This is why I always take the extra step to get a win/loss statement from gambling sites that offer them. Does your crypto gambling site provide any kind of statement or summary you can download for tax purposes?

Most legit crypto gambling sites do offer some form of win/loss statement or transaction history you can download. It's not always as detailed as traditional casinos, but it's better than nothing. For sites that don't provide good documentation, I've started keeping a spreadsheet with dates, amounts, screenshots of balances before and after significant wins/losses, and the withdrawal transactions. The more documentation you have linking the gambling activity to the crypto you received, the easier it is if questions come up later.

Thanks for breaking it down like this! The gift card to gambling site to ETH withdrawal path had me so confused. And yes, it was about $1000 worth when I cashed out, so the 10.1% decrease tracks with the market dip after I withdrew. I'm going to double check the exact date and ETH price to make sure my software has it right.

I actually have been thinking about that! How hard was the process of working with a foreign employer while in California? Did they handle the state tax withholding properly or did you end up with surprise tax bills?

The foreign employer had no idea how to handle California taxes. They didn't withhold anything for state taxes, so I had to make quarterly estimated tax payments to the California Franchise Tax Board to avoid penalties. I got hit with an underpayment penalty the first year because I didn't realize I needed to do this. If you stay in California, definitely set up quarterly estimated payments right away. The FTB is much more aggressive than the IRS about collecting penalties! Also, document everything about where you physically work - California has been known to audit people who claim they've moved to Nevada but still actually work in California.

Good point. I negotiate a USD equivalent with my foreign employer that gets adjusted quarterly. Protects against big swings. Swiss franc is usually pretty stable tho.

Does this really work? I've heard about this but wasn't sure if congressional offices actually help with tax stuff or if they just take your info and do nothing.

Yes, it absolutely works! Congressional caseworkers help constituents navigate federal agencies - it's literally part of their job. When I called, they had me fill out a privacy form so they could legally inquire about my case, then assigned a caseworker who contacted the IRS Taxpayer Advocate on my behalf. The key is being patient and polite with their office. They deal with lots of cases, so don't expect immediate results, but in my experience, they did follow through. It took about 2 weeks to get resolution, which was much faster than I was getting on my own. Just call your rep's local district office rather than their DC office for best results.

Yeah I did this last month! Call 844-545-5640 to schedule an appointment at your local Taxpayer Assistance Center. When I went in, the agent was able to look up my info and tell me exactly what was happening with my return. Just bring ID and all your tax docs.

A backdoor Roth is slightly different. That's when you contribute to a non-deductible traditional IRA first (because there's no income limit) and then immediately convert it to a Roth. Since you're converting after-tax dollars, there's minimal tax impact. What the OP is describing sounds like a regular conversion of an existing pre-tax traditional IRA, which would be fully taxable. Different situation but same conversion mechanism.

Thanks for bringing this up! I hadn't considered this. All my traditional IRA money is pre-tax (I've always been able to deduct it), so I guess this wouldn't apply to my situation specifically? But definitely good to know about.

You're right - if all your traditional IRA money is pre-tax, the pro-rata rule isn't a concern for you. It becomes an issue when people have a mix of deductible and non-deductible contributions across different IRA accounts. The IRS views all your traditional IRAs as one big pot for conversion purposes, which surprises a lot of people. But in your all-pre-tax situation, you'll just pay ordinary income tax on whatever amount you convert.

I did think about the standard mileage deduction, but from what I've calculated, the actual expense method will probably be more beneficial in my case. I drive the EV almost exclusively for business, and with the depreciation of the vehicle plus all the other expenses, I think I'll come out ahead with actual expenses. But you're right that standard mileage would definitely simplify things!

The standard mileage rate doesn't actually work well for EVs in many cases. It was designed around gas vehicles and their maintenance costs. EVs have higher upfront costs but lower per-mile costs, so you might be leaving money on the table using standard mileage.

What documentation did you need to prove the business use percentage? I'm getting a charger installed next month and want to make sure I have everything ready for tax time.