This is such a relief to read! I'm going through the exact same situation with my grandmother's estate right now. She passed away 2 months ago and left behind a house she bought in 1975 for $45,000 that's now worth about $850,000. The estate attorney mentioned stepped-up basis but wasn't clear on the timing, and I've been stressed about potentially owing huge capital gains if we need to sell the house to divide the inheritance among the grandchildren. Knowing that the step-up happens immediately at death takes a huge weight off my shoulders. I'm definitely going to get a formal appraisal done ASAP to document the fair market value as of her date of death. Better to have that documentation ready than scramble for it later when we're ready to sell. Has anyone dealt with getting appraisals done months after the death? I'm worried that appraisers might have trouble establishing the exact value from 2 months ago, especially with how much the real estate market has been fluctuating.

Just wanted to add something that might help - if you're dealing with multiple types of assets (real estate, stocks, bonds, etc.), make sure you understand that stepped-up basis applies differently to different asset types. For publicly traded securities, you can use the closing price on the date of death, which is pretty straightforward. But for things like closely-held business interests, artwork, or collectibles, you'll definitely need professional appraisals. Also, keep in mind that if your dad had any retirement accounts (401k, IRA, etc.), those don't get stepped-up basis - they retain their original tax-deferred status and you'll owe income tax on withdrawals just like he would have. This trips up a lot of people who assume all inherited assets get the step-up treatment. Given the significant value of that property you mentioned ($2.2M vs $120K original basis), you're looking at potentially huge tax savings from the stepped-up basis. Definitely worth getting professional help to make sure you document everything correctly!

If your garnishment is for a really small amount like yours, sometimes it's just easier to pay it all at once if you possibly can. I got one for $175 last year and just paid it to make it go away. The hassle of setting up a payment plan and dealing with all the paperwork wasn't worth it for that amount. Just my two cents!

Just wanted to add something that might help - if you're struggling financially like you mentioned, most states have hardship provisions for garnishments. You can request a hearing to show that having money taken from your paycheck would cause undue financial hardship (like not being able to pay rent or buy groceries). I had a friend who was in a similar situation and filled out a hardship form showing his monthly expenses vs income. The state reduced the garnishment amount significantly and gave him more time to pay. It's worth asking about when you call them. Also, keep records of everything - save copies of any letters, write down who you talk to and when, and get confirmation numbers for any payments you make. Government agencies can be slow to update their systems and you want proof of what you've done. Don't let this stress you out too much. $204 is very manageable compared to what some people face, and the fact that you're being proactive about it puts you in a good position to work something out!

Since no one mentioned it yet - don't forget that 2025 tax rules now allow each qualifying child to potentially get you up to $2,000 in tax credits (that's the increased amount after the recent tax law changes). So make sure whoever claims each child can actually benefit from the full credit amount. If your girlfriend doesn't have enough tax liability due to her part-time work, she might not be able to claim the full child tax credit amount even though she's eligible to claim your son. Something to consider when deciding who claims which child!

Great question! I was in a nearly identical situation a couple years ago. One thing that really helped me was getting everything organized early in the year rather than scrambling at tax time. Since you're paying the mortgage and most household expenses, you should definitely qualify for Head of Household status when claiming your daughter. Just make sure you're tracking everything - I started keeping a simple monthly log of who paid what, which made things so much clearer when it came time to file. Also worth noting that the IRS has gotten stricter about auditing HOH claims in recent years, especially when there are multiple taxpayers at the same address. But if you legitimately pay more than 50% of household costs and have proper documentation, you should be fine. The key is being able to prove your contribution level if they ever ask. One last tip - consider having a quick consultation with a tax professional this year to make sure you're set up correctly going forward. It's much easier to establish the right pattern from the beginning than to fix problems later!

Honestly from what you described it sounds like you qualify as Head of Household AND should claim the child, but run the numbers both ways! I helped my sister and her bf figure this out - they entered their info in TurboTax both ways (her claiming vs him claiming) and there was a $1200 difference in their combined refund amount. Tax software makes it easy to check both scenarios.

Based on your situation, you have a few key decisions to make that could significantly impact your tax benefits. Since you own the home, pay most expenses, and your daughter lives with you more than half the year, you likely qualify for Head of Household filing status - which is much better than Single. However, the bigger question is who should claim your daughter as a dependent. With your girlfriend's income at $18K, she might benefit more from claiming the child due to the Earned Income Credit, which phases out at higher incomes like yours. The EITC can be worth several thousand dollars for someone at her income level with a qualifying child. I'd strongly recommend running the numbers both ways before deciding. You could use tax software to calculate your combined household refund under both scenarios (you claiming her vs. your girlfriend claiming her). Many couples find that having the lower-income parent claim the child results in a larger total refund for the household, even though the higher-income parent loses out on Head of Household status. Also remember that your daughter qualifies for the full Child Tax Credit since she was born during the tax year, regardless of who claims her. The key is figuring out which arrangement maximizes your family's total tax benefit.

just wanna point out - the person with higher income isn't always the best choice! when i was making less than my bf, i got way more back from earned income credit when i claimed our daughter. we got almost $2k more by having me claim her even tho he made like $15k more than me that year. the credit phases out at higher incomes. so sometimes the lower earner actually gets more benefit. definitely worth checking both ways!

One thing I don't see mentioned here yet is that if your partner can file as Head of Household (which they likely can if they claim your daughter), that filing status alone can save a significant amount compared to filing Single. The HOH standard deduction is much higher and the tax brackets are more favorable. Also wanted to add - make sure whoever claims your daughter also claims any childcare expenses if you're paying for daycare. The Child and Dependent Care Credit can be worth up to $1,050 for one child (20% of up to $5,250 in expenses). This credit has to go with whoever claims the dependent, so factor that into your calculations too. Given your income levels ($42k vs $58k), I'd definitely recommend running the numbers both ways like others suggested. The Earned Income Credit phases out around $50k for someone with one child, so there's a good chance you claiming her might actually result in a better overall refund for your household, especially if you're paying for daycare.