Has anyone used specific tax software that handles ESPP sales and wash rules correctly? I tried TurboTax last year and it completely messed up my ESPP reporting.

Great thread - this is exactly the kind of ESPP situation that trips people up! Just want to add one important point that hasn't been fully addressed: when you left your job in March, your company likely processed what's called an "accelerated vesting" for your ESPP shares, which is why they all became available to sell even if they hadn't met the normal holding periods. This is pretty standard when employment ends. The key thing to remember is that since you're no longer employed there, you won't have any future ESPP purchases that could trigger wash sales. Your main concern should be any RSU vestings or option exercises you might still have scheduled, or if you're planning to buy the stock on the open market. Also, make sure you get your final W-2 from your former employer - they should report any ESPP discount as ordinary income if you end up making disqualifying dispositions, and you'll need that for accurate tax reporting.

I'm wondering if there's a way to file the 1041 without having the full investigation completed? Our trust is in a similar situation but the forensic accountant won't finish their report until after the filing deadline.

I went through something very similar with a trust I was administering last year. The key thing to remember is that you need to be extremely thorough with your documentation since the IRS will likely scrutinize theft loss claims on trust returns. Beyond what others have mentioned about Form 4684 and the year of discovery rule, make sure you're properly handling the impact on beneficiary distributions. If the theft affected distributions that should have been made to beneficiaries, you may need to adjust the distribution deduction on Schedule B of the 1041. Also, consider whether you need to file Form 3520-A (Annual Information Return of Foreign Trust With a U.S. Owner) if any of the stolen funds were moved offshore - I've seen cases where embezzling trustees tried to hide money internationally. One practical tip: keep detailed records of all legal and forensic accounting costs related to recovering the stolen funds. These are generally deductible as administration expenses on the 1041, separate from the theft loss itself. Our trust was able to deduct over $50,000 in legal fees pursuing the former trustee. Don't forget to notify the beneficiaries about the situation and how it affects their Schedule K-1s. They have a right to know about material changes to the trust's financial position.

idk why they even bother with these timeframes anymore tbh. seems like everything is delayed these days smh

NY state is definitely backed up this year - I'm seeing similar delays across the board. The "processed" status usually means they've finished reviewing your return and approved the refund, but the actual payment can still take a few more weeks. Since you have direct deposit, you should hopefully see it within the next 2-3 weeks. If it goes beyond 4 weeks from the processed date, I'd recommend calling their refund hotline to check for any issues.

Slightly off topic but this is exactly why I now require ALL contractors to fill out W9 forms BEFORE I cut them their first check. No W9, no payment. Learned this lesson the hard way.

I actually dealt with this exact situation two years ago with a plumber who did major work on my office building. After months of trying to get his W9, I ended up consulting with a tax professional who walked me through the process. Here's what I learned: You absolutely need to file the 1099-NEC even without their TIN. Put "Applied For" or "Unknown" in the TIN field - don't leave it blank or put zeros. The IRS wants to see that you're making the effort to comply. Make sure you keep detailed records of every attempt you made to get their information - screenshot those texts, save voicemail recordings if you have them, and consider sending one final certified letter requesting the W9. This documentation is crucial if you face any penalties later. The backup withholding situation is tricky since you've already paid in full, but as others mentioned, documenting your good faith efforts can help reduce or eliminate penalties. The key is showing the IRS you were trying to follow the rules, not circumvent them. Don't let this stress you into not filing at all - that would be much worse than filing with incomplete information!

One thing nobody's mentioned - depending on what state you live in, you might also need to set aside money for STATE taxes on that lump sum too! Federal isn't the only thing to worry about.

Michigan has a flat state income tax rate of 4.25%, so you'll want to set aside an additional $1,530 (4.25% of $36,000) on top of whatever you're saving for federal taxes. So if you're setting aside 25-30% for federal, you're looking at roughly 29-34% total when you include state taxes. The good news is Michigan's tax is pretty straightforward - it's just a flat rate on all income, so no complicated bracket calculations like with federal. But definitely don't forget about it! I've seen people get caught off guard by state taxes on large one-time payments because they only planned for federal. You might also want to check if Michigan requires estimated tax payments for large income increases. I'm not 100% sure on their specific rules, but it's worth looking into to avoid any penalties.