The Tuition and Fees Deduction expired after 2020. It's no longer available for current tax years.

You're absolutely right about the Tuition and Fees Deduction - I completely forgot it expired. Thanks for the correction! I should have verified before posting outdated information. The Lifetime Learning Credit and American Opportunity Credit are still the main education tax benefits available.

I successfully claimed a graphics tablet and specialized software for my digital media courses last year. The key was that my professor wrote me a letter stating these items were necessary to complete the coursework, even though they weren't explicitly listed as "required" in the official course catalog. I attached that letter to my return when I filed.

Thanks for this suggestion! I just checked my transcript online and it shows the full payment I made, but nothing about any adjustment or pending refund. Does this mean they haven't processed my response yet, even though they sent me the revised amount in September? Should I be worried?

That indicates they haven't yet processed the adjustment to your account, even though they acknowledged the correct amount in their September notice. It's not unusual for there to be a delay between them determining the correct amount and actually adjusting your account. I'd give it another 2-3 weeks and check the transcript again. If you still don't see an adjustment by then, that would be the time to call them. When you call, specifically mention that you received a revised CP2000 determination showing you only owed $2,300, but your transcript doesn't show an adjustment for the $2,500 overpayment.

Is that interest taxable? I got a refund with interest last year and wasn't sure if I needed to report it.

I moved from New York to Florida last year specifically for tax reasons. Saved me about $12,000 in state income tax alone. BUT there are serious considerations beyond just the tax savings. Florida has higher insurance costs, and the culture shock was bigger than I expected. Also, you need to be really careful to establish proper domicile in your new state - the high-tax states are aggressive about auditing people who claim to have moved.

This is really interesting! Would this work for regular W-2 employees though? I don't have control over when my employer pays me, but I do make charitable donations. Would bunching them actually help if I don't have enough other deductions to itemize?

It's more challenging for W-2 employees, but you still have options. While you can't control your regular paychecks, you might have some flexibility with bonuses or by adjusting your W-4 withholding toward the end of the year. Regarding charitable donations, bunching absolutely helps if it pushes you over the standard deduction threshold. For 2025, the standard deduction is projected to be around $14,000 for single filers and $28,000 for married filing jointly. If your itemized deductions (including state/local taxes, mortgage interest, and charitable giving) would normally be just below the threshold each year, bunching two years of donations into one year could push you over the limit, allowing you to itemize in that year and take the standard deduction the next.

1 Which states allowed you to get certificates without registering? That might be exactly what we need. Also, did you have to file any returns in those states even though you were below threshold?

22 We were able to get certificates without full sales tax registration in Washington, Indiana, and Tennessee by specifically explaining our situation. Colorado and Arizona had simplified registration processes that didn't trigger filing requirements until we hit thresholds. No, we didn't have to file returns in those states as long as we remained under threshold. Just make sure to get written confirmation that no returns are required, as policies can vary and change. Each state required different documentation to prove we were below threshold. Tennessee was particularly accommodating once we explained the Avalara supplier situation.

23 This is so true! We're still filing zero returns in Illinois and Michigan two years after our sales dropped below threshold. The deregistration process is ridiculous - multiple forms, letters explaining why, and constant follow-ups. Not worth registering unless you're consistently above threshold.

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.