This thread has been incredibly helpful! I'm in a similar situation with my dropshipping business and was making the same mistake of including sales tax in my gross receipts. One thing I'd add is that if you use payment processors like PayPal or Stripe, make sure to check their reporting features. PayPal's 1099-K forms can sometimes include the sales tax amounts in the reported gross payments, which might make it look like you have more income than you actually do. You'll need to reconcile this difference when filing your Schedule C. Also, for anyone using marketplaces like eBay or Amazon, remember that in marketplace facilitator states, the platform collects and remits sales tax on your behalf. In those cases, you won't see the sales tax in your seller reports at all - the customer pays it directly to the marketplace. This actually makes the Schedule C reporting cleaner since your gross receipts will already exclude the sales tax. Just wanted to share this since payment processor reporting can be another source of confusion when trying to figure out your actual taxable income versus total money received.

This is such a comprehensive thread! As someone who's been doing online reselling for several years, I want to emphasize one critical point that could save you from major headaches down the road. Always maintain a separate business checking account specifically for sales tax collections. When you collect that $105 total ($100 product + $5 tax), immediately transfer the $5 tax portion to this separate account. This creates an unmistakable paper trail showing you never treated sales tax as business income. I learned this the hard way during a state audit. Even though I was properly excluding sales tax from my Schedule C, the auditor initially questioned why my business account deposits were higher than my reported gross receipts. Having that separate sales tax account with clear transfer records made the explanation simple and credible. Also, don't forget about sales tax on your business purchases! If you buy inventory, packaging supplies, or equipment, you might owe use tax on items you use in your business rather than resell. Many online sellers overlook this completely. The bottom line for your Schedule C: Report only the $123,500. The $6,500 sales tax was never your income, so it should never appear on your federal return. Keep meticulous records of collections and remittances, and you'll be fine if anyone ever asks questions.

I'm having the exact same experience! Been using Free File Fillable Forms for about 5 years and this new interface has me completely lost too. The worst part is that I actually prefer doing my own taxes without all the hand-holding from commercial software, but now I'm spending more time figuring out the interface than actually working on my return. One thing I discovered that might help - after you click that "Start New Tax Return" button (which took me forever to find on the right side), make sure to go through the initial setup questions carefully. The new system seems to use your answers to customize which forms are available later, so if you skip through too quickly, you might not see all the schedules you need. Also learned the hard way about that manual save requirement! Lost about an hour of work because I assumed it would auto-save like before. Now I'm hitting that save button obsessively. It's so frustrating that they completely overhauled a system that worked perfectly fine. The old interface wasn't pretty, but it was functional and predictable. This feels like change for the sake of change rather than actual improvement.

I'm right there with you! Just went through this exact same nightmare trying to navigate the new Free File Fillable Forms interface. After using it successfully for 4 years, I felt completely lost when I logged in this week. What finally helped me get through it was taking a step back and approaching it like learning a completely new system rather than trying to find familiar features. The "Start New Tax Return" button location that others mentioned was key - it's definitely not intuitive being moved to the right side. One additional tip I discovered: if you're having trouble finding specific forms or schedules, try using the search function in the "Add Forms" menu rather than browsing through the categories. The organization is so different now that searching by form number (like "Schedule C" or "Form 8889") is often faster than trying to navigate the new menu structure. The learning curve is definitely steep, but once you get past the initial confusion, you can still get your taxes done for free. Just budget extra time this year for figuring out the interface changes. Hopefully they'll listen to all the feedback and make some usability improvements for next season!

This thread has been incredibly helpful! I'm also a content creator trying to navigate the ABN process and was feeling completely lost. Reading everyone's experiences has cleared up so many of my questions. One thing I'm still wondering about - when you're filling out the application and it asks about your business location, what do you put if you work from home? I create content from my bedroom/home office setup, but I'm not sure if I should list my home address as the business address or if there's a different way to handle this for content creators who don't have a separate business premises. Also, does anyone know if there are any specific insurance considerations for content creators once you have an ABN? I've heard some people mention public liability insurance but I'm not sure if that applies to YouTube/social media content creation or if it's more for people who film in public spaces or work with clients in person.

This is such a comprehensive discussion! As someone who just went through the ABN application process for my podcast and blog, I wanted to add a few points that might help others. When I was filling out the application, I found it helpful to have all my business details ready beforehand - things like your planned business name (can just be your own name), estimated start date, and a rough idea of your expected income. The form times out if you take too long, so having everything prepared saves frustration. For business activity classification, I ended up going with "Other Information Services" since my content focuses on educational tech reviews and tutorials. The ATO website has a business activity code tool that lets you search by keywords, which was really helpful for finding the right category. One thing I wish I'd known earlier - once you get your ABN, you can set up a free myGov business account which makes managing everything much easier. You can track your business details, update information, and even link it to accounting software later on. Also, don't stress too much about getting every detail perfect on the initial application. Most things can be updated later if your business evolves or you realize you need to change something. The important thing is just getting started with the proper registration so you can operate legitimately and take advantage of business opportunities when they come up!

I feel for you - EFTPS can be incredibly frustrating when you're just trying to pay your taxes on time! I had a similar issue last year where the system kept rejecting my information even though everything seemed correct. One thing that worked for me was making sure I was entering my EIN without any dashes or spaces - just the 9 digits straight through. Also, double-check that you're using your legal name exactly as it appears on your tax returns, not any shortened or nickname versions. For your immediate Q2 payment deadline, definitely go with IRS Direct Pay like others have mentioned. It's completely free and you don't need to register - just have your bank account info ready. You can find it at irs.gov/payments/direct-pay and select "Estimated Tax" as your payment type. While you're working on getting EFTPS sorted out, you might also want to try calling them super early in the morning (like 7 AM) when hold times are much shorter. I got through in about 15 minutes calling right when they opened versus hours later in the day. Don't give up on EFTPS completely though - once you get past this initial setup headache, being able to schedule all four quarterly payments at the beginning of the year is really convenient. The system just has some quirky formatting requirements that aren't obvious upfront.

I completely understand your EFTPS frustration - I've been there! The system is notoriously finicky, but there's one thing I haven't seen mentioned that helped me get through this exact issue. When you do get someone on the phone (definitely try the early morning calls around 7 AM), ask them to check if there's a "pending verification" status on your account. Sometimes the enrollment goes through but gets stuck in a verification queue that doesn't automatically resolve. The agent can manually push it through on their end, which takes about 2-3 minutes instead of weeks. Also, if you moved recently or changed banks since filing your last return, that could be causing the mismatch. Even if you updated your address with the IRS for tax purposes, EFTPS sometimes maintains separate records that don't sync automatically. For your immediate deadline, definitely use Direct Pay as everyone suggested - it's a lifesaver for situations like this. But once you get EFTPS working, you'll love having all your quarterly payments scheduled in advance. The peace of mind is worth fighting through this initial setup nightmare! One last tip: when you do call, have your most recent tax return right in front of you so you can verify exactly how everything appears in their system. Sometimes the smallest discrepancy (like "Avenue" vs "Ave") is enough to trigger their overly sensitive matching algorithm.

This has been an absolutely fantastic thread for understanding the real financial impact of 1099 work! As someone who's been considering making the jump from W-2 to contract work, all the detailed breakdowns here have been invaluable. What really stands out to me is how the "simple" question of comparing $20/hr 1099 to W-2 wages has revealed so many layers of complexity - from self-employment taxes and health insurance costs to emergency fund planning and unemployment protection. The consensus seems to be that $20/hr 1099 is roughly equivalent to $14-16/hr W-2, but when you factor in ALL the considerations mentioned (lack of benefits, irregular income, need for larger emergency funds, professional insurance, etc.), it sounds like you'd really need $25-28/hr to be truly comparable to a decent W-2 position. I especially appreciate the practical advice about setting up separate accounts for tax savings, keeping meticulous expense records, and understanding the difference between legitimate contractor work and employee misclassification. The tools mentioned like taxr.ai for tax calculations and QuickBooks for expense tracking seem worth checking out. For anyone else reading this thread, it seems like the key takeaways are: 1) Don't just look at the hourly rate - calculate the true take-home after ALL costs, 2) Make sure you have adequate emergency savings before making the switch, 3) Negotiate for rates that truly compensate for the additional risks and costs, and 4) Get professional advice on tax planning and business setup. Thanks to everyone who shared their real-world experiences - this kind of detailed breakdown is exactly what people need to make informed decisions about 1099 opportunities!

This discussion has been absolutely incredible to read through! As someone who recently made the transition from W-2 to 1099 work myself, I can confirm that pretty much everything discussed here aligns with my real-world experience. I want to emphasize something that might get lost in all the detailed calculations: the psychological adjustment to contractor work can be just as challenging as the financial one. Going from predictable bi-weekly paychecks to irregular payments requires a real mindset shift. Some months I'd get paid by three clients in the same week, other months I'd be waiting 45+ days for a single payment. One practical tip I'd add: when you're starting out, ask potential clients about their payment terms AND their actual payment history. A client who says "Net 30" but consistently pays in 45-50 days can really mess up your cash flow planning, especially when you're trying to set aside money for quarterly taxes. Also, regarding the health insurance costs that were mentioned - don't forget to look into Health Savings Accounts (HSAs) if you go with a high-deductible health plan. As a 1099 contractor, you can deduct both your health insurance premiums AND contribute to an HSA, which gives you triple tax advantages (deductible contributions, tax-free growth, tax-free withdrawals for medical expenses). The consensus about needing $25-28/hr to truly match a good W-2 position is spot-on from my experience. That $20/hr offer definitely seems low when you factor in everything discussed here. I'd strongly encourage negotiating higher or looking for other opportunities that better compensate for all the additional responsibilities and risks that come with contractor status.