Has anyone mentioned state taxes yet? Remember you'll need to handle those too! Some states have different rules for dependents filing their own returns.

Just wanted to add something that might help with your photography business - make sure you're tracking ALL your business expenses from day one! Things like camera equipment, editing software subscriptions, travel to photo shoots, even a portion of your phone bill if you use it for business calls can be deductible. I started a small videography business at 19 while my parents still claimed me, and I wish someone had told me to keep better records earlier. Even small expenses add up and can significantly reduce your taxable self-employment income. Get a separate bank account for your photography business if possible - it makes tracking so much easier come tax time. Also, don't forget about potential business use of your home if you do editing work there. You might be able to claim a home office deduction even while living with your parents, though the rules are pretty specific about exclusive business use of the space.

Letter 86C is definitely a relief! I remember getting one last year and being so confused by the official language, but it really is just their way of saying "all good, no issues found." One thing I'd recommend is setting up text alerts with your bank if you haven't already - that way you'll know the moment your refund hits. The IRS website also has a "Where's My Refund" tool that updates pretty regularly once they issue the letter. Hang in there, you're almost at the finish line!

Letter 86C is definitely a good sign! I went through this exact same situation last year and was panicking for no reason. The letter basically confirms they've completed their review and found no issues with your return. From my experience, once you receive the physical letter, your refund should be direct deposited within 10-21 days (mine took about 14 days). Pro tip: make sure your banking info is correct on file because any delays there could slow things down. You're almost done with this whole process - the hardest part (the waiting and worrying) is basically over!

Quick question about this - does this same rule apply for state taxes too? My husband and I file separately for federal but jointly for state because our state has better credits for joint filers.

I've been following this thread and wanted to share my experience as someone who went through almost exactly the same situation. My spouse and I had been filing separately for about 6 years, with me itemizing (due to high medical expenses and charitable donations) while my spouse took the standard deduction. Like you, we never received any notices from the IRS, so I assumed we were doing everything correctly. It wasn't until I mentioned our situation to a CPA friend that I learned about the "both must itemize if one itemizes" rule for married filing separately. What really opened my eyes was when we finally did a comprehensive comparison of filing jointly vs. separately (with both of us itemizing correctly). We discovered we had been overpaying by about $1,800 annually! The joint filing gave us access to credits we couldn't claim when filing separately, and even though our combined income pushed us into a higher bracket, the overall tax was still significantly lower. The lesson I learned is that tax situations change over time - income levels, deduction amounts, tax law changes - and what made sense years ago might not be optimal anymore. I'd strongly recommend doing that side-by-side comparison before this year's filing deadline. You might be surprised by the results!

Quick question: What software do most independent contractors use for tracking expenses and calculating quarterly taxes? I'm trying to decide between QuickBooks Self-Employed, FreshBooks, or just a spreadsheet.

Just wanted to chime in as someone who went through this exact same transition last year. The 30-35% rule mentioned earlier is spot on - I learned the hard way that 20% isn't nearly enough when you factor in self-employment tax. One thing I wish someone had told me earlier is to open a separate business checking account specifically for taxes. I set up an automatic transfer of 32% of every payment I receive directly into that account, so I never accidentally spend my tax money. It's been a lifesaver for staying organized. Also, don't forget about deducting business expenses! As a graphic designer, you can write off your design software, computer equipment (if used primarily for business), professional development courses, and even a portion of your internet bill. Keep receipts for everything - I use a simple phone app to snap photos of receipts right when I get them. The quarterly deadlines are non-negotiable, so mark them in your calendar now. Missing them gets expensive fast with the penalties and interest.

This is exactly why I keep a dedicated tax folder both digitally and physically! The IP PIN system is confusing enough without having to hunt through random download folders during tax season. One thing that might help others: I set a calendar reminder every January to check for my new IP PIN and immediately save it in multiple places - my tax folder, cloud storage, and I email it to myself with a clear subject line like "2024 IP PIN for 2024 tax return." That way when filing season comes around, I'm not scrambling to figure out which PIN goes with which year. The IRS really should make their retrieval system show you what year PIN you're getting instead of just assuming everyone understands the timing. It would prevent so much confusion like what you experienced!

I work as a tax preparer and see this exact confusion every single tax season! You're definitely not alone in this - the IP PIN system trips up so many people because the IRS doesn't make the year-specific nature of these PINs clear enough. To be crystal clear: use your original 2022 IP PIN for filing your 2022 tax return. The PIN is labeled with the tax year it's meant for, not when you received it. Your 2023 PIN that you got through the recent retrieval is for next year's filing season when you file your 2023 taxes (likely in early 2024). The reason the retrieval system gave you a 2023 PIN is because that's the current year PIN available. The IRS doesn't allow access to prior year PINs through their online system, which is frankly a design flaw that causes exactly the confusion you experienced. Pro tip for next year: as soon as you get your new IP PIN in January, save it with a very clear filename like "2024_IP_PIN_for_2024_tax_return.pdf" and keep both digital and physical copies. The IRS also mails a CP01A notice with your PIN - keep that with your tax documents. This will save you from the panic of hunting through random folders come filing time!