This thread has been incredibly helpful! I'm in a similar situation to you, Luca - just started a new job with a 401k and already have a Roth IRA. Reading through everyone's responses has really clarified the strategy for me. What I found most valuable is the consensus on contribution order: employer match first (free money!), then max the Roth IRA for flexibility, then back to maxing the 401k. The point about having both pre-tax and post-tax retirement savings for tax diversification in retirement is something I hadn't really considered before. One thing I'd add for anyone else reading this - make sure to check if your employer offers any additional benefits like HSA contributions if you have a high-deductible health plan. HSAs have triple tax advantages and can be another great retirement savings vehicle on top of your 401k and IRA. Also, don't forget to actually invest the money once it's in your accounts! I made the mistake of contributing to my IRA for months before realizing the money was just sitting in a settlement fund earning basically nothing. Make sure you're actually purchasing investments, not just making contributions. Thanks to everyone who shared their knowledge here - this is exactly the kind of practical advice that makes a real difference!

You're asking all the right questions, and yes - you can absolutely max out both accounts! The $23k 401k limit and $7k Roth IRA limit are completely separate, so at your $85k income you're well positioned to take advantage of both. I love that you're thinking about this early in your career. Here's what I'd suggest based on your situation: 1. First priority: Contribute enough to get your full employer match (sounds like 6% based on your comment) - this is free money you can't afford to leave on the table 2. Build/maintain an emergency fund if you haven't already - you want 3-6 months of expenses saved before going all-in on retirement contributions 3. Max out your Roth IRA ($7k) - you'll have way more investment options than most 401k plans, plus the flexibility to withdraw contributions if absolutely necessary 4. Then go back and max your 401k if your budget allows The math works out to about $2,500/month total if you max both accounts. That might be aggressive on an $85k salary depending on your other expenses, so don't feel like you have to hit those maximums immediately. Start with what's sustainable and increase over time as your income grows. One practical tip: set up automatic contributions so you never have to think about it. Your 401k can be a percentage of each paycheck, and you can automate the IRA transfer right after payday. Makes it much easier to stay consistent! You're way ahead of most people just by asking these questions. Even if you start smaller and work up to the maximums, the compound growth over time will be incredible.

Don't forget the statute of limitations on this! If your car was repossessed in 2021 but the lender is just now sending the 1099-C in 2025, something seems off. The IRS generally requires lenders to issue the 1099-C in the year the debt was actually canceled, not years later.

@Mae Bennett, I went through something very similar when my truck was repossessed in 2022. The timing confusion is totally normal - lenders often wait months or even years before officially "canceling" the remaining debt, especially if they're still trying to collect or if the debt gets sold to collection agencies. Here's what I'd recommend: First, call the original lender (not any collection agency) and ask specifically about the 1099-C status. Get the exact date they consider the debt "canceled" - this determines which tax year it applies to. If they canceled it in 2024, it affects your 2024 taxes. If it was 2023, you might need to amend that return. The good news is you have options even without the physical form. Keep that official notice you received as documentation. You can report the canceled debt amount on your tax return using the information from that notice. Just make sure to explore the insolvency exclusion others mentioned - if your total debts exceeded your assets when the debt was canceled, you might not owe any taxes on it at all. Don't stress too much about "getting in trouble" - the IRS deals with missing 1099-C situations all the time. As long as you report the income (or properly exclude it), you'll be fine.

Does anyone know if the same rules apply to 401ks? My company's plan administrator told me something different about the taxation year and now I'm confused.

Just wanted to add another perspective here - I went through this exact situation last year with my first RMD. The key thing to remember is that even though you have until April 15, 2025 to take your 2024 RMD, taking it in early 2025 means you'll potentially have TWO RMDs taxed in the same year (your delayed 2024 RMD plus your regular 2025 RMD). This could push you into a higher tax bracket. I ended up taking my first RMD in December 2024 instead of waiting until the following year specifically to avoid this "bunching" problem. Something to consider when planning - the April 15th extension is allowed but not always optimal from a tax perspective. You might want to run the numbers both ways to see which scenario works better for your overall tax situation.

One strategy some people use is to adjust their withholding so they don't get a big refund in the first place. If you claim more allowances on your W-4, you'll get more in each paycheck throughout the year instead of a lump sum refund that can be offset. Too late for this year obviously, but something to consider for 2025.

Sorry to hear about your situation, Lucas. Based on what others have shared, it sounds like you're likely facing an offset. Here's what I'd suggest doing right now: 1. Call that Treasury Offset Program number (800-304-3107) that Layla mentioned to find out exactly what you owe and to whom 2. Contact your child support agency - they might be willing to work out a payment plan that could reduce the offset amount 3. For the student loans, reach out to your loan servicer ASAP about rehabilitation options like Kaylee suggested The frustrating thing is that offsets happen automatically when your return processes, so time is critical. Even if you can't prevent it entirely, knowing the exact amounts ahead of time will help you plan for the car repairs. You might also want to consider filing your taxes earlier rather than later - sometimes there are administrative delays that could give you a small window to address the debts before the offset kicks in. Good luck, and definitely make those calls tomorrow if you can!

Anyone know if the IRS actually cross-references the 1095-C info with your tax return? Like if the 1095-C says I had coverage but I accidentally clicked "no coverage" on my tax form, will that trigger something?

Just want to echo what everyone else is saying to put your mind at ease - you're totally fine! I had the exact same panic last year when I found my 1095-C after filing. Called my tax preparer in a frenzy and she laughed and said "that's just a receipt, honey." The 1095-C is basically proof that you had employer health insurance coverage, but your employer already reported that info to the IRS separately. Think of it like keeping a receipt for a purchase - it's good to have for your records, but you don't send the receipt back to the store. Since your return was already accepted, that's actually a good sign that everything matched up correctly on the IRS end. If there had been a discrepancy, you likely would have heard about it during processing. Keep that 1095-C with your tax documents for this year, but no need to do anything else. Your refund should come through just fine!