14 I went through something similar with money my grandma had hidden in her house. One thing that helped me was getting a letter from my family members acknowledging they were aware of the cash and understood it was intended for me. It wasn't legally binding or anything, but it helped establish the story when I talked to the bank and later when I had questions from the IRS. Would your parents or other family members be willing to write something confirming your grandpa's verbal wishes? Might help smooth things over.

I'm a tax professional and wanted to add some important points to this discussion. First, you're correct that inheritances are generally not taxable income to the recipient, but the key word here is "generally." Since this cash wasn't formally documented as part of your grandfather's estate, you may need to treat it differently for tax purposes. The IRS looks at three main factors: 1) Was there donative intent by the deceased? 2) Was the property actually transferred? 3) Did the recipient accept it as a gift/inheritance? The verbal statements to your parents help establish intent, but you'll want to document this thoroughly. Also, keep in mind that while banks report cash deposits over $10k, they can also file Suspicious Activity Reports (SARs) for any transaction they find unusual, regardless of amount. Being prepared with proper documentation about the source will help avoid complications. I'd strongly recommend consulting with both a tax attorney and an estate attorney before making the deposit. The small cost upfront could save you significant issues later if the IRS has questions about the sudden appearance of this money in your accounts.

Has anyone used SprintTax or OLT for reporting foreign income like this? TurboTax is completely confusing me with how to enter the T4A-NR information.

I'm dealing with a very similar situation - my husband worked in Canada for about 3 weeks and we received a T4A-NR form. What really helped me was understanding that the T4A-NR withholding rate depends on whether you're covered by the US-Canada tax treaty. If your spouse is a US resident, the treaty rate should be 15% for employment income rather than the standard 25% non-resident rate. You might want to check if the correct rate was applied to your withholding. If they withheld at 25% when the treaty rate should have been 15%, you can file for a refund of the excess. Also, make sure to convert the Canadian dollar amounts to US dollars using the average exchange rate for the year (the IRS publishes these rates). This is important for both reporting the income correctly on your US return and calculating the proper Foreign Tax Credit amount. The good news is that even though this seems complicated, it's actually a pretty straightforward situation once you know the steps. The key is just making sure you report it correctly on both sides to avoid double taxation.

I had this same issue and found that Credit Karma (now Cash App Taxes) lets you file multiple state returns for FREE. The interface isn't as nice as TurboTax but saved me hundreds last year. But honestly you should double check the minimum filing requirements - I only ended up needing to file in 6 states out of the 15 I worked in because most had minimum income thresholds I didn't meet.

As someone who works in tax preparation, I can confirm what others have said about minimum filing thresholds - this is crucial for touring musicians! Here's a quick reality check: many states have thresholds ranging from $600 to $3,000 before you're required to file. Some key ones for touring acts: Texas has no state income tax, Florida has no state income tax, Nevada has no state income tax, so you're already down to 20 potential states right there. For the states where you do need to file, I'd strongly recommend against the "ignore small amounts" advice - while enforcement is rare, you don't want surprise bills with penalties years later. The better approach is to use the minimum threshold rules properly. One thing I haven't seen mentioned: if your wife received W-2s from venues (rather than 1099s), some states have different rules for employees vs. independent contractors. W-2 income often has different thresholds or may be exempt under reciprocity agreements with your home state. Before paying for expensive software, spend an hour researching each state's actual requirements. You might find you only need to file in 8-10 states instead of all 23.

Has anyone used TurboTax for reporting timber sales? I'm wondering if the standard software can handle this or if I need something more specialized?

I dealt with a similar timber sale situation on my family's property a few years back. One thing I learned that wasn't mentioned yet - make sure to keep detailed records of any costs associated with the timber sale (road maintenance, marking trees, etc.) because these can be deducted from your gross proceeds when calculating your gain. Also, if you haven't already, consider getting a professional timber cruise done to establish current fair market value documentation. Even though your sale is complete, having this baseline can be helpful for future tax planning if you have more timber on the property. Some forestry consultants will do a retroactive valuation that can help support your basis calculations. The capital gains treatment really does make a huge difference - in my case it saved me about $8,000 compared to ordinary income rates. Just make sure you document everything well since timber sales sometimes get extra scrutiny during audits.

Quick question - do you mail the 1040-X or can you e-file an amended federal return now? Last time I had to do this it was paper only and took forever.

From my experience as a tax preparer, whether you need to amend your federal return depends entirely on the nature of the error. If it was something like a state-specific deduction or credit that doesn't appear on your federal return, you're probably fine. But if it involved income, federal deductions, or anything that flows through to both returns, you'll definitely want to file that 1040-X. One thing I always tell my clients: when in doubt, amend. The IRS won't penalize you for correcting an error voluntarily, but they will charge interest and penalties if they catch it first. Since you already received your federal refund, if the amendment shows you owe additional tax, you'll need to pay that plus interest from the original due date. But if you act quickly, the interest should be pretty minimal. Also, keep good records of both your original and amended returns. The IRS sometimes sends notices years later asking about discrepancies, and having everything documented makes those situations much easier to resolve.