The one thing that really helped me as an intern was setting aside a percentage of each paycheck for taxes, especially if your employer isn't withholding enough. I got hit with a surprise tax bill because my summer internship didn't withhold correctly. Better to have extra money saved than to owe unexpectedly! For the 12% bracket, maybe set aside 20% to cover federal, state, and FICA taxes.

This is such great advice about setting aside money for taxes! I learned this the hard way during my first internship too. One thing I'd add - if you're earning enough to be in the 12% bracket like you mentioned, you might also want to consider making quarterly estimated tax payments, especially if your employer isn't withholding enough. The IRS generally expects you to pay taxes as you earn income, so if you end up owing more than $1,000 when you file, you could face underpayment penalties. Since internships are often just for a few months, the withholding calculations might not account for your full-year income properly. You can use Form 1040-ES to calculate and make quarterly payments. It might seem like a hassle, but it's better than getting hit with both a big tax bill AND penalties at filing time. Plus it helps with budgeting since you're spreading the tax burden throughout the year instead of one big hit.

Dont forget to check if u need to include any earnings/losses that happened during the recharacterization period too!! When I did mine last yr, the amount that moved from roth to traditional was more than my original contribution because of some gains, and that affected how I reported it on form 8606. turbotax was a bit confusing on this part tbh.

I went through a very similar situation last year and it really is confusing! One thing that helped me was understanding the timeline clearly: since you made the 2023 contribution in 2024 (before April 15) and then recharacterized it in 2024, both actions affect your tax reporting. You'll definitely need to file Form 8606 for 2023 to report the nondeductible Traditional IRA contribution (since that's what it became after recharacterization). The key thing I learned is that the recharacterization is treated as if the money went directly to the Traditional IRA from the beginning - so it never "counts" as a Roth contribution for tax purposes. For your 2024 return, you'll report the recharacterization itself. TurboTax should handle this when you enter your 1099-R information, but make sure you have all the documentation from your IRA custodian showing the proper recharacterization codes. I'd recommend getting your custodian statements that show exactly what happened and when, because the timing and proper documentation is crucial for reporting this correctly. The good news is once you get through this year, future backdoor Roth conversions will be much more straightforward!

has anyone tried using the free version of turbotax online? not sure if i need to pay for deluxe or if the free version would work for my situation (just w2 income

For your situation with W-2 plus some 1099 income, I'd actually lean toward the online version. I've been filing taxes for my family for years and the online version handles 1099s really well - it walks you through everything step by step and has gotten much better at importing data directly from employers and clients. The main advantage for you would be convenience - you can work on it from anywhere, and it automatically saves your progress. Since you're not dealing with super complex stuff like rental properties or multiple businesses, you probably don't need the extra forms and control that the desktop version offers. One tip though - don't get trapped by their "free" marketing. With 1099 income, you'll likely need at least the Deluxe version ($60-80 typically) to handle the self-employment forms properly. But honestly, that's still worth it compared to paying a tax preparer hundreds of dollars for what sounds like a pretty straightforward return.

Don't make this more complicated than it needs to be! Here's the simple version: 1) If anyone in the household has a regular medical FSA, nobody in the household can contribute to an HSA 2) If the FSA is limited to just dental/vision, then HSA is still allowed 3) If the FSA is "post-deductible" (only kicks in after meeting deductible), HSA is still allowed I went through this whole mess last year. Ended up having my wife decline her FSA so I could max out my HSA since the HSA has better long-term benefits (investment options + no "use it or lose it" rule).

Just wanted to add another perspective for folks dealing with this FSA/HSA household issue - timing matters a lot for your decision! If you're currently in a situation where your spouse has a regular FSA that's disqualifying you from HSA contributions, don't forget that you can make changes during your spouse's next open enrollment period. Most companies have open enrollment in the fall for the following year's benefits. Also worth noting: if your spouse has a qualifying life event (like job change, birth of child, etc.), they might be able to switch from a regular FSA to a limited purpose FSA mid-year, which could open up HSA eligibility for you sooner than waiting for the next enrollment period. The key is planning ahead since these accounts have different contribution deadlines. HSA contributions can be made up until the tax filing deadline (usually April 15th), but FSA elections are typically locked in during open enrollment and can't be changed without a qualifying event. One strategy that worked for my family: we calculated the total tax savings from both scenarios (spouse FSA + my regular health plan vs. spouse limited FSA + my HSA) and found the HSA route saved us about $800 more per year, especially since we can invest HSA funds for long-term growth.

One important consideration that hasn't been fully addressed is the potential impact on your business insurance and workers' compensation coverage. When you formally employ your spouse, you may need to update your business liability insurance and potentially add workers' compensation coverage depending on your state requirements. I learned this the hard way when I started employing my husband in my electrical contracting business. Some states exempt spouses from workers' comp requirements, but others don't, and your insurance company will want to know about any employees for liability purposes. Also, regarding the $750 weekly salary - make sure you're budgeting for the employer taxes on top of that amount. You'll be paying the employer portion of Social Security (6.2%) and Medicare (1.45%), plus any state unemployment taxes. So factor in roughly an additional 8-10% on top of her gross wages for your actual employment costs. The tax savings are definitely real though. We've saved several thousand dollars annually by properly structuring my husband's employment versus just taking all the business income as self-employment earnings. Just make sure you're compliant with all the employment law requirements in addition to the tax considerations.

I've been through a similar situation with my consulting business and wanted to share a few practical tips that made the process smoother for us. First, regarding the $750 weekly salary - that's definitely reasonable for the work you're describing. Just make sure you document her specific duties clearly. We created a simple job description that outlined tasks like client communication, scheduling, bookkeeping assistance, and transportation support. This documentation proved valuable when our accountant filed our taxes. One thing that really helped us was setting up a separate business checking account specifically for payroll if you don't already have one. It makes tracking much cleaner and shows clear separation between personal and business expenses. We also started having my wife track her hours on a simple timesheet - nothing fancy, just dates, hours worked, and brief task descriptions. The health insurance angle is worth pursuing too, but don't overlook other potential fringe benefits. We set up a small office space in our home that's exclusively for business use, and my wife's workspace is part of that home office deduction. Just remember that consistency is key - once you start treating her as an employee, you need to maintain that arrangement throughout the tax year. The IRS looks favorably on legitimate business arrangements that are consistently applied and properly documented.