Has anyone tried using Credit Karma Tax (now called Cash App Taxes) for previous years? I know they're free for the current year, but I'm not sure if they offer past years or what they charge.

I just went through this exact situation a few months ago! Had to file my 2018 and 2019 returns for a mortgage application. Here's what I learned: For H&R Block, yes they do prior year returns but their online service for old years is around $70-80 per return, which adds up fast. I ended up going with FreeTaxUSA like someone mentioned - it was only $15 for federal and worked perfectly for both years. One tip nobody mentioned: if you're really pressed for time, you can request a "Record of Account" transcript from the IRS online at irs.gov. This shows your filing history and is often accepted as proof of non-filing if you need to show you haven't filed yet. Takes about 5 minutes to get it online versus waiting weeks for mailed returns to process. Also, don't stress too much about the old tax law changes between those years - most tax software handles the year-specific rules automatically. The main thing that changed between 2018-2019 was some small adjustments to tax brackets and standard deduction amounts, but the software calculates all that for you. Good luck getting it sorted out!

This has been such an enlightening discussion! As someone who's been collecting vintage vinyl records for about 15 years, I'm facing this exact same decision and this thread has been incredibly valuable. One thing I'd add from my preliminary research is the importance of considering how this transition might affect your relationship with record stores and other collectors in your local music community. I've built relationships with shop owners who give me first dibs on rare finds, and I'm worried that once I'm seen as competition rather than just another collector, those opportunities might dry up. I'm also curious about seasonal business considerations that might be unique to different collectible markets. In the vinyl world, there are definitely peak selling seasons (Record Store Day, holiday gift-giving, back-to-school for younger collectors), and I wonder if timing the business launch around these cycles could impact that first-year success rate. The documentation requirements everyone has outlined are definitely daunting, but Anna's point about photographing everything with timestamps on transition day is something I'm definitely going to implement. For vinyl, condition is absolutely critical to value, so having that visual baseline seems essential. Has anyone dealt with the challenge of items that exist in multiple formats? I have some albums that I own as original pressings, reissues, and sometimes even different formats (45s, LPs, picture discs). Deciding which versions go to business versus personal collection when they're essentially the same music but different collectible items seems like it could get complicated from a documentation standpoint.

This thread has been absolutely invaluable! I'm in the exact same situation with a 25+ year stamp collection and was completely overwhelmed by the tax implications until reading through all these detailed responses. One aspect I haven't seen mentioned yet is the potential impact on estate planning. If I convert a significant portion of my personal collection to business inventory, how does that affect things like inheritance and estate valuation for my heirs? My collection is currently set up to pass to my children with stepped-up basis, but I'm wondering if business inventory gets treated differently in estate situations. Also, for those who've made this transition - have you found that your collecting focus has shifted? I'm wondering if the business pressure to find profitable items might change what types of stamps I'm drawn to personally. Right now I collect purely based on historical interest and personal fascination, but I worry that constantly evaluating profit potential might diminish that pure collecting joy that Anna mentioned. The documentation strategies everyone has shared are extremely helpful. I'm definitely going to implement the timestamped photography approach and start keeping much more detailed acquisition records before making any final decisions. This transition clearly requires way more planning than I initially realized! Thank you to everyone, especially the tax professional, for sharing such practical, real-world guidance. This is exactly the kind of insider knowledge that makes the difference between a smooth transition and a costly mistake.

3 has anyone dealt with the 1098-T form in this situation? my daughter's school sent her the form with HER ssn on it since she's the student, but if i'm claiming her and the education credit, do i need to somehow get that form reissued to me? how does this work with electronic filing?

This is such a helpful thread! I'm in a similar situation with my college sophomore who paid about $12,000 in tuition from her summer job earnings. One thing I learned from my tax preparer last year is to keep really detailed records of what you're paying for your kids' support - not just the big things like housing and health insurance, but also groceries, phone bills, car insurance, etc. The IRS "more than half support" test includes ALL living expenses for the year. I created a simple spreadsheet tracking what I pay vs what she pays, and it was eye-opening. Even though she paid her own tuition, I was still covering about 65% of her total support costs. This documentation gave me confidence to claim her as a dependent and take the American Opportunity Credit on my return. The key is looking at TOTAL support for the year, not just who paid the biggest single expense. Tuition might be the largest line item, but when you add up housing, food, insurance, transportation, etc., parents often still provide the majority of support even for working college students.

I'm surprised nobody mentioned getting professional help for Form 886-A responses. These are essentially audit inquiries and responding incorrectly can lead to bigger problems. When I received one questioning my home office deduction and some Schedule C expenses, I tried handling it myself first and made things worse. A tax professional who specializes in audit representation knows exactly what documentation the IRS is looking for and how to present it effectively. They typically charge $300-500 for Form 886-A assistance, but that's tiny compared to the potential additional taxes, interest and penalties if your deductions are disallowed.

I just wanted to add some perspective as someone who's been through multiple Form 886-A responses over the years. The key thing to remember is that this is NOT an audit - it's a documentation request. The IRS is essentially saying "prove what you claimed on your return." For your mortgage interest issue, the IRS wants to establish two things: (1) that the payments were actually mortgage interest (not principal, fees, or other costs), and (2) that YOU were legally obligated to pay and actually did pay them. If you have a joint mortgage but file separately, this becomes more complex. For inherited stocks, the stepped-up basis rule is in your favor - you get the fair market value on the date of death as your basis, not what the deceased originally paid. But you need to document that value. Even if you can't find estate documents, you can often reconstruct this using historical stock prices from financial websites like Yahoo Finance or requesting records from the company's transfer agent. The most important advice: respond within the deadline (usually 30 days), be thorough but concise, and organize everything clearly. Label each document and explain how it addresses their specific concern. If you need more time, call the contact number on the form to request an extension - they're usually reasonable about this. Don't panic - Form 886-A responses have a high success rate when you provide proper documentation. The IRS isn't trying to "get you" - they just need to verify the information on your return.

I've been following this thread closely since I'm dealing with a similar situation with some Disney/ESPN spin-off shares, and the advice here has been incredibly helpful! One thing I wanted to add that might save others some time - if you're going to call Fidelity's cost basis department, try calling early in the morning (around 8 AM EST) or late in the afternoon (after 4 PM EST). I've found that the wait times are significantly shorter during these windows, and you're more likely to get connected to someone who actually understands corporate actions rather than a general customer service rep. Also, when you do get through, immediately ask if they can see any "corporate action notifications" or "reorganization events" in your account related to the IBM/KD spin-off. Sometimes the correct allocation information is already in their system but wasn't properly applied to your cost basis. If that's the case, the correction might be much faster than having to submit all the documentation. The point about checking your 1099-B forms is brilliant - I wish I had thought of that earlier. It really does help you understand exactly what method your broker used and gives you concrete evidence of where the discrepancy occurred. Thanks to everyone who shared their experiences with this. It's frustrating when brokerages get these calculations wrong, but at least there's a clear path forward to get them corrected!

One additional resource that might be helpful is the SEC's EDGAR database. You can search for IBM's Form 8-K filings from late 2021 which should contain the official details about the Kyndryl spin-off, including the exact distribution ratio and valuation methods used. I had a similar issue with a Verizon/Frontier spin-off a few years ago, and finding the original SEC filing gave me the definitive documentation I needed to convince my broker to make the corrections. The Form 8-K will typically include a section called "Material Agreement" or "Other Events" that describes the distribution terms in detail. Also, if you're still having trouble after trying all the excellent suggestions here, consider filing a complaint with FINRA if Fidelity refuses to correct obviously incorrect cost basis information. Brokers are required to maintain accurate records, and persistent refusal to fix clear errors can sometimes prompt faster resolution when regulatory pressure is involved. The key is being prepared with multiple sources of official documentation - the Kyndryl website allocation info, IBM's SEC filings, and any IRS forms the companies filed. Having that comprehensive paper trail makes it very difficult for a brokerage to claim the correction isn't warranted.