This situation is more common than you think, especially with mid-year payroll system changes! The different EINs are definitely the main red flag here - that's not normal for the same employer unless there was a legitimate corporate restructure. Here's my advice based on similar experiences I've seen: **Call the employer immediately** and ask specifically for whoever handled the payroll system transition. Don't accept "both forms are correct" without a detailed explanation. Ask them: - Why are the EINs different if it's the same company? - Was the Statutory Employee classification intentional (this is huge for tax purposes)? - Can they verify the combined wages match their actual payroll records? **Don't file yet** - I know FreeTaxUSA will let you proceed despite the warnings, but those warnings exist for a reason. Filing with incorrect forms and then having to amend later can delay your refund by months and potentially trigger IRS scrutiny. **Get everything in writing** - If they claim both forms are correct, ask for an email explanation of why different EINs were necessary. If they can't provide a clear business reason, push for corrected W-2c forms. The Statutory Employee change is particularly concerning since it affects how the income is reported (Schedule C vs regular wages) and can impact your tax liability significantly. You're being smart by catching this early. Take the extra few days to get proper documentation rather than dealing with potential IRS headaches later!

I went through almost exactly this same situation last year when my company switched from Paychex to Workday! The different EINs are definitely the key issue you need to resolve - that's not normal for a simple payroll system change and could cause major headaches with the IRS if not corrected. When I called my employer about it, they initially brushed me off saying "both forms are correct because of the system change," but when I specifically asked why they needed different EINs for the same company, it turned out the new payroll system had pulled an old EIN from their records by mistake. I had to be pretty persistent to get them to actually investigate rather than just assuming everything was fine. The Statutory Employee classification change is also a huge red flag - that completely changes how the income gets reported (Schedule C instead of regular wages) and can significantly impact your tax liability. If your boyfriend's job duties didn't change from last year, there's a very good chance this was checked in error during the transition. My advice: Call them first thing and ask to speak with whoever managed the payroll transition specifically, not just general HR. Ask for written documentation explaining why different EINs were necessary, and don't file until you get either a satisfactory explanation or corrected W-2c forms. It took about 10 days to get my corrected form, but it was absolutely worth avoiding potential IRS complications later. You're being smart by catching this early - don't let them make you feel like you're being difficult for asking reasonable questions about confusing tax documents!

This is a really common issue that catches a lot of people off guard! You're absolutely right to be thorough by cross-checking between different programs - that level of diligence often reveals these kinds of discrepancies that can be costly if missed. From my experience dealing with similar AMT foreign tax credit situations, FreeTaxUSA appears to be handling this correctly. The key principle is that when you're computing AMT, you need to stay within the AMT "universe" for all related calculations. This means your Form 1116 limitation calculations should indeed use your AMT-adjusted income figures rather than your regular taxable income. The reason the IRS instructions aren't more explicit about this is because they assume you understand that AMT creates a parallel tax calculation system. When Form 6251 adjusts your income by adding back certain deductions and making other modifications, those adjusted figures should flow through to all related forms, including the AMT version of Form 1116. A $2,700 difference is significant enough that I'd definitely recommend getting this right rather than just picking the software that gives the bigger refund. If you want additional confirmation, you might consider reaching out to a tax professional who specializes in international tax issues, or even contacting the IRS directly for guidance on your specific situation. The good news is that once you understand how this works, future years become much easier to handle!

This is exactly the kind of thorough tax preparation approach that saves people from costly mistakes! Your situation perfectly illustrates why the AMT system is so confusing - it creates this parallel tax universe that affects multiple forms in ways that aren't always obvious. You're absolutely right to trust FreeTaxUSA's approach here. The AMT version of Form 1116 should indeed use AMT-adjusted figures throughout the calculation. When Form 6251 modifies your taxable income by adding back the standard deduction and making other AMT adjustments, those modified amounts need to flow through to the Form 1116 limitation calculations. Otherwise, you're mixing regular tax and AMT figures, which defeats the purpose of having separate calculations. The $2,700 difference you're seeing is actually not uncommon when AMT kicks in with foreign tax credits. The interaction between these two complex areas of tax law can create significant swings in your final tax liability. One thing to keep in mind for future years - if you're consistently subject to AMT, you might want to consider tax planning strategies to minimize the impact. This could include timing certain deductions or income recognition to optimize both your regular tax and AMT calculations. Don't go with "whichever gives the bigger refund" - that's a recipe for audit trouble. Stick with the software that's calculating it correctly (FreeTaxUSA in this case) and keep detailed documentation of the calculations for your records.

I've been following this discussion and wanted to add a few additional considerations that might help with your situation: 1. **Documentation timing**: Make sure you request detailed statements from your LTD carrier showing exactly what periods each payment covered. Sometimes these payments don't align perfectly with calendar years, which can complicate the tax credit calculation. 2. **SSDI taxation going forward**: Since you mentioned ongoing SSDI payments, be aware that these may also become partially taxable depending on your total income (including pension and capital gains). The provisional income test could push some of your SSDI into taxable territory, so factor this into your overall tax planning. 3. **Medicare implications**: With the substantial income changes you're experiencing, make sure to consider how this affects your Medicare premiums if you're enrolled. The Income-Related Monthly Adjustment Amount (IRMAA) could apply based on your modified adjusted gross income. 4. **Record retention**: Keep all documentation related to this repayment situation for at least 7 years. The IRS may have questions about the claim of right credit calculation, especially given the large amount involved. The complexity of your situation really does warrant professional help, but armed with all the great information in this thread, you'll be well-prepared for those conversations. Good luck with getting this sorted out!

This is such a helpful and comprehensive thread! As someone who works in disability benefits administration, I wanted to add one more angle that might be relevant to your situation. Since you mentioned this was employer-sponsored LTD insurance, you should also verify whether your employer reported the LTD benefits correctly on your W-2s for 2023/2024. Sometimes employers mistakenly include LTD benefits in Box 1 (wages) when they should be reported separately, or vice versa. This can affect both your original tax liability and the claim of right credit calculation. Also, given that you're dealing with both SSDI backpay and LTD repayment in the same general timeframe, make sure your tax professional understands the full timeline. Sometimes there can be beneficial timing strategies around when to make the LTD repayment relative to other income events. One practical tip: If you haven't already, request a detailed calculation from your LTD carrier showing exactly how they determined the $76k offset amount. Sometimes there are errors in these calculations, and catching them early can save you from overpaying. I've seen cases where LTD companies failed to account for attorney fees paid from SSDI backpay, or miscalculated the offset periods. The fact that you got such great advice here about the Section 1341 credit and documentation requirements puts you in a much better position to handle this correctly. Best of luck with everything!

Great discussion everyone! I'm actually dealing with a similar situation and wanted to add a few points based on my research: First, regarding the FICA savings calculation - it's worth noting that if you're already at or near the Social Security wage base limit ($160,200 for 2023, $168,600 for 2024), you might only be missing out on the 1.45% Medicare portion rather than the full 7.65%. This could change the math for higher earners. Second, I discovered that some employers allow you to make "catch-up" payroll deductions later in the year if you realize you want to contribute more. Mine lets me submit a form in November to increase my December contribution significantly, which gives me most of the year to figure out my finances while still getting the FICA benefits. Finally, don't forget about state tax implications - some states have different rules for how they treat retirement contributions, so the payroll vs. direct contribution choice might affect your state taxes differently than federal. Worth checking with a tax professional if you're in a state with high income taxes. The consensus here seems clear though - if your plan allows it and you can swing the cash flow, payroll deductions are almost always the better choice from a tax perspective.

I can't think of any state where direct contributions would be MORE beneficial than payroll deductions from a tax perspective. The federal FICA savings alone (up to 7.65%) typically outweigh any potential state-level differences. Most states that have income taxes follow federal guidelines for retirement contribution deductions, so you'd get the same state income tax benefit whether you contribute through payroll or directly. The key difference remains the FICA taxes, which are only avoided through payroll deductions. That said, a few states like California have unique rules around certain retirement accounts, so it's always worth double-checking with a local tax professional if you're in a high-tax state. But in general, the math strongly favors payroll deductions. One thing I'd add to the earlier discussion - if you're self-employed or have 1099 income in addition to your W-2 job, you might want to consider whether a SEP-IRA or Solo 401(k) could complement your Simple IRA strategy. These allow much higher contribution limits and might give you more flexibility for those end-of-year contributions you were originally considering.

Thanks everyone for the helpful responses! This really puts my mind at ease knowing it's selective rather than universal. @ThunderBolt7 your airport security analogy is perfect - that's exactly how I'll think about it now. @Keisha Jackson that's interesting about both spouses needing to verify separately. I'll keep an eye out for another letter for my spouse, though nothing has arrived yet. I think I'll go with the ID.me online verification since several of you mentioned it's much faster than scheduling an in-person appointment. Has anyone had issues with the online verification not working properly, or is it pretty reliable? I'd rather not have to fall back to the TAC appointment if I can avoid it.

I can add some perspective as someone who works with tax preparation software. The IRS uses machine learning algorithms that analyze patterns in returns to flag potential identity theft or fraud. Your MFJ status change is definitely a common trigger, but so are things like significant income changes, new dependents, first-time homebuyer credits, or claiming certain refundable credits like EITC or Child Tax Credit. The system doesn't "know" these are legitimate changes - it just sees deviations from your historical filing pattern. From what I've observed, about 6-8% of returns get flagged for verification each year, with higher rates during peak filing season (February-March) when most fraudulent returns are submitted. The good news is that once you complete verification, you're much less likely to be selected again unless there's another significant change in your tax situation.