Does this work if my employer has me working from home 3 days a week? Or is it only for self-employed people?

Unfortunately, it's currently only available if you're self-employed or run your own business. W-2 employees working from home (even full-time) can't take the home office deduction anymore after the Tax Cuts and Jobs Act of 2017. Before 2018, W-2 employees could deduct unreimbursed business expenses (including home office costs) as miscellaneous itemized deductions, but that provision was suspended until 2025. If you're working remotely as a W-2 employee, your best option is to ask your employer about expense reimbursement programs instead of looking for tax deductions.

I actually think it depends on where you live. In high-tax, high-cost areas (California, New York, etc.), the mortgage interest and property taxes can be substantial enough to make itemizing worthwhile. In my case (Bay Area), my property taxes alone are over $18k, so combined with mortgage interest and charitable giving, itemizing saves me several thousand dollars compared to the standard deduction.

Wait, so even income my wife earned in her home country BEFORE getting her green card would count? We'd have to pay US taxes on that too? That seems unfair since she wasn't even a resident then!

Yes, that's exactly right. When you make the 6013(h) election, you're choosing to be treated as US residents for the ENTIRE tax year. This means all worldwide income from January 1st onward is subject to US tax reporting requirements, even income earned before your wife physically became a resident. It can seem unfair, but the trade-off is that you get to file jointly, which often saves significantly on taxes overall. You may also be eligible for the Foreign Tax Credit if she paid taxes on that income in her home country, which can offset any US tax owed on the foreign income.

TurboTax can handle it but not super smoothly. You'll need to manually attach the election statement. I used TurboTax last year for this exact scenario and had to write up the statement separately. The premium version did walk me through the dual-status alien questions though!

That's an interesting approach I hadn't considered! Do you know if there would be any additional tax implications I should be aware of with this method? And would I still be able to claim the standard mileage rate for the personal use of my vehicle on other schedules?

If you go the lease route, you'd be treating the vehicle as rental property on your Schedule E, so you'd need to track and deduct actual expenses rather than using the standard mileage rate. You'd report the lease income from the partnership, then deduct expenses like depreciation, insurance, maintenance, and fuel based on business percentage use. For the portion of your vehicle used personally, you wouldn't be able to claim any deduction since that's considered personal use. The standard mileage rate wouldn't apply once you've chosen to treat the vehicle as rental property. This approach works best for newer, more expensive vehicles where actual expenses exceed what the standard mileage rate would provide.

That approach won't work anymore. Employee business expenses were eliminated as deductions for most people with the Tax Cuts and Jobs Act of 2017. Unless you're in certain specific professions (like armed forces reservists, qualified performing artists, etc.), you can't deduct unreimbursed employee business expenses on your personal return.

So you're saying I shouldn't worry yet? When should I start to panic if I don't see movement? It's already been 3 weeks since I filed and the tracker still just says it's being processed with that PATH Act message.

You definitely shouldn't worry yet! The PATH Act hold means nothing will happen until after February 15th at the earliest. Even then, it can take another 5-7 business days for your return to finish processing and the refund to be approved. I'd say don't start getting concerned until around March 15th. If you haven't seen any movement by then, you might want to contact the IRS to see if there's an additional issue. But right now you're still well within the normal timeframe, especially considering this year's processing volumes. The "being processed" message with the PATH Act reference is exactly what you should be seeing at this point.

Unfortunately, amended returns with EIC are subject to even longer delays. They not only get caught by the PATH Act hold, but amended returns typically take 16-20 weeks to process regardless. And that's during normal times - with current IRS backlogs, some people are waiting 6+ months for amended return processing.

That's a great point I hadn't considered. We're in Oregon. Does anyone know if Oregon generally follows federal guidelines on settlement taxation or if they have their own rules?

Oregon generally follows federal treatment for physical injury settlements, so if your portion qualifies as tax-exempt under federal rules, it should also be exempt from Oregon state income tax. However, the key is still getting clarity on whether your guardian portion maintains the same character as the physical injury settlement. If the federal determination is that it's taxable as guardian fees, Oregon would likely treat it the same way.

This is definitely the best advice. I'm a paralegal at a firm that handles injury cases, and we always make sure to include specific language about tax treatment of guardian portions. If your attorney didn't do this, they really should have.