This thread has been incredibly informative! I'm a tax preparer and see this per diem classification issue constantly during tax season. Unfortunately, many clients don't realize there's a problem until they're sitting in my office with their W-2s. One thing I'd add for anyone dealing with this situation: if your employer has been incorrectly classifying per diem payments as non-taxable, you may also be missing out on Social Security and Medicare credits. These payments should have payroll taxes withheld too, not just income taxes. For those mentioning the federal per diem rate system - that's often the best solution for companies that want to provide tax-free per diem without the paperwork burden. The 2024 standard per diem rate for most locations is $166/day ($107 for lodging, $59 for meals), though high-cost areas have higher rates. Companies can pay up to these amounts with minimal documentation requirements. Also, if anyone discovers they've been underreporting income due to misclassified per diem, don't panic about amended returns. The IRS actually prefers voluntary corrections and the process is usually straightforward. Just make sure to include all required forms and calculate interest correctly.

As someone who works in payroll for a mid-sized construction company, I wanted to add some perspective from the employer side of this issue. We actually went through this exact situation about three years ago when our CPA flagged our per diem practices during an annual review. We had been paying $135/day to crews working more than 75 miles from our home office, treating it as non-taxable reimbursement without requiring any documentation. Turns out we were creating tax problems for about 40 employees and exposing the company to potential payroll tax penalties. The solution we implemented might be helpful for others to suggest to their employers: we switched to the GSA federal per diem rate system. Now employees just need to submit a simple travel log with dates, job locations, and business purpose. As long as the per diem amount stays within federal limits for each location, it remains truly non-taxable and we don't need individual receipts. For employees who had been receiving incorrectly classified per diem in previous years, we worked with our payroll company to issue corrected W-2s and helped coordinate the amended return process. Most employees were understanding once we explained we were fixing the issue to protect everyone from IRS problems. If you're dealing with this situation, approaching your employer with a solution (like the federal per diem system) rather than just pointing out the problem tends to get much better results. Most business owners want to do things correctly - they just need guidance on the proper procedures.

As someone who's been lurking in this community while preparing for my first EFIN application, I have to say this thread is like finding gold! I'm completely new to the tax preparation industry and was honestly pretty intimidated by the whole EFIN process until reading through everyone's experiences here. The timeline breakdowns are super helpful - especially knowing that "Awaiting Verification" is actually a good sign and typically takes 10-21 days. I was imagining it could be stuck there for months! And the tip about address consistency across all documents is something I never would have thought to check carefully. I'm planning to submit my application next week, and I'm definitely going to use the organized documentation folder approach mentioned here. The tools like taxr.ai and Claimyr sound really useful too - it's reassuring to know there are ways to get actual information and help during the waiting process instead of just sitting in the dark. Thanks to everyone for being so generous with sharing your real experiences, both the frustrating parts and the success stories. It makes this whole process feel much less scary for those of us just starting out in tax preparation!

As someone who just successfully completed the EFIN application process last month, I wanted to share a few additional insights that might help others currently waiting. One thing I noticed that hasn't been mentioned yet is that the IRS sometimes updates your status late in the evening or over weekends. I was obsessively checking during business hours and almost missed when my status changed to "Authorization Approved" on a Saturday night around 11 PM. So don't limit your status checks to just weekdays! Also, I want to echo what others have said about the tools mentioned here - I ended up trying taxr.ai after reading about it in this thread and it was genuinely helpful for managing my anxiety during the waiting period. Having some visibility into typical processing patterns made the whole experience much less stressful. For anyone currently in "Awaiting Verification" - hang in there! That stage felt like it lasted forever but it was actually only 16 days for me, right in line with what others have reported. The approval notification came via email first, then the status page updated about an hour later. This community has been incredibly valuable throughout my application process. Thanks to everyone who has shared their experiences - it really does help to know we're all going through this together!

Thanks for all the insights everyone! This is really helpful. I'm leaning towards the 401k loan option that @Lilly Curtis mentioned instead of the hardship withdrawal. The idea of paying myself back with interest sounds way better than dealing with taxes and penalties. Quick question though - if I go the loan route, are there any restrictions on using it for education expenses? Or is it more flexible than the hardship withdrawal in terms of how I can use the funds? I'm thinking this might give me more breathing room if my daughter's financial aid situation changes or if other unexpected expenses come up. Also wondering about the repayment terms - is it usually taken out of your paycheck automatically?

Great question! I've been through this exact situation with my son's college expenses. From my experience, most 401k administrators do require the tuition documentation upfront but don't typically follow up to verify exactly how you used the funds afterward. However, you're still legally obligated to use it for the stated hardship purpose. The key thing is keeping good records - save your tuition bill, withdrawal paperwork, and any payment confirmations. While IRS audits are relatively rare, if you're selected, you'll need to prove the hardship was legitimate and the withdrawal amount was reasonable for your situation. One important point: hardship withdrawals can only be for the amount of your immediate financial need, so if you're requesting $16,000 for a $14,500 tuition bill, make sure you can justify those additional fees/expenses with documentation. Also worth considering - have you looked into a 401k loan instead? You'd pay yourself back with interest rather than facing taxes and the 10% early withdrawal penalty. The loan option is much more flexible in terms of how you can use the funds and might be better for your situation.

I've been battling Error 6001 for about 16 months now and this thread is honestly a lifesaver! The amount of detailed, actionable advice here is incredible compared to the runaround I've been getting from official channels. What really resonates with me is the pattern everyone's describing - both agencies acting like they've never heard of Error 6001 before, then immediately passing the buck to the other side. I've had at least 8 calls where IRS says "that's an ID.me authentication issue" and ID.me says "the IRS system is rejecting you." It's maddening! I'm taking notes on all the specific phone numbers and approaches mentioned here: - Taxpayer Advocate Service (1-877-777-4778) - Identity Protection Specialized Unit (800-908-4490) - The IAL2 authentication status refresh request - Checking exact name/address formatting between ID.me and tax returns - Filing Form 8822 to force a system refresh The historical data conflicts mentioned by @PrinceJoe and name formatting issues from @Jade Lopez are particularly eye-opening. I've moved 3 times and gotten married (name change) since setting up my ID.me account, so there's probably all kinds of mismatched data causing authentication chaos. Going to start with the simple formatting checks first, then work my way up through the specialized departments if needed. Thank you everyone for sharing your war stories and victories - this gives me actual hope after over a year of frustration! 🙏

I've been struggling with this exact same Error 6001 for about 7 months now and honestly was starting to think I was the only one! This thread is like finding buried treasure - so many specific solutions I never would have known about otherwise. The finger-pointing between IRS and ID.me is SO real. I've literally been told by IRS phone support "we don't support ID.me technical issues" and then ID.me support says "the IRS portal is rejecting your authentication, we can't fix that." It's like being trapped in bureaucracy purgatory! What's really helpful is seeing the pattern of historical data mismatches causing these issues. I've had 2 address changes and filed some returns with my nickname vs full legal name, so there's probably all kinds of conflicting info in their systems. I'm definitely going to try the name formatting check first - seems like such a simple thing but apparently these systems are incredibly picky about exact matches. Then I'll work through the Taxpayer Advocate Service route if needed. Thank you to everyone sharing your experiences and actual solutions! This community knowledge is worth its weight in gold compared to the generic troubleshooting loops we get stuck in with official support. Finally feels like there's a light at the end of the tunnel! 🙏

Great question! You're dealing with what's called "pre-rental" expenses, and the good news is that most of what you described should be deductible. Since you inherited the property in January and placed it in service in October of the same year, with clear intent to rent it out, those repair expenses should qualify for deduction. The key distinction is that repairs like fixing plumbing, patching roof leaks, and general maintenance are typically deductible in the year paid, even if done before officially renting. However, that water heater replacement would likely be considered a capital improvement that needs to be depreciated over 27.5 years (unless it qualifies for the de minimis safe harbor if under $2,500). Make sure to keep detailed records showing your rental intent from the beginning - any correspondence with contractors, rental market research, listing attempts, etc. This documentation will support your position if the IRS ever questions the timing of these deductions. Also consider whether you might qualify for Section 199A deductions on your rental income once you start receiving it - it's worth looking into for additional tax savings!

Just to add another perspective from someone who's been through multiple property acquisitions - timing documentation is absolutely crucial for pre-rental expenses. I learned this the hard way when the IRS audited one of my rental properties a few years back. Beyond what others have mentioned, I'd also suggest documenting any property inspections you had done, communications with property management companies (even if you didn't hire them), and any advertisements or listings you may have posted. The IRS wants to see a clear "business purpose" timeline. One thing that really helped me was creating a simple spreadsheet tracking all expenses by category (repairs vs. improvements) with dates and descriptions. It made tax prep so much easier and showed the IRS I was treating this as a legitimate business from day one. Also worth noting - if you did any work yourself on the property, you can't deduct your own labor, but you can deduct materials and any tools you purchased specifically for the rental property work.