Thanks for this suggestion! I do work full-time though and make about $38k per year, so I don't think I'd qualify as his dependent? We split all expenses pretty evenly.

You're right - with that income level, you definitely wouldn't qualify as a dependent. The income limit for a qualifying relative in 2023 is $4,400, and you're well above that. And since you split expenses evenly rather than him providing more than half your support, that would disqualify you anyway. Thanks for the additional info! It's always good to explore all possibilities, but in this case, it looks like neither of you will get tax benefits from your living arrangement.

This! I work in property management and we definitely notice when someone is living in a unit who's not on the lease. Maintenance visits, neighbors mentioning things, security cameras in common areas, etc. The tax stuff is probably the least of your concerns.

Thanks for the organization tips! Did you include explanations directly on the cover sheet or separate explanation pages for each question? And did you use any particular format that seemed to work well? I want to make this as painless as possible for both me and whoever reviews my case.

I created a master cover sheet listing all questions and what was included for each, then for complex items I added separate explanation pages with more detail. For example, "Question 12: Home Office Deduction - See floor plan on page 5, utility bills on pages 6-8, and explanation of business use on page 9." The format that worked best was using a clear numbering system matching their questions exactly. I used dividers between sections and paper-clipped related documents together. I also highlighted relevant information on bank statements or lengthy documents. The agent who handled my last audit specifically mentioned that my organization made their job easier, which I think contributed to a favorable outcome!

Yes! I appealed an audit decision and won about 70% of what they initially disallowed. The key was providing additional context that showed why those expenses were actually ordinary and necessary in MY specific industry. I included articles about standard practices in my field and letters from colleagues confirming these were normal business expenses for our type of work.

16 Wait seriously? I did some small jobs last year for like $200 each and never got 1099s so I didn't report them. Should I be worried?

12 You shouldn't receive a 1099 until after the tax year ends. Companies are required to send them out by January 31st of the following year. So if you did work in 2024, you won't get your 1099 until January 2025. If you did work in the previous tax year and still haven't received a 1099 by mid-February, you should contact your client. Remember though, even without a 1099, you're still required to report all income you earned.

Don't waste your money on H&R Block for a simple return. The people at those physical locations often just input your info into the same software you could use yourself for free. I made that mistake my first year - paid like $150 for something I could've done myself in 30 minutes.

Wow, that's really good to know! Do I need to file those previous years separately or can I do it all at once with this year's taxes?

You need to file each year separately. For previous years, you'll need to use the tax forms specific to those years - you can't use 2024 forms to file for 2022 or 2023. You can find previous year forms on the IRS website, and most tax software can handle prior year returns (though they might charge for this service). Start with the most recent unfiled year and work backward. The good news is that if you're owed refunds, there's generally no penalty for filing late. You're just losing out on money that was already yours!

If we go with partnership taxation, do my dad and I need to split everything 50/50 or can we have different percentages? Also, do we need to pay ourselves a salary or can we just take draws?

You can absolutely have different ownership percentages - it doesn't have to be 50/50. Your LLC operating agreement should specify the ownership percentages, and your K-1 forms will reflect those percentages for distributing profits and losses. For a partnership, you don't technically take "salaries" - you take draws, which aren't subject to withholding. However, you'll still pay self-employment taxes on your share of the profits regardless of whether you take draws or leave the money in the business. That's different from S-corps where you'd need to pay yourself a reasonable salary subject to payroll taxes.

For a new LLC filing as a partnership, you'll need to include Form 1065 Schedule B and check the box indicating it's an "initial return." You'll also need to select your tax year (usually calendar year for most small businesses). Make sure you've obtained an EIN before filing - you can't use your SSN for a partnership return.