Anyone know how this affects my 401k? I'm in a similar situation where I got laid off and have a 401k with the old employer. Will taking distributions from that generate imputed income W-2s too?

Based on your description of receiving severance in 2023 and having a $2,800 W-2, this is most likely related to those restricted stock units (RSUs) that Victoria mentioned. Many companies have "accelerated vesting" or "continued vesting" provisions in their equity agreements for layoffs, where your unvested stock continues to vest for a period after termination. The key thing to understand is that when RSUs vest, the IRS treats the fair market value of those shares as regular W-2 income, even though you didn't receive cash. Your former employer is required to report this and withhold taxes just like regular salary. Check if there's any federal or state tax withholding shown on this W-2 - if so, you'll get credit for those withholdings when you file your return. Since you strategically timed your severance for tax purposes, you'll want to factor this additional $2,800 of income into your 2023 tax planning. It's treated exactly like regular wages for tax purposes, so it will be subject to your marginal tax rate. The good news is this is likely a one-time occurrence unless you have more equity that continues vesting in 2024.

Has anyone considered the gift tax implications here? If you're paying your kids above-market interest rates, the excess interest could potentially be considered a gift from you to them. My accountant flagged this for me in a similar situation.

This is a great discussion! One thing I'd add is to make sure you're documenting everything properly from the start. I learned this the hard way when my daughter borrowed money from me (opposite situation, but same principle). Keep records of: - The original source of funds in those joint accounts (was it allowance money, gift money from grandparents, etc.?) - A written loan agreement with clear terms, even if informal - Payment records showing principal vs. interest breakdown - Bank statements showing the transfers The IRS really cares about substance over form here. If your kids truly owned that money originally and you're paying them legitimate interest, then yes, it's taxable income to them. But if you were just moving your own money around between accounts, that's different. The key is being able to prove the economic reality of who owned what. Also worth noting - if your kids are minors and this pushes their income over the filing thresholds mentioned earlier, you might want to consider whether the tax complications are worth it compared to just keeping it as a family arrangement without formal interest payments.

Great question! I was in a similar situation a few years ago. Here's how I think about it: If you're already at 15% for your 401k and getting your full employer match, the decision really comes down to your personal financial goals and cash flow needs. **Go with higher 401k contributions if:** - You're behind on retirement savings for your age - You have stable income and don't need the extra cash flow - You're close to a tax bracket threshold (as mentioned above) - You want to maximize long-term wealth building **Go with higher withholding if:** - You're on track for retirement but just want to avoid owing taxes - You might need more flexibility with your money during the year - You have other financial priorities (emergency fund, debt payoff, etc.) - You prefer having more control over your cash flow One middle-ground approach: increase your 401k by just 2-3% and adjust your withholding slightly. This way you get some additional tax reduction benefits from the 401k while not tying up too much extra cash. The most important thing is that you're being proactive about this instead of getting surprised again next April!

Another factor to consider is your current tax situation versus your expected tax situation in retirement. If you think you'll be in a lower tax bracket when you retire (which is common), then maximizing traditional 401k contributions now makes a lot of sense - you're getting a tax deduction at your current higher rate and will pay taxes later at a lower rate. However, if you expect to be in the same or higher tax bracket in retirement, or if tax rates in general go up by then, the immediate tax savings from higher 401k contributions might not be as beneficial long-term. Given that you're already at 15% which is really solid, and you owed taxes this year, I'd lean toward a hybrid approach: bump your 401k up to maybe 17-18% and also increase your withholding slightly. This gives you some additional tax reduction benefits while also ensuring you don't owe next year. The IRS penalty for underpaying can be pretty steep if you owe more than $1,000, so making sure you're covered on the withholding front is important regardless of what you do with your 401k.

One important thing to watch for with multiple W2s - Social Security tax. Each employer withholds 6.2% of your wages for Social Security up to the annual wage limit ($147,000 for 2022). If your combined income from both jobs exceeded that limit, you may have overpaid Social Security tax that you can get back when filing.

Just wantd to mention, when I had 2 w2s I just added the box 1 income from both, added the fed witholding together, and the state witholding together. Enter those on your 1040 and ur good to go! No need to complicate it imo.

Don't overthink this. The property is still a rental until you sell it. Expenses still go on Sch E. If you get audited, the IRS isnt gonna care that it was vacant while u were trying to sell it. Happens all the time.

I went through this exact situation two years ago with a duplex that sat vacant for 5 months while trying to sell. What really helped me was creating a clear paper trail showing my intent to sell rather than abandon the property. I kept copies of all MLS listings, price reduction notices, showing feedback, and even rejection letters from potential buyers. When I filed my Schedule E with expenses but no rental income for those months, I included a brief statement explaining the vacancy was due to active marketing for sale. The IRS never questioned it, but having that documentation gave me peace of mind. Also, make sure you're only deducting expenses that you would have paid anyway as a rental property owner - don't try to deduct any costs specifically related to marketing the property for sale, as those should be treated as selling expenses when you calculate capital gains. One tip: if you're doing any repairs or improvements to help with the sale, be careful how you categorize those. Minor repairs to maintain the property can still go on Schedule E, but major improvements to increase sale value should be added to your basis.