I just went through this exact situation with a CP22A notice a few weeks ago! Everyone's advice about selecting "Notice" in DirectPay is absolutely correct - that's definitely the right option for your CP22A payment. One thing I'd add that really helped me is to have a backup payment method ready, just in case there are any technical issues with your primary bank account. I ran into a temporary problem with my bank's online system during the payment process, and having my debit card information ready as a backup saved me from missing my deadline. Also, when you're entering your information, take your time and double-check everything before hitting submit. The system is pretty forgiving, but it's better to get it right the first time than to have to deal with payment corrections later. The whole process from start to finish took me about 15 minutes, and I got my confirmation immediately. Make sure to save that confirmation number - you'll want it for your records. The $825 will likely show up as pending in your bank account within 24-48 hours. Good luck with your payment!

I actually work in tax resolution and deal with CP22A notices regularly, so I can definitely help clarify a few things! You're absolutely right to select "Notice" as your payment type in DirectPay - that's the correct option for any IRS notice payment. Here are the key pieces of information you'll need to have ready: - Your Social Security Number (primary taxpayer if married filing jointly) - The notice number (should be clearly marked on your CP22A) - The notice date (exactly as printed on the letter) - Tax year the notice relates to - Your bank account and routing number (if paying by bank transfer - no fees vs. debit card fees) One thing many people miss: make sure you're paying the correct amount! If your notice is more than 2-3 weeks old, additional interest may have accrued since it was issued. You might want to add an extra $10-20 to cover any additional interest, or call the number on your notice to get the exact current balance. The DirectPay system will credit your payment on the date you submit it (if done before 8 PM ET), which is what matters for avoiding additional penalties. Just make sure to save/print your confirmation page - that's your proof of payment if any issues arise later. The whole process typically takes 10-15 minutes once you have everything organized. You've got this!

As a tax professional who specializes in self-employment issues, I want to emphasize something that's been touched on but bears repeating: the IRS has very specific criteria for what constitutes an independent contractor versus an employee, and your situation has several red flags for misclassification. The three main factors the IRS considers are: 1) Behavioral control (do they control how you do your work?), 2) Financial control (do you have unreimbursed business expenses, opportunity for profit/loss?), and 3) Relationship type (do you have employee benefits, is this an ongoing relationship?). Based on your description - showing up to their salon, working set hours, using their equipment - you sound like an employee. The fact that you "don't feel like you're running your own business" is actually a key indicator. Here's my advice: Start documenting everything NOW. Keep records of your work schedule, what equipment/supplies you provide versus what the salon provides, whether you can set your own rates, if you can refuse certain clients, etc. This documentation will be crucial whether you decide to file Form SS-8 for a determination or if the IRS ever audits your employment status. In the meantime, if you're filing as 1099, be conservative with deductions. Focus on supplies you personally purchase, professional licenses, liability insurance, and continuing education. Avoid gray areas like meals and transportation unless you have clear business purposes documented. Remember, getting properly classified as an employee might actually save you money even without the deductions, since your employer would pay half your Social Security and Medicare taxes.

I've been reading through this thread and wanted to add something that might help - the distinction between "ordinary and necessary" business expenses versus personal expenses that happen to occur during work. The IRS requires business deductions to be both "ordinary" (common in your type of business) and "necessary" (helpful and appropriate for your business). Your nail supplies, professional licenses, and continuing education clearly meet this test. Your daily lunch and subway commute, even though they happen because you work, are considered personal expenses. One area that might be worth exploring is if you ever travel between multiple work locations in the same day - like if you do nails at the salon and also do house calls or work at events. That kind of business travel (not commuting) would be deductible. Also, since several people mentioned worker classification issues, I'd recommend checking out the Department of Labor's guidance on this too, not just the IRS rules. Some states have even stricter tests for employee vs contractor status, and you might have additional protections under state labor laws. Keep detailed records of everything business-related, but don't let the pursuit of deductions distract you from addressing what sounds like a pretty clear misclassification issue. Sometimes the straightforward solution (proper employee status) is better than trying to work around a problematic situation.

I went through something very similar with my grandmother last year. The key thing that tripped me up was understanding that ANY money you give her counts as income, even if it's just a "thank you" or help with expenses. What ended up working for us was keeping the cash payments under $93/week (which keeps her under the $4,850 annual limit for 2025) and then covering more of her direct expenses instead. So instead of giving her extra cash, we started paying for things like her prescriptions, clothing, personal care items, and even set up a small monthly allowance on a prepaid card for incidentals. We were able to claim her as a dependent and got a nice tax break. The documentation was key though - we kept receipts for everything we paid for her to prove we provided more than half her support. It's definitely worth restructuring if you can make the numbers work!

Based on what everyone's saying about the income limits, it sounds like your current arrangement unfortunately disqualifies your mother-in-law from being claimed as a dependent. At $135/week ($7,020 annually), she's well over the $4,850 limit for 2025. However, I'd strongly recommend consulting with a tax professional about your specific situation before making any changes. There might be nuances to your arrangement that could affect how the payments are classified, and you want to make sure any restructuring is done properly to avoid issues down the road. If you do decide to restructure, the suggestions about keeping cash payments under $93/week and covering direct expenses instead seem like a solid approach. Just make sure to document everything carefully - the IRS will want to see proof that you're providing more than half her total support if you claim her as a dependent. Also, don't forget to consider the childcare angle that Benjamin mentioned. Even if you can't claim her as a dependent, there might be other tax benefits available for the childcare services she provides.

One thing nobody mentioned yet - when you're liquidating an S-Corp, check if your state requires a tax clearance certificate before you can formally dissolve the business. I completely missed this step and had to reopen my case with the state after I thought everything was finished. The balance sheet issues in TurboTax might be frustrating, but don't forget about the state-level requirements too. In my state, I couldn't formally dissolve until I got clearance showing all state taxes were paid, and that process took almost 3 months!

Great point about state requirements! I'm actually going through S-Corp liquidation right now and almost made the same mistake. For the balance sheet issue in TurboTax, one thing that helped me was creating a simple spreadsheet to track all my liquidation transactions before entering them into the software. I listed: - Beginning balances for all accounts - Each distribution with the corresponding reduction in both cash and equity - Asset disposals with any gain/loss calculations - Final balances (should all be zero) This helped me see exactly where the imbalance was before fighting with TurboTax. In my case, I had forgotten to record the accumulated depreciation removal when I disposed of some equipment. Also, make sure you're using the correct tax year dates. Since you're liquidating, some transactions might span multiple tax years, and TurboTax needs to know which year each transaction belongs to for proper reporting. The taxr.ai tool mentioned above sounds interesting - might be worth trying if you're still stuck after manually checking your entries.

Just want to echo what others have said about selecting HOH on your W-4 - you absolutely should since you qualify! I made this switch last year and saw an immediate difference in my take-home pay. One additional tip I haven't seen mentioned: make sure to keep documentation that proves your kids lived with you for more than half the year. This includes school enrollment records, medical records showing your address, any custody agreements, etc. I know it seems obvious since you have full custody, but it's good to have this stuff organized just in case. Also, don't forget that as HOH with two kids, you'll likely qualify for the Child Tax Credit and possibly the Earned Income Tax Credit too, depending on your exact income. These credits can be worth thousands, so it's definitely worth getting your withholding right to avoid a big tax bill or giving the government an interest-free loan. The fact that you're thinking about this proactively with your new job shows you're on the right track. So many people just fill out the W-4 once and never revisit it, even when their life situation changes dramatically!

This is such a helpful thread! I'm a single parent too (one kid, age 10) and I've been making the same mistake for years - selecting Single on my W-4 even though I file HOH on my tax return. Reading through all these responses, I'm realizing I've probably been giving the government way too much money throughout the year and then getting it back as a "refund." That's basically what everyone is saying, right? That if you qualify for HOH when filing, you should select HOH for withholding too so you get more money in each paycheck instead of waiting for a big refund? I'm definitely going to update my W-4 this week. My situation is pretty straightforward - I have full custody, pay all household expenses, and my daughter lives with me year-round. Sounds like I clearly qualify for HOH. Thanks to everyone who shared their experiences and tools - this thread probably just saved me hundreds of dollars in overwithholding for the rest of the year!