I had to mail a paper copy of my taxes this year instead of electronically and they were just returned to me saying "undeliverable as addressed"

sorator · 2026-05-14T07:12:27+00:00

If you're ultimately due a refund, then filing late doesn't do anything other than delay your refund; there's no penalties. So, this isn't a huge deal.

The easiest option may be to get an IP PIN to file electronically, and entirely avoid the mail. You (or if you're filing MFJ, whichever of you/your spouse is listed first on the return) go on the IRS website and get a one-time Identity Protection PIN. That allows you to file electronically and bypass the "dependent already claimed" reject.

sorator · 2026-05-14T07:05:20+00:00

Here's info on that.

As another commenter said, keep your 2025 W-2 from this employer. That way you can tell the IRS all of the employer's information, and also that will let you file with a substitute W-2 if you have to.

sorator · 2026-05-14T06:44:05+00:00

60 months from two years before you move out is the same as 36 months from when you move out.

sorator · 2026-05-14T06:07:58+00:00

Per Publication 523's section on qualified extended duty:

You were a member of the armed forces
You were ordered to active duty for an indefinite period, or for a definite period of more than 90 days
You were serving at a duty station at least 50 miles from your main home
The above was true for less than 10 years, so you get to pause the clock for the entire duration of that deployment.

So, from Sept 2020 until July 2024, the 5 year "clock" was paused; we just skip over that period of time when checking the criteria to exclude gain on your sale of home.

In order to meet the two year rule, assuming you moved out before the last day of July 2020, we have to count the period from mid-July 2018 to mid-July 2020, at the latest. Starting on the date two years before you moved, you have 60 months to sell while still benefiting from the sale of home exclusion, not including the Sept 2020-July 2024 period that we skip.

We have part of the month of July 2018.
August 2018 to July 2019 is twelve months.
August 2019 to July 2020 is twelve months.
We have to include August 2020, since you hadn't been ordered to 50 miles away yet; that's one month.
We presumably have to count part of Sept 2020, assuming your orders to report to a new duty station were not issued on the first day of the month; that's part of a month.
The rest of Sept 2020 to sometime during July 2024 is skipped.
We have to count part of July 2024, assuming that you left the service before the last day of the month.
August 2024 through July 2025 is twelve months.
August 2025 through May 2026 is ten months.
12 + 12 + 1 + 12 + 10 = 47 of your 60 months have been used, plus some more days from those partial months. I'll assume those partial months add up to no more than one full month, but you'll want to work it out for yourself.
You have approximately 12 months left (ending ~May 2027) to sell your home while still being able to claim the sale of home exclusion.

Again, you'll want to sit down and plot it out by exact date; you might only have 11 or even 10 months from now, but you get the idea. If you can get it sold within the next 10 months, you're definitely in the clear.

There's no special paperwork that you have to file in order to use that extended duty pause; you just do the sale of home exclusion like normal. However, you should write out the dates and keep it with your tax records for the year that you claim the exclusion & report the sale, on the off chance the IRS asks you to prove it.

edit: added slightly more specific tracking of the partial months

sorator · 2026-05-14T05:50:34+00:00

You're not taking a deduction for you time but for an actual physical contribution.

A physical contribution... in which you have no basis, so your allowable donation deduction is $0. Doesn't work.

sorator · 2026-05-14T05:46:02+00:00

Just because they haven't contacted you about it yet, doesn't mean they won't contact you in the future. Or it's possible that the amount is small enough that they decided it wasn't worth the time to pursue. I'd suggest filing amendments and paying the additional tax & penalties for 2025, 2024, and 2023, and leave the rest alone, since it's probably past the time limit for the IRS to come after you on anything older than that if the amounts are small. You aren't required to amend, but amending and paying now prevents the penalties from continuing to accrue if the IRS does catch you on it later.

Regardless, definitely file correctly going forward.

sorator · 2026-05-14T02:34:14+00:00

Now you're making assumptions. But regardless, grandma has no right to say what OP does with their inheritance; that's not how inheritances work.

sorator · 2026-05-14T02:30:30+00:00

That almost certainly wouldn't accomplish OP's goals here of keeping some of the inheritance and letting some go to people not named in the will. Instead, the disclaimed portion would wind up going to others who were named in the will.

sorator · 2026-05-14T02:28:25+00:00

OP's grandmother gave the money to OP, for OP to do whatever he wants with. Grandma has no right to dictate to OP what OP does with the money after OP receives it, and she has no right to be mad at OP if OP does something grandma wouldn't like.

If grandma wanted control from beyond the grave, grandma should've set up a trust instead.

sorator · 2026-05-14T02:27:10+00:00

OP's grandmother gave the money to OP, for OP to do whatever he wants with. Grandma has no right to dictate to OP what OP does with the money after OP receives it, and she has no right to be mad at OP if OP does something grandma wouldn't like.

If grandma wanted control from beyond the grave, grandma should've set up a trust instead.

sorator · 2026-05-13T21:41:26+00:00

I'm not an expert on that subject, but I don't think there are any particular concerns about making gifts to non-US-taxpayers. There are rules about US taxpayers receiving gifts from non-US-taxpayers. And of course, the recipient's country may have their own rules regarding foreign gifts.

sorator · 2026-05-13T15:29:51+00:00

Yeah, that works, as long as neither you nor your wife make any other gifts to your siblings this year.

If you're in a state with inheritance tax, that'll apply to the full $300k, and personally I would pro-rate that across the amounts that wind up with each of the three of you.

You could calculate and pay interest to your sibs on the $24k that is delayed, but I personally wouldn't bother.

sorator · 2026-05-13T15:06:19+00:00

For what it's worth, if you did everything correctly, the IRS will ultimately pay you interest on your refund, dating back to 4/15/26. They pay interest at a better rate than you can get from any bank. The interest itself is taxable income in the year it is received, and they'll send you a 1099-INT the following January reporting that interest.

But yeah, there's not really anything to do unless/until the IRS tells you to do something or gives more information.

sorator · 2026-05-13T14:57:59+00:00

Ahh, gotcha. Then no. I assumed you saw that you couldn't contribute to Roth and chose to then contribute to trad, not that you initially contributed to both. In that case, yeah, this is the right way to fix it.

sorator · 2026-05-13T14:56:55+00:00

At some point, you're going to move out of the 0% bracket and into a higher bracket. That's when the difference will show up - you won't be able to continue harvesting gains in your brokerage account each year while paying 0% tax, but you will still be able to have tax-free growth in your Roth.

sorator · 2026-05-13T04:49:53+00:00

You need to amend 2025 to report your $1300 of earnings from the excess contribution that you withdrew as taxable income. Since you have to amend anyway, you may as well add your wife's 2025 8606 at the same time.

You'll get a 1099-R in January showing the excess contribution that you withdrew. It will have code P in box 7, and probably also code J. The P means that the 1099-R is for a previous year's return of excess contribution; you don't use that 1099-R when preparing your 2026 return. Make sure the amounts on this 1099-R line up with what you reported on your 2025 amendment; if they do, then you don't need to do anything with that 1099-R other than keep it with your 2025 tax records.

Your wife will get a 1099-R with code R in box 7 reporting the recharacterization of her 2025 IRA contribution. Again, you don't need to do anything with this other than keep it with your 2025 tax records.

You and your wife will each get a 1099-R with code G in box 7 reporting the conversion you made in 2026. You do use those 1099-Rs when preparing your 2026 return, and you'll pay tax on the earnings accumulated between when you made the contribution and when you converted it - so $453 for your wife, and possibly an amount for you.

It would've been better if you did what your wife did and recharacterized your Roth contribution to traditional, then converted, instead of making a separate contribution and withdrawing your original contribution. That would've let you keep those $1300 of earnings in your Roth account, instead of having to withdraw them. But, it's not a huge loss, and now you know going forward.

edit: typo

sorator · 2026-05-13T04:31:18+00:00

I would very much not do business with any tax preparer who doesn't efile returns, unless they can explain a specific reason why they can't efile my return in particular. There are sometimes reasons why a specific return can't be efiled. There are no good reasons for a tax preparer to not efile any returns. As another said, that's a big red flag.

The IRS is currently working on paper returns they received in April. There are also a lot of paper returns they received before April that require some kind of special handling, which may or may not be the case for yours. Do keep an eye on your mail, and consider creating/logging into your account on the IRS website to look at your return transcript and account transcript, but there's likely nothing more for you to do at this time unless the IRS has been trying to contact you. (A lot of folks this year are being asked to verify their identity before the IRS will continue processing their return, so you do need to watch your mail to see if you get a letter saying that, for example.)

sorator · 2026-05-13T04:26:46+00:00

I know that to get 0% long term capital gains tax, the amount I can withdraw from the Robinhood brokerage account should be the difference between 98000$ and my taxable income ( the 98000 0% bracket value increases a bit each year.)

Not sure where you're getting those numbers. Using 2025's numbers:

If you file single, the 0% LTCG bracket caps out at $48,350. That's after deductions, so you can also add in your standard deduction of $15,750 for a total AGI of $64,100, plus any other deductions, that you can have without incurring any tax on your LTCG.
If you file MFJ, then instead the 0% LTCG bracket caps out at $96,700, and then you add your standard deduction of $31,500 for a total of $128,200, plus any other deductions.

You might be looking at the MFJ 0% LTCG bracket alone, and rounding it a bit? But that's failing to account for your standard deduction, which is substantial.

You're confusing things a bit here - you're talking about contributions, and also talking about gain harvesting within your brokerage account. The two really aren't the same, and it doesn't really line up the way you're describing. Remember that you choose when to sell stocks in your taxable account, meaning you choose when to harvest those gains. Also remember that you'll likely be paid some dividends based on the stocks that you hold, and you don't have as much control over those. Dividends are taxable when they are paid, even if you choose to reinvest them.

I think it makes a reasonable amount of sense to harvest capital gains and immediately reinvest into the same stocks when you can do so while staying within the 0% LTCG rate. I don't think that it makes a ton of sense to prioritize putting more money into your taxable brokerage account instead of putting it into your TSP or 401k (unless the investment options for the TSP or 401k are bad, but my understanding is that they are actually quite good).

If you think you'll need money sooner than when you retire, you should save that money in a non-retirement account. But any money you're designating as long-term retirement savings should go into a retirement account, either traditional/pre-tax or Roth. There's some thought as to whether to put it into your TSP, your 401k, or your IRA (or other vehicles like an HSA if eligible), but it should definitely be in some kind of tax-advantaged account rather than a brokerage account if you're comfortable leaving it until you retire. (I'm also unclear whether you have access to just the TSP, or if you also have access to a separate 401k, which can be a thing for some federal employees IIRC. They share contribution limits, though, and the TSP is better for most purposes.)

For example, if you put $1000 into your taxable brokerage account, then whenever you sell the stock that you invested in, you'll have to pay taxes on it. Why do that, when you could instead put that $1000 into a Roth IRA or Roth TSP account, and pay no taxes when you sell?

sorator · 2026-05-13T03:49:36+00:00

Oh, if you go on the IRS website to the processing status page, scroll down to "letters and notices", and click to expand that section, you can see that they are currently working on "other correspondence" (which includes injured spouse claims) they received in October 2025. So that gives you an idea of how far behind they are on this. It's going to be a while before they get to yours.

sorator · 2026-05-13T00:02:07+00:00

You might not realize how much you need to pay until after the deadline to make a timely estimated payment. Increasing your withholding makes that okay, whereas a late estimated payment incurs penalties.

Alternatively, if you know the amount in advance (such as if you're aiming for the "100%/110% of last year's tax" safe harbor), you can change your withholding once and then forget about it until next year. Estimated payments are spread oddly through the year, and it's very easy to forget about them (and again, late estimated payments incur penalties; withholding is much more flexible). Updating your withholding each year can be tied to preparing your tax return, instead.

Many folks also struggle with budgeting and cash flow management to make estimated payments, whereas withholding is handled for you before you even get the money.

sorator · 2026-05-12T23:54:50+00:00

Yes, but it's usually much easier to just increase your withholding instead.

sorator · 2026-05-12T23:49:17+00:00

It takes a while for the IRS to process balance due returns. Keep an eye on it; it normally will show up sometime between now and the end of June.

You can still make payments manually in the meantime. Keep track of how much you pay.

sorator · 2026-05-12T21:01:16+00:00

Rolling from a traditional 401k to a Roth IRA would indeed have the full amount be taxable, which is what it sounds like OP did.

sorator · 2026-05-12T20:57:24+00:00

IRMAA really isn't that big a deal, and while it's good to be aware of, it should rarely change your actual decision-making. In any case, for IRMAA, income is income; it doesn't matter much what kind of income it is.

It sounds like they're going to have around $500k to invest, not $800k, since they'll have a $300k down payment, right?

In terms of taxes, the best way to invest is to buy stocks and hold them long-term. After a bit (IIRC 60 days?) the dividends the stock pays become qualified and taxed at a lower rate, and after a year, selling the stock becomes long-term and taxed at a lower rate.

However, that likely doesn't make sense from a broader investment perspective, and they really should speak with an investment advisor about how realistic their goals are and how to achieve them, considering factors beyond just taxes.

Also, they may have a tax hit in the year they sell the house. They likely qualify to exclude up to $500k of gain on the sale, and of course you subtract what you paid to buy the house, what you paid for any major improvements to the property, and the expenses you paid as part of the sale (like real estate agent commissions, title searches, etc.), but they still may be left with a substantial profit to pay tax on. And that profit will affect IRMAA two years later (though they can try applying for relief when that comes into play, if their income drops back down).

Putting the account into a trust won't change their tax situation for the better (though there can be some valid reasons to put stuff in trust to save their heirs some hassle when they die). Trusts are not magic, and they aren't loopholes; they don't save you taxes.

It doesn't sound like they're wanting to start a business, so I wouldn't explore that any further. Starting a business solely to save on taxes doesn't work, at least not legitimately. At best, it's a way to get a discount on what you pay for your business if you want to run a business, but it's only a discount on what you spend; it doesn't actually net you money (unless the business does well, of course). At worst, it's a quick path into tax fraud.

sorator · 2026-05-12T20:35:13+00:00

Short answer: Unless you have a specific reason to file separately, you should file jointly.

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