But what if I literally have zero income for 2024? Can I still file and claim these credits? My child was just born a month ago, and I'm still waiting on disability approval.

You can still file taxes with zero income, and you absolutely should if you have a dependent child. The Earned Income Credit has special rules that might apply even with zero earnings in your situation. For the Child Tax Credit, up to $1,600 per child is refundable (called the Additional Child Tax Credit), meaning you can receive it even if you have no tax liability. Since your child was born this year, they count as your dependent for the entire 2024 tax year.

That's actually a really important point I hadn't considered. I'm applying for several assistance programs right now while waiting on disability approval. I definitely don't want to mess up those applications.

I'm glad you brought that up. Each program has different rules, but many require you to report if you're being claimed as a dependent on someone else's taxes. This could potentially: - Change your household size calculation for benefits - Affect income limits since they might count some of your brother's income - Impact housing assistance eligibility or priority I'd recommend contacting the specific programs you're applying for and asking directly how being claimed as a tax dependent would affect your application. It's much better to know beforehand than to have benefits reduced unexpectedly.

What happens if your kid takes more than 4 years to graduate? My son is probably going to take 5 years to finish his degree. Can I still claim anything in that fifth year?

After you've used the American Opportunity Credit for 4 years, you can still claim the Lifetime Learning Credit for any additional years. The Lifetime Learning Credit doesn't have the 4-year limit that AOTC has. The Lifetime Learning Credit is worth less overall (20% of up to $10,000 in qualified expenses, so maximum $2,000 credit), compared to AOTC which can be up to $2,500. But it's definitely better than nothing for that fifth year! Also, Lifetime Learning has fewer restrictions - doesn't require half-time enrollment and can be used for graduate school too.

I dealt with this last year. If box 5 is larger than box 1, it usually means the scholarship/grant money exceeded qualified tuition expenses. You generally can't claim a credit in this case because there are no "out-of-pocket" qualified expenses. BUT - here's the trick: If your scholarship/grant is more than qualified expenses, you can choose to treat some of the scholarship as taxable income to your daughter, which then allows you to claim a credit for that same amount of expenses. This sometimes works out better overall, especially if your daughter has little/no other income.

Do I need to submit the death certificate with my tax return or just keep it with my records in case they ask? And thanks for mentioning the medical expenses - she had quite a few in those last couple months that I paid out of pocket.

You don't need to submit the death certificate with your tax return - just keep it with your tax records in case of an audit. The IRS generally doesn't require supporting documentation when you file, but you should keep it for at least 3 years after filing. Definitely add up those medical expenses! If your total medical expenses exceed 7.5% of your adjusted gross income, you can deduct the amount over that threshold. Since you were claiming your mom as a dependent, any medical expenses you paid for her care count toward your medical expense deduction.

You definitely need to return any SS payment received for the month they died or later. My mom passed in June and they took back her June payment automatically from her account. Call the SSA office right away because they might assess penalties if you keep it.

That's actually a really interesting option I hadn't considered. How complicated is the 1031 exchange process? And would I still be able to do this if I'm potentially downsizing to a less expensive rental property?

The 1031 exchange process isn't too complicated, but you absolutely need to follow the rules precisely - any misstep can disqualify the whole exchange. You definitely need to work with a qualified intermediary who specializes in these transactions, as they'll handle the paperwork and hold the funds. You can certainly downsize to a less expensive property, but there's a catch - if the replacement property is less expensive than what you sell your current property for, the difference (called "boot") will be taxable. So if you sell for $215k and buy for $180k, that $35k difference would be subject to capital gains and depreciation recapture taxes. Still, it allows you to defer taxes on the $180k portion, which could be worthwhile.

This is such an important point! I messed this up on my tax return last year and had to file an amendment. I replaced all the windows in my rental and was depreciating them separately, but when I sold, I forgot to account for that specific recapture amount.

Thank you so much for pointing this out! I didn't even consider wash sales. Looking at my trading pattern, I definitely bought back into some positions within that 30-day window after selling at a loss. Does the wash sale rule apply across different brokerage accounts too? Like if I sell at a loss on Fidelity and then buy the same stock on Robinhood within 30 days?

Yes, the wash sale rule absolutely applies across different brokerage accounts. The IRS doesn't care which platform you use - if you sell at a loss on Fidelity and buy the same stock on Robinhood within that 30-day window, it's still a wash sale. This is actually one of the biggest traps for traders who use multiple platforms. Your individual brokers won't know about trades you make elsewhere, so their reporting might not flag wash sales that actually exist when you look at all your accounts together. This is why tax software that can consolidate all your trading activity is valuable - it can identify wash sales that individual brokers miss.

How much trading do you have to do to qualify as a "trader" vs just an "investor"? I probably make like 5-10 trades a week, not sure if that's enough.