Don't forget that worthless securities are still subject to the capital loss limitations. You can only offset up to $3,000 of ordinary income per year after you've used the losses to offset any capital gains. Had to learn this the hard way when I tried to claim $12,000 in losses from some penny stocks that went to zero in 2022. I offset about $2,500 in gains from other stocks, then could only use $3,000 against my regular income. The remaining $6,500 had to be carried forward to future tax years.

I went through this exact situation last year with some defunct crypto mining stocks that got delisted. Here's what worked for me: First, contact your broker's tax department (not regular customer service) and specifically request a "worthless securities letter" or "abandonment letter." Most major brokers have a standard process for this. If your broker won't cooperate, you can still claim the loss but need to document everything yourself. Save screenshots of your account showing the securities, any emails with your broker, and find public records of when the companies went bankrupt or were delisted. For the tax filing, you'll use Form 8949 and Schedule D. Mark the transaction with code "W" for worthless, use December 31st of the tax year as the "sale" date, $0 as the sale price, and your original cost basis as the loss amount. One important thing - make sure you're claiming these in the correct tax year. Securities become "worthless" when there's no reasonable hope of recovery, which is usually when the company files bankruptcy or is officially dissolved, not necessarily when they stop trading. Keep all your documentation for at least 7 years in case the IRS has questions. The key is being able to prove you actually owned the securities and that they truly became worthless during the tax year you're claiming.

I used FreeTaxUSA for the first time last year and had a pretty frustrating experience with their import feature. It completely failed to import my previous year's return from TurboTax, so I had to manually enter everything from scratch. This was especially annoying for carryover items like capital loss carryforwards. The software also didn't catch that I was eligible for the Earned Income Tax Credit until I specifically went looking for it. Other tax software I've used in the past would automatically suggest credits you might qualify for, but FreeTaxUSA seems to rely more on you knowing what to look for. That said, once I got everything entered correctly, the actual filing process was smooth and my refund came through without issues. Just be prepared to do more legwork yourself compared to the hand-holding you get with more expensive options.

I used FreeTaxUSA for the first time this past tax season and ran into a pretty specific but annoying issue. The software had trouble handling my HSA contributions correctly when I had both employer and personal contributions in the same year. It kept double-counting one of them, which would have led to an incorrect deduction. I caught the error during my final review, but it took quite a bit of digging through the forms to figure out where the problem was occurring. Their help documentation on HSA reporting was pretty sparse compared to other topics. Eventually got it sorted out, but it made me nervous about what other edge cases might not be handled well. The price is definitely right, and for straightforward tax situations it seems solid. But if you have any slightly unusual circumstances, just make sure to double-check everything carefully before filing. The software doesn't always catch calculation errors that might seem obvious.

I completely understand your frustration - I went through something very similar last year and the waiting period was absolutely nerve-wracking! In my case, it ended up being related to an old student loan that had been transferred between servicers, and I wasn't even aware it was in default status. A few things that helped me get answers faster: 1. **Call the TOP automated line multiple times** - I found that calling at different times of day sometimes gave me slightly different information. The system can be glitchy but persistent calling helped. 2. **Contact your state's Department of Revenue** - Even though this seems like a federal issue, sometimes state agencies coordinate with federal offsets, especially for unemployment overpayments that you might not be aware of. 3. **Check with your college's bursar office** - They often have records of financial aid adjustments that happen after graduation. In my case, there was a semester where my enrollment status changed and it triggered a grant-to-loan conversion that I was never properly notified about. The 3-week mark is frustrating but unfortunately pretty normal right now. Most people I know who've dealt with this recently didn't get their letters until week 4-6. The remote work situation definitely makes it worse when you can't check mail daily. One last tip: if you have any tax prep software or used a CPA, check if they sent you any notices that might have gone to spam. Sometimes there are warnings about potential offsets that get buried in email folders. Hang in there - you'll get answers soon, and there are usually options to resolve whatever it is!

I'm dealing with a similar situation right now - had about $950 offset from my refund in early March and still no explanation letter. The waiting and not knowing is incredibly stressful, especially when you're trying to budget and plan your finances. Based on what others have shared here, I've started being more proactive instead of just waiting. I called the Treasury Offset Program line (800-304-3107) yesterday morning around 8am and actually got through to a person after about 25 minutes on hold. They were able to tell me it was a Department of Education offset, which at least narrows it down since I also just graduated. One thing I learned that might help you - the representative said that if you've moved recently, you can actually call the specific agency (once you know which one it is) and request they resend the explanation letter to your current address. You don't have to wait the full processing period if the letter went to an old address. The whole system is definitely frustrating and seems designed to keep you in the dark as long as possible. But reading through everyone's experiences here has been really reassuring that this delay is unfortunately normal and that there are usually reasonable explanations and solutions once you finally get answers. Hang in there - the 3-week mark is frustrating but you should hopefully hear something soon!

Has anyone used the automatic consent procedures for changing accounting method for depreciation? I filed my 2022 return on time but didn't take bonus depreciation on some equipment because my accountant said it wouldn't benefit me. Now my business situation changed and I wish I had taken it.

I went through this exact situation last year with a late-filed 2021 return and commercial property. The good news is you're not completely out of luck! While it's true that bonus depreciation is generally supposed to be claimed on timely filed returns, the IRS has provided relief through Rev. Proc. 2019-33 and automatic consent procedures. You can file Form 3115 (Application for Change in Accounting Method) with your next tax return to claim the missed bonus depreciation as a Section 481(a) adjustment. For your $475k commercial building, the cost segregation study will be crucial. The building structure itself won't qualify for bonus depreciation (it's 39-year property), but components like electrical systems, plumbing, HVAC, flooring, and interior fixtures typically qualify for accelerated depreciation schedules and bonus treatment. One important note: make sure you place the property in service during 2022 to qualify for the 100% bonus depreciation rate. If you're filing Form 3115, you'll need to include detailed calculations and documentation. I'd strongly recommend working with a tax professional who has experience with these forms - the IRS scrutinizes them closely, and errors can be costly. The tax savings can definitely be substantial, so it's worth pursuing the proper procedures to capture this benefit even on a late-filed return.

People haven't mentioned quarterly estimated taxes yet, but that's super important for self-employed folks! Based on your situation, you're probably getting hit with underpayment penalties too, which would be included in that high blended rate. When you're self-employed, you're supposed to make quarterly tax payments throughout the year. If you don't, the IRS charges penalties that get factored into your total tax bill.

Hey Klaus! I totally feel your pain on this - that 39% rate freaked me out too when I first started freelancing. Everyone else has given great explanations, but I wanted to add one thing that might help you going forward. Since you're doing graphic design work, make sure you're deducting ALL your creative software costs - Adobe Creative Suite, fonts, stock photos, design assets, etc. Those subscriptions add up to thousands per year and are 100% deductible business expenses. Also, if you're meeting clients in coffee shops or co-working spaces, those costs are deductible too. Even things like business cards, portfolio printing, or a new computer/tablet for design work can be deducted (or depreciated if it's expensive equipment). The key thing to remember is that every business deduction saves you money on both regular income tax AND that brutal 15.3% self-employment tax. So a $1000 deduction could save you $153 in SE tax alone, plus whatever your income tax bracket is. Start keeping better records now for next year - use an app like Expensify or even just a simple spreadsheet. Your future self will thank you when tax time comes around again!