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Mine was because I claimed the Recovery Rebate Credit. They just needed me to prove I didn't receive the stimulus payment. Check if you claimed any special credits this year that might need verification.
I went through this exact same situation last year! The "Action Required" status with Tax Topic 152 is actually pretty routine - it usually means they need to verify something on your return before processing your refund. In my case, it was because we had a significant change in our income compared to the previous year, which triggered their automated review system. The waiting for the letter is definitely the most frustrating part, but once you get it, the instructions are usually pretty straightforward. Mine took about 10 days to arrive (not the full 2-3 weeks they estimated), and they just needed copies of our W-2s and a signed statement confirming our filing status. One thing that really helped me was pulling my tax transcript from the IRS website to see if there were any transaction codes that might give a hint about what they're looking for. The codes can be confusing, but sometimes you can piece together what triggered the review. Don't stress too much about it - in most cases, as long as you respond promptly with the requested documentation, you'll get your full refund. It just adds a few extra weeks to the process. The key is to respond exactly as they ask and keep copies of everything you send them.
Thanks for sharing your experience! That's really helpful to know it might arrive sooner than the 2-3 weeks they estimate. We did have a pretty big income change this year too (got a new job with higher pay), so that's probably what triggered it. I'm going to try pulling our transcript like you suggested to see if I can figure out what they're looking at. Really appreciate the reassurance that it's usually straightforward once you get the letter!
From what I've gathered from the community, most people seem to be on cycle 05 (Friday updates), but there are possibly other cycles too. It might depend on your filing status, whether you have certain credits, or perhaps even the last two digits of your SSN - though I'm not entirely sure about that last part. The most reliable way is probably checking your transcript for the cycle code, which should be a number ending in 01-05.
I've been tracking IRS cycles for three tax seasons now, and here's what I've learned that might help with your 14-day timeline. The cycle code appears in the upper right corner of your Account Transcript (not Return Transcript) as a format like 20241205. The last two digits (05 in this example) indicate your cycle - 01=Monday through 05=Friday. Most individual filers are on cycle 05, which means your transcript updates Friday nights and deposits typically hit 3-5 business days later (Wednesday-Friday of the following week). Given that you're at day 23 and need funds in 14 days, check your Account Transcript this Friday night after 11 PM. If it updates with a deposit date (DDD), you should receive your refund within your timeframe. If no update, you'll likely need to wait another full cycle (7 days). The key is checking the RIGHT transcript - Account, not Return.
Just a heads up, the IRS might consider this a hobby rather than a business if you never had income or customers. I tried to deduct expenses for my photography "business" a few years ago and got audited because I had no income for 2 years.
But the difference here is they never actually started operating because of the job change. Wouldn't that be different from your situation where you were actively trying to get photography clients but didn't make money?
I was in a very similar situation when I started my CPA practice! The key distinction here is that you had legitimate business intent before circumstances changed due to your employment situation. This isn't a hobby case at all. You should definitely be able to claim these as startup costs under IRC Section 195. Since you invested with genuine profit motive and only stopped due to employment restrictions (not lack of interest), you can deduct up to $5,000 in startup expenses in the first year, with any remaining amount amortized over 15 years. Make sure to document everything: your original business plan, any research you did, receipts showing business intent, and especially your new employer's policy that prevented you from continuing. The IRS looks favorably on situations where external circumstances (like employment contracts) prevent business operations. One tip: If you think you might resume this business after leaving your current job, keep all your documentation. You could potentially carry forward unused startup costs to future tax years when the business becomes active.
This happened to me too! Check if you received cost sharing reductions (CSR) with your plan. If you had a Silver plan with cost sharing reductions but your final income came in above the CSR threshold, you might lose those reductions even though you still qualify for premium tax credits. This doesn't affect the premium itself but could explain why your refund changed. Also, make sure TurboTax didn't accidentally check the "married filing separately" box which makes you ineligible for premium tax credits in most cases.
I've seen this exact issue several times, and it's usually related to the benchmark plan calculation when you move states mid-year. Since you moved from Nebraska to Colorado in June but kept your Nebraska marketplace plan, the system needs to calculate different benchmark premiums for each state period. Here's what likely happened: Your 1095-A shows the advance premium tax credits you received based on Nebraska's benchmark plans for the full year. But for tax purposes, once you moved to Colorado, the calculation should use Colorado's benchmark plan costs for June-December. Colorado likely has different (possibly higher) benchmark premiums than Nebraska, which would reduce your allowable premium tax credit for those months. The good news is this can often be corrected. In TurboTax, when you're completing the ACA section, make sure to indicate that you moved during the year AND that this move affected your marketplace coverage. This should trigger the "alternative calculation for year of move" option on Form 8962. You'll need to enter separate benchmark amounts for your Nebraska period (Jan-May) and Colorado period (June-Dec). If TurboTax isn't offering this option, you might need to override the automatic calculation and manually complete Form 8962 using the worksheets in IRS Publication 974. The key is getting the correct benchmark premium amounts for each state during your respective residency periods.
Christian Bierman
One important thing no one mentioned: you need to make quarterly estimated tax payments on your DoorDash income! When you have a W-2 job, taxes are withheld automatically, but with 1099 work, nothing is withheld. If you wait until tax time to pay, you might get hit with underpayment penalties. I found this out the hard way last year and had to pay extra. You can either increase withholdings at your regular job to cover the additional income or make quarterly payments directly to the IRS.
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Paige Cantoni
ā¢Wait really? I had no idea about quarterly payments! How do you even calculate how much to pay? And am I already in trouble since I started dashing 5 months ago and haven't paid anything yet??
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Christian Bierman
ā¢You generally need to pay enough to cover 90% of your current year tax or 100% of your previous year's tax (whichever is smaller) to avoid penalties. You can use Form 1040-ES to calculate your estimated payments. Don't panic about the 5 months you've already been dashing. The penalty is calculated based on how much you underpay and for how long. Since it's your first year doing this, you might qualify for a waiver of the penalty. Also, if your withholding from your W-2 job is substantial, you might already be covered. The important thing is to start planning for this now before tax season arrives.
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Emma Olsen
I did doordash last year and messed up my taxes by not tracking my miles properly. KEEP A MILEAGE LOG starting today!! The standard mileage deduction was worth waaaaay more than itemizing all my other expenses. Download a mileage tracking app that records your trips automatically. I use Stride and it saved me over $1800 in taxes last year just from mileage deductions alone.
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Lucas Lindsey
ā¢Do you track miles from your house to your first delivery? Or only between deliveries? I've heard different things and don't want to do it wrong.
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QuantumQuest
ā¢You can deduct miles from your home to your first pickup AND between deliveries AND from your last delivery back home - as long as you're actively working. The key is that you need to be "in business mode." So if you drive from home to start your DoorDash shift, that's deductible. Miles between deliveries are definitely deductible. And the drive home after your last delivery counts too. What you CAN'T deduct is driving from home to your regular W-2 job, or personal errands you run while the DoorDash app happens to be on. Make sure your mileage app distinguishes between business and personal trips!
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