Thanks for sharing your experience. This is exactly what I was worried about. I think I'm going to go ahead and file the amended return this week. Better to just deal with it now than have it hanging over my head.

Good call! It's definitely the smart move. The peace of mind alone is worth it. And like others have mentioned, the penalties are usually much less severe (or even waived completely) when you correct the issue yourself instead of waiting for them to find it.

Can confirm this works! First Time Penalty Abatement saved me about $200 in penalties when I messed up some 1099 income reporting two years ago. You just need a clean compliance history for the past 3 years.

That's a good point I hadn't considered! I actually moved out completely in late November, and the flooring work was completed in early December before I signed with the property management company on December 15th. Would that affect how the flooring is treated? And would the HOA fees for December be fully deductible then?

Since you moved out in late November and the flooring was installed in early December before signing with the property management company, that timing actually helps your case. The flooring work was done while the property was being prepared for rental use, not while you were using it as a personal residence. The HOA fees for December would likely be fully deductible since the property was no longer your personal residence during that month. Just make sure you have documentation showing you had moved out in November and that the property was being prepared for rental use in December. The property management agreement from December 15th is excellent supporting documentation of your intent to rent the property.

This is super important! I got hit with this last year when I couldn't deduct my rental losses because my income was too high. The carry-forward helped eventually, but it wasn't what I expected when filing that first year with the rental property. Also, doesn't the fact that OP is actively participating in rental management affect this? Or does using a property management company automatically make it non-active participation?

Thanks for mentioning the streaming services - I hadn't even thought about that! I do occasionally break down scenes from movies to explain the engineering concepts they got wrong. For the home office deduction, does it matter if it's just a corner of my living room with my filming setup, or does it need to be an entirely separate room?

For the home office deduction to work properly, the space needs to be used exclusively for your business. A corner of your living room is trickier because it's not exclusively a business space. The IRS really looks for a separate area that's only for business use. What some content creators do is create a clearly defined studio space, even if it's within a larger room, and ensure that particular area is only ever used for content creation. Taking photos that show the clear boundary between personal and business space can help document this. Just be aware that the home office deduction is one that can trigger extra scrutiny, so make sure your documentation is solid.

Do you use any specific software or apps to track your expenses? I'm terrible at keeping physical receipts and wondering if there's a better system.

Thanks for this info! She's being claimed as our dependent. I'm going to check the 1098-T boxes more carefully. Do you know if room and board counts as a qualified expense even though it doesn't show up on the 1098-T?

Yes, room and board can count as qualified expenses if your daughter is enrolled at least half-time, even though they don't appear on the 1098-T. You'll need to use the school's official cost of attendance figures for on-campus housing, or if she lives off-campus, the actual expenses up to the school's published allowance for room and board. Make sure you're accounting for all eligible expenses when determining how much of the 529 distribution is tax-free. The key is that your total qualified expenses need to be at least equal to the total 529 distribution to avoid having any taxable portion.

Yes, textbooks absolutely count as qualified expenses regardless of where they were purchased, as long as they were required for her courses. Keep receipts and a copy of her syllabus or course requirements showing these were required materials.

I pay $260 for mine which includes state and federal. Self-employed with a Schedule C, rental property, and some investments. I've been with my guy for 8 years though, so maybe I'm grandfathered into lower pricing. $375 does seem high for a basic W-2 return, honestly.

Thanks for the perspective! I might need to shop around more. I've been doing my own taxes with TurboTax but was thinking about switching to a professional this year since my situation got a bit more complicated with some freelance income and a home office. Sounds like I should expect somewhere in the $250-300 range for that complexity.

Check if you claimed the Earned Income Tax Credit or Additional Child Tax Credit. Those automatically get additional scrutiny and can't be issued before mid-February by law. My sister had that issue and didn't realize that was causing her delay.