I just went through this exact same situation last month! Had Medicaid coverage for about 7 months in 2024 and was getting those same scary TurboTax warnings about missing 1095-A forms. What really helped me was understanding that Medicaid is completely separate from marketplace insurance. The 1095-A form is only for people who bought insurance through Healthcare.gov and received advance premium tax credits - since Medicaid doesn't involve any tax credits, there's no 1095-A to worry about. When I got to the health insurance section in TurboTax, I selected "I had qualifying health coverage" and then specified it was government coverage (Medicaid) for the months I was enrolled. The warnings immediately disappeared once I indicated it correctly. Pro tip: Keep your Medicaid eligibility notice or approval letter handy when filing - not to submit, just to reference the exact coverage dates. Being precise about which months you had coverage versus any gaps will ensure you answer the questions correctly and avoid those confusing warnings. Your return definitely won't get rejected for this! The IRS just needs to know you had minimum essential coverage, which Medicaid absolutely qualifies as. Don't let the software scare you - you're doing everything right!

As someone who just went through this exact situation, I completely understand your stress! I had Medicaid coverage for about 6 months last year and got those same terrifying TurboTax warnings about potential rejection. Here's what I learned after doing a deep dive: Medicaid is considered "minimum essential coverage" under the ACA, which means you're fully compliant with health insurance requirements. The 1095-A form warnings are specifically for marketplace insurance purchased through Healthcare.gov where people received advance premium tax credits - that's a completely different system from Medicaid. When you get to the health insurance section in TurboTax, look for options like "I had qualifying health coverage" or "government-sponsored coverage" rather than marketplace-specific choices. Once you select the correct category and indicate Medicaid coverage for your specific months, those scary warnings should disappear. I kept my Medicaid approval letter handy just to reference the exact coverage dates, but you don't need to submit anything with your return. The IRS just needs to know you had qualifying coverage during those months. My return went through without any issues, no follow-up from the IRS, and no rejection. The software warnings are just being overly cautious about situations that don't apply to Medicaid recipients. You're doing everything right - don't let TurboTax scare you!

Pro tip: If this is from crypto transactions, the rules are a bit different! Had that issue last year and nearly reported it wrong. For crypto without cost basis, you need to report it on Form 8949 with code B or E depending on how long you held it.

Don't panic about audit risk here. I'm a tax preparer and see this situation ALL THE TIME. Just report your actual cost basis based on your records, keep documentation of how you determined it, and move on. The "not reported to IRS" checkbox is mainly for the IRS's information, not a red flag or audit trigger. As long as your reported proceeds match what's on the 1099-B, you're fine. The IRS expects taxpayers to provide cost basis when brokers don't have it.

Something nobody's mentioned yet - if you have the option to contribute MORE to your HSA, that's usually better than taking the medical expense deduction for most people. HSA contributions directly reduce your AGI (even if you don't itemize), while medical expense deductions only help if you itemize AND only for the amount over 7.5% of AGI. For 2025, you can contribute up to $4,150 for individual coverage or $8,300 for family coverage to an HSA (plus $1,000 catch-up if you're 55+). That's a dollar-for-dollar reduction in your taxable income PLUS the money grows tax-free AND comes out tax-free for medical expenses. So if you're trying to optimize, max out your HSA contributions first, then figure out the best way to handle your expenses.

I think there's some confusion in this thread about when HSAs actually make sense to use. I've had an HSA for 9 years and have never spent a penny from it - I pay all medical expenses out of pocket and keep the receipts. Why? Because HSAs are actually the ultimate retirement hack if you can afford to use them this way. The money: - Goes in tax-free (reducing your taxable income) - Grows tax-free (through investments) - Comes out tax-free for medical expenses (no matter when they occurred) So to the original poster - if you can afford it, consider paying those medical bills out of pocket, taking the itemized deduction for expenses over 7.5% of AGI this year, but KEEPING all your receipts. Then in retirement, you can reimburse yourself tax-free from your (hopefully much larger) HSA. Just make sure your HSA was established before you incurred the expenses you plan to reimburse later!

Anyone here use TurboTax for reporting these backdoor Roth conversions? I'm doing exactly what the original poster described but TurboTax seems confused about how to handle the form 8606 when I have both 2023 and 2024 contributions converted in the same year.

Great question! You're absolutely right that there are no dollar limits on Roth IRA conversions. Since your traditional IRA contributions weren't deductible (due to your employer plan), converting that entire $13,500 in 2024 should be essentially tax-free. One small clarification - when you convert in 2024, you'll report both the 2023 contribution (made in January 2024) and the 2024 contribution on your 2024 tax return using Form 8606. The IRS doesn't care that one contribution was "for" 2023 - what matters is when the conversion actually happened. Since you mentioned there are no gains in the account, you should owe zero taxes on the conversion. Just make sure to keep good records of your non-deductible contributions for Form 8606 reporting. The backdoor Roth strategy you're using is perfectly legitimate and very common for people in your situation who exceed the income limits for direct Roth contributions. One tip: consider doing the conversion soon after making contributions in the future to minimize any potential gains that would be taxable. You're doing everything correctly!

Anyone know if accepting PayPal or Venmo payments matters for reporting? Like do they send the IRS info if it's under a certain amount?

Just to add another perspective - even though you're likely under the reporting thresholds, it's still super smart to track everything from day one! I started my photography side hustle thinking I'd make nothing, but it grew faster than expected. Having good records from the beginning made tax time so much easier when I did cross the $400 threshold. Plus, if you ever want to grow your jewelry business or apply for small business loans later, having that financial history is really valuable. You can use something as simple as a spreadsheet or even a notes app to track sales and expenses. Good luck with your Etsy shop!