21 Question for anyone - if I have unrealized losses (stocks that have gone down but I haven't sold yet), can I still claim those on my taxes? Or do I actually have to sell to get the tax benefit?

Great question about unrealized losses! You absolutely have to sell the stock to claim the tax loss - just holding a stock that's down in value doesn't give you any tax benefit. This is actually a strategic consideration many investors face near year-end. If you have stocks that are significantly underwater and you don't think they'll recover, selling them before December 31st lets you claim those losses on that year's tax return. Just remember the wash sale rule I mentioned earlier - if you sell for a loss but then buy back the same stock (or something "substantially identical") within 30 days before or after the sale, the IRS disallows the loss deduction. So if you still believe in the company long-term, you'd need to wait 31 days before repurchasing, or buy something similar but not identical. Some people get around this by selling their losing position in Company A and immediately buying a similar company or ETF in the same sector, so they maintain market exposure while still capturing the tax loss.

Have you considered using the IRS's Reasonable Cause Assistant on their website? It's not as well-known as calling, but sometimes works better for straightforward cases like yours. 😂 Though "straightforward" and "IRS" rarely belong in the same sentence! Jokes aside, you might also want to check if your state has separate requirements for reasonable cause exceptions - some states are more forgiving than others for medical emergencies.

I went through something very similar after a car accident kept me hospitalized for several weeks during tax season. The key thing that helped me was being proactive once I was able to handle my affairs again. I immediately filed my return with a detailed letter explaining the medical emergency, included copies of hospital discharge papers, and specifically referenced "reasonable cause" under IRC Section 6651(a)(1). The IRS did initially send me penalty notices, but after I called and explained the situation (yes, the hold times were brutal), they completely abated all failure-to-file and failure-to-pay penalties. The whole process took about 90 days from start to finish, but I didn't pay a single penalty dollar. One tip: if you do get penalty notices, don't panic. The IRS computer systems automatically generate these, but human review almost always results in abatement for legitimate medical emergencies. Just make sure you respond promptly to any notices and keep detailed records of all communications. Your quarterly estimates for 2024 shouldn't be affected by this situation at all - those are separate obligations going forward.

I went through something very similar when I got married in 2023! The anxiety is totally understandable, but you're likely in much better shape than you think. A few key points that helped ease my mind: - Single withholding rates are typically higher than married rates, so you've probably been giving the IRS an interest-free loan all year - Filing status for your tax return is based on your marital status on December 31st, not what your W-4 says - For your income levels ($78K + $65K), married filing jointly will almost certainly be your best option The IRS actually expects situations like this - life changes happen and people don't always update their withholding immediately. As long as you file correctly now (married filing jointly), you should be fine. You might even get a nice refund! Don't forget to update those W-4s with your employers ASAP for 2025 though. You can use the IRS withholding calculator on their website to figure out exactly what to put on the new forms.

I completely understand the panic you're feeling right now! I work as a tax preparer and see this situation ALL the time, especially with newlyweds. The good news is that you're actually in a much better position than you think. Since you've both been withholding at the "Single" rate all year, you've likely had MORE taxes taken out than necessary, not less. Single withholding is more conservative (higher) than Married Filing Jointly withholding. So instead of owing money, you'll probably get a decent refund! For your 2024 tax return, you should definitely file as Married Filing Jointly - this will give you the best tax outcome for your combined income levels. The W-4 status only affects payroll withholding throughout the year; your actual filing status is determined by your marital status on December 31st. A few action items for you: 1. File your 2024 return as Married Filing Jointly (you'll likely get a refund) 2. Update your W-4s with your employers ASAP for 2025 3. Use the IRS withholding calculator to get your 2025 withholding amounts exactly right You haven't done anything wrong - life happens and the IRS understands that people don't always update their paperwork immediately after major life changes. Take a deep breath - you're going to be just fine!

Quick question about e-filing in this situation - has anyone successfully e-filed with no full-year state residency? When I tried last year, TurboTax kept giving me errors and forcing me to choose a "home state" even though I didn't have one.

This is actually a pretty common situation for people with mobile lifestyles! You're correct that you can be a non-resident or part-year resident in all states you lived in without being a full-year resident anywhere. One thing to double-check though - make sure you understand Colorado's rules about "domicile" vs "residency." Even if you weren't there 183+ days, if Colorado considers itself your domicile (basically your permanent home base where you intend to return), they might still try to claim you as a full-year resident for tax purposes. Since your mail goes to your friend's place there and you're returning there, you might want to clarify this with Colorado's tax department. Also, since you've been in South America since September, depending on how your income was structured and how long you stay abroad, you might qualify for some foreign income exclusions on your federal return. Worth looking into if you're doing any work while traveling. Keep all your documentation (lease agreements, employment contracts, travel records) - the IRS and state agencies love clear timelines when dealing with multi-state situations like yours.

Honestly all the chains are expensive imo. H&R Block charged me $320 last year for what I later found out was a pretty basic return. Try looking for an "enrolled agent" in your area - they're tax specialists who usually charge way less than CPAs or the big chains.

Great suggestions everyone! I'm definitely going to look into both the enrolled agent route and credit union options - hadn't considered either of those before posting. For anyone else reading this thread, I ended up calling around to a few places after reading these comments. What I found was that the chains really do vary a lot in pricing even within the same company - the H&R Block near my work quoted me $280 while one across town said $195 for basically the same services. Location seems to matter more than I expected. Also wanted to mention that several of the independent preparers I contacted were willing to give me a rough estimate over the phone once I described my situation (investment income, job change, etc.), which was way more helpful than the chains that just gave generic "starting at $X" pricing. Definitely worth making a few calls before deciding!