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If I could give 10 stars I would If I could give 10 stars I would Such an amazing service so needed during the times when EDD almost never picks up Claimyr gets me on the phone with EDD every time without fail faster. A much needed service without Claimyr I would have never received the payment I needed to support me during my postpartum recovery. Thank you so much Claimyr!
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Really made a difference, save me time and energy from going to a local office for making the call.
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An incredibly helpful service
An incredibly helpful service! Got me connected to a CA EDD agent without major hassle (outside of EDD's agents dropping calls – which Claimyr has free protection for). If you need to file a new claim and can't do it online, pay the $ to Claimyr to get the process started. Absolutely worth it!
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Used this service a couple times now. Before I'd call 200 times in less than a weak frustrated as can be. But using claimyr with a couple hours of waiting i was on the line with an representative or on hold. Dropped a couple times but each reconnected not long after and was mission accomplished, thanks to Claimyr.
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I tried for weeks to get thru to EDD PFL program with no luck. I gave this a try thinking it may be a scam. OMG! It worked and They got thru within an hour and my claim is going to finally get paid!! I upgraded to the $60 call. Best $60 spent!
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Libby Hassan
After using both systems, I will say the one advantage TurboTax has is the W-2 and 1099 import feature. I have like 8 different 1099-B forms from my brokerage and manually entering all those transactions in FreeTaxUSA was a giant pain. TurboTax just pulled them all in automatically. But if you don't have a ton of forms or complicated investments, FreeTaxUSA is definitely the better value. Just my 2 cents.
Do you know if Cash App Tax has import features? I've heard mixed things but thinking about trying it this year.
Libby Hassan
•Cash App Tax does have some import capabilities, but not as extensive as TurboTax. Last I checked, they could import W-2s by taking a picture, and they can import some 1099s from major brokerages like Robinhood and a few others. The coverage isn't nearly as comprehensive as TurboTax though, which can connect to hundreds of financial institutions. If you have accounts at smaller or less common brokerages, you might still need to enter things manually with Cash App Tax.
Sofia Peña
I used H&R Block for years until I realized I was paying $120+ for them to enter numbers from my W-2 into a computer... something I could literally do myself in 20 minutes lol. Switched to FreeTaxUSA and saved so much!!
Aaron Boston
•The free versions often miss deductions though. My cousin works for H&R Block and says they train them to upsell because the free version is designed to be incomplete.
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Something to consider that hasn't been mentioned - if you have documentation showing you reported everything correctly, you should absolutely challenge this! The IRS makes mistakes ALL THE TIME. Last year they sent me a similar notice claiming I had "substantially understated" my income by not reporting a 1099-R distribution, but I had included it on the correct line of my return. I sent them a detailed response with copies of my return highlighting where I had reported the amount and a copy of the 1099-R form. They reversed the entire penalty about 8 weeks later. Don't automatically assume you're in the wrong!
Mia Green
•How exactly did you format your response? Did you use any specific IRS forms or just write a letter explaining the situation?
I wrote a formal letter that referenced the notice number and my tax ID at the top. I didn't use a specific IRS form, but made sure my letter was very clear and organized. I started with a direct statement: "I am writing to request abatement of the substantial understatement penalty because all income was properly reported on my original return." Then I included a table showing exactly where each item appeared on my return with line numbers and amounts. I attached highlighted copies of both my filed return and the 1099 forms, with the relevant numbers circled. I find that making it super easy for them to see the evidence increases your chances of success. Don't make them hunt for information or they might just deny your request due to lack of clear documentation.
Emma Bianchi
Has anyone used tax software to help deal with these kinds of notices? I'm wondering if TurboTax or H&R Block have any special features for responding to IRS letters about substantial understatement.
Most tax software doesn't have great features for handling notices after filing. TurboTax has an "audit support" feature but it's pretty basic - mostly just gives you general guidance. H&R Block offers actual representation if you pay for their Peace of Mind extended service, but that's something you have to purchase when you file, not after you get a notice.
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Don't forget about state taxes too! Depending on where you live, you might need to pay state income tax on your photo sales. Some states also have business license requirements even for small operations.
Omg I totally didn't even think about state taxes! I'm in California - do you know if they have any special requirements for small online businesses?
California definitely has state income tax, and they're pretty thorough about collecting it! You'll need to report your income on your CA state tax return. California also technically requires a business license for most businesses, though many small online sellers operate without one initially. If your sales exceed $600 annually, you should register for a Seller's Permit with the California Department of Tax and Fee Administration, especially if you're selling any physical products alongside your digital content. For purely digital goods like photos, the rules can be a bit different, but it's still income that needs to be reported.
Sunny Wang
Can I just say that the term "side hustle" needs to die? The corporations have tricked us into thinking we need multiple jobs to survive and then glamorized it with cute names. In the 70s one job could support a family but now we're all out here selling feet pics just to make rent 😒
This is actually helpful tax advice for OP's question though? Maybe save the economic commentary for another thread.
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Sasha Reese
Something else to consider - if you only formed the S Corp in mid/late 2021, you might have income from early 2021 that was legitimately earned as a sole proprietor before the S Corp was formed. You need to make sure you're distinguishing between pre-S Corp income (which would go on Schedule C) and S Corp income (Form 1120-S). Also, if you didn't make a formal S Corp election with Form 2553, you might actually be a C Corp by default, which would be a whole different tax situation. Do you remember filing Form 2553?
Kiara Greene
•That's a really good point. I started contracting around April 2021 and didn't form the S Corp until September. So I definitely had some income before the corporation existed. And yes, I'm pretty sure I filed the 2553 - the bookkeeper handled that paperwork and I signed it. I got something back from the IRS confirming the S election but I'd have to dig through my files to find it.
Sasha Reese
•That's good you filed Form 2553 and have confirmation. Your approach should be to file two different types of returns for 2021 then: For January-August 2021, report your contracting income on Schedule C as a sole proprietor. This will be part of your personal 1040. For September-December 2021, file an 1120-S for your S Corporation. You'll need to report any reasonable salary you should have taken (even if you didn't actually run payroll) and any distributions you took from the business.
Jumping in to add another perspective - I went through something similar last year and learned that operating as an S Corp without proper salary payments can be a red flag. The IRS looks specifically for S Corps that don't pay reasonable salaries to owners to avoid payroll taxes. If you decide to keep the S Corp status and file 1120-S forms for those years, make sure you work with a tax pro to determine a reasonable salary amount. You might need to file amended payroll tax returns too.
I use TurboTax Business for my S Corp. Would that work for someone in OP's situation or is this too complex for DIY software?
TillyCombatwarrior
One thing nobody's mentioned - CHECK THE CHECK CAREFULLY! Make sure it's actually from the US Treasury and not some kind of scam. There are so many tax scams these days. Also, when you deposit it, maybe ask your bank to put a longer hold on it just to be extra sure it clears properly. I've heard horror stories of people cashing what they thought were legitimate refund checks, spending the money, and then finding out they were fraudulent.
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Anna Xian
•Totally valid point! Real IRS checks have watermarks and security features. The paper should have a slight blue tint and there's usually a watermark visible when held up to light. Also, if you're not expecting a check or the amount seems off, it's another red flag. Scammers count on people being excited about surprise money and not questioning it too carefully.
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Jungleboo Soletrain
The IRS is running behind on notices this year. My tax guy said they're about 3-4 weeks behind on sending out explanations for adjustments. Your extra money could be from: 1. Interest accrued during processing time (they pay interest on delayed refunds) 2. An adjustment from a previous year they found while processing your amended return 3. A math error correction in your favor 4. Some weird glitch in their system I'd cash the check but set aside the "extra" amount for a few months just in case they come asking for it back. The IRS always eventually figures out their mistakes, so better safe than sorry!
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