Thanks for pointing this out! So if I understand correctly, my 2023 contribution ($6,500) plus my 2024 contribution ($7,000) gives me a total basis of $13,500, which matches lines 3 and 5 on my Form 8606. But I only converted $7,204, leaving $6,296 as my remaining basis (line 14). Does that mean none of my conversion should be taxable? That doesn't seem right if I had earnings.

Your understanding is partially correct, but there's a key distinction. When you convert from traditional to Roth, the IRS looks at the proportion of your basis to the total value across ALL your traditional IRAs, not just the one you're converting from. If you converted $7,204, and your total basis across all traditional IRAs was $13,500, then the taxable portion would be calculated using the ratio of non-deductible contributions to total IRA balances. However, if the $7,204 includes $704 of earnings on the original $6,500 contribution, those earnings should be taxable. The fact that line 4b on your 1040 is showing "rollover" but no amount suggests the software isn't calculating this correctly. You may need to manually enter the taxable amount there.

I use TurboTax every year for my backdoor Roth. The trick is to enter the 1099-R first, THEN enter Form 8606 information. If you do it the other way around, it sometimes miscalculates the taxable amount. Also, make sure you're entering your prior year non-deductible contributions correctly on line 2 of Form 8606.

I managed to get through last month but only by calling at exactly 7:00 AM Eastern when they first open. Even then I waited for 1.5 hours on hold. Tuesdays and Thursdays seem to be slightly better than Mondays from my experience.

Thanks for the tip. I'll try calling right when they open on Thursday. Did you end up resolving your issue when you finally got through? I'm still debating whether it's worth the hassle for a small amount or if I should just pay it.

Does the electronic version work the same for filing? My tax guy always wants the "official" form and I'm worried the electronic one won't count.

The electronic version is exactly the same as the paper one for tax filing purposes - it contains all the same information and is considered an "official" form by the IRS. Your tax preparer can use it just like the paper version. I actually find the electronic ones better because there's no risk of faded print that scanners can't read properly. Plus you can download it as a PDF and keep it stored safely without worrying about losing the physical copy. Just make sure you save it somewhere secure since it has your Social Security number on it.

Last year mine had the wrong state tax withholding amount. Double check all the numbers against your final paystub of the year! Box 1 (wages) and Box 2 (federal tax withheld) are the most important to verify. If there's a mistake, contact HR immediately for a corrected W-2.

At what income level do you need to start doing the quarterly payments? I'm just starting out and made like $800 last year from my art channel.

The general rule is if you expect to owe $1,000 or more in taxes for the year (after accounting for any withholding from other jobs), you should make quarterly payments. At $800 total income, you're probably fine waiting until tax time, especially if you have another job with withholding. But as your content income grows, keep an eye on it. Many creators don't realize they need to start making these payments until they get hit with penalties. I recommend setting aside 25-30% of your creator earnings for taxes just to be safe.

You don't need to track each individual deposit for tax purposes. What matters is the total income for the year. However, keeping a spreadsheet of your deposits can help you reconcile your total earnings against what the platform reports. What I do is download the annual tax summary from Etsy, which shows gross sales, fees, shipping costs, etc. That's the document you'll use for your Schedule C, not your bank deposits (which won't show fees taken out).

That spreadsheet approach sounds really helpful! Do you have any template or example you could share? Also, does your spreadsheet account for the half-year convention that applies in the first year for most MACRS assets?

I don't have a shareable template, but I can describe how I set it up. I created columns for: Asset Description, Date Acquired, Cost Basis, Recovery Period, and then a row for each year of depreciation showing the percentage and calculated amount. Yes, my spreadsheet definitely accounts for the half-year convention! That's one of the most important aspects of MACRS. For 7-year property, I use the standard MACRS percentages: 14.29% in year 1 (reflecting half-year convention), 24.49% in year 2, 17.49% in year 3, and so on. The spreadsheet automatically applies these percentages to the basis amount.

This is only partially correct. The 50% rule doesn't automatically force you to use ADS. It limits your Section 179 expensing, but you can still use regular MACRS for depreciation. The actual rule is that if business use drops BELOW 50%, then you must switch to ADS.