This is such a good point! I made this mistake last year with a CPA who didn't know about my state's special treatment of retirement income. Do you think it's better to find someone local who does online consultations or someone fully remote?

I've had better luck finding someone local who offers online services. They tend to know both the state and local tax situations better while still providing the convenience of remote meetings. A fully remote CPA can absolutely work too, especially if they specifically list your state as one they're familiar with. Just make sure to specifically ask about their experience with your state's tax laws during your initial consultation.

Tax software is fine for filing, but it doesn't help with actual tax planning throughout the year. A good CPA helps you make strategic decisions BEFORE tax time to minimize what you owe. Software just processes what already happened.

That's a fair point. I guess I was just thinking about the filing part and not the planning aspect. Maybe I should look into this too since I'm starting a side business this year and could probably use some guidance on how to set things up properly from the beginning.

Yes! The income phase-out range for Roth IRA contributions is increasing for 2024. For single filers, the phase-out range is $146,000 to $161,000 (up from $138,000-$153,000 in 2023). For married filing jointly, it's $230,000-$240,000 (up from $218,000-$228,000). So if you were just above the limit last year, you might be eligible for at least partial Roth contributions in 2024!

That's awesome news! I was just barely phased out last year with an income of $154k, so it sounds like I can make at least partial direct Roth contributions this year. Thanks for the info!

Yes, the $23,000 contribution limit for 2024 applies to 403(b) plans as well! The elective deferral limits are the same for 401(k)s, 403(b)s, most 457 plans, and the federal government's Thrift Savings Plan. The $7,500 catch-up contribution for those 50+ also applies to your 403(b). Additionally, 403(b) plans sometimes have a special catch-up provision for employees with 15+ years of service at the same eligible employer, which can allow for additional contributions beyond the standard limits.

That's a great point about the fees! I didn't realize I could add those to my cost basis. And thanks for the reminder about state taxes - I'm in Illinois and haven't even thought about how they might treat this differently. So if I include the fees in my basis, the capital gain would be $17,380 as you calculated. That would save me some tax compared to reporting the full $18,000!

Illinois follows federal treatment for the most part, but double-check if they have any AMT differences. The fees make a real difference in your case - whenever you're dealing with stock sales, always incorporate the transaction costs into your basis. Be sure to keep all your documentation from the sale and the Form 3921 for at least 7 years. ISO transactions are a common audit trigger because they're often reported incorrectly. Having clear records of how you calculated everything will save you headaches if questions ever come up.

Do you know if TurboTax handles the AMT credit tracking properly? I've heard horror stories about people losing track of their AMT credits and never getting to use them.

This is a gray area. The IRS guidance states that computer equipment can be a qualified education expense if it's needed for enrollment or attendance. Since your courses had online components that required a computer, you have a legitimate case.

I successfully claimed a new laptop last year. The key was documenting how it was necessary for my specific program. My university had a policy stating students needed "access to a computer" for certain courses, which I printed out and included with my tax documents. Also saved course syllabi that mentioned required online components.

Oh that's really good to know! My university lumps everything together on one statement - tuition, fees, housing, meal plan, health insurance, etc. I need to make sure I'm only including the qualified items in my appeal. Is there an easy way to separate these out?

most schools will give you an itemized statement if you request it from the bursar or student accounts office. just ask for a "detailed statement of account" with all charges broken down by category. thats what i did and it made it super clear which items were tuition/fees vs housing/meals. some schools also have a separate form they can provide specifically for tax purposes that only shows the qualified education expenses. worth asking if they have something like that!

Do they accept payments right there at the office? Or do they just help you figure out how to pay? My payment is due really soon and I'm getting nervous about penalties.

They don't actually accept payments directly at most locations, but they'll help you make the payment online while you're there. The IRS employee can bypass the normal verification requirements when you're in person with proper ID. They did this for me when I couldn't verify online. If your payment is due very soon, make sure to mention that when you call for an appointment. They sometimes have emergency slots for urgent cases. If you absolutely can't get an appointment before your due date, you might want to mail a check as a backup plan just to show you're trying to pay on time.

Not to be that person but this doesn't actually help OP with their current problem of paying taxes without previous returns. They already know how much they owe, they just need to pay it.