Has anyone actually calculated what the tax impact would be if you just filed with the W2 as-is? Like if they don't correct it in time and you have to file by the deadline? I'm in a similar situation but with healthcare FSA mixed with dependent care.

I went through this exact same issue two years ago! My employer also combined my dependent care FSA ($5k) with my transit benefits ($300) in Box 10, making it look like I exceeded the dependent care limit. Here's what I learned: definitely get the corrected W2 before filing. The IRS computers will automatically flag any Box 10 amount over $5k for dependent care, which could trigger correspondence or an audit later. Even though it's "just" $300, it's not worth the headache. When you contact HR again, be specific about what needs to be corrected. Ask them to issue a W-2c that shows only your actual dependent care FSA contribution ($5k) in Box 10, and make sure your transit benefit is properly reflected as a reduction in your Box 1 wages instead. Most payroll departments can turn around a W-2c in 1-2 weeks once they understand what needs to be fixed. Don't feel bad about pushing for this - it's their error and you have every right to accurate tax documents!

One thing nobody's mentioned - watch out for when you sell the house! If you've been claiming depreciation on the business portion of your home (which you should with the regular method), you'll have to recapture that depreciation when you sell. Also, the business portion won't be eligible for the capital gains exclusion ($500k for married filing jointly). That's something to consider when deciding between the regular and simplified methods. The simplified method doesn't claim depreciation, so you avoid these complications when selling.

Great question! I actually went through this exact scenario when I bought my home in 2023. Your understanding is correct - you'll split the mortgage interest proportionally between business and personal use. Since your spouse will use 15% of the home exclusively for business, that 15% of the mortgage interest becomes a business deduction on Schedule C. The remaining 85% can potentially be claimed as an itemized deduction on Schedule A, but remember it's subject to the $750k mortgage debt limit. One important consideration for California: our high property values mean you might hit that $750k cap quickly. With a $1.2M mortgage, only the interest on the first $750k of debt qualifies for the personal mortgage interest deduction. So you'd calculate 15% of total mortgage interest for the business deduction, then take 85% of the interest on just the first $750k for Schedule A (assuming you itemize). Also, don't forget about California's more restrictive mortgage interest deduction limits for state taxes - we cap it at interest on $1M of acquisition debt for state purposes, which is different from the federal $750k limit. Make sure you have solid documentation showing the exclusive business use of that 15% of your home. The IRS scrutinizes home office deductions closely, especially on higher-value properties.

Just wanted to add another perspective on documentation - I went through a similar situation last year and found that maintaining a simple spreadsheet with dates worked really well for tracking custody. I included columns for pickup/dropoff times, who had the kids each night, and any deviations from our normal schedule. What really helped during my IRS review was that I also kept copies of things like: - School pickup/dropoff records (many schools track this) - Medical appointment records showing which parent took kids - Activity registrations and who transported them - Even grocery receipts showing kid-related purchases on specific dates The key thing I learned is that the IRS wants to see a pattern of actual physical custody, not just what's written in your divorce agreement. Since you mentioned having the kids "slightly more than 50%" of nights, make sure you can prove that specific percentage with real dates and documentation. Also, don't forget that overnights count more than just daytime hours - the IRS specifically looks at where the child slept, not just spent time during the day. So even if your ex picks up the kids after school but they sleep at your house, that night counts toward your custody percentage.

Great question about Head of Household status with split custody! I went through this exact situation after my divorce two years ago. The key thing to understand is that Head of Household eligibility and dependency exemptions are actually two separate tests under IRS rules. For HoH status, what matters is physical custody - where your children actually sleep for more than half the nights in the year. The fact that you're splitting the dependency exemptions (one child each) doesn't disqualify you from HoH as long as at least one qualifying child lives with you more than 50% of the time. Since you mentioned having the kids "slightly more than 50% of the nights," you should qualify for Head of Household status. Just make sure to document this carefully - count the actual overnights, not just what your separation agreement says. I kept a simple calendar marking which nights each child was at my house, and it really helped when I was preparing my taxes. One thing to double-check: make sure your divorce is finalized by December 31st of the tax year you're filing for, since you need to be "considered unmarried" to qualify for HoH status. It sounds like your February 2023 finalization should cover you for the 2023 tax year. The tax savings from HoH versus Single filing status can be significant, so it's definitely worth getting this right!

I went through this exact same situation with Goodwill last year and wanted to share what ultimately worked for me! After reading through all these helpful responses, I think the most important thing is to start with the basics - updating your address with their regional payroll office. What many people don't realize is that Goodwill operates through regional headquarters, and each region handles payroll differently. Your local store won't be able to help with W2 issues for former employees. When I called my regional office (found it by googling "Goodwill Industries [my city] regional headquarters"), they were incredibly helpful. Here's what made the difference for me: I had moved after leaving my job and never updated my address with them. They had been mailing my W2 to my old apartment! Once I provided my current address over the phone, they immediately emailed me a digital copy and mailed a physical one to my new address. One thing I'd add to all the great advice already given - if you're having trouble finding the right regional office number, try calling the main Goodwill customer service line and ask them to transfer you to payroll for former employee tax documents. They'll know exactly which department handles W2 requests. Also, don't forget that you can request a filing extension (Form 4868) if you need more time to sort this out. It gives you until October 15th to file, which takes a lot of pressure off while you're waiting for your W2 to arrive. The extension is automatic - you don't need to provide any justification. You'll get this sorted out! This is such a common situation and there are always solutions available.

I just wanted to jump in here as someone who went through this exact situation with Goodwill last tax season! Reading through all these responses brings back memories of how stressed I was, but I'm happy to report there's definitely a solution. The key thing that worked for me was calling their regional payroll office directly. Don't bother with your local store - they literally cannot access W2 information for former employees. I found my regional office by googling "Goodwill Industries of [my area] headquarters" and calling their main number. When I explained I was a former employee needing my W2, they transferred me to payroll immediately. Turns out they had been mailing it to my old address (I moved in November after leaving in September). They were able to email me a PDF copy that same day and sent a corrected one to my new address. Here's what I had ready when I called: - My full name and SSN - Exact employment dates - Current mailing address - Which store location I worked at The whole thing was resolved in about 15 minutes once I reached the right department. They deal with this all the time, especially after the holidays when lots of people have moved. Also, definitely keep your last paystub if you have it! It has all your year-to-date earnings and withholding info, which is exactly what appears on your W2. That's your backup plan if anything goes wrong. Don't stress too much - this is super common and totally fixable. You've got plenty of time to sort it out before filing season really gets busy!

FYI - Marcus and TurboTax work together fine, but one tip: the payment doesn't show as "pending" in your Marcus account right away which freaks some people out. When I did mine last year, it took about 24 hours before the pending transaction appeared in my account, but the money was already earmarked. Don't panic if you don't see it immediately!

I actually just went through this exact situation a few weeks ago! Used my Marcus account to pay both federal and state taxes through TurboTax and everything went smoothly. The key things that helped me avoid any issues: 1. Made sure I had sufficient funds well before the payment date (Marcus can be picky about available balance vs pending transactions) 2. Double-checked all my account info in TurboTax - routing number, account number, everything 3. Called Marcus beforehand to give them a heads up about the large outgoing payment (they noted it in my account) The whole process took about 3-4 business days from when I submitted through TurboTax to when it showed as processed on the IRS website. I got email confirmations from both TurboTax and Marcus, so you should have a good paper trail if anything goes wrong. Your friend might be thinking of older issues or different banks - Marcus has gotten much better with government payments over the past couple years. As long as you're under your transfer limits and have the funds available, you should be fine!