I just went through this exact situation last month! When you have two W-2s like this from the same employer, it's usually because of a mid-year change in tax jurisdictions (which matches your husband's office move). Here's what worked for me: Use the Federal/State W-2 as your primary form in TurboTax. This has all your complete federal wage and tax information. The City/Local W-2 is supplementary and should only be used for the local tax sections. For Box 12 specifically, the differences you're seeing make sense: - The lower Code C amount ($390 vs $1,350) on the City/Local form reflects the reduced life insurance benefit calculation after the move - The Code D difference ($10,900 vs $11,800) shows 401k contributions were slightly different between the two periods - Code AA only appears on the Federal/State form because that's where the complete annual Roth 401k contribution total is reported TurboTax's import feature will likely only grab the Federal/State W-2, so you'll need to manually enter the city tax amounts in the local tax section. Don't worry about "double reporting" - the software keeps federal and local separate. Just make sure you're using the right form for each section!

This is exactly the kind of confusing situation that can happen with mid-year employment changes! You're right to be cautious about which W-2 to use. From what you've described, the Federal/State W-2 should be your primary document for filing. The fact that it has complete state information and higher Box 12 amounts suggests it reflects your husband's full annual earnings and deductions. The City/Local W-2 with lower amounts makes perfect sense given that he stopped paying city taxes in July when the office moved. Those reduced Box 12 amounts (like the $390 vs $1,350 for Code C) reflect the partial year when city taxes applied. When you use TurboTax, enter the Federal/State W-2 as the main W-2 for your husband. If TurboTax asks about local taxes (which it should since you'll indicate he had some city tax withheld), that's when you'd reference the City/Local W-2 for those specific local tax fields. The electronic import feature will probably only pick up one W-2, so you may need to manually verify the local tax information. But this approach should ensure you're reporting the complete annual federal amounts while properly accounting for the partial year of city taxes.

Has anyone talked about the deadline aspect? You mentioned having an extension, but those military extensions only last so long. Are you using a tax professional or filing yourself? With this complexity, it might be worth getting a CPA who specializes in military transitions.

I went through something very similar when I separated from the Air Force in 2022. The key thing that helped me was getting everything documented in writing from DFAS before filing my taxes. Here's what I'd recommend based on my experience: 1. **File with your W-2 as is** - Your payroll contact is correct that the W-2 reflects the proper reporting to the IRS. The overpayments aren't taxable income since they're considered debt. 2. **Get a debt collection statement** - Request written documentation from DFAS showing the overpayment amount and confirming it's being treated as debt, not income. This protects you if there's ever an audit. 3. **Understand your repayment options** - When you repay, you'll likely only need to repay the net amount (what hit your bank account after taxes). The withholdings stay with the IRS as credits on your return. 4. **Don't wait for DFAS to contact you** - They can be incredibly slow. Proactively starting the debt collection process will give you more control over timing and payment options. The good news is this situation is more common than you think, and the IRS understands how military pay works. Your extension gives you time to get the documentation you need, but don't stress too much about filing "incorrectly" - you're filing with the W-2 as provided, which is exactly what you're supposed to do.

I made $9,400 last year and didn't file. Now I regret it because I checked my W-2 and saw they withheld like $500 in federal taxes that I could've gotten back. Is it too late to file for last year?

For someone in your exact situation (single, 24, $9,200 income, not a dependent), you should definitely file! Even though you're under the $12,950 threshold that requires filing, you'll likely get back every penny of federal income tax that was withheld from your paychecks. Check box 2 on your W-2 - if there's any amount there, that's money the government owes you. Plus, you might qualify for the Earned Income Tax Credit, which could actually give you more back than what was withheld. The 1040 form is straightforward for your situation. You can use the IRS Free File program since your income is well under $73,000, or any free tax software. Don't leave money on the table - file that return!

This is a really complex situation that highlights why partnership taxation is so tricky. Based on what you've described, it sounds like you're caught between two different approaches to loss allocation - one based purely on ownership percentages, and another based on economic risk. The key issue here is that partnership tax law requires loss allocations to have "substantial economic effect" under Section 704(b). This means the partner claiming the loss should actually bear the economic burden if the partnership fails. If one member is funding most operations while others take equal loss allocations, that can create problems. Your negative capital account might actually be less concerning than it appears. What really matters for your ability to deduct losses is your "outside basis" - which includes your capital contributions plus your share of partnership liabilities. Even with a negative capital account, you might still have positive basis if the partnership has debt allocated to you. A few questions that might help clarify your situation: - Does the partnership have any loans or debt that would be allocated among partners? - What does your partnership agreement say about loss allocation and capital account maintenance? - Are there any guarantee provisions or deficit restoration requirements? Given the complexity and the fact that you're getting conflicting advice from CPAs, you might want to consider getting a third opinion from someone who specializes in partnership taxation. The difference between the two approaches could have significant implications for both current and prior year returns.

I've been following this thread and wanted to add something that might help clarify the situation. When you have a partnership where one member is providing most of the funding but losses are being allocated based on ownership percentages, you're essentially dealing with what the IRS calls "artificial" loss allocations. The new CPA is likely applying the "at-risk" rules under Section 465, which limit loss deductions to amounts you actually have at risk in the activity. This is separate from but related to the substantial economic effect rules others have mentioned. Here's what might have happened: Your old CPA was mechanically following the partnership agreement (allocate by ownership %), but didn't consider whether you actually had sufficient basis or were "at-risk" for those losses. The new CPA is applying the proper limitations. The good news is that if you couldn't deduct losses in prior years due to insufficient basis or at-risk amounts, those losses don't disappear - they get suspended and can potentially be used in future years when you have sufficient basis. Given the complexity here, I'd strongly recommend asking the new CPA to prepare a multi-year basis and at-risk limitation worksheet showing: 1. Your beginning and ending basis for each year 2. Your at-risk amounts 3. Which losses were properly deductible vs. suspended 4. Current suspended loss carryforwards This will help you understand exactly where you stand and whether any prior year amendments are needed.

I'm going through the same thing right now! What tax software are you using? I'm on H&R Block and was confused because when I entered my 1099-K, it automatically wanted to treat it as business income on Schedule C which seems wrong for personal items.

I went through this exact same situation last year and completely understand your stress! The key thing to remember is that the 1099-K is just a reporting document - it doesn't automatically mean you owe taxes on the full amount. For personal items sold at a loss (which sounds like your situation), you'll want to report these on Form 8949 and Schedule D, not as business income. The IRS Publication 544 specifically covers sales of personal property and explains that you can use reasonable estimates for cost basis when you don't have original receipts. Here's what worked for me: I created categories for my items (electronics, clothing, books, household items, etc.) and researched what similar items would have cost when I originally bought them. I documented my methodology and kept screenshots of comparable retail prices as backup. For example, if I sold a kitchen appliance from 2015, I looked up what that model cost new in 2015 and used that as my cost basis. The most important thing is to be honest and consistent in your approach. Since you sold personal belongings rather than running a business, you're not trying to claim business deductions - you're just documenting that these sales resulted in losses, not gains. Keep good records of your estimation process and you should be fine!