Has anyone used the Schedule C form for Doordash taxes? I'm confused about which expenses go where. And do I need to register as a business to use this form?

Great question! I went through the same confusion when I started doing gig work. Your calculation isn't quite right, but you're on the right track thinking about the tax burden. Here's what you're missing: the self-employment tax and income tax don't stack the way you calculated. The SE tax is 15.3%, but you get to deduct half of it (the employer portion) when calculating your income tax. Plus, both taxes are calculated on your NET earnings after business deductions, not your gross. For a $1250 week, assuming you track your mileage and other business expenses properly, your actual tax burden will likely be closer to 18-22% of gross income, not the 25%+ you calculated. The key is maximizing your legitimate business deductions - especially mileage at 65.5 cents per mile for 2024. Also, definitely make quarterly estimated tax payments! Set aside about 25-30% of your net earnings each quarter to avoid penalties and a huge tax bill in April. The IRS form 1040-ES makes this pretty straightforward. One more tip: keep detailed records of everything. Mileage logs, receipts for delivery bags, phone bills, etc. Good record-keeping can save you hundreds or even thousands in taxes.

Don't forget about state taxes! Everyone's talking about the IRS, but state tax authorities can be even more aggressive about collection in some places. Make sure you're filing those missing state returns too. Also, if you've moved between states during those unfiled years, you might need to file part-year resident returns in multiple states, which gets complicated fast.

I went through almost the exact same situation last year - 3 unfiled years with a mix of W-2 and unreported cash business income. The anxiety was eating me alive, but I'm happy to report I got through it and you will too. Here's what I learned: The IRS is actually more reasonable than you'd expect when you come forward voluntarily. Since you had W-2 income with withholdings, you likely have credits that will offset some of what you owe on the unreported income. My biggest mistake was waiting so long to start. The failure-to-file penalties are brutal - 5% per month up to 25% of what you owe. But once you file, even if you can't pay immediately, those penalties stop growing. For reconstructing records, I used bank statements as my primary source. Even without perfect receipts, you can estimate business expenses reasonably - office supplies, gas, equipment, etc. The IRS accepts reasonable estimates when you can't locate exact documentation. One thing that really helped my peace of mind was calling the Taxpayer Advocate Service. They're an independent organization within the IRS that helps taxpayers resolve problems. They can't reduce what you owe, but they can help you understand your options and rights. You're not going to face criminal charges for this situation. Tax evasion prosecution is reserved for much more serious cases involving intentional fraud or massive amounts. Your situation sounds like life got in the way, which happens to more people than you'd think. Get started on those returns ASAP. Each day you wait is costing you money in penalties and interest.

I think I might be in a similar situation as you... I got my 846 code yesterday with a 2/26 date. I'm with Chime too, but I'm not getting my hopes up too much about it coming early. Last year I had a 2/15 date and it didn't hit until exactly that day, even though others with Chime got theirs early. Maybe it depends on when in the day the IRS actually sends the file? I'm just trying to be patient and assume it'll come on the actual date so I don't drive myself crazy checking my account.

Same here with the 2/24 DDD! I've been refreshing my Chime app way too much today. From what I've seen in this community, it really seems to depend on when exactly the IRS sends out the payment batches. Some people get lucky with the early deposit, others have to wait until the exact date. I'm trying not to get my hopes up too high, but fingers crossed we see something by tomorrow or Wednesday. The 846 code is definitely a good sign though - at least we know it's actually coming this time instead of being stuck in processing limbo!

Has anyone here done an asset purchase vs. stock purchase for an insurance agency? We're debating between the two approaches. I know asset purchases generally favor buyers tax-wise because of the step-up in basis, but wondering if there are insurance industry-specific considerations I should know about?

Great question! I went through a similar acquisition process for my consulting firm two years ago. One thing that really helped me was getting an independent business valuation done before finalizing the allocation. This gave us solid documentation to support our allocation decisions if the IRS ever questions them. For insurance agencies specifically, you'll want to pay close attention to how you value the customer relationships versus goodwill. Customer lists can often be valued more aggressively than general goodwill because they're more concrete and measurable - you have actual renewal rates, commission histories, and customer demographics to support the valuation. Also, don't forget about any licensing or regulatory assets that might have value. Some states require significant licensing investments that could be allocated separately from goodwill. One mistake I see people make is trying to be too aggressive with the allocation to get maximum tax benefits. The IRS has gotten pretty sophisticated about auditing purchase price allocations, especially for service businesses. Make sure whatever allocation you choose, you can defend it with solid business reasoning and documentation.

Whatever you do, DO NOT CALL the phone number in the letter without verifying it first! There are tons of scam letters that look exactly like they're from the IRS. Go to the official IRS website directly and get the phone number from there. Also, the IRS will NEVER demand immediate payment via gift cards, wire transfers, or cryptocurrency - that's a huge red flag for scams. Real IRS notices always give you appeal rights and multiple payment options.

Hey Aisha, I totally understand the panic! I went through the exact same thing about 6 months ago as a freelancer. That sick feeling when you see an IRS letter is the worst. Here's what helped me get through it: First, take a deep breath. The vast majority of IRS notices are routine administrative stuff, not the scary audit situations we imagine. Second, you absolutely need to get that letter and open it - the anxiety of not knowing is always worse than the reality. When I finally opened mine, it was just asking me to verify some 1099 income that didn't quite match what I reported (turns out one of my clients had made a small error on their end). Took about 20 minutes to resolve with a simple response letter. The key things to remember: You have rights, you have time to respond (usually 30+ days), and there are resources to help you understand what they're asking for. Don't let your imagination run wild - most of these notices have simple solutions. You've got this! Come back and let us know what the letter says once you open it. This community is great for helping each other navigate these situations.