Just wanted to share that depending on your total tax debt amount, another option is to request what's called a "tiered" installment agreement from the IRS. I had a similar situation last year, and the IRS set me up with a plan where I paid a higher amount for the first 12 months to clear the newer tax debt, then my payment dropped down to the original amount for the remainder of the older debt. The benefit was that it looked like one continuous agreement rather than a defaulted one that got modified. Might be worth asking about when you call!

I actually work as a tax professional and deal with these situations regularly. The confusion you encountered is unfortunately very common because the IRS has different procedures depending on when you call and which department you reach. Here's what's really happening: The IRS system is designed to automatically flag installment agreements as defaulted when new tax debt posts to your account. However, there's a difference between a "systemic default" (which happens automatically) and an "administrative default" (which results in collection actions). The key is calling within 30 days of when the new assessment posts. During this window, you can request what's called a "modification" rather than starting a completely new agreement. This keeps your payment history intact and avoids the more serious consequences of a true default. My advice: File your 2022 return ASAP, then monitor your online IRS account transcript. The moment you see the new balance assessment appear, call immediately to request the modification. Be specific that you want to "modify your existing installment agreement to include the new tax year" rather than saying you want to "restart" or "set up a new" agreement. The exact wording matters with IRS representatives.

Great question about the tax implications for your son as the renter! From the renter's perspective, paying below-market rent generally doesn't create any tax consequences for him. The IRS doesn't typically treat discounted rent as taxable income to the tenant - the tax implications fall on you as the landlord. The below-market rent isn't considered a gift in the traditional sense because he's still paying rent for a legitimate housing arrangement. Gifts become taxable when they exceed the annual exclusion ($17,000 for 2023), but rental discounts usually aren't calculated as gifts since there's still consideration (rent payment) involved. Regarding rental history - yes, having formal documentation definitely helps! My nephew used his lease agreement and payment history from our arrangement when he applied for his own apartment later. Property managers and landlords actually prefer seeing documented rental relationships, even with family, because it shows the person takes rental obligations seriously and has a track record of consistent payments. Make sure your lease agreement includes all the standard terms (payment due dates, responsibilities, etc.) and keep detailed records of on-time payments. This creates valuable documentation for his future rental applications and reinforces the business nature of your arrangement for tax purposes. It's a win-win situation that benefits both of you long-term.

This entire discussion has been incredibly valuable! As someone who's been hesitant to rent my property to family because of tax confusion, reading through everyone's real experiences has given me the confidence to move forward properly. The key takeaways I'm gathering are: treat it like a legitimate business relationship regardless of the family connection, document everything professionally (lease agreement, market research, payment records), report the rental income on Schedule E with deductions limited to that amount, and maintain mortgage interest/property tax deductions on Schedule A. I particularly appreciate the practical tips about automatic payments, annual rent reviews, and even collecting security deposits to maintain the professional appearance. The point about how formal documentation actually helps family members build rental history for future applications is something I never considered but makes total sense. One thing that really stands out from this discussion is how important it is to establish clear expectations upfront - whether that's about eventual transitions to market rate, maintenance responsibilities, or lease terms. Having everything in writing prevents misunderstandings later and shows the IRS this is a genuine business arrangement. Thanks to everyone who shared their real-world experiences, especially those who went through IRS inquiries or audits. This community knowledge has been far more practical and actionable than trying to parse through tax publications alone!

H&R Block also offers prior year software at decent prices. Their interface is more user-friendly than some of the cheaper options, and they're usually less expensive than TurboTax. Plus they have physical locations if you get stuck and need in-person help.

Another option worth considering is OLT (OnLine Taxes) - they specialize in prior year returns and have been around for decades. Their software isn't flashy but it's reliable and reasonably priced, usually around $20-30 per year for federal returns. They support going back many years and are particularly good for straightforward W-2 situations. One thing I learned the hard way is to gather ALL your documents before starting with any software. Make sure you have your W-2s, any 1099s you might have forgotten about, and your prior year AGI (Adjusted Gross Income) for identity verification. The IRS requires your prior year AGI to process returns, and if you don't have it, you'll need to request transcripts which can delay everything by weeks. Also, don't panic about the penalties - they're often not as bad as people think, especially if you're owed refunds on some years. The IRS interest rates have been relatively low in recent years too.

Great question about tax treaty resources! The IRS has a page dedicated to tax treaties (Publication 901) that covers the basics, but for country-specific details on retirement distributions, I'd recommend checking your host country's tax authority website first - they often have English-language guides for expats. For more comprehensive treaty analysis, the tax software tools mentioned earlier (like taxr.ai) can be really helpful since they analyze specific treaty articles that apply to your situation. I've also found that expat Facebook groups for your specific country often have members who've dealt with identical situations and can share their experiences. One thing to watch out for - some treaties have "saving clauses" that allow the US to tax its citizens as if the treaty didn't exist, which can affect retirement distributions. Also, make sure you understand if your host country considers these distributions as pension income (often taxed favorably) or regular income. The timing suggestion from AstroAdventurer is spot-on too. I learned the hard way that taking a large distribution in December can push you into a higher bracket for that year, whereas spreading it across January and February of the following year might keep you in lower brackets for both years.

One thing I haven't seen mentioned yet is the potential impact of state taxes on your 401k withdrawals as an expat. Even though you're living abroad, you might still owe state taxes depending on which state you last resided in before moving overseas. Some states like California and New York can be particularly aggressive about claiming you're still a resident for tax purposes. Also, regarding the Roth conversion strategy you mentioned - while you can't contribute to a Roth IRA without earned income, you CAN do Roth conversions from your traditional 401k. This might actually be a smart move while you're in lower tax brackets abroad. You'd pay tax on the conversion amount, but then the money grows tax-free in the Roth account. The key is timing these conversions when your overall income is low to minimize the tax hit. Since you mentioned not working currently, this could be an ideal time to convert portions of your traditional retirement savings to Roth, especially if you can stay within the lower tax brackets. Just make sure you have enough cash flow to pay the taxes on the conversion without having to withdraw even more from retirement accounts.

Emma, I'm so sorry you went through this stressful experience, but you should feel proud of how you handled it! Recognizing those red flags and backing away before signing anything likely saved you from a much worse situation. As a newcomer to this community, I've been reading through all these helpful responses and wanted to add one more protective step: consider contacting your bank directly to let them know about the potential fraud attempt. Even though you gave them an empty gift card instead of your real account information (which was brilliant thinking!), it's good to have your bank aware in case the scammers try any other tactics. The advice everyone's given about working directly with the IRS is spot on. I had a similar tax debt situation last year and was amazed at how reasonable the IRS was when I called them directly. They set up a payment plan that was way more affordable than what those "relief" companies were trying to charge me. One thing that really stands out to me is how these scammers seem to specifically target people who actually do have tax issues. It makes me wonder if they're getting information from people who search for tax help online. Going forward, it might be worth being extra cautious about sharing personal information on tax-related websites or forms. You absolutely did everything right by trusting your instincts. Your experience is going to help so many other people recognize these warning signs before they get taken advantage of!

Emma, I'm so glad you trusted your instincts and didn't fall for this! Those high-pressure tactics and demands for immediate signatures are classic scam red flags. You handled this perfectly by recognizing something was wrong before it was too late. Since you've already frozen your credit, I'd also recommend monitoring your existing accounts closely for any unusual activity. Even though you were smart enough to give them an empty gift card, scammers sometimes try other ways to access financial information once they have your SSN. For your actual $8000 tax debt, definitely work directly with the IRS rather than any third-party company. Call them at 1-800-829-1040 to discuss legitimate payment options. The IRS offers installment agreements through their Fresh Start program that are much more reasonable than what these "relief" companies charge - often as low as $25-50 per month depending on your situation. I'd also suggest reporting this to the FTC at reportfraud.ftc.gov and to TIGTA (Treasury Inspector General for Tax Administration). Your report could help protect others from falling for similar scams. You should also consider getting an Identity Protection PIN from the IRS through your online account - it's free and prevents anyone from filing fraudulent returns using your SSN, which is especially important now that they have that information. Your quick thinking probably saved you thousands of dollars and months of stress. Thanks for sharing this experience - it's going to help so many other people recognize these warning signs!