Would replacing my old furnace with a heat pump qualify? How much of a credit could I get? My heating system is on its last legs anyway.

Yes, replacing your old furnace with a heat pump would likely qualify under the Energy Efficient Home Improvement Credit. For 2023, you could get up to 30% of the costs back as a tax credit, with a limit of $2,000 specifically for heat pumps. The great thing about this being a credit rather than a deduction is that it directly reduces your tax bill dollar for dollar. Just make sure the heat pump meets the efficiency requirements - usually the manufacturer or installer can confirm this for you and provide the necessary certification documentation you'll need for your tax return.

I did this last year! You can defer recognizing capital gains until 2026 by investing in Qualified Opportunity Zone Funds within 180 days of realizing the gain. Plus if you hold the investment for 10+ years, gains on the QOZ investment itself can be completely tax-free. But be careful - these investments can be risky and illiquid, so definitely do your homework.

Thanks so much for breaking down those method codes! That makes much more sense now. So if I understand correctly, my desk and MacBook were essentially "fully depreciated" for federal purposes in the first year because of the 100% bonus, but for California they're still on their regular depreciation schedules? When I enter these as existing assets in FreeTaxUSA, do I need to enter different prior depreciation amounts for federal vs state? Or does the software handle that difference automatically?

Yes, you've got it exactly right! For federal purposes, your desk and MacBook were fully depreciated in the first year thanks to 100% bonus depreciation available in 2022. But for California, they're following their normal depreciation schedules over 7 and 5 years respectively. FreeTaxUSA should handle the federal vs state difference automatically once you input the correct information. You'll want to enter the assets with their original acquisition dates, costs, and depreciation methods. For "prior depreciation," enter the cumulative federal depreciation taken to date (which would be the full amount for the desk and MacBook, and the partial amount for the iPhone). The software will then apply the correct state adjustments automatically. If you want to double-check the calculations, the state return should include a specific form showing the depreciation differences between federal and California.

This is super important! I messed up my taxes last year because I didn't realize the rates change throughout the depreciation period. Is there an easy calculator anywhere that shows what the percentage should be for each year?

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.

Thanks for bringing this up! My understanding was that since my husband was a US citizen, I don't need to file Form 3520 even though the property is in the UK. Is that correct? Are there any other international forms I should be aware of besides FBAR and the Form 8938?

You're correct. Since your husband was a US citizen, you don't need to file Form 3520 for this inheritance, even though the property is located in the UK. The form is specifically for gifts or inheritances from foreign persons (non-US citizens/residents). Beyond FBAR (FinCEN Form 114) and Form 8938, you might want to be aware of Form 8833 if you're claiming benefits under the US-UK tax treaty, but that's typically not needed for straightforward inheritances. Also, if you maintain any financial accounts in the UK after settling the estate, remember you'll need to continue reporting those on FBAR and potentially Form 8938 in future years if they meet the threshold.

Good point! What exchange rate date did you end up using? Date of death, date of distribution, or something else?

Thanks for this suggestion! I didn't realize there was an income threshold for free filing options. My income is actually around $78,000 so I just miss that cutoff, but $49 sounds way more reasonable than what H&R Block quoted me. Did you find TaxSlayer easy to use? I'm not super tax-savvy but can follow clear instructions.

TaxSlayer is pretty user-friendly with a straightforward interface. It walks you through everything step by step with explanations along the way. The questions are clear and it imports W-2s if you have your employer's EIN number. For mortgage interest, you just enter the information from your Form 1098. Even if you're not tax-savvy, these programs are designed for regular people. They have help sections and explanations for almost everything. And if you get stuck, most have support options where you can chat with a tax pro for specific questions.

Is the Peace of Mind guarantee even worth it? I've always wondered if these audit protection plans are just a way to scare people into paying more.