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Has anyone tried just using the numbers from their last paystub and filling out the substitute W-2 form (Form 4852)? I'm in this exact situation - my employer shut down their whole operation in November and literally no one is responding to emails. My tax guy says I can use my last paystub to fill in all the numbers, but I'm worried about accuracy since some of my deductions were weird toward the end (they started taking out different health insurance amounts when they were having financial problems).
I did this last year when my W-2 never showed up. Used my December paystub and filled out Form 4852. It worked fine but I had to file a paper return which took FOREVER to process. Got my refund like 5 months later. Also make sure your YTD (year to date) numbers are actually for the full year. My paystub reset the YTD fields in July for some weird reason so I had to add two numbers together. Check if you have an earlier paystub to compare.
Thanks for the info. I do have all my paystubs thankfully, so I can check the YTD totals. Did you just attach the 4852 form to your regular return? And did the IRS ever question any of your numbers or was it all accepted as submitted?
For anyone dealing with this issue in the future - the IRS usually gets W-2 information from employers by late March even if the business closed. The transcript might not be immediately available online, but an IRS rep can often see it in their system before you can. Also worth knowing that if you absolutely can't get the info and must estimate, make your best guess using your final paystub and file on time. If you find out later that your numbers were wrong, you can always file an amended return. Better to file on time with estimates than miss the deadline completely!
Something nobody mentioned yet - if you have a regular W-2 job AND self-employment income, you still need to report the self-employment income even if it's under $400. The $400 threshold is just for paying the self-employment tax (Social Security/Medicare), but you still pay income tax on all your earnings. I learned this the hard way when I got a letter from the IRS about unreported income from a small web design project I did.
Wait seriously? So even if I only make like $200 from dog walking, I still need to report it? Does that mean I need all those complicated self employment forms too or just report it as extra income somewhere? This is exactly the kind of detail that confuses me.
Yes, you still need to report it, but it's not as complicated as it sounds. You'll need to fill out a Schedule C to report your business income and expenses, but it's pretty straightforward for a simple side gig like dog walking. You won't need to pay the self-employment tax (the Social Security and Medicare portion) if your net profit is under $400, but you'll still include that income on your regular 1040 form and potentially pay income tax on it depending on your overall tax situation. Many tax software programs will walk you through this pretty easily.
Jumping in to add something important - keep GOOD RECORDS of your self-employment income and expenses! I've been self-employed for 3 years and the biggest thing that saved me was creating a simple spreadsheet from day one. Log every payment you receive and every expense related to your work. Take photos of receipts. If you use your car for business, track miles. It's so much easier to do this as you go than to try reconstructing everything at tax time.
Quick question - if I amend my 2022 return for missed mileage, will that increase my chances of being audited? I've heard that filing amendments raises red flags.
Filing an amended return doesn't automatically trigger an audit, but significant changes that substantially reduce your tax liability might get more scrutiny. The key is having proper documentation for your mileage claims. If you have good records (or even reconstructed records based on actual evidence like your delivery history), you shouldn't worry too much. The IRS understands that people make mistakes or learn about deductions they missed.
For those amending multiple years of tax returns for mileage, be strategic about when you file them. Don't send them all at once because that can look suspicious to the IRS. Space them out a few weeks apart. Also, don't forget that if your self-employment net income (after deducting mileage) was over $400 for any of these years, you still owe self-employment tax even if you were below the standard filing threshold. When people say "I made less than the threshold," they're often thinking of income tax, not self-employment tax which kicks in at a much lower level.
Don't overthink this! I've been driving for Lyft and Uber on weekends for 3 years while working my regular 9-5. Here's what I do: 1. Track ALL my miles when the app is on (I use Stride - it's free) 2. Save receipts for car washes, phone mounts, etc. 3. Put aside about 25% of what I make from driving 4. At tax time, I use the 1099 from Uber and fill out Schedule C and Schedule SE I've never done quarterly payments and never had an issue. My regular job withholding covers the extra tax. If you're really worried, just put some money aside in case you owe at tax time.
Do you think 25% is enough to set aside? I've heard people say to save 30-35% for self-employment stuff. Also does the mileage deduction really make that big a difference?
I find 25% is plenty for me, but it depends on your tax bracket and how much driving you're doing compared to your main job. If Uber is a small percentage of your total income, 25% should be more than enough. The mileage deduction is HUGE! Last year I drove about 4,200 miles for rideshare and got a deduction of nearly $2,460. That significantly reduced my taxable income from driving. In fact, after the mileage and other deductions, I only had to pay taxes on about 30% of what Uber/Lyft paid me. That's why I emphasize tracking every single mile you drive with the app on.
As a teacher who also drives for DoorDash during breaks, I recommend using the IRS withholding calculator on their website. Input both your teaching income AND estimated gig earnings, and it'll tell you if you need to adjust your W-4 at school to cover the extra income. I just had my school district withhold an extra $50 per paycheck, which covered my DoorDash earnings so I didn't need to bother with quarterly payments. Way simpler than figuring out estimated payments!
KaiEsmeralda
This happened to me once and turned out to be related to a phone my wife bought that was added to our family plan. The phone itself was billed to the phone carrier account but for some reason the sales tax posted separately to my credit card. Check if anyone else in your household might have made a purchase?
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Zane Hernandez
ā¢I actually live alone and don't have any shared accounts with family members. I've never even had a family phone plan - always just had my own individual account. That's what makes this so confusing. There's literally no legitimate reason I should be seeing this charge.
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KaiEsmeralda
ā¢In that case, it definitely sounds like fraud. One other possibility - did you recently buy anything online where you paid through PayPal or another payment service? Sometimes the merchant will process the main payment through the service but charge taxes separately directly to the card.
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Debra Bai
Watch out for what happens next! These small tax charges are often "test charges" by fraudsters. If they go through without being disputed, they'll hit you with much larger charges. I'd recommend: 1) Dispute the charge immediately 2) Ask for a new card number 3) Check your credit reports at all three bureaus 4) Set up fraud alerts and credit freezes Don't wait on this - I learned the hard way and ended up with $3000 in fraudulent charges after ignoring a strange $15 tax charge.
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Gabriel Freeman
ā¢This is exactly what happened to my sister. Small weird tax charge, then boom - two weeks later her card was maxed out with purchases from electronics stores across the country. Definitely get a new card number ASAP.
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Zane Hernandez
ā¢Thank you both for the warnings. I just got off the phone with my credit card company and they're sending me a new card with a different number. They're also refunding the charge after I explained the situation. Going to check my credit reports right now.
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