Based on what everyone's shared here, it sounds like you're in good shape regarding your past Medicaid benefits. The key thing to remember is that Medicaid eligibility is determined based on your circumstances at the time you received the benefits, not who claims your daughter on taxes later. Since you accurately reported your household situation when you applied for and maintained Medicaid coverage throughout 2024, allowing her father to claim the child tax credit shouldn't create any retroactive issues with the benefits you already received. Just make sure you follow the proper procedures - complete Form 8332 as mentioned above to officially release your claim to the exemption, and don't forget to report your new employment status to your state Medicaid office for future coverage decisions. This way you're being transparent about your changing circumstances while protecting the benefits you legitimately received when you qualified for them. It's really nice that her father has been supporting you both, and it sounds fair that he should get the tax benefit for that support!

As someone who works in benefits administration, I can confirm what others have said about the separation between tax filing and Medicaid eligibility. These are governed by completely different sets of federal and state regulations. Your Medicaid benefits for 2024 were approved based on your household composition and income at the time of application and during periodic renewals. The IRS dependency rules for tax purposes operate independently from these benefit determinations. However, I'd strongly recommend documenting this decision. Keep copies of Form 8332 when you complete it, and consider getting written confirmation from your state Medicaid office about your reporting of the employment change. This creates a paper trail showing you've been transparent about your circumstances throughout the process. One additional tip: when you notify Medicaid about your new job, ask specifically about the transition timeline. Some states have grace periods or step-down coverage options that might help bridge any gaps between losing Medicaid and your new employer coverage taking effect.

One additional consideration that might be relevant to your situation - if either of you contributed to retirement accounts like traditional IRAs or 401(k)s, the deduction limits are significantly different for MFS status. For married filing separately, the ability to deduct traditional IRA contributions phases out completely at much lower income levels if either spouse has a workplace retirement plan. At your $142k income, you'd likely lose the ability to deduct traditional IRA contributions entirely if filing separately (assuming you have a 401k at work). Your wife at $24.3k would still be able to make deductible contributions, but the overall household retirement savings tax benefits could be reduced. Also, since you mentioned you're in the process of separating, don't forget about the dependency exemption aspect. While you can each claim your biological children as dependents, make sure you coordinate who claims any other potential dependents or qualifying relatives to avoid conflicts with the IRS. The timing of your separation during the tax year can also affect certain deductions - for example, if you paid any medical expenses for your wife or her daughter before the separation, those might only be deductible if you file jointly. Same goes for any educational expenses you might have paid on behalf of her daughter.

Given your complex situation with the income disparity and children involved, I'd definitely recommend getting professional help to run both scenarios. The math can get really tricky with MFS, especially when you factor in all the credits you might lose. One thing I haven't seen mentioned yet is the potential impact on any student aid applications if either child will be applying for college soon. The FAFSA uses tax filing status to determine which parent's income to consider, and this could significantly affect financial aid eligibility. With your higher income vs. your wife's much lower income, the filing status choice could make a huge difference in aid calculations. Also, since you're living separately now, you might want to consider whether either of you qualifies for Head of Household status instead of MFS. If you're not legally separated or divorced by year-end, you'd still be considered married for tax purposes, but there might be some planning opportunities for next year once everything is finalized. The general rule of thumb is that joint filing usually comes out ahead unless there are very specific circumstances (like significant medical expenses for one spouse, or income-based student loan repayment considerations). But your situation has enough moving parts that professional guidance could save you thousands.

Has anyone used TurboTax Business for their partnership return? We're a simple 50/50 LLC with basic income and expenses, wondering if it's worth the $200 or if there's a better option.

Great question! I went through this exact same confusion with my LLC last year. Just to add a few practical tips to what Emily covered: 1. Make sure you get an EIN (Employer Identification Number) for your LLC if you don't already have one - you'll need it for the 1065 form. 2. Keep really good records throughout the year of all income and expenses. The 1065 requires you to categorize everything properly, and it's much easier if you're organized from the start. 3. Don't forget about estimated quarterly payments! Even though the LLC doesn't pay taxes directly, you and your partner will likely need to make estimated payments on your individual returns based on your K-1 income. 4. Consider setting up a separate business bank account if you haven't already. It makes tracking business expenses so much cleaner when tax time comes around. The March 15 deadline is firm, so start gathering your documents in January. If you think you might be cutting it close, file that extension (Form 7004) early - it's better to be safe than sorry with those penalties!

I'm so grateful to have found this thread! I've been in a similar situation for the past couple of months after being let go from my job, and I've been selling off various personal belongings to help make ends meet - old furniture, some jewelry, electronics, books, you name it. Like everyone else here, I'm definitely selling everything for way less than what I originally paid for it. The tax anxiety has been real though! I kept wondering if I was supposed to be reporting these sales or setting aside money for taxes, especially since some weeks I might sell $200-300 worth of stuff. But reading through everyone's experiences here has been such a relief - it makes perfect sense that selling personal items at a loss wouldn't be taxable income. I love the practical advice about keeping a simple spreadsheet with photos. I've been loosely tracking things in my head, but having actual documentation sounds like a smart approach for peace of mind. The point about different platforms having different 1099-K requirements is also really helpful since I've been using multiple selling platforms. What strikes me most about this thread is how supportive everyone has been while sharing genuinely useful, real-world advice. When you're already dealing with the stress of unemployment and financial uncertainty, having a community where people share their actual experiences (rather than just theoretical tax advice) makes such a difference. Thank you all for taking the time to help others navigate this challenging situation!

I've been following this discussion and wanted to add my perspective as someone who went through a very similar situation about 18 months ago. After being laid off, I ended up selling quite a bit of personal property - everything from old camping gear to kitchen appliances to books and DVDs I'd accumulated over the years. What helped me the most was understanding that the IRS really does make a clear distinction between personal property sales and business activity. When you're selling items you originally bought for personal use at a loss, you're essentially just disposing of depreciated personal property. The key factors that kept me in the "personal" category were: 1) I owned everything for personal use originally, 2) I was clearly selling at a loss, and 3) I wasn't regularly buying items with the intent to resell them. I did keep basic records - just a simple list with item descriptions, rough original cost, and selling price. Looking back, this was more for my own peace of mind than anything else, but it did help me see that I was consistently selling everything for 20-40% of what I originally paid. One thing I learned that might be helpful - even if you receive a 1099-K from a platform like eBay, you can still properly account for these as non-taxable personal property sales on your return. The form doesn't automatically mean you owe taxes on that income. Hang in there with the job search - I know how stressful this whole situation can be, but you're asking the right questions and approaching it thoughtfully!

Just to add to the excellent advice here - make sure you keep detailed records of EVERYTHING, even the purchases you don't need to report right now. The IRS uses FIFO (First In, First Out) accounting by default for crypto unless you elect specific identification, so when you do eventually sell, you'll need those early purchase records to calculate your cost basis correctly. I learned this the hard way when I sold some Bitcoin in 2022 and realized I needed purchase records going back to 2019 to properly calculate my gains. Had to dig through old email confirmations and bank statements. Save yourself the headache and create a simple spreadsheet now with dates, amounts, and prices for all your transactions - even the small $50 purchases. Future you will thank you!

@Cynthia Love For someone just starting out like yourself, I'd recommend keeping it simple with a basic Google Sheets or Excel spreadsheet. Create columns for: Date, Platform (Robinhood, etc.), Transaction Type (Buy/Sell), Coin, Amount, Price per coin, Total USD, and any fees. Since you're using Robinhood, they actually make record-keeping easier because everything stays on their platform - just make sure to download your monthly statements. But if you ever move crypto off Robinhood or start using other exchanges, that's when detailed tracking becomes critical. A few free templates you can find online: CoinTracker has a free CSV template, and there are good Reddit threads in r/CryptoCurrency with spreadsheet templates people have shared. Start simple now and you can always upgrade to more sophisticated tools later if your crypto activity increases. The key is just getting in the habit of logging everything as it happens rather than trying to reconstruct months of transactions later!