I used FreeTaxUSA last year for my W2 and multiple 1099-NECs and it worked fine technically but I missed a TON of deductions. I think the issue is that FreeTaxUSA doesn't prompt you for industry-specific deductions - they have the fields for everything but you have to know what to enter. This year I paid a CPA $350 and she found over $4,200 in additional deductions FreeTaxUSA never prompted me about.

I've been using FreeTaxUSA for my W2 + 1099-NEC situation for two years now and it's definitely capable of handling both income types. The software walks you through everything step by step - W2 entry is straightforward, and for the 1099-NEC it creates Schedule C automatically and calculates your self-employment tax on Schedule SE. That said, after reading these comments I'm realizing I probably left money on the table with deductions. FreeTaxUSA asks about common business expenses but doesn't really probe deeper for industry-specific ones. For graphic design work specifically, you might be able to deduct things like stock photo subscriptions, design software, computer equipment depreciation, professional development courses, even a portion of your internet bill if you work from home. My advice: FreeTaxUSA will get the job done correctly, but spend some time researching graphic design business deductions beforehand so you know what to look for when you're entering expenses. The IRS has good resources on their website about what freelancers can deduct. With only $7,800 in freelance income, you're probably fine with FreeTaxUSA as long as you do your homework on deductions first.

I just want to echo what others have said about TurboTax being able to handle this situation - I used it for a similar multi-state move from Michigan to Florida last year and it worked great. The software really does walk you through everything step by step. One additional tip I haven't seen mentioned yet: when you're entering your information, pay close attention to the "income allocation" screens. TurboTax will ask you to confirm how much income was earned in each state based on your move date. Double-check these numbers against your pay stubs to make sure the allocation looks reasonable - this is where you can catch any errors before filing. Also, don't be surprised if your Arizona return shows you owe a small amount even after withholding. This happened to me with Florida (well, Florida doesn't have income tax, but with Michigan) - sometimes the withholding calculations don't perfectly align with part-year resident tax calculations. It's usually not a big amount if your employer was withholding at reasonable rates. The whole process took me about 2 hours using TurboTax, including time to gather documents and double-check everything. Way less stressful than I expected!

I've been through a very similar situation and can definitely relate to the stress you're feeling! Moving mid-year and dealing with multi-state taxes for the first time is overwhelming, but it's actually much more manageable than it seems initially. You're absolutely correct that you'll need to file part-year resident returns in both Colorado and Arizona. Colorado will tax the income you earned while living there (January through July), and Arizona will tax income earned while you were an Arizona resident (July through December). Your suspicion about the continued withholding being wrong is likely spot-on - this is an extremely common payroll mistake. The good news is that when you file your Colorado part-year return, you should get a refund for any taxes they withheld on income earned after you moved to Arizona. I had a similar situation when I moved from Ohio to Tennessee, and I got back almost $1,800 in incorrectly withheld taxes. Don't worry about the Box 16 amounts not matching Box 1 - this is completely normal because states have different rules about what constitutes taxable income. Some items that are federally taxable might not be state taxable and vice versa. TurboTax can definitely handle your situation. When you get to the state section, you'll indicate that you moved during the year and it will guide you through allocating income between the states based on your move date. Just make sure you have your exact move date ready - the software does all the calculations from there. One tip: keep documentation of your move date (lease agreements, utility connections, etc.) just in case, though it's rarely needed for electronic filing. The whole process seems scary but once you start, you'll see it's quite straightforward!

I'm a little late to this convo but fyi - TurboTax has a known glitch with scholarships!! When you enter the 1098-T information, it doesn't automatically connect the scholarship amounts from Box 5 with the qualified expenses. You have to manually tell it that the scholarship was used for qualified expenses by entering those details in the scholarship/grant section. I had to call their support line to figure this out after it kept saying we owed taxes on my son's full scholarship amount. Super frustrating but fixable!

Great to hear you got it sorted out! For anyone else dealing with this, I'd also recommend keeping detailed records of what qualified expenses your scholarship covered. The IRS defines qualified education expenses pretty specifically - tuition, required fees, books, and required supplies/equipment for courses. Room and board, transportation, and personal expenses don't qualify, even if they're listed on your student bill. Also, if you're claiming education tax credits like the American Opportunity Credit, you can't "double dip" - the same tuition dollars can't be both tax-free (from scholarship) AND used to claim a tax credit. One more tip: if your child has multiple scholarships or grants, you might have some flexibility in how you allocate them between qualified and non-qualified expenses to optimize your tax situation. It can get complex, so definitely worth consulting with a tax professional if the amounts are significant!

Has anyone figured out how to handle staking rewards in FreeTaxUSA? I've got my regular trading figured out but Coinbase also gave me staking income and I have no idea where to put that. Is it different from the capital gains stuff?

I went through this exact same struggle last year! One thing that really helped me was making sure I understood the difference between what Coinbase sends you and what you actually need for FreeTaxUSA. Coinbase provides a "Tax Document" that looks like Form 8949, but it's not an official IRS form - it's their summary of your transactions. You'll use this information to fill out the actual Form 8949 section in FreeTaxUSA. Here's what worked for me: Go to the "Income" section in FreeTaxUSA, then "Investment Income," then "Capital Gains and Losses." You'll see options for entering 1099-B info, but since Coinbase doesn't issue actual 1099-B forms for crypto, you'll select the option for transactions "not reported on 1099-B." Don't stress too much about getting audited - as long as you report everything accurately and keep your records, you'll be fine. The IRS mainly cares that you're reporting your gains and losses honestly. Take your time with it and double-check your numbers against the Coinbase summary before submitting.

I've been dealing with capital loss carryovers for several years now, and I can confirm what others have said - you absolutely must use them in consecutive years. The IRS doesn't give you the option to pick and choose which years to apply the losses. In your case, since you missed claiming the $4,500 carryover on your 2023 return, you'll need to file Form 1040-X to amend that return and claim $3,000 of the loss. Then apply the remaining $1,500 on your 2024 return. One thing I learned the hard way is to always check line 16 of Schedule D from your previous year's return - that shows your capital loss carryover to the next year. I now make a note in my tax folder each year with the carryover amount so I don't forget it when preparing the following year's return. The sequential requirement exists because the IRS wants to ensure taxpayers don't strategically time their loss deductions for maximum benefit. It's frustrating when you forget, but the amended return process isn't too complicated and it's definitely worth recovering those deductions.

I've been following this thread and want to add some clarity based on my experience as a tax preparer. Everyone is correct that capital loss carryovers must be used consecutively - there's no "skipping" allowed under IRS rules. For your specific situation, Ravi, you have two options: 1. File Form 1040-X to amend your 2023 return and claim the $3,000 carryover you missed, then claim the remaining $1,500 on your 2024 return. 2. If you choose not to amend 2023, you unfortunately forfeit that $4,500 carryover entirely. You cannot apply it to 2024 or any future year. The IRS is very strict about this sequential requirement. The logic is that capital loss carryovers are meant to help taxpayers in the immediate years following large losses, not to be strategically saved for more advantageous tax years. I'd strongly recommend filing the amended return for 2023. Even if it's a bit of paperwork, you're essentially leaving $3,000+ in tax savings on the table otherwise. The statute of limitations for amendments is three years from the original filing date, so you should still be within the window for 2023.