As someone who's been lurking in this community while considering a career change into tax preparation, this entire discussion has been incredibly eye-opening! I'm currently working in corporate finance but have been thinking about making the jump to tax work for the flexibility and the opportunity to build my own practice. What's really striking to me is how unanimous everyone is about the importance of thinking beyond just tax preparation from the very beginning. The progression that several of you have outlined - from seasonal preparer to year-round tax professional - seems challenging but definitely achievable with the right mindset and strategy. I'm particularly intrigued by the EA credential path that keeps coming up. Coming from a finance background, I think I might have some transferable knowledge that could help with the studying process. The ability to offer representation services and command higher hourly rates sounds like exactly the kind of differentiation that would make the off-season viable. The relationship-building aspect that Connor mentioned really resonates with me too. In my current role, I've seen how ongoing advisory relationships are so much more valuable (and stable) than transactional work. It sounds like tax preparation could be the perfect entry point for those deeper professional relationships. One question for the group: For someone making a mid-career transition into this field, would you recommend starting at a firm like Ella is doing, or jumping straight into solo practice? I'm trying to weigh the learning opportunity and steady income of working for someone else against the potential to build my own client relationships from day one. Thanks to everyone for sharing such detailed experiences - this thread alone has been worth joining the community!

As someone who's been in the tax preparation field for about 6 years now, I can definitely confirm that building a sustainable living from tax work alone requires strategic diversification, but it's absolutely achievable. My journey mirrors what many others have shared here - started with pure seasonal tax prep, struggled during off-months, then gradually built complementary services. What really accelerated my success was getting my EA credential after my second season. The representation rights opened up audit defense work, which has become about 30% of my annual revenue and happens mostly during the "slow" months. One strategy I haven't seen mentioned yet is developing relationships with local CPAs who get overwhelmed during tax season. I now handle overflow work for three CPA firms, which gives me access to more complex returns and higher-value clients. These relationships also lead to year-round referrals for representation work when their clients have IRS issues. The key insight that changed everything for me: most clients see tax season as a stressful obligation, but you can position yourself as their year-round tax advocate. I send quarterly newsletters with tax tips, deadlines reminders, and planning opportunities. This keeps me top-of-mind and positions me as proactive rather than reactive. My current revenue split is roughly 40% tax prep, 35% representation/problem resolution, 15% tax planning consultations, and 10% overflow work for other firms. The income is actually more stable now than when I had a traditional corporate job. For someone just starting like Ella, my advice is: master the fundamentals first, but start planning your expansion strategy immediately. The EA credential should be your first priority after gaining some practical experience.

I want to add one more angle that hasn't been fully explored here - what happens if you're in a state with different tax rules around these accounts? Most of the discussion has focused on federal IRS rules, but some states don't conform to federal HSA tax treatment or have their own quirks around FSA/HSA interactions. For example, California and New Jersey don't allow HSA deductions on state tax returns, which could affect your overall tax strategy even if you're compliant with federal rules. If you're going through all the effort to optimize your federal tax situation with these accounts, make sure you understand how your state treats them too. It might influence whether the complexity is worth it or if there are other strategies that work better for your overall tax picture. Also, one practical tip I learned the hard way: if you do find that you can legitimately contribute to both accounts, make sure your payroll department codes everything correctly. I had to fix a situation where my HSA contributions were being treated as taxable income because payroll didn't realize my spouse's FSA had the spouse exclusion language. Getting that corrected took months of back-and-forth with both HR and payroll. Document everything and keep copies of the plan language that supports your position - you may need to reference it later if questions come up during tax season or in payroll processing.

This is a really comprehensive discussion! As someone who works in benefits administration, I want to clarify a few things and add some practical guidance. First, @Mikayla Brown and others are absolutely correct that the specific FSA plan language is what determines HSA eligibility - not just whether you're on separate health plans. The IRS looks at whether the FSA *could* be used to pay for your spouse's medical expenses, regardless of whether you actually intend to use it that way. Here's what I'd recommend as your action plan: 1. **Request the full Summary Plan Description** (not just enrollment materials) from your benefits team 2. **Look for the "Eligible Expenses" or "Covered Persons" section** - this will tell you exactly who can receive reimbursements 3. **Ask specifically about Limited Purpose FSA options** during open enrollment - many employers offer these but don't advertise them well 4. **Get any verbal confirmations in writing** - forward the email chain to yourself for documentation One thing I haven't seen mentioned: if your employer uses a third-party administrator for the FSA (like WageWorks, CONEXIS, etc.), you can often call them directly for plan-specific questions. They tend to know the details better than internal HR staff. The good news is that if you discover you can't do both accounts, you still have good options - maxing out either an HSA or FSA provides significant tax savings, just in different ways. Don't let perfect be the enemy of good when it comes to your tax strategy!

idk but the IRS be playing games this year fr. 6 weeks and still processing here 🙄

Same thing happened to me last year! Jackson Hewitt denied my RAL even though I had been approved before. Turns out the IRS had put a hold on my return for income verification - had nothing to do with my credit. The tax prep places can't approve the loan if the IRS has any flags on your return, even if they don't tell you about it upfront. Try checking your account transcript on irs.gov to see if there are any indicators or codes that might explain what's going on. Sometimes there's stuff happening behind the scenes that the tax office doesn't even know about.

I'm surprised nobody mentioned IRS Publication 525! It specifically addresses this on page 12 under "How to report stock option income." It clearly states you need to adjust your basis by the amount included as income. The trickier part is making sure you account for the reverse split correctly. When I went through this, I created a simple spreadsheet that tracked: - Original shares and exercise price - FMV at exercise (from 3921) - Amount included in income that year - Post-split shares and adjusted basis Also, if you're in a state with income tax, make sure you're adjusting your state basis too! Many people forget that part.

This is such a helpful thread! I'm dealing with a similar situation but with a twist - my company did multiple corporate actions (a reverse split AND a spinoff) between when I exercised my ISOs and when I sold. From reading everyone's responses, it sounds like the key principle remains the same - adjust my cost basis to include what I already paid taxes on from the Form 3921. But I'm wondering how to handle the spinoff portion. Did anyone here deal with spinoffs in addition to splits? Also, @AstroAce, your math example really helped clarify things for me. I was getting confused about whether to adjust the total basis or the per-share basis, but seeing it broken down like that makes it crystal clear. One more question for the group - has anyone had success explaining these adjustments directly in their tax software's notes section, or is it better to attach a separate statement? I'm using TurboTax and want to make sure I document everything properly.

Hey don't forget about potentially adjusting your retirement contributions too. My husband and I discovered that when we got married and started filing jointly, we could leverage our income difference to max out his 401k and IRAs differently than before. Ended up saving us about $4,200 in taxes while building retirement faster.

Great question about marriage and taxes! As others have mentioned, with your income split ($87k and $28k), you'll likely see a marriage bonus rather than a penalty when filing jointly. One thing I'd add - don't forget to consider the impact on any tax credits you might be eligible for. The Earned Income Tax Credit, Child and Dependent Care Credit, and education credits all have different income thresholds for married couples. Sometimes these can create unexpected benefits or phase-outs depending on your combined income. Also, since you mentioned buying a house next year, keep in mind that as a married couple you'll have a higher gift tax exclusion limit if family helps with the down payment, and you can potentially exclude up to $500k in capital gains if you ever sell a primary residence (vs $250k for singles). I'd definitely recommend running a tax projection for 2024 now that you're married to avoid any surprises. Most tax software lets you do this, or you could work with a tax professional to make sure you're optimizing everything for your new situation.