Has anyone used any specific tax software that handles household employee situations well? I tried using [popular tax software] last year for my mother's caregiver and it was a nightmare trying to figure out the Schedule H and W-2 generation.

I went through this exact same situation with my grandmother's caregiver two years ago and learned some hard lessons. First, the IRS classification really does depend on the degree of control you have over the work, not just whether they work for other families. If you're directing what tasks need to be done, when they need to be at your home, and how the care should be provided, you're likely an employer regardless of their other clients. One thing I wish someone had told me earlier: even if you determine she should get a 1099-NEC as an independent contractor, you still need her Social Security Number or Individual Taxpayer Identification Number (ITIN), her full legal name, and address before you can file anything. The deadline for giving her the form is January 31st, and you need to file it with the IRS by the end of February (or March 31st if filing electronically). But honestly, given that you're paying her $26,000+ annually for regular ongoing care work in your home, this sounds like a textbook household employee situation to me. I'd strongly recommend getting professional help to sort this out properly - the penalties for misclassification can be significant, especially when you're dealing with this much money.

Has anyone here actually gone through an IRS audit over gifted stocks? I'm worried because I did something similar last year but don't have great records of my original purchase from like 15 years ago. What happens if you can't prove the original cost basis?

I went through almost this exact scenario with my mom last year when she gifted me some Apple stock she'd held since 2010. What everyone's saying about inheriting the cost basis is absolutely correct - I had to use her original purchase price from over a decade ago to calculate my capital gains, not the value when she gave it to me. One thing I'd add that hasn't been mentioned yet: make sure your daughter gets the holding period too. Since you held the stock for several years, she automatically qualifies for long-term capital gains treatment (even though she only held it briefly), which means lower tax rates. This is actually a nice benefit of receiving gifted stock versus inherited stock. Also, don't forget that your daughter will need to report this on Schedule D of her tax return, and possibly Form 8949 if her broker doesn't have the correct cost basis information. My broker initially showed the wrong basis (the value when gifted rather than mom's original purchase price), so I had to make an adjustment on Form 8949. It's worth double-checking what your daughter's brokerage reports to avoid any confusion when she files.

Has anyone else noticed that the withholding calculators seem to be way off for people with multiple jobs? I work a full-time job plus a weekend gig, and none of the calculators seem to handle this correctly. I always end up owing even when I follow their recommendations.

I've been dealing with this exact same frustration! What I discovered is that many calculators don't properly account for the timing of when you make the withholding changes during the year. If you're adjusting your W4 in April versus January, the calculations should be different because you've already had several months of potentially incorrect withholding. The IRS calculator is generally most accurate, but make sure you're entering your year-to-date withholding amounts correctly from your most recent pay stub. Also, if you have any life changes planned (like getting married, having a baby, buying a house), factor those into your calculations since they'll affect your tax situation. One trick I learned from my CPA is to aim for owing between $0-$100 at tax time rather than getting a big refund. That way you're not giving the government an interest-free loan, but you're also not hit with underpayment penalties. It takes some trial and error to dial it in perfectly, but it's worth the effort!

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.