I actually hadn't thought about the FSA option! Does it provide the same tax advantages as an HSA? And what happens to any FSA funds when we transition to the HDHP with an HSA in 2025?

FSAs do provide a similar tax advantage by allowing pre-tax contributions that reduce your AGI, similar to an HSA. However, they typically have much lower contribution limits (usually around $3,050 for 2023) compared to HSA limits ($7,750 for family coverage). Regarding your second question, FSA funds generally need to be used by the end of your plan year, though some employers offer either a grace period (usually 2.5 months) or a carryover option (usually $610 maximum). If you don't use the funds within these timeframes, you forfeit them - that's the big downside compared to HSAs. When you transition to an HDHP with HSA in 2025, you'll need to either spend down your FSA funds before the new plan year or see if your employer offers that limited purpose FSA I mentioned that can coexist with an HSA.

This is great advice! When I had my second child last year it counted as a qualifying life event and I was able to switch from a PPO to an HDHP mid-year. Started contributing to my HSA right away for the remaining months.

How much did the CPA charge? I'm trying to figure out if the cost would be worth it compared to potential savings.

My CPA charged $450 for my return, which included W-2 income, investment income, and some small business income from consulting. Given that he saved me $3,800, it was definitely worth it! Most CPAs I researched charged between $350-700 for returns with complexity similar to yours. The key is finding someone who specializes in the areas relevant to your situation - in your case, someone experienced with S-corporations and investment income.

Can you elaborate? I'm also getting K-1 income from an S-corp and just using TurboTax. Now I'm worried I'm leaving money on the table.

Can you explain more about the trust option? Wouldn't that defeat the purpose of giving the girlfriend financial independence if the money is tied up in a trust for the kids?

You're right that a trust solely for the children wouldn't address the goal of financial independence for the girlfriend. What my attorney suggested (and what we ended up doing) was a combination approach: a direct gift to my partner for her immediate financial security, plus a separate family trust where she was both a beneficiary and a trustee. This had several advantages: it reduced the immediate gift tax implications by splitting the amounts, it provided structured financial security for both her and our children, and it created an additional layer of documentation showing the personal nature of these financial arrangements. The trust paperwork explicitly referenced our family relationship, which further reinforced that these were personal financial planning decisions rather than business compensation.

Bad idea. The IRS would absolutely flag that as suspicious. Going from $50K to suddenly hundreds of thousands in "contractor fees" would trigger an audit instantly. Plus, even if it was legitimate, she'd have to pay self-employment tax on all of that, which is around 15%. That's a huge tax hit compared to receiving it as a gift.

That's a really good point I hadn't considered. Do you know if there's any resource specifically about Arizona's policies on this? I definitely want to avoid surprise tax bills from AZ after I've moved to Indiana.

I don't know Arizona's specific rules, but I'd recommend calling the Arizona Department of Revenue directly. That's what I did with California. For what it's worth, most states follow the federal treatment and don't try to tax the gain immediately, but some have started implementing these clawback provisions to prevent losing tax revenue when property owners leave the state. Usually there's a form you need to file acknowledging the deferred gain and agreeing to file nonresident returns if you later sell the replacement property.

Is that really a thing? I thought QIs weren't actually licensed in most states. They're not like real estate agents with state-specific licenses. At least that's what I understood.

Do students ever qualify for any special moving deductions or credits? I'm planning to move for my first job after graduation and wondering if I can deduct anything.

Unfortunately, moving expenses are no longer deductible for most people since the 2017 tax law changes. The only exception is for active-duty military members moving due to military orders. As a student starting your first job after graduation, you likely won't have any federal tax deductions for moving expenses. However, some states still allow moving expense deductions on their state returns. Also, if your new employer provides any relocation assistance, that's typically taxable income, but sometimes employers will "gross up" the payment to cover the tax impact.

FreeTaxUSA doesn't handle everything correctly tho. My gf used it last year and it messed up her education credits. She had to file an amendment. Sometimes paying more for a professional is worth it if they catch things software might miss.