This is such a good point! I tried selling everything when I moved and it was SO time consuming. Some guy literally tried to talk me down from $200 to $40 for my filing cabinet when we met up. I ended up donating half my stuff just to be done with it. Is there a minimum value for tracking donations though? Like do I need to track if I donate a $20 trash can?

For very low-value items like a $20 trash can, you should still track it if you're planning to claim it as part of your total donation, but realistically the IRS isn't going to flag you over small amounts. The general rule is you need receipts for any donation of goods worth $250 or more, and if your total non-cash donations exceed $500 for the year, you'll need to file Form 8283 with your tax return. Once you get over $5,000 in donations, that's when you might need qualified appraisals. During a move, these small items can add up quickly, so keeping a simple spreadsheet with estimated values is a good idea.

Great question! A deduction reduces your taxable income, not your tax bill directly like a credit would. The actual tax savings depends on your marginal tax bracket. For example, if you're in the 22% federal tax bracket and donate furniture with a fair market value of $1,000, your federal tax savings would be about $220 (22% of $1,000). If you also pay 5% state income tax, you might save another $50 there. So in this example, donating $1,000 worth of furniture might save you around $270 in actual taxes. That's why selling can sometimes be more profitable if you can get more than 25-30% of the original value.

That won't work. Only the employee can contribute to their own IRA, and those contributions have to come from earned income. The boss can't directly fund someone else's retirement account. The boss could potentially set up a retirement plan for the business and make employer contributions before selling, but that would need to be available to all eligible employees, not just one person. And it sounds like the business is already sold, so that ship has sailed.

This approach would still result in taxable income, just potentially with different tax implications. As a consultant/independent contractor, the husband would receive a 1099 instead of a W-2, and would be responsible for self-employment tax (15.3%) on top of regular income tax. The advantage might be the ability to deduct legitimate business expenses, but those would need to be actual expenses related to the consulting work. There could also be issues if the "consulting" arrangement isn't genuine - the IRS could view it as disguised compensation or a sham arrangement to avoid proper employment taxes.

Do you know if I have to specify which coins I'm selling for the tax loss? Like if I have 3 different cryptocurrencies all at a loss, can I pick which ones to realize losses on and keep holding the others?

Yes, you can absolutely specify which coins you're selling for tax loss harvesting. You're not required to sell all your underwater positions - you can strategically choose which specific coins and even which specific lots if you've bought the same coin at different times. If you have three different cryptocurrencies at a loss, you can choose to sell just one or two and keep holding the other. You might base this decision on which coins you're least confident about long-term or which would give you the biggest tax benefit. Some tax software lets you optimize this by showing which sales would be most beneficial.

Yep, same forms as stock trades. Form 8949 is where you'll list all your crypto transactions, and then the totals carry over to Schedule D. Make sure you check the correct box at the top of Form 8949 depending on whether the transactions were reported on a 1099-B. For most crypto exchanges in 2025, you'll likely check box C since many still don't issue 1099-Bs (though this is changing). Keep all your transaction records because the burden of proof is on you!

Thank you all for the helpful responses! This clears things up a lot. I was getting confused because my space is 100% commercial (no home office) but my accountant kept talking about "disqualified utilities" which made me worry. Based on your advice, it sounds like I can deduct both the water and steam heating portions since they're directly related to my bakery operations. I'll definitely keep all my bills organized for documentation.

You're welcome! Yes, sounds like your accountant might have been mixing up rules for home offices with your commercial bakery situation. For a dedicated business space, utility expenses are straightforward business deductions on Schedule C. Just make sure the utilities are in your name/business name and that you have a paper trail showing they're for your business location. If you ever get audited, having organized documentation makes the process much smoother. Good luck with your bakery!

The IRS instructions are clear but they can be super dense to read through. Here's the direct link to the Schedule C instructions if anyone needs it: https://www.irs.gov/instructions/i1040sc And yes, utilities for regular business use are covered under "Other Expenses" if not listed separately.

thanks for adding the link! sometimes i forget not everyone knows where to find this stuff. the thing with tax instructions is you gotta read the whole section carefully. they might mention exceptions elsewhere that apply to specific situations. but for standard commercial space utilities, it's pretty straightforward.

Thanks for the price info! Did you find the local CPA was more knowledgeable about this specific issue than H&R Block would have been? I'm torn between convenience and expertise.

Definitely yes - the local CPA had handled several backdoor Roth situations before and immediately knew why my 8606 was rejected. He mentioned that national chains like H&R Block often use preparers who don't specialize in more complex retirement account transactions. The main issue with backdoor Roth conversions involving same-day recharacterizations is that there are specific reporting requirements for the timing and basis calculations. My CPA showed me exactly what went wrong on my original form and how to fix it. Well worth the slightly lower price for someone who dealt with this specific issue regularly.

This is great advice! I'd recommend keeping these records for at least 7 years, particularly for retirement account transactions. I'd even go further and suggest scanning all the documents and storing them digitally as well as in paper form.