Did you receive a 1099 from Coinbase? If your trading volume exceeded certain thresholds, they're required to send one. The form type matters too - a 1099-K just shows total transaction volume while a 1099-B would show cost basis. If H&R Block is only using the 1099-K data without your complete cost basis info, that would explain the huge tax bill.

This is a really frustrating situation but totally fixable! The key thing to understand is that H&R Block is showing your gross proceeds (total money that moved through your accounts) rather than your actual taxable gains. Here's what likely happened: When you imported from Coinbase, H&R Block pulled all your transaction data but may be missing cost basis information for some trades. Without proper cost basis, the software assumes your entire sale proceeds are profit. My advice: 1. Don't ignore the crypto reporting - the IRS does get 1099s from Coinbase 2. Go through each transaction in H&R Block's crypto section and verify that both the sale price AND purchase price (cost basis) are correctly entered 3. Look specifically for any transactions marked as "basis not reported" - you'll need to manually enter what you originally paid for those The $4,200 figure from your Coinbase dashboard is probably accurate for your actual gains. The $50,000 is just the total dollar volume of all your buy/sell transactions added together. Once you get the cost basis entered correctly, your tax liability should drop dramatically to match your actual $4,200 in gains.

I just went through this exact same situation last month! My husband had Medicaid for the first half of 2024, then switched to my employer plan. We got so confused by TurboTax asking for 1095-A information that we almost paid for an accountant. What finally worked for us was being very literal with the questions. When TurboTax asks "Did you have health insurance from the Marketplace?" the answer is NO for Medicaid coverage. When it asks "Did you have qualifying health coverage?" the answer is YES for both Medicaid and employer plans. The key is not overthinking it. Both types of coverage satisfy the ACA requirement, so you just indicate full-year coverage. Keep that 1095-B form with your tax records but don't stress about entering any numbers from it. The IRS already knows you had Medicaid coverage from their own records anyway. One tip: if you get stuck on a screen that seems to require 1095-A info, look for tiny links that say "I don't have this form" or "Continue without entering" - they're easy to miss but they're usually there somewhere!

I'm dealing with a very similar situation right now! My daughter had CHIP coverage for most of 2024, then we added her to my work insurance in October. We got a 1095-B form for the CHIP coverage, and TurboTax kept confusing me with all the healthcare questions. After reading through all these responses, I feel so much better about just selecting "No" when asked about Marketplace coverage and "Yes" for having qualifying coverage all year. It's such a relief to know that the 1095-B is just for our records and doesn't need any information entered into the tax software. I was honestly considering paying for professional tax prep just because of this one issue, but now I'm confident I can handle it myself. Thanks to everyone who shared their experiences - this thread has been incredibly helpful for understanding the difference between all these healthcare forms!

For the startup investing business mentioned in your question, there's another wrinkle to consider. If you're regularly investing in startups as your primary business activity, the IRS might classify you as a "dealer" rather than an "investor." This classification can dramatically change your tax situation - dealer transactions generate ordinary income/loss while investor transactions generally create capital gains/losses (which have different tax rates and limitations).

The key distinction you're looking for really comes down to timing and purpose. Business expenses are costs that benefit your business for one year or less and are deductible immediately. Investments (capital expenditures) are purchases that benefit your business for more than one year and must be depreciated over time. For your $135k example - if it's going toward salaries, rent, utilities, supplies, etc., those are current expenses that reduce this year's taxable income. But if you're buying equipment, real estate, or other assets with useful lives beyond one year, those are capital expenditures where you recover the cost through depreciation deductions over several years. The house-flipping scenario is interesting because it depends on your business model. If you're regularly buying, improving, and selling homes as your primary business, those properties are actually inventory (similar to a car dealer's vehicles). The purchase price and improvements become your cost basis, not immediate deductions. However, ongoing costs like insurance, utilities, and property taxes while you hold the property are typically deductible as business expenses. One important exception to watch for is Section 179, which lets you immediately deduct up to $1.2M of qualifying equipment purchases instead of depreciating them. This can be huge for cash flow if you're buying machinery, computers, or other business equipment. I'd strongly recommend working with a tax professional who understands your specific industry, as these distinctions can significantly impact your tax liability.

I'm dealing with a similar situation with my vacation rental and this thread has been incredibly helpful! Based on what I'm reading, it sounds like the key is first determining whether your property falls under the 7-day rule (making it a business activity) or if it's a traditional rental activity. For traditional rental activities with longer average stays, the active vs passive participation distinction matters a lot for the $25,000 loss allowance. But for short-term rentals with average stays of 7 days or less, you're looking at material participation tests instead since it's considered a business activity. One question I still have - if you have multiple short-term rental properties, do you evaluate the participation tests for each property individually, or can you combine your activities across all properties? I manage three different Airbnb units and I'm not sure if my management time gets pooled together or evaluated separately for each property.

This is such a helpful discussion! I'm in a similar boat with my mountain cabin rental and the distinction between active vs passive participation has been driving me nuts too. What really helped me was tracking all my management activities in detail - even the time spent reviewing financial reports, approving repairs, and communicating with the property management company. I realized I was doing way more "active participation" work than I initially thought. One thing I learned the hard way is that the average rental period calculation is crucial. My cabin has some week-long rentals mixed with weekend stays, so I had to carefully calculate the average to determine if the 7-day rule applied. It turned out my average was 8 days, so I stayed in the traditional rental activity category where active participation mattered for the $25k loss allowance. The income phase-out is also something to watch carefully - if you're close to that $100k-$150k range, it might be worth timing some income or deductions to maximize your rental loss deduction eligibility.

Anyone else find that these tax software options don't handle the health insurance deduction for S Corp owners very well? That's been my biggest frustration with TaxAct.

I switched from TaxAct to TurboTax for our S Corp last year and it was definitely worth it! Like you, I was getting frustrated with TaxAct's outdated interface. TurboTax handles the S Corp passthrough income much more smoothly - especially the flow from the business return to personal. The interview process walks you through everything step by step, which helped me catch some deductions I'd been missing (like properly calculating the home office percentage for business use). One specific advantage: TurboTax does a better job explaining the reasonable salary requirements for S Corp owners taking distributions. This is crucial since the IRS scrutinizes this area heavily with 1099 income flowing through S Corps. The price difference is noticeable, but given that you're already doing the accounting work yourself, the time savings and reduced stress during tax season made it worthwhile for us. Plus their customer support is significantly better if you run into issues. If you're comfortable with tax concepts already, you might also want to double-check your past returns to make sure you haven't missed anything over the years with TaxAct's less intuitive interface.