The bonus was paid separately with the 22% supplemental rate when I first received it. My employer hasn't mentioned anything about Social Security or Medicare taxes being returned to me - is that something I need to specifically ask them about?

Yes, you should definitely ask your employer about the Social Security and Medicare taxes. When you repay wages in the same year you received them, employers typically adjust everything including those taxes. But for repayments that cross tax years (like yours), the employer is only required to provide documentation of the repayment. For the Social Security (6.2%) and Medicare (1.45%) taxes withheld on that bonus, you'll need to specifically request a refund of those amounts from your employer. They're not automatically included in the Claim of Right calculation. If your employer won't refund these directly, you may be eligible to claim them as a credit on your tax return using Form 8919, but that gets complicated so you might want to consult with a tax professional about the specific process.

This is super important! My brother had to repay a bonus and his company didn't provide proper documentation. He got audited and it was a huge mess. Make sure to get everything in writing from your employer.

Where did you find your crypto-friendly accountant? I've been looking for someone who won't charge me these insane rates but have had trouble finding anyone who seems knowledgeable about crypto tax rules.

I found mine through a local crypto meetup group. There are also some online directories specifically for crypto-friendly accountants - try searching "crypto tax professional directory" and you'll find a few options. The key questions to ask are: what software do they use for crypto tax preparation, how do they handle missing cost basis information, and if they have a flat fee structure for crypto reporting regardless of transaction count. Any accountant who acts like crypto is some mysterious new technology or charges by the transaction is probably not your best option in 2025.

This is really good advice. I'd add that you should sit down with your accountant and go through the forms together before filing to make sure everything transfers correctly. And keep copies of EVERYTHING, including all the work you did to calculate your crypto basis. The IRS has been focusing more on crypto compliance lately.

Thanks for this advice! I'm still waiting on those statements from T-Rowe, but this gives me a good framework for organizing everything. Do you think I should attach some kind of explanation with my tax return explaining why I'm reporting different figures than what's on the 1099-Q?

You don't need to attach an explanation to your regular tax return. When you report a distribution from an education account on Form 8863, you're only reporting the taxable portion anyway. If you're concerned, you can certainly keep a written explanation with your tax records that you could provide in case of questions. But don't send additional documentation unless specifically requested by the IRS.

I had this issue spanning 4 years of distributions. What worked for me was calculating the initial ratio of contributions to earnings before ANY distributions started, then applying that same ratio to all distributions. So if your account was 80% contributions and 20% earnings when you first started taking money out, you'd consider all distributions to be split that same way.

Thanks, that makes sense. I think I've actually been doing it wrong then. I've been trying to recalculate the ratio each year which has been a total nightmare with all the market fluctuations. I'll try using the initial ratio approach instead.

Do you think there's value in going back to the same preparer each year? Or should I shop around for the best price annually?

There's definitely value in building a relationship with the same preparer over time. They learn your specific situation and can provide more tailored advice as they get to know your financial patterns. They'll also notice changes year-to-year that might indicate new tax opportunities. Shopping based on price alone can backfire. The cheapest preparers are often the least experienced or may rush through returns during busy season. If you find someone who does quality work and you're comfortable with them, the continuity is usually worth any small premium you might pay compared to shopping around.

Not everyone is confident doing their own taxes, especially with self-employment income. I tried doing my own and missed a huge home office deduction that my preparer caught the next year. Sometimes paying a professional saves you more than their fee.

That's a great point about the state agencies. Do you know if there's an easy way to find out which agency handles this in my state? I'm in Michigan if that helps.

For Michigan specifically, you'd want to contact the Department of Licensing and Regulatory Affairs (LARA). They handle professional licensing and regulation for tax preparers. Their website has a complaint form you can fill out. If your preparer claimed to be a CPA but wasn't, that's also something LARA would be interested in knowing about. In addition to filing with them, the Michigan Attorney General's office has a Financial Crimes Division that takes complaints about financial fraud, which this could qualify as.

Exactly! Check box 128 on your Form 1040 from last year (or corresponding box if it was a different tax year). A legitimate preparer must sign and include their PTIN. If they didn't, that's an immediate violation.