I'm dealing with this exact same situation right now! My company switched to a PEO mid-year and I'm seeing the same overwithholding issue. Reading through all these responses is super helpful. Quick question for those who've been through this - when you calculate the excess amount for Schedule 3 Line 11, do you use the current year's Social Security wage base limit? I want to make sure I'm using $160,200 for 2023 (which would make the max withholding $9,932.40) and not some other figure. Also, has anyone had success with the TurboTax workaround that Landon mentioned? I'm using TurboTax Deluxe and want to try that route before attempting the double W-2 entry method. Thanks everyone for sharing your experiences - this thread is a goldmine for PEO tax issues!

I went through this exact nightmare last year with ADP TotalSource as my PEO! The frustration is real when every tax software tells you one thing but your situation clearly calls for something else. What finally worked for me was a combination approach: I used the TurboTax method that others mentioned (found under Federal > Deductions & Credits > Other Tax Credits > Credit for Excess Social Security Tax Withheld) AND I called the IRS directly to confirm I was doing it right. The IRS agent I spoke with was actually really helpful and confirmed that PEO situations are becoming more common. They see this issue frequently now. She walked me through the calculation - for 2023 it's total SS withholding minus $9,932.40 - and confirmed that Schedule 3, Line 11 is absolutely the correct approach when you have a single W-2 from a PEO. One tip: when you file, include a brief statement explaining the PEO situation. I attached a simple note saying "Excess Social Security tax withheld due to multiple employers using same PEO (Professional Employer Organization)" along with my return. It helps explain the situation upfront if anyone reviews it. Got my full $1,847 refund without any issues or follow-up questions. Don't let the software confusion discourage you - this is definitely your money to claim!

Wow, this thread has been absolutely incredible to read through! As someone who's currently in the middle of my first ORISE fellowship and was already starting to worry about tax season, this discussion has been like finding a treasure trove of practical advice. I love how this evolved from the original question about where to report the stipend in TurboTax to such a comprehensive guide covering everything from quarterly estimated payments to professional validation from actual tax preparers. The consistency of advice throughout really gives me confidence that we're all on the right track. One thing I'm taking away that I hadn't considered before is the importance of keeping detailed records not just of the stipend amount, but specifically how I'm using those funds. Based on what everyone's shared, it sounds like the IRS distinction between "qualified educational expenses" vs "living expenses" is really the key factor in determining what's taxable. For anyone else just starting their ORISE journey, the practical tips here are gold: set up a separate savings account for taxes, save 25-30% of each payment, keep all your ORISE documentation, and don't overthink the complexity - the tax software will guide you through the details once you know to look for "Scholarships and Fellowships." Thank you to everyone who shared their experiences and especially to the tax professionals who validated this guidance. This thread should honestly be pinned somewhere as the definitive ORISE tax guide!

This has been such an incredibly helpful thread! I'm currently dealing with my ORISE stipend taxes and was completely lost until I found this discussion. Reading through everyone's experiences has been like having a personal guide through this confusing process. What really stands out to me is how consistent everyone's advice has been - from the personal experiences to the professional validation from actual tax preparers and CPAs. It's clear that reporting ORISE stipends under "Scholarships and Fellowships" in tax software is the standard approach, and the key distinction is simply whether you used the funds for qualified educational expenses or living expenses. I especially appreciate the practical tips about setting aside money for taxes throughout the year. As someone who's planning to continue with fellowships, the advice about opening a separate savings account and automatically saving 25-30% of each payment is going to save me so much stress next tax season. For anyone else finding this thread in the future, the key takeaways seem to be: 1) Use the "Scholarships and Fellowships" section in your tax software, 2) Be honest about how you used the funds (living expenses = taxable), 3) Keep all your ORISE documentation, 4) Plan ahead for tax payments since nothing is withheld, and 5) don't let Publication 970 intimidate you - your situation is probably more straightforward than it seems! Thank you to everyone who shared their knowledge and experiences. This community support makes navigating these complex tax situations so much more manageable!

This is such a helpful thread! I went through something similar last year and want to add one more piece of advice that saved me headaches: keep copies of ALL your Roth IRA contribution receipts/confirmations from your brokerage. When I had to file Form 8606, I discovered that my old brokerage (which had been acquired by another company) couldn't easily provide historical contribution data going back more than 3 years. Having my own records meant I could accurately complete the form without having to dig through old tax returns or make estimated guesses. Also, if you've been contributing to your Roth for several years like the original poster, double-check that you didn't accidentally exceed the annual contribution limits in any given year. If you did, those excess contributions could complicate your withdrawal calculations and potentially trigger different tax treatment. The peace of mind from having proper documentation is worth the small effort to maintain these records!

Great discussion everyone! As someone who works in tax preparation, I see this Roth IRA contribution withdrawal confusion constantly. The key points mentioned here are spot on, but I want to emphasize one critical thing that often gets overlooked: Even if you file Form 8606 correctly, the IRS automated systems sometimes don't properly match it with your 1099-R, which can trigger incorrect penalty notices months later. This is exactly what happened to several people in this thread. My recommendation: After filing your return with Form 8606, keep a copy of that form easily accessible and monitor your IRS account online (irs.gov) for any notices. If you do get an incorrect penalty notice, you'll need to either call the IRS directly or use a service like the ones mentioned here to get it resolved quickly. Also, for future reference, some newer brokerage platforms are starting to track contribution vs. earnings separately, which should eventually make this process smoother. But for now, assume you'll need to handle the proper reporting yourself regardless of what code appears on your 1099-R. The ordering rules Sofia mentioned are absolutely critical - contributions always come out first, but YOU have to prove that to the IRS through proper documentation!

This has been an absolutely fantastic discussion to follow as a newcomer to this community! I've been struggling with a very similar 1095-A allocation situation involving my 26-year-old son who's on our marketplace plan but files independently with around $20K in income. What I find most valuable is how this thread has evolved from the initial confusion about whether "100% allocation to the daughter" was acceptable, to a clear consensus on best practices backed by real practitioner experience. The marketplace premium calculator approach that multiple preparers have endorsed gives me confidence that there's a tried-and-tested method for these situations. For my case, I'm planning to follow the framework that's emerged here: - Use healthcare.gov to determine what my son's individual coverage would cost - Allocate based on that proportional share (likely around 30% for a 26-year-old) - Document everything with screenshots and calculation notes - Coordinate with my son upfront so we're aligned for filing The emphasis on "reasonableness" throughout this discussion really resonates with me. It's clear that while the IRS allows flexibility, they expect allocations to be defensible based on objective factors like premium costs, not just income optimization strategies. One thing that particularly stood out was the point about audit experiences - hearing that the IRS primarily looks for reasonable basis and documentation gives me confidence that following the marketplace calculator approach puts you in the safe zone. Thanks to everyone who shared their expertise - this is exactly the kind of real-world guidance that makes complex tax situations manageable!

As a newcomer to this community, I'm incredibly grateful for this comprehensive discussion! I've been dealing with a similar 1095-A allocation challenge involving my 23-year-old nephew who's on our marketplace plan but files independently with about $17K in income. What really stands out to me is how this thread has provided such clear, actionable guidance on what initially seemed like a confusing aspect of the Premium Tax Credit rules. The consensus around using marketplace premium calculators to establish defensible allocation ratios makes perfect sense - it transforms what could be arbitrary percentage choices into research-backed decisions. For my situation, I'm planning to implement the framework that's emerged here: - Research individual premium costs on healthcare.gov for my nephew's age and our location - Allocate based on that proportional cost (expecting around 30-35% based on the age ranges discussed) - Document the methodology with screenshots and calculation notes - Coordinate upfront to ensure he has all the information needed for his Form 8962 The "reasonableness" standard that seemed vague in the IRS publications becomes much clearer when you see how experienced preparers actually apply it in practice. Using objective premium cost data as the foundation for allocation percentages clearly puts you in defensible territory while still maximizing appropriate credits for lower-income family members. This discussion has been an excellent example of how community expertise can clarify complex tax regulations that official guidance leaves murky. Thanks to everyone who shared their real-world experience!

This is such a common situation! I was in almost the exact same boat with my spouse - we were both claiming 0 and getting huge refunds every year. What really opened my eyes was realizing that big refund meant we were missing out on having that money available for things like emergency savings, paying down debt, or even just having more breathing room in our monthly budget. One practical tip: when you do make the switch, keep track of your first few paychecks to see the actual dollar difference. It's pretty motivating to see that extra money hit your account! We ended up using our increased take-home pay to boost our emergency fund, which felt way better than waiting for a lump sum refund. Also, don't stress too much about getting it perfect right away. You can always adjust your withholding again if needed - it's not a once-and-done decision. The key is just getting started and fine-tuning as you go.

I went through this exact same situation a few years ago! My husband and I were both claiming 0 and getting refunds around $3,500 each year. After doing some research, we realized we were basically giving the government an interest-free loan while struggling with tight monthly budgets. We started by switching just my husband (the higher earner) from 0 to 1, and it added about $85 to his bi-weekly paycheck. That extra $170/month made a huge difference in our day-to-day finances! After a few months, we adjusted mine too. One thing that really helped was using that extra money strategically - we automatically transferred it to savings so we didn't just spend it frivolously. When tax time came around, we still got a small refund ($400) which was perfect - just enough to feel like we hadn't messed up our withholding, but not so much that we were overwithholding significantly. The peace of mind from having better monthly cash flow was worth way more than that big refund check. Just make sure you track your first few paychecks after making the change so you can see the actual impact!