Has anyone used TurboTax for this specific situation? I'm dealing with the same thing and wondering if it handles the nondividend distributions correctly when importing from Vanguard.

I went through this exact same headache last year with Schwab! The key thing to remember is that box 3 nondividend distributions are typically "return of capital" - meaning you're getting back part of your original investment, not earnings. When you sell the security quickly after receiving the distribution, you need to reduce your cost basis by the box 3 amount on Schedule D. So if you originally paid $1000 for the stock, received a $50 nondividend distribution, your adjusted basis becomes $950. When you sold, your gain/loss calculation should use this adjusted $950 basis. Check your 1099-B from Fidelity carefully - look for any codes or footnotes that might indicate whether they already made this adjustment. If not, you'll need to manually adjust it when filling out Schedule D. The IRS gets copies of both your 1099-DIV and 1099-B, so they'll be looking for this to match up correctly.

Don't forget to check if your state allows deductions for unreimbursed employee expenses even though federal doesn't! I'm in NY and we can still deduct these expenses on our state return if they exceed 2% of our adjusted gross income.

Pennsylvania does allow some unreimbursed employee expense deductions on your state return! You can deduct qualifying work expenses that exceed 2% of your adjusted gross income, similar to how the federal deduction used to work before 2018. For remote work expenses like internet upgrades, office supplies, or dedicated workspace costs, you'll want to look at PA Schedule UE (Unreimbursed Employee Business Expenses). The key is documenting that these expenses are ordinary, necessary, and directly related to your job duties. Keep detailed records of your internet bills showing the cost difference between your work-required plan and what you'd need for personal use. Also save receipts for any office equipment, software, or supplies you purchased specifically for work. Since you mentioned paying an extra $25/month for faster internet ($85 vs $60), that's $300 annually. If your other work expenses push you over that 2% AGI threshold, you could potentially deduct the work portion on your PA return even though you can't federally.

Don't forget that this needs to be the FINAL 1041 with the "Final Return" box checked. Many executors miss this and end up getting notices from the IRS asking for returns for subsequent years. Also make sure Form 56 (Notice Concerning Fiduciary Relationship) is filed showing the termination of the fiduciary relationship.

Just to add another perspective - make sure you have clear documentation showing your mom was acting in her capacity as Personal Representative when she paid these fees. A simple letter or memo to the file stating something like "Paid attorney fees of $7,600 on behalf of [Estate Name] from personal funds due to bank restrictions" can be helpful documentation. Also, when you enter these on the 1041, you might want to attach a brief statement explaining the circumstances (that the estate's bank wouldn't allow the payment but the PR paid personally). This isn't required, but it can prevent questions later if the IRS reviews the return. The good news is that since your mom was the sole beneficiary, this is really just a timing difference - the money was always going to come out of "her" funds eventually anyway, whether directly from the estate account or indirectly through her inheritance.

I'm in a very similar boat - freelance graphic designer who's been putting this off for way too long. Reading through everyone's experiences here has been both terrifying and reassuring! One thing I wanted to add that helped me when I finally started tackling this: I created a simple timeline document for each year listing major life events, moves, big purchases, etc. It sounds silly, but remembering "oh yeah, that was the year I bought my new laptop" or "that's when I moved apartments" helped me reconstruct which months I was earning more or less income. Also, for anyone worried about the penalties - I called a local VITA (Volunteer Income Tax Assistance) program and they said they often help people with simple back-filing situations for free. Might be worth looking into before paying for professional help, especially if your income wasn't super high during those years. The hardest part really is just starting. I kept putting it off thinking it would be this massive catastrophe, but once I actually began gathering what information I could find, it felt much more manageable. The IRS genuinely seems to prefer people who come forward voluntarily versus people who try to hide forever. Thanks to everyone sharing their stories - it's making me feel like I can actually handle this instead of just panicking about it indefinitely!

I'm going through something very similar right now - freelance web developer who hasn't filed in 4 years due to a combination of depression, disorganization, and fear. Reading through all these responses has been incredibly helpful and honestly kind of emotional for me. What really resonates is how many people emphasize that this is fixable and that the IRS isn't out to destroy you if you come forward voluntarily. I've been living with this constant anxiety about it, imagining worst-case scenarios, but seeing real people share their actual experiences makes it feel so much more manageable. The advice about starting with just one recent year is spot on. I keep getting overwhelmed thinking about all 4 years at once, but focusing on 2023 first feels like something I can actually accomplish. And the timeline/life events approach someone mentioned is genius - I'm definitely going to try that to help reconstruct my income patterns. One question for anyone who's been through this: how long did the whole process take you from start to finish? I'm trying to set realistic expectations for myself so I don't get discouraged if it takes longer than I hope. Emma, thank you for posting this - knowing I'm not alone in this situation is honestly a huge relief. We can both get through this!

Has anyone used TurboTax or H&R Block for 1040NR? I tried using TurboTax but it kept asking me for Schedule OI info even though I'm not claiming treaty benefits. Is that normal?

I went through this exact same confusion last year! After doing a lot of research and speaking with a tax professional, here's what I learned: Schedule OI is technically required for ALL 1040NR filers, regardless of whether you're claiming treaty benefits or not. The confusion comes from the fact that many people think it's only needed for treaty claims, but if you read the actual instructions carefully, it asks for basic information like your visa type, country of residence, and days in the US - which applies to everyone filing 1040NR. That said, I've seen people successfully file without it when not claiming treaties, but why risk it? It's pretty straightforward to fill out Parts I and II with your basic info. Better to be complete and avoid any potential follow-up questions from the IRS. Good luck with your filing!