I've been following this discussion and wanted to address the audit question since I went through this exact situation two years ago with my husband's medical expenses. From what my tax professional told me, medical expense deductions don't automatically trigger audits, but they do increase your audit risk if they're disproportionately large compared to your income. In our case, the medical expenses exceeded our AGI, and we did get selected for examination. However, because we had meticulously documented everything - direct payments to providers, receipts, insurance statements, and detailed support calculations - the audit went smoothly. The IRS examiner was actually quite reasonable and seemed to appreciate that we had organized everything clearly. She mainly wanted to verify that we had actually paid the expenses (not reimbursed our family member) and that we could substantiate the support test calculations. One thing that helped tremendously was having a summary sheet that showed our total payments by category with supporting documentation attached. The examiner spent maybe 30 minutes reviewing everything and accepted our deductions without any adjustments. To answer the earlier question about payment methods - credit card, check, or phone payments all work equally well as long as the payment comes directly from your account to the provider. The key is having clear documentation showing YOU made the payment, not your daughter. The stress of potentially being audited was honestly worse than the actual audit itself. If you keep good records and follow the rules correctly, these deductions are completely legitimate and the IRS recognizes that families often have to support adult children with medical needs.

I wanted to add some perspective as someone who works in tax preparation and has seen many cases like yours. The good news is that the medical expense deduction for non-dependents who fail only the income test is a well-established provision, though it's often overlooked. A few additional points that might help: 1. **Income timing consideration**: Since your daughter made $13,500 in 2024, if there's any possibility of her reducing her 2024 income below $4,850 (maybe through retirement plan contributions if she's eligible, or by deferring some year-end income to 2025), she could actually qualify as your dependent, which would make the medical expense deduction much more straightforward. 2. **State tax implications**: Don't forget to check your state's rules - some states have different thresholds for medical expense deductions or may not conform to the federal rules about non-dependent medical expenses. This could affect your overall tax benefit. 3. **Estimated tax considerations**: If these deductions are going to significantly reduce your tax liability, you might want to adjust your estimated tax payments for 2025 to avoid overpaying throughout the year. The key documentation the IRS typically wants to see includes: direct payment records to providers, insurance EOBs showing what wasn't covered, a statement from your daughter that she's not claiming these expenses on her return, and detailed support calculations showing you provided more than 50% of her total support. Given the complexity and amounts involved, I'd strongly recommend having a tax professional review your situation before filing. The rules are nuanced and the stakes are high enough that professional guidance could save you significant money and stress.

I just went through this exact same situation with my part-time weekend job at a local restaurant! Made about $1,800 over four months with zero federal withholding, and I was really confused at first. What I learned is that your employer's payroll system is actually working correctly - it's just calculating withholding based only on what you earn at that specific job. Since your $2,100 annually is below the standard deduction threshold, their system determines you wouldn't owe federal income tax on just that income alone. That's why you're still seeing FICA taxes (Social Security and Medicare) being deducted - those apply from the first dollar earned. The issue is that when you combine your part-time earnings with your full-time job income, you'll likely end up owing more in taxes than what's currently being withheld from just your main job. I used the IRS Tax Withholding Estimator on their website (it's completely free) and it was actually really straightforward. It takes all your income sources into account and tells you exactly how much additional withholding you need. Based on the results, I ended up requesting an extra $20 per paycheck be withheld from my main job rather than trying to coordinate W-4 changes at both employers. The whole process took maybe 15 minutes and gave me total peace of mind knowing I won't get hit with a surprise tax bill. Definitely worth doing sooner rather than later!

This is such a helpful discussion! I'm actually dealing with this exact same issue right now with my part-time job at a local bookstore. I've been working there since September and just realized they haven't withheld any federal taxes from my roughly $1,900 in earnings, even though I have a full-time job elsewhere. Reading through everyone's experiences really helped me understand that this isn't actually an error - the payroll system at my bookstore is correctly calculating that I wouldn't owe federal taxes on just that income alone since it's below the standard deduction threshold. The problem is obviously that it doesn't account for my combined income from both jobs. I'm definitely going to use the IRS Tax Withholding Estimator this week to figure out how much additional withholding I need. The suggestion that several people made about just having extra withheld from my main job rather than trying to coordinate W-4 changes at both employers sounds like the most practical approach. It's really reassuring to see how many others have successfully navigated this situation. Thanks to everyone for sharing their experiences and solutions - it's turned what seemed like a scary problem into something totally manageable!

Has your mom checked whether a "tax-free liquidation" under Section 337 might be possible? It's complicated but can sometimes allow for liquidation without recognizing gains. Also, don't forget to look into "step-up in basis" rules since the assets were inherited - this might significantly reduce any potential tax impact on sale.

I'm so sorry for your loss. Closing a business after a death is incredibly overwhelming, especially when you're still grieving. One important thing to consider is the timing of everything. Your mom has inherited these business assets with what's called a "stepped-up basis" - meaning their tax basis is reset to fair market value as of your dad's date of death. This can actually save a lot in capital gains taxes compared to what your dad would have owed if he had sold them while alive. Before making any major decisions about selling assets to family members, I'd strongly recommend having your mom meet with both an estate attorney AND a tax professional who specializes in business closures. The accountant's confusing explanation might be because there are several different tax strategies that could apply depending on how the business was structured (sole proprietorship vs. LLC vs. corporation) and the total value of assets involved. Also, your mom doesn't necessarily have to rush this process unless there are pressing debts or lease obligations. Taking time to properly value everything and find legitimate buyers at fair market prices will likely result in better outcomes than quick sales at below-market rates. The inventory and equipment in those shipping containers might be worth more than you think, and rushing to liquidate could leave money on the table that your family deserves.

I've been following this discussion with interest as someone who works in tax compliance. A few key points to consider: The IRS has been fairly consistent in their position that gambling losses, even for content creators, remain subject to the traditional limitations under Section 165(d). The critical test is whether the primary purpose of the activity is profit from gambling itself versus profit from creating content about gambling. However, there are some legitimate business deductions you might be overlooking: - Equipment costs (cameras, editing software, etc.) - A portion of your home office if used exclusively for content creation - Internet and phone costs related to your business - Professional development (courses on content marketing, etc.) - Banking fees for your business accounts The tricky part is documenting that your betting activity serves a legitimate business purpose beyond just the potential to win money. If you can show that you're placing specific bets solely to demonstrate strategies or create educational content (and you document this thoroughly), you might have a stronger case for some deductions. I'd strongly recommend consulting with a tax professional who has experience with content creators and gambling-related businesses. The penalties for misclassifying gambling losses as business expenses can be significant.

This is a fascinating case that highlights how the tax code hasn't fully caught up with modern content creation business models. While I understand the frustration with the traditional gambling loss limitations, there might be a middle-ground approach worth exploring. Consider documenting a clear separation between "demonstration bets" and any personal gambling. For the bets you place specifically for subscriber content, you could: 1. Use a dedicated business account/card for these transactions 2. Create content BEFORE placing the bet (showing your analysis process) 3. Never cash out winnings from these demonstration bets - instead, use them for additional content 4. Maintain detailed records showing the direct connection between specific bets and specific content pieces While the actual wagered amounts would still likely be treated as gambling activity, this approach could strengthen your position for other related expenses like research time, analysis tools, and the business costs of maintaining separate accounts for content creation. The key is showing the IRS that these aren't just bets you're placing anyway and then creating content about - they're bets placed solely as part of your content creation process with no personal profit motive from the gambling itself. I'd also suggest reaching out to other gambling content creators to see how they've handled this. There might be some informal best practices emerging in your industry that could provide guidance.

Tell your coworker to google "IRS frivolous tax arguments" and look at the official IRS website. They literally have a whole section dedicated to debunking these exact schemes and warning about the $5,000 penalty for submitting these arguments. Also search for "tax protester cases" to see how many people have gone to PRISON for this stuff!

Your instincts are spot on - this is absolutely a scam and your coworker is playing with fire. I work in tax compliance and see the aftermath of these schemes regularly. The "Revocation of Election" is complete nonsense with no legal basis whatsoever. The scary thing is that people can get away with it for a few years, which makes them think they're safe. But the IRS has up to 6 years (or indefinitely in cases of fraud/non-filing) to come after you. When they do, it's devastating - we're talking about accumulated interest, failure-to-file penalties, failure-to-pay penalties, plus that $5,000 frivolous filing penalty for each year. I've seen cases where someone owed $15K in actual taxes but ended up owing over $60K after penalties and interest. Your coworker needs to get back into compliance immediately before this gets worse. The longer he waits, the more expensive this mistake becomes.