This is super helpful, thank you!! So to clarify - on my 2023 Form 8606, I'll only complete lines 1-7 (or 1-8)? And then for 2024, I'll need to report the actual conversion on that year's form?

Exactly! For 2023, you'll only complete Part I (lines 1-7 or 1-8) to establish your nondeductible contribution and basis. You won't complete Part II (the conversion section) on your 2023 form. Then on your 2024 Form 8606, you'll complete both parts. Part I will show any new 2024 contributions, and Part II will show your April 2024 conversion of the 2023 contribution. Your basis from the 2023 form carries over to the 2024 form. This ensures you don't get taxed twice on the money. The important thing is making sure you file the 2023 Form 8606 to establish that initial basis, even if you're not reporting a conversion on it.

I switched to FreeTaxUSA after TurboTax kept calculating my Form 8606 wrong. It has better handling of backdoor Roth conversions and actually explains the basis calculations clearly. Plus it's way cheaper!

Thanks for this info. Did you have to fill out any specific forms for the penalty abatement? And how long did it take to resolve after you contacted them?

In my situation, the IRS representative handled the penalty abatement over the phone once I explained the situation and provided evidence my business didn't exist during the tax period in question. I didn't have to fill out any special forms since it was clearly their error. It took about 6 weeks from my phone call until I received the official letter confirming the notice was withdrawn. The representative told me it would take 4-8 weeks, so that was accurate. Make sure you keep all documentation related to this issue, including notes about any calls (date, time, representative's ID number if they provide one).

Not everything is identity theft! The IRS makes mistakes all the time. Their systems are from the stone age and they're understaffed. I got a CP2000 for $12k last year because they couldn't match my Schedule C to my 1099s correctly. Took 3 months to sort out.

I hadn't even considered identity theft - that's a scary thought. I just checked my credit reports and don't see anything suspicious there, thankfully. But I'll definitely mention this possibility when I speak with the IRS. If someone created a business using my information back in 2020, I need to know about it.

Wait, student loans count as support provided by the student?? I had no idea. What about if the parent is a cosigner on the loan? And do parent PLUS loans count as support from the parent?

Student loans are indeed considered support provided by the student even if a parent cosigns, because the student is ultimately responsible for repaying the loan. This is a common misunderstanding that causes problems during audits. For Parent PLUS loans, those DO count as support provided by the parent because the parent is legally responsible for repaying them, not the student. This distinction is important when calculating the total support. Another thing people often miss is that qualified tuition paid directly by the parent to the educational institution always counts as support from the parent.

Yes, you should include the full tuition amount in the total support calculation. The scholarship portion counts as support provided by a third party (not by either you or your son). So when determining if you provided more than 50% of support, the formula would be: (Amount you paid) ÷ (Total support including full tuition) > 50% The "total support" denominator includes everything: full tuition (including scholarship portion), housing, food, medical, etc. from ALL sources.

I'm sure we don't qualify for FMLA - we're truly a small independent business with just 12 employees total. I did check into my state's laws and unfortunately we're in a state with minimal protections beyond the federal requirements. I'm going to look into the temporary disability option that a few people mentioned. I had no idea that might be available to me! And I'm definitely not going to file for unemployment fraudulently. After reading everyone's comments, I can see that's a terrible idea that could come back to haunt both me and my employer.

This is so true. My sister works for our state's unemployment department and they absolutely compare birth records with unemployment claims. They also check social media sometimes. Someone at her office caught a claimant posting about their new baby on Facebook during the exact period they claimed to be "laid off" and actively seeking work.

Wait what? 100% of meals can be deducted? I thought that was only for actual businesses, not independent contractors? And what counts as "far from usual work area"? Like is that a specific mile range?

Independent contractors ARE businesses - that's the whole point of being a contractor instead of an employee. As long as your wife files a Schedule C, she's operating a business and qualifies for these deductions. For the "far from usual work area" definition, there's no specific mile requirement in the tax code, but the general rule is that it needs to be far enough that it wouldn't be reasonable to return home for meals. Most tax professionals consider anything requiring an overnight stay or sites more than 50 miles from your home base to clearly qualify, but even shorter distances can work if there's a business necessity to remain on-site.

I'm not a tax pro but I've been a contractor for 6 years. The drive from home to first job site and last job site to home are considered personal commuting miles and NOT deductible. Only the miles between job sites during the day count as business miles. EXCEPTION: If you have a qualifying home office that serves as your principal place of business, then drives from home to job sites CAN be deductible business miles.