I feel your pain! I went through this exact same nightmare last month. Here's what finally worked for me: I called the Identity Verification line (800-830-5084) at exactly 7:00 AM Eastern on a Tuesday. I had to redial about 6 times but finally got through after a 45-minute hold. The key thing is having ALL your documents ready before you call - last year's tax return, current year's W-2s, Social Security card, driver's license, and any IRS letters you've received. The agent will ask for specific information from these documents to verify your identity. Also, if you have a smartphone, try downloading the IRS2Go app and see if you can access some services there while you're waiting to get through on the phone. Sometimes different entry points work better than others. Don't give up - I know it's incredibly frustrating but you will eventually get through. The refund delay is stressful but the IRS will process it once your identity is verified. Hang in there!

I went through this same identity verification nightmare about 6 weeks ago and it was absolutely maddening! What finally worked for me was a combination of the strategies mentioned here. I used the dedicated identity verification line (800-830-5084) and called at exactly 7:00 AM Eastern on a Wednesday. Like others mentioned, I had to redial about 8-10 times before getting into the actual hold queue, but once I was on hold I stayed on for over an hour until I got through. One thing I didn't see mentioned yet - when you finally do get an agent, ask them to make detailed notes in your account about the verification call. I had to call back a second time for a different issue weeks later, and the agent could see the previous verification notes which saved me from having to go through the whole identity verification process again. Also, if you're really stuck and your financial situation is urgent (like needing the refund for rent), you might qualify for expedited processing. Tell the agent about your hardship situation - they sometimes have options for people facing eviction or other financial emergencies. It's worth asking about even if it feels awkward. Hang in there - I know how stressful this is when you're counting on that refund!

Has anyone used QuickBooks Self-Employed for tracking this kind of side business? I'm wondering if it's worth the monthly fee or if there are better alternatives for someone just starting out.

Great question! I went through something very similar when I started my handyman side business. A few key points to add to what others have said: Section 179 is fantastic for your situation, but make sure you understand the "predominantly business use" requirement. For equipment like a tractor and dump trailer, you'll need to use them more than 50% for business to qualify. Keep detailed logs from day one - date, hours used, type of work performed. This documentation will be crucial if you're ever audited. Regarding offsetting W2 income: Yes, Schedule C losses can reduce your overall tax liability, but be aware of the "at-risk" and "passive activity" rules. Since you're actively running the business (not just investing in it), you should be fine, but it's worth understanding these limitations. One practical tip: Consider financing part of the equipment purchase rather than paying cash upfront. This can help with cash flow while you're building the business, and the interest is deductible as a business expense. You can still claim Section 179 on financed equipment. Also, don't forget about bonus depreciation as an alternative to Section 179 - sometimes it works out better depending on your specific situation. A good tax professional familiar with small businesses can help you run the numbers both ways.

The way I finally figured mine out was by focusing on the transaction codes (TC) and their dates. TC 150 means your return was accepted, TC 846 is your refund being sent, and TC 570/971 usually mean there's some kind of hold or review. The dates next to them are cycle dates - they follow a weekly pattern where most updates happen on Fridays. If you see TC 846 with a date that's already passed, your refund should be on its way!

Another thing that helped me was learning about the "as of" date at the top of your transcript - that's not when your transcript was generated, but the latest date the IRS has processed information through. So if you filed recently and don't see your return info yet, check if your filing date is after that "as of" date. Also, the cycle code (the first 4 digits after the date) can tell you a lot - odd cycles process weekly, even cycles process every other week. Made a huge difference once I understood the timing!

This thread has been incredibly helpful! I'm in a similar situation with my consulting LLC and was getting overwhelmed trying to figure out the proper approach. From what I'm gathering, the key takeaways for a disregarded entity are: 1. Interest payments to yourself aren't tax deductible for the LLC 2. You don't report the interest as income on your personal return 3. Loan structure still has benefits over capital contributions for flexibility 4. Proper documentation is crucial even though tax treatment is neutral One question I haven't seen addressed - what happens if my LLC can't make the scheduled payments in a particular month due to cash flow issues? Can I modify the loan terms, or would that create problems with the IRS regarding the legitimacy of the arrangement? I want to set up realistic payment terms but also maintain the business formality that seems so important. Also, for those using QuickBooks, are you setting up automatic recurring transactions for the interest payments, or handling them manually each month?

This is such a valuable discussion! I've been wrestling with this exact issue for my consulting LLC. One thing I'd add from my recent experience - make sure you're consistent with your loan repayment schedule not just for IRS purposes, but also for your state's LLC requirements. Some states (like California) have franchise taxes and annual reporting requirements that can be affected by how you structure member loans versus capital contributions. My state requires me to report outstanding member loans on the annual LLC filing, so having proper documentation became even more important. Also, for those considering the S-corp election mentioned earlier - timing matters a lot! I'm planning to make that election next year, but I learned you have to file Form 2553 by March 15th to have it take effect for the current tax year (or within 75 days of forming the LLC). Missing that deadline means waiting until the following year. The loan structure definitely makes the S-corp transition smoother since you already have the debt arrangement established. Just wanted to share these practical considerations that I wish someone had told me earlier in the process!

Do most small business tax software programs handle this credit correctly? I've been using TaxAct for my coffee shop and it never asks specifically about FICA tip credits.

This is such a common confusion for restaurant owners! I made the same mistake in my first year running a diner - tried to claim both the deduction AND the credit for the same FICA taxes on tips. My CPA caught it during our year-end review and explained that the IRS specifically prohibits this double-dipping. What helped me understand it better: think of it as choosing between getting $1 off your tax bill (credit) versus reducing your taxable income by $1 (deduction). The credit is almost always more valuable since it's a direct reduction in what you owe, while the deduction only saves you money based on your tax bracket. One tip that saved me headaches - I now track all our tip-related FICA taxes in a separate spreadsheet throughout the year so I can easily calculate the maximum credit available when tax time comes. Makes the whole Form 8846 process much smoother!