I just take a picture of mixed receipts immediately and mark them up digitally using my phone's markup tools. Circle business items in red, add up the subtotal right on the image, and calculate the proportional tax. Then save to a tax folder in my cloud storage. My accountant said the IRS doesn't require original paper receipts anymore - digital copies are acceptable as long as they're legible and you can prove the expense was for business.

Great question! I've been dealing with this exact same issue as a freelance consultant. Here's what I've learned works best: For mixed receipts, definitely keep them - just be methodical about marking them up. I use a simple system: I circle all business items in blue ink and write "BIZ" next to each one, then total up just those items at the bottom of the receipt. This makes it crystal clear what portion was for business. For the sales tax calculation, the proportional method is totally acceptable. If your business items were $30 out of a $60 total purchase, then you can claim 50% of the sales tax ($6.43 out of your $12.85 example). The IRS just wants to see that you have a reasonable, consistent method. One tip that's saved me time: I do this markup immediately while I'm still in the parking lot or as soon as I get home. Trying to remember what was business vs personal weeks later is nearly impossible, especially for generic items like batteries or folders. Your spreadsheet approach sounds solid - just make sure you're only entering the business portion of each receipt, including the calculated business portion of sales tax. Keep those marked-up receipts organized by month in case you need them later!

I've been in your exact situation before and it's so frustrating! The "information not available" message is unfortunately very common after setting up a payment plan - the IRS systems just don't communicate well with each other. Here's what I'd strongly recommend: Don't make any payments until you know your exact balance. I made that mistake and it created more headaches later when trying to track what I still owed. Your best bet is to request an Account Transcript through the same ID.me portal you're already using. Go to "Get Transcript" and select "Account Transcript" for the tax year in question. This transcript typically shows your current balance including accrued interest and penalties, even when the main account page is broken. If the transcript still doesn't help, you'll need to call the IRS using the specific phone number on your payment plan agreement (not the general customer service line). Have your payment plan agreement number ready along with the usual identity verification info. One important thing to remember: interest is still accruing daily on your $2,800 balance at the current federal rate (around 8% annually). So on a 180-day plan, you're looking at roughly $110-120 in additional interest if you spread payments evenly. The sooner you start paying, the less total interest you'll pay. Also keep in mind that the IRS applies payments to interest first, then penalties, then principal - so you want to make sure you're paying enough to make meaningful progress on the actual tax debt. The account transcript method worked for me when nothing else would - hopefully it helps you too!

I completely understand your frustration - I went through this exact same issue about 6 months ago! The "information not available" message after setting up a payment plan is incredibly common and so stressful when you're trying to be responsible. Here's what worked for me: First, try getting your Account Transcript through the same ID.me portal (under "Get Transcript" then "Account Transcript"). The transcript usually updates much faster than the main account page and will show your current balance breakdown including interest and penalties. If that doesn't work or you want to double-check the numbers, definitely call the specific phone number listed on your payment plan agreement letter - NOT the general IRS customer service line. The payment plan specialists typically have shorter wait times and can give you your exact current balance over the phone. Whatever you do, don't start making payments without knowing the exact amount. Interest is still accruing daily (currently around 8% annually), and the IRS applies payments to interest first, then penalties, then principal. On your $2,800 balance over 180 days, you're looking at roughly $110-120 in additional interest if payments are spread evenly. The good news is that once you get the balance figured out, you have plenty of time with the 180-day plan to pay it off early and save on interest. The uncertainty is definitely the worst part - once you have the numbers, it becomes much more manageable!

I've been in your exact situation and totally get the anxiety! As someone who splits everything with roommates and frequently covers group expenses, I was terrified about having to explain dozens of Zelle transfers during tax season. The relief came when I realized that reimbursements are fundamentally different from income in the eyes of the IRS. When you pay $100 for a group dinner and friends send you back $75, you didn't earn $75 - you're actually out $25 for your own meal. The IRS understands this distinction perfectly. What helped me feel more confident was learning that IRS audit systems are designed to catch significant patterns of unreported business income - regular payments that look like wages, total deposits way higher than reported income, etc. Random personal transfers from different friends for splitting bills don't fit those red-flag patterns at all. For documentation, I keep it simple: clear memos when possible ("utilities - roommate share," "dinner split") and screenshots of group texts for bigger shared expenses like vacation rentals. But I don't stress about documenting every coffee split or small reimbursement. The bottom line is that millions of Americans use payment apps this way every day, and it's completely normal, legal behavior. Focus your energy on accurately reporting your actual income rather than worrying about explaining legitimate personal reimbursements. You're being responsible by thinking about compliance, but don't let this anxiety consume you over something the tax system fully accounts for!

I completely understand your anxiety about this - I was in the exact same situation last year and spent way too much time worrying about it! The good news is that personal reimbursements between friends are definitely not taxable income, even when there are tons of them. The key insight that helped me was understanding that these transfers don't represent actual income - they're just you getting back money you already spent. When you pay $60 for groceries and your roommate sends you $30 back, you haven't earned $30, you're still out $30 for your share. The IRS recognizes this fundamental difference between reimbursements and actual income. From an audit perspective, the IRS systems are designed to flag patterns that suggest unreported business income - things like regular payments from the same person that look like wages, or total bank deposits that significantly exceed your reported income. Your random Zelle transfers from different friends for splitting bills don't fit those patterns at all. My practical advice: start using descriptive memos when you can ("dinner split," "utilities," "concert tickets"), and for larger shared expenses like vacation rentals, maybe save the group text where you discussed splitting costs. But don't stress about documenting every small coffee or lunch reimbursement. You're being responsible by thinking about this, but try not to let it consume too much mental energy. This is incredibly common behavior that millions of people engage in, and the tax system absolutely understands how payment apps are used in daily life!

This is maybe a dumb question but what if i start a small side business just to be able to deduct my phone? like selling stuff on ebay once a month or something? would that work?

Great question! I dealt with this exact situation last year when I was trying to figure out phone deductions. As others have mentioned, the Tax Cuts and Jobs Act really changed the game for W-2 employees - those miscellaneous itemized deductions are off the table until at least 2025. Since you mentioned you're a regular W-2 employee, your best bet is definitely to approach your employer about reimbursement first. Many companies are willing to provide a monthly stipend once they understand the business need - especially if you can document how much you're using your phone for work calls, emails, and navigation. If that doesn't work out, you might want to consider if you have any side income that could qualify as self-employment. Even small amounts of freelance work, consulting, or selling items online could potentially allow you to deduct the business portion of your phone expenses on Schedule C. Just make sure any side business is legitimate and profit-motivated, not just set up for tax purposes. The separate phone plan idea is smart for keeping things organized, but unfortunately won't change the deduction rules for your W-2 employment. Hope this helps clarify things!

Has anyone actually had success getting their credits back after filing Form 8862? My credits were denied two years ago, I filed 8862 last year, and still got rejected again with no clear explanation.

I went through something similar with my brother's return last year. The IRS reduced his refund and he needed to file Form 8862 the following year. One thing that really helped was getting a copy of his account transcript from the IRS website - it shows much more detail about exactly what they adjusted and why. The transcript has specific transaction codes that explain the adjustments, which is way more informative than the basic notice they send. Also, make sure your sister keeps excellent records going forward. The IRS tends to scrutinize returns more closely once someone has been flagged for these credits. Things like school enrollment records, medical appointments, and utility bills in her name at the same address as the kids can all help establish that the children lived with her for more than half the year. The good news is that filing Form 8862 doesn't prevent you from claiming the credits again - it just requires extra documentation and verification. Just be thorough and honest when completing it.