment. The tool is actually really good at handling complex situations like yours. It will ask about all your income streams and help calculate the right withholding amount. For freelance income, it'll even help determine if you need to make estimated tax payments throughout the year to avoid penalties.

That's actually the opposite issue but still not ideal. Claiming 0 when you have 2 qualified dependents means you're having TOO MUCH withheld. It's legal but you're giving the government an interest-free loan of your money throughout the year. You'd be better off claiming your actual dependents and putting that extra money to work for you each month.

This is actually really helpful - I had no idea about the quarterly thing. How do I figure out how much to pay each quarter if my income isn't consistent? My construction projects vary a lot month to month.

You have a couple of options for calculating your estimated payments. The safest method is paying 100% of your previous year's tax (or 110% if your income was over $150,000). This gives you a "safe harbor" from penalties even if you end up owing more. If your income fluctuates, you can use the "annualized income installment method" using Form 2210. This lets you make payments based on what you actually earned in each period rather than 25% each quarter. Most construction businesses have seasonal fluctuations, so this might work better for you. A good tax software or accountant can help you run these calculations.

Completely agree - especially for construction. My brother's construction company got hammered in an audit because they hadn't structured things correctly. Not worth the risk when you're dealing with this kind of money. A good tax attorney will save you way more than they cost.

Where exactly is this override option? I'm staring at the error screen right now and don't see anything like that. Is it only in certain versions of TurboTax?

It's not always obvious - look for small text links near the bottom of the error message that say something like "I want to continue anyway" or "Override this warning." Sometimes you have to click on "Why am I seeing this?" first, and then the override option appears. If you're using the downloadable version, it might be under "Tools" → "Options" → "Error checking" where you can adjust the sensitivity level. For the online version, sometimes you need to click on a "More options" or "What should I do?" link that expands additional choices.

This!! I had the same issue. Check if you accidentally entered a 1099 or W-2 twice in the state section. TurboTax's interface makes this so easy to do by accident.

Thanks for bringing this up! How would I know if I have profits interests vs capital interests? The agreement uses the term "restricted incentive units" throughout and mentions something about only being eligible for distributions after I've vested and after all capital contributions have received a return of some percentage. Does that sound like profits interests?

That definitely sounds like profits interests based on the language about distributions only happening after capital contributions receive their return. This is good news tax-wise! Profits interests are designed to give you a share of future growth without taxing you on existing value. The "after all capital contributions have received a return" language is classic profits interest structure - it means your units only have value after the existing investors get their money back plus some preferred return. Just make sure you understand the vesting schedule and any potential acceleration clauses. Also, check if your company will provide tax distribution provisions to cover any phantom income that might be allocated to you.

This is so true. My friend got hit with a massive surprise tax bill because of self-employment taxes on her LLC equity income. Her company didn't withhold anything, and she ended up owing like $15k unexpectedly. Definitely something to budget for!

That's really good advice. I'm definitely going to make copies of everything. Do you know if I should be including my original tax returns with the response or just the supporting documentation for the head of household status?

Just include the supporting documentation for Head of Household status, not your entire original returns. The IRS already has your returns in their system. Focus on providing proof that you provided more than half the support for your mom and sister and that they lived with you. Include a copy of the notice they sent you with your response. Write your Social Security number on every page you send them. And definitely use certified mail with return receipt - that saved me when they tried claiming they never received my documents.

Yes, I filed Form 1040X for the amendment, but looking back at my copy, I see I checked the "Single" box on line 4 again. I was so focused on adding the dependents and credits that I completely missed changing the filing status. Rookie mistake I guess.

That explains exactly what happened then. When you amend a return, you need to check the correct filing status for your situation on Form 1040X, even if you're not changing your filing status from the original return. Since you were adding dependents, you should have updated to Head of Household. The good news is this is fixable. As others have mentioned, respond to the notice with proof that you qualified for Head of Household (provided more than half support, they lived with you more than half the year). The IRS will recalculate your taxes based on the correct filing status.