quick question - what happens if i dont file? i worked at a restaurant for like 4 months last year but only made maybe $6000 total and they paid me mostly in cash except for the hourly minimum wage part. do i still need to file something?

@Tristan Carpenter - I went through almost the exact same situation last year! Here's what worked for me: First, don't panic about the filing deadline - you still have time. Since you worked from July to January, you definitely had income in 2023 that needs to be reported. Target is required by law to send you a W-2 by January 31st. If you haven't received it, here's what to do: 1. Check if they have your current address - sometimes W-2s get sent to old addresses 2. Call Target's corporate payroll department (not your store manager) - they have a dedicated line for former employees requesting tax documents 3. If that doesn't work, you can request a wage transcript from the IRS which will show what Target reported Even if you made less than the $13,850 filing threshold, you should still file because Target likely withheld federal taxes from your paychecks that you'd get back as a refund. I got back about $800 when I filed! The good news is that as a first-time filer with just one W-2, your return will be pretty straightforward. Most free tax software can handle this easily once you get your documents. Don't let the process intimidate you - it's much simpler than it seems, and you'll feel so much better once it's done!

okay this is making so much more sense now! I was literally driving myself crazy checking my transcript every single day wondering why nothing was changing 🤦‍♀️ so cycle 05 = Thursday updates only, got it. definitely gonna stop torturing myself with daily checks lol. and wow everyone seems to love this taxr.ai thing - might have to bite the bullet and try it since I'm clearly terrible at decoding all these numbers myself. thanks for breaking it down in actual human language instead of IRS speak!

honestly this whole thread is making me feel so much better! I've been in the same boat checking my transcript obsessively every day like a maniac 😭 had no idea cycle 05 meant Thursday updates only - that explains why I was seeing zero changes for days at a time. gonna save myself the mental torture and just check thursdays from now on. also after seeing literally EVERYONE mention taxr.ai I'm definitely gonna give it a shot - seems like it could save me from hours of confusion and googling random IRS codes. thanks for asking this question OP, clearly a lot of us needed this explanation! 🙏

This is unfortunately more common than it should be, and you're right to be concerned about the lack of communication. Many CPAs do file automatic extensions as a protective measure, especially for clients with complex returns involving K-1s, but the professional standard should be to inform clients beforehand. The bigger issue here is the potential financial impact. Since you mentioned you paid your Q4 2023 estimated taxes late in April 2024, there's a good chance you might owe additional tax for 2023. If your CPA filed the extension without making an estimated payment and you end up owing money, you could face failure-to-pay penalties and interest from the original April 15 deadline. I'd recommend: 1) Contact your CPA immediately to clarify what they did and why, 2) Ask if they made any estimated payment with the extension, and 3) If not, calculate whether you owe additional tax and consider making a payment now to minimize penalties. This situation highlights why clear communication agreements with tax professionals are so important. You might want to establish upfront expectations about notifications for any filings made on your behalf.

I work as a tax preparer and want to address some of the concerns raised here. While it's true that many firms file automatic extensions for clients with complex returns (especially K-1 recipients), the lack of communication you experienced is definitely not acceptable professional practice. Here's what should have happened: Your CPA should have either 1) obtained written authorization to file extensions on your behalf as part of your engagement letter, or 2) contacted you before filing to explain why an extension was necessary and discuss any potential tax payment requirements. The fact that you found out by accident when trying to file your own extension suggests poor client communication protocols at that firm. This is particularly concerning because if you owe tax for 2023 and no estimated payment was made with the extension, you're now facing penalties and interest from April 15. I'd strongly recommend getting a copy of your engagement letter with this CPA to see what authorities you actually granted them. If extension filing wasn't explicitly covered, you may have grounds to hold them responsible for any penalties that result from their unauthorized filing. For immediate next steps: Check your 2023 tax liability estimate and consider making a payment ASAP if you think you'll owe money. The sooner you pay, the less penalty and interest will accumulate.

This is such a common situation - you're definitely not alone in dealing with this! I went through the exact same thing with my Vanguard account last year and was equally stressed about it. The good news is that TurboTax handles this scenario really well. When you get to the investment section, there's a specific workflow for entering 1099-B transactions where the cost basis wasn't reported. You'll see checkboxes or dropdown options that let you indicate this situation, and then you can enter your own cost basis data. A couple of practical tips that helped me: - Double-check that your sale proceeds match the 1099-B exactly (that's the number the IRS definitely has) - If you use Fidelity's website, try looking under "Accounts & Trade" > "Account Features" > "History" - they often have trade confirmations going back several years - For any missing records, I created a simple spreadsheet showing how I estimated each cost basis with notes like "researched historical price on MarketWatch for approximate purchase date" The "cost basis not reported" checkbox is actually the IRS telling you they expect YOU to provide this information, not a warning that something's wrong. You're doing exactly what you're supposed to do by using your own records. Just make sure to keep documentation of how you determined your numbers, and you'll be fine!

I totally understand your anxiety about this - I was in a very similar situation last year with my Charles Schwab account and it kept me up at night worrying about it! The key thing to remember is that you're absolutely supposed to report your cost basis even when it's not reported to the IRS. That checkbox just means your broker didn't send that information to the IRS, but it doesn't mean you can't or shouldn't report it yourself. Here's what worked for me: First, I gathered whatever records I could find - old statements, trade confirmations, even screenshots of transactions if that's all I had. For the ones where I was missing exact purchase prices, I researched historical stock prices around the dates I remembered buying them and used reasonable estimates. TurboTax actually makes this pretty straightforward. When you enter your 1099-B information, there's a specific section for transactions where cost basis wasn't reported. You'll see options to indicate this situation and then input your own cost basis data. The software walks you through it step by step. The most important thing is to make sure your sale proceeds match your 1099-B exactly - that's the number the IRS definitely has and expects to see. For the cost basis, just use your best information and keep notes on how you determined each amount. Don't stress about audits - this is an incredibly common situation that tax preparers and the IRS deal with routinely. You're doing exactly what you're supposed to do by providing the missing cost basis information!

I want to add another important consideration that hasn't been mentioned yet - the timing of when you recognize your trading gains and losses for tax purposes. Since you mentioned you've been "tracking everything meticulously," make sure you understand that for tax purposes, you generally recognize gains and losses when you close positions, not when you open them. This is crucial for your quarterly estimated tax planning because if you have large unrealized gains in open positions, you won't owe taxes on those until you actually close them. Conversely, if you have unrealized losses, you can't use them to offset your tax liability until you realize them. Given that you're 8 months into the year with $78K in profits, I'd also suggest setting aside a separate "tax account" going forward - maybe 35-40% of each month's realized profits - so you're not scrambling to find cash for tax payments. Many full-time traders get caught off guard by the cash flow impact of quarterly payments, especially if they've reinvested their profits back into trading. One more tip: keep detailed records of all your trading-related expenses (platform fees, data subscriptions, home office costs, etc.) as these can significantly reduce your taxable income, whether you qualify for trader tax status or not.

Jumping in as someone who went through this exact transition from corporate job to full-time trading last year! A few additional points that might help: 1. **Safe Harbor Rule**: Since you mentioned this is new territory, the "safe harbor" rule is your best friend. If you pay 100% of last year's total tax liability spread across four quarterly payments (110% if your prior year AGI was over $150K), you're protected from underpayment penalties regardless of how much you make this year. This gives you peace of mind while you figure out your trading tax situation. 2. **Self-Employment Tax Nuance**: Be careful about that 14.13% self-employment tax calculation mentioned earlier. If you qualify for trader tax status, your trading profits might NOT be subject to self-employment tax - they'd be treated as capital gains instead. This could save you thousands. But if you're just considered an "investor" (even an active one), then yes, you might owe SE tax. 3. **Quarterly Payment Timing**: Don't stress too much about perfect quarterly amounts. I made uneven payments my first year based on actual performance each quarter, and it worked fine. The key is making sure your total payments for the year meet the safe harbor threshold. Since you're already 8 months in with solid profits, I'd calculate 25% of last year's total tax liability and make that payment for Q3 (September 15), then reassess for Q4 based on how the rest of the year goes. This approach has saved me from both penalties and overpaying. Good luck with the transition - it's definitely manageable once you get the system down!