21 Question for anyone - if I have unrealized losses (stocks that have gone down but I haven't sold yet), can I still claim those on my taxes? Or do I actually have to sell to get the tax benefit?

Great question about unrealized losses! You absolutely have to sell the stock to claim the tax loss - just holding a stock that's down in value doesn't give you any tax benefit. This is actually a strategic consideration many investors face near year-end. If you have stocks that are significantly underwater and you don't think they'll recover, selling them before December 31st lets you claim those losses on that year's tax return. Just remember the wash sale rule I mentioned earlier - if you sell for a loss but then buy back the same stock (or something "substantially identical") within 30 days before or after the sale, the IRS disallows the loss deduction. So if you still believe in the company long-term, you'd need to wait 31 days before repurchasing, or buy something similar but not identical. Some people get around this by selling their losing position in Company A and immediately buying a similar company or ETF in the same sector, so they maintain market exposure while still capturing the tax loss.

Honestly all the chains are expensive imo. H&R Block charged me $320 last year for what I later found out was a pretty basic return. Try looking for an "enrolled agent" in your area - they're tax specialists who usually charge way less than CPAs or the big chains.

Great suggestions everyone! I'm definitely going to look into both the enrolled agent route and credit union options - hadn't considered either of those before posting. For anyone else reading this thread, I ended up calling around to a few places after reading these comments. What I found was that the chains really do vary a lot in pricing even within the same company - the H&R Block near my work quoted me $280 while one across town said $195 for basically the same services. Location seems to matter more than I expected. Also wanted to mention that several of the independent preparers I contacted were willing to give me a rough estimate over the phone once I described my situation (investment income, job change, etc.), which was way more helpful than the chains that just gave generic "starting at $X" pricing. Definitely worth making a few calls before deciding!

One thing to watch out for with bonuses and stock - your employer might not withhold enough taxes. My company withholds only 22% federal on bonuses and RSUs regardless of your actual tax bracket. Had to learn the hard way when I owed a ton at tax time. Consider making estimated tax payments if your withholding seems too low.

Great question! As others have mentioned, your tax bracket is determined by your total taxable income, not just base salary. So your $230k puts you in the 35% marginal bracket for 2025. One important consideration that hasn't been fully addressed yet - timing matters a lot with RSUs and bonuses. If your RSUs vest throughout the year and your bonus comes at year-end, you might want to look into adjusting your W-4 withholding allowances earlier in the year to account for the higher tax burden coming later. Also, with that income level, you'll want to make sure you're not subject to underpayment penalties. The IRS requires you to pay either 90% of this year's tax liability or 110% of last year's (since you're over $150k AGI) through withholding and estimated payments. Given the complexity with multiple income sources, it might be worth consulting with a tax professional to set up a withholding strategy that works for your specific situation.

Have you considered using the IRS's Reasonable Cause Assistant on their website? It's not as well-known as calling, but sometimes works better for straightforward cases like yours. 😂 Though "straightforward" and "IRS" rarely belong in the same sentence! Jokes aside, you might also want to check if your state has separate requirements for reasonable cause exceptions - some states are more forgiving than others for medical emergencies.

I went through something very similar after a car accident kept me hospitalized for several weeks during tax season. The key thing that helped me was being proactive once I was able to handle my affairs again. I immediately filed my return with a detailed letter explaining the medical emergency, included copies of hospital discharge papers, and specifically referenced "reasonable cause" under IRC Section 6651(a)(1). The IRS did initially send me penalty notices, but after I called and explained the situation (yes, the hold times were brutal), they completely abated all failure-to-file and failure-to-pay penalties. The whole process took about 90 days from start to finish, but I didn't pay a single penalty dollar. One tip: if you do get penalty notices, don't panic. The IRS computer systems automatically generate these, but human review almost always results in abatement for legitimate medical emergencies. Just make sure you respond promptly to any notices and keep detailed records of all communications. Your quarterly estimates for 2024 shouldn't be affected by this situation at all - those are separate obligations going forward.

Something nobody mentioned - depending on what kind of settlement this was, it might not even be taxable income! I had a personal injury settlement and didn't have to pay taxes on it at all. What was your class action for?

I went through something similar with a consumer protection class action settlement last year. One thing that helped me was looking at the settlement notice that was posted on the court's website - it usually has the full fee arrangement spelled out. In my case, the attorneys took 33% plus expenses, which wasn't clearly shown on my 1099-MISC either. I ended up having to calculate it myself based on the settlement notice. Make sure when you report the attorney fees as a deduction that you have documentation to back it up in case the IRS asks questions later. Also, keep in mind that if this was a punitive damages settlement (like for a data breach or consumer fraud), it's definitely taxable income. But if any portion was for actual damages or reimbursement of losses you incurred, that part might not be taxable. The settlement paperwork should specify what each portion represents.