Any difficulties in doing deceased relative's taxes?
There are two different tax returns you'll be doing: one is for her, until the day of her death. The other is for the estate. The personal one you could probably do on your own, it's nothing different from the one for a living person, except for the cut-off date in the middle of the year. The estate tax return may be a bit more nuanced, since it is a trust return and not an individual return, and is done under a different set of rules. I'd suggest talking to a tax professional who'd help you. Your estate executioner should be doing the estate tax return (or hiring someone to do it). Sorry for your loss.
You receive a 1099-misc for the value of the car. You claim that as income (even though you received goods rather than cash). When you sell the car, it would be much like selling any posession, and would cause no tax consequence unless the sale price was much different than the value... When you sell the car, you may have received more or less than the value of the car (likely less). If you sold it for more, then you might need to claim the additional money as income (perhaps short term capital gains). If you sold it for less, but to a friend or relative, then you might think you could claim a loss, but the tax collector would just claim that you had given them a gift, and attempt to collect the tax from them. Contest winners often have the frustration that they are taxed at the full value of the item(s) won, even though they would not value the item at that amount. And contest prizes often do not sell for the full value stated on the 1099, and often for much less. Marginal tax rates were higher prior to Reagan, and when a contest winner would sell an item for 80% of the value, they often paid most of the proceeds to taxes. Honestly, this whole story seems overblown. It sounded like he didn't know her husband... Because *he didn't know her husband*. Presidential calls to families of military deceased are a formality.  i feel like I'm being manipulated by the media on this one. Where's the story? But why can't two companies exchange goods directly without paying VAT? This would make the famous carousel fraud scam impossible and businesses won't have to deal with complicated refunds. Sales tax in the United States works as you describe.  Sales tax is charged only to end customers, not to businesses that themselves charge sales tax.  But this means that a criminal business can charge tax and just pocket it unless someone else reports it.  They can also evade income tax the same way.  Not to mention other issues like cross jurisdiction taxes (e.g. internet sales often evade sales tax).   The whole point of a Value Added Tax (VAT) is that they charge at each level.  This creates a system where each buyer reports the tax paid to the seller so as to be able to deduct it.  So the seller has to pay the VAT that they charged.  Or the tax authorities know and can revoke their VAT license.   If only the end user is charged tax, then fraud is easier than under a VAT.  So easy, I doubt they have a special name for it.  The fraudulent business just collects tax from end users and disappears.  Or simply fails to record those transactions.  You could call it missing transaction record fraud, but why bother?  It's just straight up tax fraud.  The complexity of the carousel fraud arises from the difficulty of evading a VAT. Does this make sense? I'm concerned that by buying shares with post tax income, I'll have ended up being taxed twice or have increased my taxable income. ... The company will then re-reimburse me for the difference in stock price between the vesting and the purchase share price. Sure.  Assuming you received a 100-share RSU for shares worth $10, and your marginal tax rate is 30% (all made up numbers), either: or So you're in the same spot either way.  You paid $300 to get $1,000 worth of stock. Taxes are the same as well.  The full value of the RSU will count as income either way, and you'll either pay tax on the gains of the 100 shares in your RSU our you'll pay tax on gains on the 70 shares in your RSU and the 30 shares you bought.  Since they're reimbursing you for any difference the cost basis will be the same (although you might get taxed on the reimbursement, but that should be a relatively small amount). This first year I wanted to keep all of the shares, due to tax reasons and because believe the share price will go up. I don't see how this would make a difference from a tax standpoint. You're going to pay tax on the RSU either way - either in shares or in cash.  how does the value of the shares going up make a difference in tax? Additionally I'm concerned that by doing this I'm going to be hit by my bank for GBP->USD exchange fees, foreign money transfer charges, broker purchase fees etc.  That might be true - if that's the case then you need to decide whether to keep fighting or decide if it's worth the transaction costs. "All transactions within an IRA are irrelevant as far as the taxation of the  distributions from the IRA are concerned. You can only take cash from an IRA, and a (cash) distribution from a Traditional IRA is taxable as ordinary income (same as interest from a bank, say) without the advantage of any of the special tax rates for long-term capital gains or qualified dividends even if that cash was generated within the IRA from sales of stock etc. In short, just as with what is alleged to occur with respect to Las Vegas, what happens within the IRA stays within the IRA. Note: some IRA custodians are willing to make a distribution of stock or mutual fund shares to you, so that ownership of the 100 shares of GE, say, that you hold within your IRA is transferred to you in your personal (non-IRA) brokerage account. But, as far as the IRS is concerned, your IRA custodian sold the stock as the closing price on the day of the distribution, gave you the cash, and you promptly bought the 100 shares (at the closing price) in your personal brokerage account with the cash that you received from the IRA. It is just that your custodian saved the transaction fees involved in selling 100 shares of GE stock inside the IRA and you saved the transaction fee for buying 100 shares of GE stock in your personal brokerage account. Your basis in the 100 shares of GE stock is the ""cash_ that you imputedly received as a distribution from the IRA, so that when you sell the shares at some future time, your capital gains (or losses) will be with respect to this basis. The capital gains that occurred within the IRA when the shares were imputedly sold by your IRA custodian remain within the IRA, and you don't get to pay taxes on that at capital gains rates. That being said, I would like to add to what NathanL told you in his answer. Your mother passed away in 2011 and you are now 60 years old (so 54 or 55 in 2011?). It is likely that your mother was over 70.5 years old when she passed away, and so she likely had started taking Required Minimum Distributions from her IRA before her death. So, You should have been taking RMDs from the Inherited IRA starting with Year 2012. (The RMD for 2011, if not taken already by your mother before   she passed away, should have been taken by her estate, and distributed to her heirs in accordance with her will, or, if she died intestate, in accordance with state law and/or probate court directives). There would   not have been any 10% penalty tax due on the RMDs taken by you on the grounds that you were not 59.5 years old as yet; that rule applies to owners (your mom in this case) and not to beneficiaries (you in this case). So, have you taken the RMDs for 2012-2016? Or were you waiting to turn 59.5 before taking distributions in the mistaken belief that you would have to pay a 10% penalty for early wthdrawal?  The penalty for not taking a RMD is 50% of the amount not distributed; yes, 50%. If you didn't take RMDs from the Inherited IRA for years 2012-2016, I recommend that you consult a CPA with expertise in tax law. Ask the CPA if he/she is an Enrolled Agent with the IRS: Enrolled Agents have to pass an exam administered by the IRS to show that they really understand tax law and are not just blowing smoke, and can represent you in front of the IRS in cases of audit etc," Yes, if you gift him with a large amount you may be liable for gift tax. I believe the current limit is still $17k per person per person per year, so between you and your spouse you could give him up to $34k per year without triggering gift tax. If you want to give a larger sum, the standard workaround is an intra-family loan. Websearch for that phrase to learn more about it, but basically you loan the money and then gift the payments on the loan. This gives him the money up front, spreading the gift over subsequent years --but it requires that you declare the interest that he is supposedly paying you as income. There is a lower limit on the interest rate for these loans, but it's a fraction of a percent so this generally isn't a significant cost. (If you are able to structure the loan as a mortgage, he may be able to deduct the interest from his taxes. That usually requires a few hundred dollars if paperwork to set up.) I've done it. It works. And one of the advantages is that it puts the exact terms of the lian on paper where everyone can agree to them, which could be useful should there be arguments later on.  When doing business with friends and relatives, keeping it on a clear business contract basis is the best way to avoid destroying the friendship. "Do I understand correctly, that we still can file as ""Married filing   jointly"", just add Schedule C and Schedule SE for her? Yes. Business registration information letter she got once registered   mentions that her due date for filing tax return is January 31, 2016.   Does this prevent us from filing jointly (as far as I understand, I   can't file my income before that date)? IRS sends no such letters. IRS also doesn't require any registration. Be careful, you might be a victim to a phishing attack here. In any case, sole proprietor files a regular individual tax return with the regular April 15th deadline. Do I understand correctly that we do not qualify as ""Family   partnership"" (I do not participate in her business in any way other   than giving her money for initial tools/materials purchase)? Yes. Do I understand correctly that she did not have to do regular   estimated tax payments as business was not expected to generate income   this year? You're asking or saying? How would we know what she expected? In any case, you can use your withholding (adjust the W4) to compensate." I don't know if I would go so far as to hire an accountant. None of those things you listed really complicates your taxes all that much. If you were self-employed, started a business, got a big inheritance, or are claiming unusually large deductions, etc. then maybe. The only thing new from your post seems to be the house and a raise. The 3rd kid doesn't substantially change things on your taxes from the 2nd. I'd suggest just using tax preparation software, or if you are especially nervous a tax-preparation service. An accountant just seems like overkill for an individual.