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Don't forget to check if your state offers education credits too! I'm in New York and we have a separate college tuition credit that gave me another $400 on my state return. TurboTax should walk you through this too, but sometimes the state credits are easy to miss.
I hadn't even thought about state credits! I'm in California - does anyone know if there are education credits here too? Turbo Tax hasn't mentioned anything about state-specific education stuff yet in my filing process.
California doesn't have a specific education credit like some states do, unfortunately. However, California does conform to some federal tax benefits related to education. For example, if you have student loan interest, that deduction carries over to your California return automatically. While you won't get an additional education credit on your state return, the money you save from the federal AOTC will still make a big difference in your overall tax situation. Make sure you're claiming all qualified expenses including required course materials and books, not just tuition!
Quick tip that saved me last year: if you've already filed but realized you missed claiming the education credit, you can file an amended return (Form 1040-X). I did this last April after realizing I could claim the AOTC, and got an additional refund of $1,500!
How far back can you amend returns for this? I totally missed claiming education credits for 2023 too. Is it too late?
22 A little-known trick: check if your property is listed on Zillow or Redfin. In many cases, they'll show the tax assessment including the land/improvement breakdown even when the county website doesn't make it obvious. Look under the "Tax History" or "Property Details" sections. Not always accurate, but it's worked for 3 of my rental properties when I couldn't find the info elsewhere.
4 I never thought to check Zillow! Just looked at my property and they do have land value listed, but it's from 2022. Do you think those values would still be acceptable to use for my 2024 taxes, or would they be too outdated?
22 2022 values are fine to use as a starting point! The land/improvement ratio tends to stay fairly constant unless there's been major construction or a significant change in your area's land values. If you want to update them to current values, you can apply the same ratio to your current total assessed value. For example, if land was 25% of the total in 2022, apply that same percentage to your current assessment.
3 Is anyone else bothered by how difficult they make this for regular people? I'm not an accountant or tax professional and it feels like the government deliberately hides this information to trip us up. All these extra steps just to figure out a number they already know!
Whatever you do, don't try to update your direct deposit info through email if anyone suggests that! My cousin got scammed this way last year - got an email claiming to be from the IRS about updating bank info for his refund. Turned out to be identity thieves. The IRS NEVER initiates contact through email about refunds or personal info. Just wait for the paper check like others have suggested. It takes a bit longer but it's the safest option at this point.
This happened to my mom too! She got a text message with a link to "update direct deposit info" and almost fell for it. These scammers know exactly when tax season is and target people waiting for refunds. The IRS will NEVER text or email you asking for bank information.
Has anyone had luck with calling the IRS Taxpayer Advocate Service instead of the main IRS number? I've heard they sometimes can help with refund issues if it's causing financial hardship.
The Taxpayer Advocate Service is really only for serious hardship cases or if you've tried multiple times to resolve an issue with the IRS without success. For a simple returned direct deposit that's being converted to a check, they probably won't take the case since the IRS has a standard procedure already in place.
Thanks for the clarification. Guess I'll just have to be patient and wait for the paper check to arrive. Seems like there's no way to speed up the process once the direct deposit has been rejected.
I use QuickBooks for my business accounting, and they have an integrated 1099 e-filing service. If you're already using QB or similar accounting software, check if they offer this feature - it's usually pretty straightforward. You just verify the vendor info, select who needs 1099s, and submit electronically. The fee is typically around $15-20 per form.
Does QuickBooks automatically know who should get a 1099? I've paid several people but I'm not sure which ones qualify for needing the form.
QuickBooks doesn't automatically determine who needs a 1099 - you need to properly categorize your vendors first. Generally, you need to send 1099s to any unincorporated businesses or individuals you paid $600+ for services during the tax year. When you set up vendors in QB, there's an option to mark them as 1099 vendors and enter their tax information. At year-end, the system will identify all 1099 vendors who've been paid over the threshold amount. You can then review the list, make any needed adjustments, and process the forms directly through their e-filing service.
Just want to point out that the IRS changed things in 2020. Now you should use Form 1099-NEC (Non-Employee Compensation) for contractor payments instead of the 1099-MISC. The 1099-MISC is still used but only for other types of payments (like rent, royalties, etc.). Sounds like you might be using the wrong form entirely for contractor payments.
This is accurate. I made the same mistake my first year with contractors. The 1099-NEC is what you need for anyone who did contract work for your business. MISC forms are for things like rent, prizes, etc. The instructions on both forms explain the difference pretty well.
Wait seriously?? I've already sent the contractor the 1099-MISC Copy B. Do I need to send them a 1099-NEC now instead and withdraw the MISC form somehow? This is getting more confusing.
Arjun Patel
Umm, aren't we forgetting about the "economic substance doctrine"? The IRS can disallow transactions that don't have a real economic purpose beyond tax avoidance. If you sell and immediately rebuy the exact same crypto, they might argue there was no real economic purpose. I'm not a tax pro but I read about this somewhere. Maybe someone here knows more?
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Jade Lopez
ā¢That's more applicable to complex corporate tax shelters than to individual investors making normal investment decisions. As long as you have a legitimate investment purpose (which it sounds like OP does - they believe in the long-term prospects), tax-loss harvesting is a widely accepted practice. Even traditional brokerages recommend it for stock portfolios. The key is having investment intent beyond just tax savings. The fact that OP genuinely wants to maintain investment in this crypto should be sufficient.
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Tony Brooks
Don't forget another benefit - if your losses exceed your gains plus the $3000 limit for ordinary income, you can carry forward the unused losses to future tax years! I had $7500 in crypto losses last year, used $3000 against my income, and am carrying forward $4500 to use this year. It's not just a one-year benefit. Think of it as the government letting you spread a large loss over multiple tax years, which is actually pretty reasonable when you think about it.
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