I went back through everything and you're totally right! There was a question that asked "Did you receive all Economic Impact Payments you were eligible for?" and I must have clicked "No" by accident. When I changed it to "Yes" the huge credit disappeared and now I owe $3,275 like I originally expected. Thank you! Do you know if I would have gotten in serious trouble if I had filed with that error?

Glad you found it! That question trips up so many people. Since it was clearly just a mistake on a confusing question, you probably wouldn't have faced fraud penalties, but the IRS definitely would have caught it, rejected the credit, and you'd end up owing the correct amount plus interest for the late payment. You might have also had your return flagged for additional review, which could have delayed any legitimate refunds on other parts of your return. Always better to catch these things before filing!

This is such good advice. I never look at the actual forms cuz all the tax software just asks questions instead. Where exactly do you find the forms view in TurboTax? Is it obvious or hidden in some menu?

In TurboTax, you can usually find the forms view by looking for "Tax Tools" in the left sidebar and then selecting "View Tax Forms." If you're using the web version, it might be under a menu called "Tools" or there's sometimes a "Preview" button near the end of the filing process. It's definitely worth checking before filing. The software is generally accurate, but only if all the questions are answered correctly. Looking at the actual forms helps catch errors like this $10,000 credit that shouldn't be there.

Wait, so if we take the depreciation on this roof for my wife's business portion, we'll have to pay some kind of extra tax when we eventually sell our house? That sounds concerning. How exactly does that work?

Yes, that's exactly right. When you sell your house, you'll need to recapture the depreciation you've claimed on the business portion. For example, if you claimed $1,776 in depreciation over the years for that 12% of your roof, you'll pay a 25% tax on that amount when you sell, even if you qualify for the $250,000/$500,000 capital gains exclusion on your primary residence. It's still usually financially beneficial to take the depreciation deduction now (and you're technically required to take it even if you choose not to claim it), but you should be aware of this future tax implication. It's a surprise many home business owners don't anticipate.

I used TurboTax last year for my home office deduction with some renovations. It does ask the right questions and walks you through the depreciation calculations for home improvements, but you need the Home & Business version. The lower versions don't handle Schedule C and Form 4562 properly. Just make sure you know the square footage of your office and total home before you start.

Thank you! That makes sense. So even though I put in $18,000 over those three years, since I converted it all, my traditional IRA basis is now $0. Does that mean if I check my traditional IRA account, it should show a $0 balance too?

Yes, if you converted the full contribution amount each year, your traditional IRA account balance should show $0 or close to it (maybe a few cents of interest if there was any time delay between contribution and conversion). Remember that "basis" refers to the money you've already paid tax on. Since backdoor Roth contributions start as nondeductible traditional IRA contributions (meaning you've already paid tax on that money), you don't pay tax again when converting to Roth as long as you convert quickly before any earnings accumulate and you properly document everything on Form 8606.

This is such an important point! I messed this up one year when I had an old 401k that I had rolled into a traditional IRA. Made my backdoor Roth partially taxable because of the pro-rata rule. Definitely something to watch out for.

Do you know which states specifically have these credits? I'm in California and doing the exact same thing as OP (Uber/car living) and could really use any extra tax breaks available.

California definitely has one of the more generous state EITCs called the CalEITC. For tax year 2024 (filing in 2025), if your income is below certain thresholds (around $30,000 for a single filer), you could qualify for both the CalEITC and the Young Child Tax Credit if you have a dependent under 6. For your car-living situation, California also has some specific programs through counties that offer tax preparation assistance for homeless individuals, which includes people living in vehicles. Look up the CalEITC4Me program or visit your local VITA (Volunteer Income Tax Assistance) site - they can help identify all credits you're eligible for based on your specific situation.

Yeah I'm definitely worried about that self-employment tax hit. Do you know if I should be making quarterly estimated payments? I haven't done any yet this year since I wasn't sure how to calculate them with my unusual expenses situation.

The IRS has a safe harbor rule that might help - if you pay at least 90% of this year's tax OR 100% of last year's tax liability (110% if your previous year AGI was over $150k), you won't get hit with underpayment penalties. Since this is your first year self-employed, you might be able to use your prior W-2 job's withholding as your safe harbor amount.

Did your accountant recommend any specific software for tracking dual businesses? I'm currently using a spreadsheet but it's getting unwieldy.

I started with QuickBooks Self-Employed but found it limiting for multiple businesses. I switched to QuickBooks Online Small Business which lets you track multiple businesses with separate profit & loss statements. FreshBooks is another good option that many of my freelancer friends use. The key feature to look for is the ability to tag transactions by business/project and run separate reports. If you're on a tight budget, Wave is free and can handle basic tracking for multiple ventures. Whatever you choose, set it up correctly from the beginning - I wasted hours recategorizing transactions because I didn't have a proper system initially.

This is actually super important advice that saved me thousands last year. My accountant initially combined my businesses, but when we separated them, I was able to claim QBI on my consulting income while still deducting all startup losses.