Something to consider: if the additional W-2 is small enough, you might technically be allowed to just wait and report it next year by filing a form 8275 disclosure statement with next year's return explaining the situation. This is generally only recommended if the additional tax is very minimal (like under $50). That said, the right thing to do is file the amendment. Just want to point out that the tax world won't end if your amendment takes a little time to file. The penalties for a small amount would be minimal if you're getting a refund anyway.

Don't stress too much about this - it's actually a pretty common situation! You're handling it correctly by filing the 1040-X amendment. Just to clarify a few things that might ease your mind: 1. The reason the 1040-X shows you "owe" $82 is because it only shows the DIFFERENCE from your original return, not your new total tax situation. You'll still get your original refunds ($643 federal, $720 state), but then later you'll need to pay back the $82 difference when the amendment is processed. 2. Yes, amendments must be mailed - no e-filing option currently exists for 1040-X forms, regardless of which software or preparer you use. 3. Since your refunds haven't hit your bank yet, you're in good timing. The IRS will process your original return first, issue those refunds, then separately process your amendment months later. 4. For state taxes, you'll need to file a separate state amendment form (each state has their own process). One tip: when you mail your 1040-X, include a cover letter explaining the situation (late W-2 received after filing) and attach a copy of the additional W-2. This helps the IRS processor understand the amendment quickly. You caught this early and you're doing everything right. The process just takes time, but you won't face any significant penalties since you're being proactive about it.

I've been following this thread as someone who went through a similar situation a few years ago, and I wanted to share what worked for me. I was a W-2 commission stylist trying to deduct everything under the sun, including my nail expenses, until I had a wake-up call during a tax preparation appointment. The key insight that changed everything was understanding that the employment classification issue isn't just about taxes - it affects your entire business relationship with the salon. When I switched to booth rental, not only could I deduct legitimate business expenses (including a portion of appearance-related costs that directly impacted my service), but I also gained control over my pricing, scheduling, and client relationships. For your specific manicure question - I do deduct about 60% of my nail expenses now as an independent contractor, but only because I can document that I get specific nail art that matches seasonal themes for my salon suite, and I track client comments and rebooking rates. The other 40% I consider personal grooming that I'd do anyway. The documentation piece that @d0c7f860b662 mentioned is crucial. I keep a simple spreadsheet with dates, services, costs, and any client feedback. Takes maybe 5 minutes after each appointment, but it's saved me during tax season when my accountant reviews everything. Bottom line: talk to a tax professional first, then approach your salon owner. The conversation might be easier than you think - many salon owners are dealing with rising labor costs and would welcome a booth rental arrangement that gives them predictable income without payroll headaches.

This thread has been incredibly eye-opening! I had no idea about the Tax Cuts and Jobs Act eliminating unreimbursed employee expense deductions for W-2 employees. I've been working as a commission stylist for three years and have been incorrectly assuming I could deduct my supplies and professional expenses. Reading through everyone's experiences with employment classification has me wondering if I need to have a serious conversation with my salon owner. I purchase all my own color, tools, and products, set my own schedule, and essentially run my own book of clients within their space. Based on what @09257794d4f0 and others have described, it sounds like I might be misclassified as well. The documentation strategies that @e25bcdc944e7 shared for tracking appearance-related expenses are really smart - the 60/40 split approach for nail expenses with proper documentation makes way more sense than trying to justify 100% as a business expense. I think my next step is going to be getting a consultation with a tax professional who understands the beauty industry before making any decisions. Better to invest in proper advice upfront than potentially face audit issues later. Has anyone else here made the switch from W-2 to booth rental recently? I'd love to hear more about how those conversations with salon owners went.

Thanks everyone for the detailed discussion! As someone who just went through this exact decision process with my single-member S Corp, I wanted to add one more perspective that might help others in similar situations. I was initially hesitant about the Solo 401(k) because of the perceived complexity, but after making the switch from a SEP IRA last year, I can confirm it's really not that complicated in practice. The key is choosing the right provider - I went with Fidelity and their setup process was surprisingly straightforward, with good online resources and phone support when I had questions. One thing that really sealed the deal for me was running the numbers on tax savings. With my $50k salary, the Solo 401(k) allowed me to defer about $15k more in taxes annually compared to the SEP IRA. Even if I paid a few hundred dollars in extra admin costs, the tax savings more than made up for it. For anyone still on the fence, I'd recommend calling a few of the major providers (Fidelity, Schwab, E*TRADE) and asking them to walk you through the setup process and fee structure. They're usually very helpful in explaining how it would work for your specific situation. The peace of mind from maximizing my retirement savings while keeping all my options open for future tax planning has been worth the minor extra effort.

I've been running a single-member S Corp for about 3 years now and went through this exact decision last year. After reading through all the great advice here, I can definitely confirm that the Solo 401(k) is the way to go for most S Corp owners in our situation. One thing I'd add that hasn't been mentioned much is the importance of timing your salary decisions with your retirement contribution strategy. I initially set my S Corp salary too conservatively (around $45k) because I was worried about payroll taxes, but then realized I was actually limiting my retirement contribution potential. Working with my CPA, we found the sweet spot was increasing my salary to about $65k, which allowed for much higher employer contributions while still being well within "reasonable compensation" guidelines for my industry. The Solo 401(k) setup with Schwab was honestly easier than I expected. The rollover from my old SEP IRA took about 10 days, and they handled all the paperwork. The only "gotcha" I encountered was making sure to coordinate the timing so I didn't accidentally make contributions to both plans in the same year. For your situation with $55k in wages, you're looking at potentially $36,750 in total Solo 401(k) contributions versus only $13,750 with a SEP IRA. That extra $23k in annual tax-deferred savings really adds up over time!

I'm so sorry for your loss, Nia. I went through this exact situation when my grandmother passed away earlier this year, and I completely understand the stress and uncertainty you're feeling right now. You absolutely made the right choice working with H&R Block and filing by mail - that's the proper procedure for deceased taxpayer returns. Unfortunately, these returns do take significantly longer than regular ones. Mine took about 20 weeks total from mailing to receiving the refund. The IRS has to do additional verification steps to confirm your legal right to claim the refund, which adds months to their normal processing time. A few things that helped me manage the waiting: First, I signed up for USPS Informed Delivery to track any IRS correspondence before it arrived. Second, I stopped checking "Where's My Refund" obsessively since it just shows "processing" for months. Third, I called the IRS after 17 weeks just to confirm they had received everything - they couldn't provide a timeline, but knowing it was in their system helped. Make sure to monitor your mail carefully, as they may request additional documentation. I had to send a copy of the death certificate around week 14. I know how hard it is to have this hanging over you while you're already grieving. You did everything correctly, and the refund will come through. The waiting is brutal, but you're definitely not alone in this experience. Hang in there!

I'm so sorry for your loss, Nia. I went through this exact situation when my father passed away about 8 months ago, and I know how stressful and overwhelming it can be to deal with tax matters while grieving. You absolutely made the right decision working with H&R Block and filing by mail - that's the standard procedure for deceased taxpayer returns. The IRS requires additional verification steps for these returns to prevent fraud, which unfortunately means much longer processing times. My dad's return took exactly 18 weeks from the date I mailed it. During that time, I learned a few things that might help you: 1. Sign up for USPS Informed Delivery if you haven't already - it lets you see mail coming before it arrives, which really helped with anxiety about missing IRS correspondence. 2. Try to resist checking "Where's My Refund" daily (I know it's hard!). It just shows "processing" for months and doesn't provide useful updates. 3. Keep detailed records of when you mailed everything and what you included. 4. Around week 15-16, you can call the IRS just to confirm they received your paperwork. They won't give you a timeline, but knowing it's in their system provides some peace of mind. 5. Monitor your mail carefully - they may request additional documentation like a death certificate or Form 1310 verification. The waiting feels endless when you're already dealing with loss, but you did everything correctly. The refund will come through - it's just a matter of being patient with their incredibly slow process for these specialized returns. You're definitely not alone in this experience!

I'm going through the exact same thing! Verified my identity 9 days ago and still stuck with "Action Required" and completely blank transcripts. It's so nerve-wracking not knowing if everything is processing correctly. After reading through all these experiences, it sounds like the 2-3 week timeframe after verification is pretty standard this year. Oliver's explanation about the manual processing queue really helped me understand what's actually happening - makes so much more sense than just the generic "we're reviewing your return" message. I'm definitely going to try checking my transcript at 3am on Friday like Mei suggested. Thanks everyone for sharing your stories - it's such a relief to know this is normal and not something we did wrong!

I'm in almost the exact same situation! Verified my identity through ID.me about 7 days ago after getting the letter from the IRS, and I'm still seeing the "Action Required" message on Where's My Refund with completely blank transcripts for 2024. It's been so stressful wondering if I did something wrong or if there's another issue with my return. Reading through everyone's experiences here is incredibly reassuring though - it sounds like the 2-3 week timeframe after verification is pretty standard this year, and Oliver's explanation about the manual processing queue really helps explain what's actually happening behind the scenes. I had no idea that the blank transcript is actually expected during this phase and that everything will populate all at once when the review is complete. I'm definitely going to try checking my transcript early Friday morning around 3-4am like Mei suggested - I had no idea the IRS did their weekly updates at specific times! It's amazing how many of us are all going through this exact same process right now. Thanks for posting this question because I was starting to think my return got lost in the system or something. Hopefully we'll all start seeing some movement in the next week or two!