I feel your pain! Four months of delay letters is incredibly frustrating, especially when you have clear documentation showing their error. The scanning issues seem to be getting worse - I've heard from multiple people dealing with similar problems where handwritten numbers get completely mangled. Have you considered trying any of the tools or services mentioned earlier in this thread? The Claimyr callback service that @Grace Durand and @Zoe Wang used might help you get through to someone who can at least put notes on your account to stop the automated collection process while they sort this out. Also, since you re at'the 4-month mark, you might want to start preparing for the 6-month milestone when you can escalate to your Congressional representative s office'if the IRS still hasn t acted.'Keep all those delay letters as evidence of how long this has been dragging on!

This is really encouraging to hear that you eventually got it resolved! Seven months is a long time to wait, but knowing there's light at the end of the tunnel helps. I'm curious - when your state representative's office got involved, did they contact the IRS directly or did they have you submit additional documentation through them? I'm keeping detailed records like you suggested, including screenshots of my online account showing the incorrect balance. It's reassuring to know that the Congressional route actually works when the normal process fails. Did you get any pushback from the IRS about the interest they had charged on the incorrect amount, or did they automatically reverse all of that once they fixed the scanning error?

Is it just about WHERE the childcare happens? My mother-in-law watches my kids at my house 3 days a week and at her house 2 days. How would we handle that split situation?

It's not just about location - the key factor is whether she has control over how the work is performed or if you're directing her activities. If she's essentially following your schedule, using your supplies, and you're controlling when and how she provides care, she's likely a household employee regardless of location. For a split situation like yours, the IRS would look at the overall arrangement. If the majority of control rests with you (setting schedules, providing materials, directing activities), then the entire arrangement would likely be treated as household employment, even if some care happens at her house. However, if she has significant independence - like setting her own rates, providing her own supplies, caring for other children, and having control over her methods - she might qualify as an independent contractor for the whole arrangement. The $2,600 threshold would apply to your total payments to her for the year, not split by location.

This is such great advice about keeping detailed records! I'm actually in a very similar situation - just started paying my aunt to watch my twins, and I had no idea about the household employment threshold. One question about the written agreement you mentioned - are there specific things that should be included to help establish whether someone is self-employed vs. a household employee? Like should it specify that she sets her own rates or methods of care? I want to make sure we document this correctly from the start rather than trying to figure it out later when tax time comes around. Also, do you know if there are any templates or examples of these types of family childcare agreements that might help ensure we're covering all the important points?

That's super helpful, thanks! Did you need to work with a specialized CPA to get the aggregation right? I'm worried my regular tax guy might not be familiar enough with these specific QBI rules for architects.

I'd definitely recommend finding a CPA who specializes in business taxation, especially if you're dealing with multiple entities and aggregation elections. The QBI rules are still relatively new (since 2018) and many general tax preparers haven't fully mastered the nuances, particularly for professional service businesses like architecture. The aggregation election can be really powerful but there are strict requirements - you need to demonstrate that the businesses operate as an integrated economic unit, share facilities, employees, or significant business operations. Just having the same owner isn't enough. For your situation with design services, project management, and product design, you'll want to document how these activities are interconnected and support each other. The IRS looks for things like shared marketing, overlapping customer bases, shared administrative functions, etc. One thing to watch out for - once you make the aggregation election, you're generally stuck with it unless there's a material change in facts and circumstances. So make sure it's the right move long-term, not just for one tax year.

That's a really interesting angle I hadn't considered! I'm also a mechanical engineer dealing with the phase-out, and I've been so focused on the W-2 wage limitation that I completely overlooked the qualified property component. Do you know if leased equipment counts toward the qualified property test, or does it have to be owned outright? I lease most of my CAD workstations and some testing equipment through my business, but if purchasing them could help with QBI calculations, it might make sense to restructure those arrangements. Also wondering about software - I spend probably $15-20k annually on various engineering software licenses. Some are subscription-based, but others I could potentially purchase as perpetual licenses if that would count as qualified property for depreciation purposes. Has anyone worked with a tax professional who's specifically knowledgeable about maximizing the property component for engineering firms? This thread has been way more helpful than the generic QBI advice I've been finding online.

This wage cap confusion happens so often! I made the same mistake when I first started working and thought my employer was withholding too much Social Security tax. Turns out I was looking at information from several years prior. @d50f9aae8163 Definitely check that tax year on your W-2 before going any further. If it really is 2023 and you earned $142,500, then as everyone's pointing out, your employer did everything correctly since you're well under the $160,200 cap. But if it turns out to be an older tax year where you actually did exceed the cap, then you'll get that money back when you file - the tax software handles it automatically. Either way, you'll have a clear answer once you confirm which year's W-2 you're looking at!

This is such a helpful clarification! I think a lot of people (myself included) get confused because when you search online for "Social Security wage cap" you often get results from different years mixed together. I'm curious though - where's the most reliable place to find the current year's Social Security wage base limits? I want to make sure I'm looking at the right source so I don't make this same mistake when reviewing my own tax documents. @d50f9aae8163 Hope you can get this sorted out quickly once you check that tax year on your W-2! Either way, at least you'll have a definitive answer.

So what happens if you do give gift cards? Do you have to issue 1099s to each recipient or something?

Yes, gift cards are treated as taxable compensation to the recipients. If you give gift cards to employees of your clients, those individuals would need to report it as income on their tax returns. However, you typically don't need to issue 1099s unless the recipient is someone you have a business relationship with (like a contractor or vendor) and the total payments exceed $600 in a year. For random employees at client offices, the responsibility to report the income falls on them, though many people don't realize this. It's one of the reasons why tangible gifts under $25 are usually much simpler from a tax perspective.

This is really helpful context about the annual limit! I hadn't thought about previous gifts counting toward the $25 cap. Quick question - when you mention promotional items with company branding falling under advertising expenses, does the branding need to be prominent or would a small logo on the bottom of a gift basket still qualify? I'm wondering if I could add small branded items to my existing gift baskets to potentially change how some of the cost gets categorized.