I've been dealing with Form 8621 for my foreign mutual funds for about three years now, and this thread perfectly captures the challenges everyone faces with PFIC reporting! Based on my experience, I'd strongly recommend starting with TaxSlayer Pro if you can stretch your budget to the $60-70 range. While FreeTaxUSA is cheaper at $15-20, TaxSlayer's interface for Form 8621 is significantly more user-friendly and includes better error checking for the complex PFIC calculations. One thing I learned the hard way - make absolutely sure you understand the "excess distribution" calculations before you start any software. This is where most people (including myself initially) make mistakes that can trigger penalties. The IRS considers any distribution that exceeds 125% of the average distributions from the prior three years to be an "excess distribution" subject to special rules. Also, regarding the QEF election discussion above - if your foreign funds qualify and provide the necessary annual information, it's almost always worth making this election. It eliminates the excess distribution complexity and treats the fund more like a domestic mutual fund for tax purposes. Just remember you need to make this election by your return due date (including extensions) for the first year you hold the fund. For anyone still hesitant about DIY approaches, the suggestion about paying a CPA $100-150 just to review your completed form is excellent advice. It's good insurance against costly mistakes while keeping costs reasonable.

I've been filing Form 8621 for my European ETFs for the past two years and wanted to share a few additional insights that might help fellow PFIC filers. First, regarding audit triggers - based on conversations with my CPA, the IRS tends to scrutinize Form 8621 filings more closely when there are large discrepancies between reported distributions and calculated excess distributions, or when QEF elections appear inconsistent across multiple years. Making sure your calculations are rock-solid and well-documented is crucial. For software recommendations, I started with FreeTaxUSA my first year to save money, but switched to TaxSlayer Pro the second year after spending way too much time troubleshooting calculation errors. The extra $50 was absolutely worth it for the better guidance and error checking, especially for the Section 1291 calculations that can get quite complex. One practical tip I haven't seen mentioned - if you're dealing with multiple PFICs, consider using a simple spreadsheet to track all your data before entering it into tax software. Include columns for fund name, acquisition date, basis, annual distributions, year-end FMV, and election type. This makes the data entry much smoother and helps catch errors before they make it into your return. Also, definitely start the process early if possible. I learned that some European fund companies can take 6-8 weeks to provide PFIC annual statements, so reaching out in January gives you plenty of buffer time before filing deadlines.

This thread has been incredibly helpful for understanding 1099-R code PJ situations! I'm actually dealing with something similar but with a twist - I made an excess contribution to my Roth IRA in December 2024, but I didn't catch the mistake until March 2025 (after I had already filed my 2024 return in February). I had the excess removed in March 2025, so it was still before the extended deadline (October 15, 2025), which means I should avoid the 6% penalty. But I'm wondering if there's anything different about my situation since I already filed my original 2024 return before discovering the excess. From what I'm reading here, I'll still need to amend my 2024 return when I get the 1099-R (which should have code PJ), and I'll report the earnings as taxable income for 2024. Is that correct even though I filed my original return before removing the excess? Also, should I be concerned about any notices from the IRS in the meantime, since my original 2024 return showed the contribution but didn't account for it being excess? Or do they typically not flag these things until they start matching up 1099-R forms? Thanks for all the detailed explanations - this community has been way more helpful than trying to navigate IRS publications on my own!

I've been following this thread closely since I'm in a very similar situation with an excess Roth IRA contribution from 2024. What strikes me most is how consistent everyone's advice has been about the core process - amend the 2024 return to report earnings from the 1099-R code PJ, regardless of when the form was issued. One thing I'd like to add for anyone else dealing with this: make sure you understand exactly what constitutes "earnings" in your situation. In my case, the market actually went down slightly between when I made the excess contribution and when it was removed, so the "earnings" were actually negative. My brokerage explained that this means there would be no taxable earnings to report, and the 1099-R should reflect this with a $0 or very small amount in Box 2a. It's worth calling your brokerage or IRA custodian to get a clear breakdown of how they calculated the earnings portion before you receive the 1099-R. This can help you verify that the form is correct when it arrives and avoid any confusion when preparing your amendment. Also, for those using tax software like TurboTax or TaxSlayer, I'd recommend calling their support line when you're ready to file the amendment. These code PJ situations are tricky enough that having someone walk you through the software's specific process for reporting this type of income can be really valuable. Most of the major tax software companies have seen these situations before and can guide you to the right screens and entries.

The verification backlog right now is worse than any time since 2021. Most people are waiting 3-4 weeks compared to the normal 7-10 days. If you need your refund urgently, you should consider contacting your local Taxpayer Advocate Service office - they can flag your verification for expedited processing if you can demonstrate financial hardship (like pending eviction, utility shutoff, medical bills). The verification queue is processed in batches every Tuesday and Thursday, so check your transcript on Wednesday and Friday mornings for the best chance of seeing updates.

I'm going through this exact same situation right now! Filed in early April and did the identity verification on 4/12, just one day after you. I've been calling that verification line every morning at 7am for the past week and getting the same "high call volume" message. It's incredibly frustrating when you just need a simple status update. What I've learned from researching this is that the IRS verification system is completely overwhelmed right now - they're processing about 15,000 verifications per day but receiving over 25,000 new ones. The phone system automatically plays that busy message when call volume exceeds capacity, which happens within minutes of opening each day. I've started checking my online IRS account transcript daily instead. Look for any new transaction codes that appear - specifically TC 971 with Action Code 123 means your verification was accepted. I haven't seen this code yet on mine, but at least it's something concrete to monitor rather than that useless phone message. Has anyone had luck with the local Taxpayer Advocate Service offices for verification issues? I'm considering reaching out to them if I don't see movement by next week.

Quick question - how would this even show up on a paystub? Would it be obvious if an employer was making you pay both halves of FICA? My paystubs are confusing and just show a bunch of different deductions.

I went through something similar at my previous job and want to share what I learned. Your employer's request is definitely illegal, but I'd also recommend checking if they've already started doing this without telling you properly. Look at your most recent paystub and calculate what your FICA withholding should be: multiply your gross pay by 0.0765 (that's 7.65% total for employee portion). If the actual withholding is close to double that amount (around 15.3%), they may have already started making you pay both portions. Also, keep in mind that if your employer does this, you'll essentially be overpaying your taxes. When you file your tax return, you should get a refund for the overpaid amount, but that doesn't make what your employer is doing legal. You shouldn't have to wait until tax season to get back money that was illegally withheld from your paychecks. Document everything - the conversation with your boss, your current and future paystubs, and any written communication about this policy. This documentation will be crucial whether you decide to confront your employer or report them to the IRS.

I've been using UltraTax CS for my family trust returns for the past 3 years and it's been solid. It's definitely more expensive than consumer software (around $500-600 annually), but the reliability has been worth it after dealing with similar issues you described with H&R Block. What I really appreciate is how it handles the flow-through calculations from the 1041 to the K-1s automatically, and it has excellent error checking that catches common trust return mistakes before you file. The interface takes some getting used to if you're coming from consumer software, but their support team actually knows trust taxation rules, which has been helpful when I've had questions about distribution deduction calculations. One thing to note - they require you to maintain the subscription annually even if you only file during tax season, so factor that into your cost comparison. But given your bad experience with H&R Block's reliability issues, it might be worth the peace of mind to use something designed for professional preparers.

I went through a similar software nightmare with trust returns a few years ago and ended up switching to ProSeries. It's been rock solid for Form 1041 preparation and handles all the K-1 complexities without any of the freezing issues you experienced with H&R Block. What really sold me on ProSeries was how it handles the trust-specific calculations automatically - things like the distribution deduction, DNI calculations, and the proper allocation of different income types to beneficiaries. The software walks you through each step and has built-in checks to catch common trust return errors before filing. The price is reasonable (around $400-450 annually) and includes unlimited e-filing, so both your trusts would be covered. Their customer support actually understands trust taxation, which was a huge relief after dealing with consumer software support that clearly had no clue about fiduciary returns. One feature I particularly love is that it saves your work automatically every few minutes, so even if something did crash (which hasn't happened to me), you wouldn't lose hours of work like you did with H&R Block. Given your focus on reliability over price, I think ProSeries would be a great fit for your situation.