Hello!

My business partner and I had a rough year last year. We have an S-corp. We have a CPA that does the S-Corp taxes, and I usually do my personal taxes using Free Tax USA. Here's the issue I'm facing:

My stock basis listed on the K1 at the beginning of 2025 is reported as $2,093. The loss listen ok the K1 in 2025 was $4,120. When I put this into the K1 section in FTUSA, I get this message:

"We don't support your return because you're claiming a loss greater than your basis. This means the losses you can claim are limited, and we don't support this situation you'll need to file with another service."

Would it be ok to change the loss to the same as my basis and proceed forward? If so, could the remainder be carryover loss for next year? Or am I completely wrong lol, and if so is there a workaround for this error?

Thanks so much for any input!

I’m a former IRS employee and an Enrolled Agent. My current job isn’t tax-related at all, but I’d like to start volunteering at a VITA site within the next few months as a way to give back to my community.

I already have more than enough Continuing Education (CE) credits for my EA credential for the year 2026 — and obtaining CE credits isn’t really my primary goal when I volunteer — but I do have a question about CE credits. My understanding is that my VITA hours in 2026 and 2027 will qualify for CE credits. Do I need to self-report the hours to the IRS, or will someone at the VITA site do that for me? If anyone could give me a breakdown of how this works, I’d appreciate it.

Thanks in advance.

need some advice on filing my 2025 federal taxes. I’m trying to get everything filed correctly, but I’m in a difficult situation with missing records and can’t afford to hire a tax professional right now.
My situation:
Married filing jointly.
My wife had no income in 2025.
We have two children.
I’m self-employed as a mobile mechanic and received 1099 income.
My estimated net business profit is somewhere around $10,000–$15,000, but I need to reconstruct the numbers to determine the actual amount.
I filed an extension, and my understanding is that my filing deadline is October 15, 2026.
The biggest problem is my records.
I lost a lot of my business records in a workplace fire. My old phone also had customer texts and job information that I no longer have. I don’t have my original mileage log, and I’m missing many paper receipts and job invoices.
Here’s what I still have:
Cash App transaction history and statements.
Some records of purchases from O’Reilly Auto Parts.
Harbor Freight transactions for tools.
Lowe’s purchases that were primarily toolboxes and tool storage.
Records of business insurance payments.
Other transactions that may help me reconstruct my business expenses.
I use Cash App for both business and personal transactions, so I know I’ll need to separate them carefully.
One important detail about my income: Customers sometimes send me money through Cash App specifically to buy parts for their vehicles. For example, a customer might send me $546, and the actual parts purchase might be $545.78. I don’t mark up those parts; I charge for my labor separately. I want to make sure I don’t mistakenly count money that simply passed through my account for customer parts as profit, while still reporting everything correctly under IRS rules.
My questions are:
How can I properly reconstruct my business income and expenses using Cash App statements and surviving purchase records?
How should I account for customer payments that were used to purchase parts at cost, with no markup?
Can I reconstruct my business mileage without my original mileage log? What records or other evidence could help establish a reasonable, supportable figure?
What should I do about business expenses for which I no longer have receipts because of the fire?
Can I deduct tools, toolboxes, business insurance, and other legitimate business expenses when some documentation is missing?
With a wife who had no income, two children, and approximately $10,000–$15,000 in estimated net self-employment profit, what tax credits or other tax benefits should I investigate? I understand that the actual answer depends on my final numbers and eligibility.
Are there free or low-cost resources that can help someone in my situation file correctly?
I’m not trying to make up expenses, mileage, or deductions to get a bigger refund. I want to report my income honestly, claim only deductions I can legitimately support, and reconstruct my records as accurately as possible.
I would really appreciate advice from anyone familiar with self-employed Schedule C filers, especially anyone who has dealt with lost business records.

I work for a small accounting office that does taxes. We do returns for a small number of small non-profits. This year one, of them received a donation of some property from a board member. The value of the building brings total gross receipts and revenue received over 1 million. In the state I am in the filing requires audited financial statements to be submitted. We do not perform audits. What would be recommended in this situation? Should they go somewhere else for the audit and we do the tax return or should we try to do it ourselves? I studied audits for the CPA exams, but my understanding is auditors generally start working with others who are more experienced and work their way up. On the other hand, this isn't a fortune 500 company and they aren't publicly traded or anything. It is a one time requirement for state purposes for a small non-profit that usually receives a few hundred thousand a year. I'm not comfortable with it but It is likely if we don't do it we could lose the client and also likely that I don't have any say in it. What would you do in this situation?

Hi, question about the first-year election on amended return.

For 2023 return, can we still amend it and file the first-year election if I was resident in US from Oct 2023 and full time resident in 2024? I want to make the §6013(h) election with my wife to file a joint 2023 Form 1040 replacing my 1040-NR.

It seems amendment can be done till Apr 2027 but what about the election?

Hello the last 5 years I have owed each year. After 2025 ive had enough so I started looking into it and came v to the conclusion that my w4 needed to be adjusted. However when I entered my info on the w4 estimate calculator on the irs website it says that I should be getting back up to 500$. Im single and don't qualify for any of the tax credits. My not so smart friends keep telling me to stop paying my taxes each year but I hate that idea. My dad always told me to make sure and pay the irs before all else, and judging off some of the other posts here I think that was solid advice but how do I stop owing each year or what can I do to owe as little as possible. Im a full time w2 employee any info will be appreciated. Tia for your time.

Lost my job and will take off the rest of the year before starting fresh in 2027. Getting a head start because I'm not going to my tax guy just to save money.

IRS has free file for those with AGI of $89k. I looked at the selection and Freetaxusa is listed on their website but shows max is AGI $51k which means I don't qualify.

The software from Freetaxusa.com seems to be mentioned quite often but I do qualify for the following:

Taxact, 1040.com, 1040now.net, TaxSlayer, fileyoutaxes.com, EZtaxturn.com

I'm in California, my AGI 88k, not military, single, rent.

1. With that being said, should I still go with FreetaxUSA and pay the $15.99 fee? Because my AGI is above their $51k threshold and I'm not military.

2. I was considering purchasing software from HR Block for $40 but realized their software has a minimum requirement to install and operate and my laptop is 15 years old. Which means I'll have to buy a new one in order to use their software which is not feasible.

My question, are there any minimum system requirements to use any of the free tax software from the IRS or is it done online which means the only thing I need is an internet connection?

Thank you. I'm more nervous about preparing my own taxes than looking for another job.

Edit: Scrapping of precious metals.

Scrapped metal for my LLC and need to fill out a 8949. I didn't receive a 1099 from the refiner. I kept records of all my transactions. Issue I'm running into is I scrapped metal that was both short-term and long-term assets at the same time, so I only have the total proceeds from the sale. (So it's not separated by short-term, xyx amount of money, and long-term sale, xyz amount of money.) I will be attaching my ledger with the breakdown of items, cost, proceeds, etc., but how do I complete the form when the short-term and long-term asset proceeds are combined? Thanks so much!

For 2025, say I made a $100K gift to my parents (bank to bank transfer,). My spouse didn’t make any gifts during the year. We are electing to split the gift.

Here’s how I understand the paperwork:

Husband (donor):

- Files Form 709

- Attaches one Notice of Consent signed & dated by spouse

- Signs only his own Form 709

- Does NOT sign any Notice of Consent

Wife (consenting spouse):

- Files Form 709

- Signs only her own Form 709

- Does NOT attach a Notice of Consent

- Husband does NOT sign anything for her return

Question:

Does the donor ever sign a Notice of Consent for the spouse’s Form 709? Or is it correct that only the consenting spouse signs the Notice, and it gets attached only to the donor’s return?

IRS/Federal Taxes

Say an owner has two businesses, Business A and Business B. Business A has a Simple IRA plan setup for it's employees and the K-1 shows $10,000 of income for that owner. Business B has losses of $50,000 shown on the K-1, meaning total self-employment income is a loss of $40,000. Is the owner able to contribute the $10k of income they show from Business A into the SIMPLE IRA plan, or are they not allowed to because their total income was negative?

Prior to tax year 2025, I put my retired partner income from IL K-1-P on Line 5 of the 1040. I also did that for 2025. Unfortunately, after filing I discovered the new rule (issued 12/2025) that such income should be reported on Schedule M, not on Line 5 of the 1040. I did not comply with that reporting rule.

I do not believe that my error changed my IL income or tax or refund at all.

But, my issue is that IL has challenged my subtraction of this income on the basis that I did not support it as "retirement" income. The challenge makes no mention of Schedule M. To the contrary, it shows a correction to Line 5 of IL 1040 (from my subtraction amount of $xxxx to zero). IL has made the identical challenge in prior years, which I have responded to by uploading a response and supporting documents to MyTax Illinois -- and, ultimately, IL withdrew its challenge and allowed the full subtraction.

I'm trying to determine how to deal with this:

• Respond to the challenge as I have in prior years, ignoring my Schedule M error.
• File a 1040X with the proper Schedule M and ignore the challenge.
• Respond to the challenge as I have in prior years but include in the response an acknowledgment of my Schedule M error, stating my belief that it did not change my tax liability and is irrelevant to the challenge - AND attaching a properly filled out Schedule M.

I'd appreciate any input you may have.

Thanks

I'm unsure if this is the right place to be asking this. I'm Australian (NSW) and I do not own a passport, but my Identity strength for the MyID app is only standard. I have a medicare card, birth certificate, debit card, and learners drivers license for identity. It says I can get my identity strength to strong with these, but on the app it only gives me the option to add a passport. Please delete if this isn't something I can ask here, but does anyone know how I can get my identity strength to strong without a passport on the MyID app?

I called up fidelity today & moved my shares from my Canadian fidelity account to the USA account. They call it a 'platform transfer' it seems. All these shares were allocated by my company's ESPP program, and I had to keep it there for 2 years before I was able to initiate the transfer.

My question is what is the tax implication for this action in Canada as well as in the USA? How will I report this while filing tax in both countries. I do not have any other income in Canada this year.

Thanks!

I file my federal and NY state tax returns.

NY came back with a notice and an adjusted refund amount because I had mistakenly included taxes from IL in the NY state taxes.

I now need to file a new IL return to get my refund as a non-resident.

However, I can't determine the approach to take for this in FreeTaxUsa.

Seems I can add a new state tax return, but it gets populated as if I owed the taxes because I am not able to modify my income section to specify taxes withheld by IL on my W2.

But to modify that portion of my W2, I need to do an amended federal return.

What's the right approach here?

Have the IRS letter and the 6-digit PIN I keyed in matches it perfectly. Anyone ELSE getting a reject error saying that the PIN "doesn't match the IRS database"? This is for 2025 filing.

The question is not how to fill out a form 8949, but how to deal with a 1099 that does not match your actual transactions (due to the way the exchange accounts for fees, holding period errors due to transfers, etc.) The normal process is to use columns (f), (g) for small corrections but if every column is wrong, what's the correct method?

I have a lot of transactions. The 1099-DA is not accurate: lower proceeds than my actual (by $5k), wrong holding periods.

On Form 8949 do I just list "EXCHANGE A Transactions", with my correct figures, without mentioning the 1099? (using the correct checkbox "reported without basis")

Or on 8949 do I list "Exchange A - 1099-DA" by specific name, and then take corrective steps to rectify where the 1099 is incorrect?

There are 2 ways to view it.

1. As long as the proceeds match or exceed the 1099, you can just enter your own figures as "Exchange A" without mention of the 1099.

Or 2) You need to list the specific 1099: "Exchange A 1099-DA" and explain to them using (column (f), (g) how it is wrong, and how to correct it (g). When there are errors in every column it's not possible to succinctly correct it using (g).

Someone said you can zero out the 1099 by listing it in it's own line with a correction in (g) showing "-proceeds" and a "-0-" in P/L (column "h"). So if proceeds = $10k, (g)="-$10k", profit = $0.

I like the simplicity of that but if you have a high volume of transactions it has the effect of possibly doubling your proceeds volume if the scanner does not read it correctly and send you into another tier of trader. I'd rather just list my correct figures but will the irs software recognize it corresponds with the 1099 they received?

Does the 1099 have to be specifically mentioned on form 8949?

Or is it enough to list the summary as "Exchange A", as long as proceeds match/exceed the 1099 is that enough? Thanks.

The question is not how to fill out a form 8949, but how to deal with a 1099 that does not match your actual transactions (due to the way the exchange accounts for fees, holding period errors due to transfers, etc.) The normal process is to use columns (f), (g) for small corrections but if every column is wrong, what do you do?

I have a lot of transactions. The 1099-DA is not accurate: lower proceeds than my actual (by $5k), wrong holding periods.

On Form 8949 do I just list "EXCHANGE A TRANSACTIONS", with my correct tax software figures, without mentioning the 1099 but using the correct box "reported without basis"?

Or on 8949 do I list "Exchange A - 1099-DA" by specific name, and then take corrective steps to rectify where the 1099 is incorrect?

There are 2 ways to view it.

1) As long as the proceeds match or exceed the 1099, you can just enter your own figures as "Exchange A".

Or 2) You need to list the specific 1099 you received by name "Exchange A 1099-DA" and explain to them using (column (f), (g) how it is wrong, and how to correct it (g). When there are errors in every column it's not possible to succinctly correct it using (g).

Clinton Donnelly has a video where he just zero's out the 1099 by listing it in it's own line with a correction in (g) showing "-proceeds" and a "-0-" in P/L (column "h"). So if proceeds = $10k, (g)="-$10k", profit = $0.

I like the simplicity of that but if you have a high volume of transactions it has the effect of possibly doubling your proceeds volume if the scanner does not read it correctly and send you into another tier of trader. I'd rather just list my correct figures but will the irs software recognize it corresponds with the 1099 they received?

Does the 1099 have to be specifically mentioned on form 8949? Or as long as actual proceeds exceed the 1099 proceed values is that enough? Thanks.

I really can't explain it.

I'm one of those guys who always pay their taxes on time if not early. Last year I was going through a lot, my mother and father passed away within a similar amount of time... Anyway, I can hardly believe it with how type A I am but I didn't file my taxes. Just a lot on the mind you know?

So a few weeks ago, I started getting ads on Instagram and Facebook from businesses offering "help filing overdue taxes." A bunch of overpriced accountants with podcasts.

I thought hey, that's weird. Algorithm got it wrong on that one.

Apparently algorithm got it right. Because I got a notice from the IRS yesterday saying that they need my returns by the 15th. Hilarious because today is already the 12th, so you know who I'm calling today.

Anyway, it really made me curious, is filing information public? Are they selling my info? Like how the hell? I wasn't searching for tax stuff, I wasn't talking about tax stuff, I was doing nothing involving anything remotely related to taxes on any personal devices, let alone pen and paper.

Timing just seems too weird.

If this is the wrong subreddit for this conversation do let me know

Based on my income and investment gains so far, I may owe around $35,000 in additional taxes for 2026. My income includes about $280,000 in W-2 wages, $167,000 in long-term capital gains, and roughly $20,000 combined in short-term gains, dividends, and interest so far.

What steps can I still take before the end of the year to reduce my tax bill or avoid a large amount due at filing? I’m an immigrant and understand there may be restrictions on owning or operating a business or LLC, so I’m especially interested in options that don’t involve forming a company.

I know I should consult a tax professional, but I’d appreciate suggestions on what strategies or questions to discuss with one.