As a newcomer to independent contractor taxes, this thread has been incredibly helpful! I'm in a similar situation doing part-time delivery work and had no idea about the distinction between regular meals (not deductible) vs. travel meals when you're away from your normal business area. One thing I'm still confused about - how do you define your "tax home" or "normal business area" when you're doing deliveries? Is it based on where you live, or the area you typically cover for deliveries? I usually work within about a 30-mile radius of my house, but occasionally get those longer rural routes that take me 50+ miles out. Would love to understand better when those longer trips might qualify for the meal deduction rules that were mentioned. Also really appreciate everyone sharing the different tools and resources - definitely going to look into better mileage tracking since that seems like the bigger opportunity here!

Just wanted to add another perspective as someone who's been doing independent contractor work for several years. One thing that helped me tremendously was setting up a separate business checking account and business credit card specifically for all my contractor expenses. This makes tracking everything so much cleaner come tax time. For meals specifically, I learned the hard way that the IRS is pretty strict about the business purpose requirement. I used to think any meal while "on the job" counted, but after getting some guidance from a tax pro, I realized most of my regular delivery route meals were just personal expenses that happened to occur during work hours. The real game-changer for me was focusing on the bigger deductions like mileage, phone expenses (you can deduct the business portion), and equipment costs. I also deduct things like insulated delivery bags, phone mounts, and even a portion of my car insurance since I use my vehicle for business. Keep detailed records of everything though - date, amount, business purpose. The IRS loves documentation if they ever come knocking. Good luck with your taxes!

You've got it exactly right! Since your W2 income already exceeds the $168,600 Social Security cap for 2025, you're completely done paying Social Security tax for the year - whether from W2 or self-employment sources. For your quarterly estimated payments on the freelance income, you only need to calculate: 1. The Medicare portion of self-employment tax (2.9% on net self-employment income) 2. Regular income tax at your marginal tax rate 3. Don't forget the additional 0.9% Medicare tax if your total income exceeds $200,000 (single) or $250,000 (married filing jointly) When you file your annual return, Schedule SE will do the heavy lifting. You'll enter your W2 wages on the appropriate line, and the form will automatically limit your Social Security tax liability to zero since you've already hit the cap through your employer. One tip: make sure you're calculating self-employment tax on your *net* freelance income (after business deductions), not the gross 1099 amount. This can save you quite a bit since you'll only pay the Medicare portion on the actual profit from your consulting work. Your accountant will confirm this when they return, but you're definitely on the right track for your quarterly payment calculation!

Absolutely! You should definitely be tracking those business expenses - they can make a significant difference in your tax liability. For freelance/consulting work, you can deduct legitimate business expenses like: - Home office expenses (if you use part of your home exclusively for business) - Business equipment and software - Professional development courses and certifications - Business meals (50% deductible) - Marketing and networking expenses - Professional memberships and subscriptions The key word is "legitimate" - make sure these expenses are ordinary and necessary for your consulting business. Keep receipts and document everything, as the IRS can ask for substantiation. For 2025 quarterly payment deadlines, they are: - Q1 2025: April 15, 2025 - Q2 2025: June 16, 2025 (extended due to holiday) - Q3 2025: September 15, 2025 - Q4 2025: January 15, 2026 Since you mentioned your quarterly payment is coming up, you're probably looking at the Q1 deadline. The good news is that now you know you only need to calculate the Medicare portion of SE tax (2.9%) on your net freelance income, plus regular income tax - no Social Security portion needed since you've already maxed out through your W2. Consider using a simple expense tracking app or spreadsheet to stay organized going forward. The tax savings from proper expense tracking can be substantial, especially when you're only paying the Medicare portion of SE tax rather than the full 15.3%!

This thread has been incredibly helpful! I just wanted to add one more perspective as someone who works in payroll - the issue you're describing is extremely common and often catches people off guard. For your in-laws' situation with $87k combined income, the mathematical reality is that their effective federal tax rate should be around 10-12%, which means they should expect to pay roughly $8,700-$10,400 annually in federal income taxes. The problem occurs because each employer's payroll system calculates withholding in isolation. Here's a simple way to think about it: if your father-in-law makes $50k and your mother-in-law makes $37k, his employer withholds as if he's single making $50k (putting him mostly in the 12% bracket), and her employer does the same for $37k (keeping her in the 10-12% brackets). But when you file jointly, that $87k combined pushes portions of their income into higher brackets than what was actually withheld. The quickest fix while you sort out the W4s: take whatever they owed last year, divide by their remaining pay periods this year, and add that as extra withholding immediately. This prevents another surprise while you implement the proper long-term solution using the IRS withholding estimator.

I've been helping people with similar withholding issues for years, and your in-laws' situation is unfortunately very common. For an $87k combined income with married filing jointly status, they should expect to pay around $9,000-$11,000 in federal taxes annually. The core problem is that when both spouses work, each employer calculates withholding as if that's the only income in the household. So if one makes $50k and the other $37k, each employer withholds at lower rates than what their true combined tax bracket requires. Here's my recommendation: First, use the IRS Tax Withholding Estimator tool immediately - it's free and designed exactly for this situation. Input both of their current pay stubs and it will give you precise numbers for additional withholding. As a temporary fix while you're sorting out the W4s, calculate last year's total tax owed, divide by their remaining paychecks this year, and have that amount withheld extra. This prevents another surprise bill while you implement the proper solution. For the new W4 forms, make sure they both complete Step 2 (the multiple jobs section) properly - either check the box or use the worksheet. This is crucial and often overlooked!

What an absolutely infuriating situation! I'm a tax professional and what this CPA did is completely inexcusable. Filing a return without Form 8879 or any signed authorization is a clear violation of IRS regulations and professional ethics. The advice given here about filing Form 14157 and contacting your state board is spot-on. I'd also suggest immediately requesting that the preparer provide you with their PTIN (Preparer Tax Identification Number) and a detailed explanation of what authorization they believed they had to file your return. Since you mentioned this is your first year with side business income, I want to emphasize that you likely have significant deductions available that were completely ignored. Home office expenses, business equipment, vehicle mileage, professional development, supplies, and even a portion of your phone/internet bills could be legitimate write-offs depending on your business. The $925 fee is outrageous for the minimal work described. A return like yours should typically cost $300-500 at most. Combined with filing without permission and ignoring your deduction questions, this suggests either gross incompetence or intentional misconduct. Don't let this preparer intimidate you - you have every right to be furious and you're taking exactly the right steps. Make sure to document every interaction going forward and don't accept any responsibility for their unauthorized actions. You've got this!

This is absolutely unacceptable and I'm really sorry you're dealing with this violation of trust. As a newcomer to this community but someone who's dealt with tax issues before, I want to echo what others have said - what this CPA did is not just unprofessional, it's potentially illegal. The fact that you specifically asked about deductions and they completely ignored your questions while charging nearly $1000 is bad enough, but filing without your consent crosses a serious line. No legitimate tax preparer should ever submit a return without your signature on Form 8879. I'd suggest taking photos or screenshots of any documents you have from your meeting with them before contacting them - you want to preserve evidence of exactly what was discussed and what you never signed. Also, when you do contact them in writing, ask them to provide a timeline of their actions. This might reveal other procedural violations. The silver lining is that your TurboTax calculation showing a refund instead of money owed gives you strong evidence that their work was inadequate. This isn't just about unauthorized filing - it's about incompetent preparation that could have cost you hundreds of dollars you don't actually owe. Keep detailed records of everything as you work through this process. Your experience could really help other community members recognize and avoid similar situations with unethical preparers.

As someone who's done several 1031 exchanges over the years, I can confirm that paying off your mortgage before the exchange is absolutely fine and actually quite common. You're right to verify this - the rules can be confusing! The main thing to understand is that mortgage relief (when debt transfers to the buyer) is considered "boot" in a 1031 exchange, which can trigger taxable income. By paying off the mortgage with your inheritance money before closing, you eliminate this issue completely. A few practical tips from my experience: - Get your payoff quote early and make sure it's good through your closing date - Wire the payoff funds rather than using a check to ensure faster processing - Notify your title company and qualified intermediary about the payoff so they can prepare clean closing documents - Keep detailed records showing the mortgage payoff came from separate funds (your inheritance) and not from exchange proceeds With a $425k property and $112k mortgage, you'll have substantial proceeds to reinvest. Just remember you'll need to purchase replacement property worth at least your net proceeds (after selling costs) to fully defer capital gains. Your real estate agent is correct - this is a perfectly legitimate strategy that many investors use to simplify their exchanges. The inheritance timing couldn't be better for this situation!

This is exactly the kind of situation where having the inheritance money works in your favor! I just completed a similar exchange last month where I paid off my mortgage about 3 weeks before closing. One thing I learned that might help you - when you call for your payoff quote, ask specifically about any "per diem" interest that might accrue between payment and your closing date. Some servicers will add daily interest even after you've paid off the principal balance, and you want to make sure this is handled cleanly. Also, since you're doing this with inheritance funds, make sure you have a clear paper trail showing those funds were never commingled with any exchange proceeds. I kept my inheritance in a completely separate account and used that account exclusively for the mortgage payoff. This makes the documentation super clean if the IRS ever has questions. The $112K debt elimination actually gives you more flexibility in choosing your replacement property since you won't need to worry about matching mortgage amounts. Just remember that to fully defer capital gains, you'll need to reinvest all your net proceeds (probably around $400K after selling costs) into the replacement property. Good luck!