My experience was completely different from what others are saying. I cashed out a whole life policy last year and got hit with a huge tax bill! I think it depends on how much you're getting back compared to what you put in.

Your Banner agent is definitely using scare tactics to push their investment products. The "half your cash value" claim is completely false and shows they either don't understand tax law or are intentionally misleading you. Here's what actually happens: You're only taxed on gains above what you paid in premiums (your cost basis). Since you've been paying $75/month since 2019, you've likely paid around $4,500+ in premiums for a $3,000 cash value, meaning you'd owe ZERO taxes. Even if there were taxable gains, it would be taxed as ordinary income - not some arbitrary "half" penalty. There's no special tax penalty for cashing out life insurance. I'd recommend: 1. Call Allstate for your cost basis documentation 2. Keep that $3,000 for your emergency fund or debt payoff 3. Consider finding a new agent who doesn't use fear tactics You made a smart financial move switching to term life insurance and getting better coverage for less money. Don't let pushy sales tactics make you doubt that decision!

I work in benefits administration (not tax advice!) and this issue comes up frequently. The technical distinction I've seen most HSA administrators make: 1. Items that ONLY serve a medical purpose = eligible 2. Items with dual purpose = not eligible So breast pumps = eligible because their only purpose is medical Specialized breast milk storage bags = usually eligible because they're designed specifically for breast milk General bottles = usually not eligible because they can be used for formula, water, etc. But honestly, every HSA administrator interprets things a bit differently, and some are more lenient than others. It's always best to check with your specific administrator.

Thank you all for sharing your experiences! This has been incredibly helpful. Based on what everyone is saying, it sounds like the key is: 1. Breast milk storage bags specifically marketed for breast milk = likely eligible 2. General bottles = likely not eligible unless part of pump kit 3. Each HSA administrator has different interpretations I think I'm going to start by purchasing the Medela or Lansinoh storage bags that several of you mentioned getting approved, and skip the bottles for now. If we do need bottles later, I'll look for ones that are specifically part of a pumping system. @Sofia Ramirez and @StarSeeker - I'm definitely going to check out taxr.ai before submitting anything. Having documentation that explains the eligibility seems like it could save a lot of headaches. @Ava Martinez - I'll also keep Claimyr in mind if I run into issues and need to actually talk to someone at my HSA company. The hold times are brutal! Really appreciate this community helping navigate these confusing rules. It's frustrating that something so clearly related to medical care (breastfeeding) has so many gray areas, but at least now I have a better strategy going in.

Been banking with Chime for 3 years and can confirm they're super fast with deposits! But yeah, the IRS doesn't actually send anything on weekends. Last year my deposit date fell on a Sunday and I got it the Friday before around 3pm. With Presidents Day this year though, you're probably looking at Tuesday the 18th like others said. The waiting game is brutal but at least Chime won't hold it up once the IRS releases it!

I've been through this exact situation with Chime before! The key thing to remember is that while Chime is great at processing deposits quickly once they receive them, the IRS still follows federal banking rules. They don't initiate ACH transfers on weekends or federal holidays. Since your deposit date is Saturday the 16th and Monday the 17th is Presidents Day, the IRS will most likely send your refund on Friday the 15th (which means you could see it Thursday night or Friday morning with Chime's early deposit) or Tuesday the 18th. I'd lean toward Friday since the IRS usually tries to get refunds out before the scheduled date when weekends are involved. Keep checking your account Thursday evening!

Hey Diego, I feel your pain - I've been in a similar situation before. The key thing is to act fast now. Since you can't get a retroactive extension, your best bet is to file your return ASAP to minimize the failure-to-file penalty. Here's what I'd recommend: 1) File immediately, even if you can't pay the full amount owed. The failure-to-file penalty is much steeper than the failure-to-pay penalty. 2) Pay as much as you can when you file to reduce interest charges. 3) If you have a clean filing history for the past 3 years, definitely look into First Time Penalty Abatement after you get your penalty notice from the IRS. Don't beat yourself up too much - life happens and you're taking action now. The penalties aren't fun but they're manageable, especially if you qualify for penalty abatement. Good luck!

Don't panic, Diego! While you can't get a retroactive extension, you're not completely out of options. The most important thing right now is to file your return immediately - every day you wait, the failure-to-file penalty keeps growing. Here's your action plan: 1) File your 2024 tax return ASAP using whatever method is easiest for you (tax software, paper, or a tax professional). 2) Pay as much as you can afford right now, even if it's not the full amount - this will reduce the failure-to-pay penalty and interest charges. 3) Once you get your penalty notice from the IRS, look into First Time Penalty Abatement if you've been compliant for the past 3 years. The failure-to-file penalty is typically 5% of your unpaid taxes per month (up to 25%), so time is really of the essence. If you end up owing a refund, there's actually no penalty for filing late - only if you owe money. Job changes and moves are stressful, and while the IRS doesn't typically consider these "reasonable cause," focusing on damage control now is your best bet. You've got this!

Has anyone actually SEEN the withholding tables the IRS uses? I'm curious how much difference there really is between the different options. I checked "single" even though I'm married just to avoid owing (my husband does "married") and now we get huge refunds which isn't ideal either.

I've been following this thread and wanted to share my experience since I dealt with the exact same frustrating cycle for about 4 years. What finally worked for me was using the IRS Tax Withholding Estimator mid-year (around July) rather than trying to fix it at the beginning of the year. The key insight I learned is that if you're already halfway through the tax year and realize you're going to owe, you need to calculate how much extra withholding you need for the REMAINING pay periods, not the whole year. So if you need an extra $1,200 withheld and you have 10 paychecks left, you need to add $120 per paycheck, not divide $1,200 by 26 pay periods. Also, I'd definitely recommend the "Married but withhold at higher single rate" option that everyone's mentioning. We switched to that two years ago and it solved about 90% of our underwithholding problem. The remaining 10% we handle with a small additional withholding amount that we recalculate each July using the estimator tool.