Thanks for mentioning Ordlock v. Commissioner - I hadn't heard of that case! Did you have to pay the attorney a lot up front? My client is already out the $92k refund so she's struggling with the idea of paying more money for something that might not work.

Our attorney worked on contingency - he took 30% of what we recovered. Most tax attorneys dealing with refund cases will work this way since they know if they win, there will be money to pay them. The Ordlock case is perfect for your situation since it specifically addresses California community property law and the IRS's obligation to consider separate property interests even in community property states. The key in our case was proving that the refund was generated primarily from my wife's separate withholdings. I'd suggest at least doing a consultation with a tax attorney who specializes in Tax Court petitions. Many offer free initial consultations. Just having the attorney letterhead on your communications sometimes gets the IRS to take a second look before it ever gets to actual litigation.

Did you submit this directly to the IRS or did you go through the appeals process first? I'm in a similar situation but in Washington state (also community property).

I submitted it directly to the address on the rejection letter as a "reconsideration request" rather than a formal appeal. In my cover letter, I specifically referenced that I was providing "additional documentation not available during the initial review" which I think helped get it looked at. For Washington state, you'd want to focus on the same principles - documenting the separate nature of your income and withholding. The community property rules are similar but not identical, so make sure you're addressing the specific Washington state provisions. The most helpful document for me was a signed statement from my ex acknowledging the debt was his alone. If you can get something like that, it really strengthens your case.

Does the Vanguard calculator work if you have income from both self-employment and a W-2 job? I work part-time for a company and also do freelance work on the side.

The Vanguard calculator works best for purely self-employed individuals. For mixed income situations where you have both W-2 and self-employment income, it gets more complicated. For someone with both types of income, you'll need to calculate your SEP contribution based only on your self-employment income, and keep in mind any employer retirement contributions from your W-2 job count toward your total annual limit. The calculator won't automatically factor in those employer contributions, so you'd need to do some additional calculations manually. In your specific situation, I'd recommend using a more comprehensive calculator or consulting with a tax professional just to be safe.

Thank you all so much for the helpful responses! This was way more complicated than I thought, but now I understand why the 25% is actually 20% in practice. I'll definitely use the formula that Profile 22 shared, and might check out that taxr.ai tool to double-check my calculation since I don't want to mess this up. For my $95k in net profit, looks like I can contribute around $17,550 which is way more than I've been putting away. Time to boost those retirement savings!

Does the 25-30% include state taxes too or just federal? I'm trying to figure out exactly how much to set aside each week.

That percentage includes both federal and state taxes for most situations. If you're in a high-tax state like California or New York, you might want to bump it up to 30-35%. I'm in a medium-tax state and 28% has covered me completely. The exact amount depends on your overall income level and tax bracket when combined with any other jobs you have.

I've used both TurboTax Self-Employed and FreeTaxUSA for my delivery gig taxes. TurboTax is more user-friendly and asks specific questions about delivery driving, but it's expensive (around $120-150 for federal and state with self-employment). FreeTaxUSA handles 1099 income well too and costs way less (about $15 for state, federal is free), but you need to know which forms to fill out yourself.

What if my brokerage is a smaller one that doesn't offer those kinds of services? I'm with a regional firm that's not as full-service as Fidelity or Schwab.

If you're with a smaller brokerage, you still have options. Even if they don't offer formal basis reconstruction services, their customer service might still be able to help you identify the share price on the date of death. If that doesn't work, you can also use resources like Yahoo Finance or Morningstar to look up historical prices for most mutual funds. Just search for SSHFX and find the historical price data for your uncle's date of death. Document how you determined the value (take screenshots), and keep that with your tax records.

This is actually a really good point. The executor had to choose one valuation method for ALL assets in the estate though - they couldn't cherry pick different dates for different assets. So you might want to check what method was used on the estate tax return if one was filed.

That's really helpful, thanks! Do you know where I can find information about this tax treaty? Is there a specific IRS form or website that explains how it would apply to my situation?

You can find the full text of all US tax treaties on the IRS website - search for "United States Income Tax Treaties A to Z" and look for New Zealand. But I'll warn you, these documents are written in dense legal language and can be hard to understand. A more user-friendly approach is to look at IRS Publication 901 (U.S. Tax Treaties). It breaks down the key provisions by country in more understandable language. For your specific situation as a seasonal worker, pay attention to the sections on "dependent personal services" or "income from employment" in the treaty. These sections typically address short-term work situations like yours.

This isn't totally accurate. The $10,000 threshold is for the COMBINED total of ALL your foreign accounts at ANY point during the year. So if you had $5k in a NZ account and $6k in another foreign account, you'd still need to file FBAR. Better safe than sorry with these things!