I went through this exact same frustrating experience with my mom's Form 2848 last year! The IRS rejection letter was so confusing - like you, I couldn't understand why they wanted a "licensing jurisdiction" for a family member. After multiple phone calls and rejected submissions, I finally learned that when you select "f" for family member in the Declaration of Representative section, you need to write the specific relationship (like "son," "daughter," etc.) in that licensing jurisdiction column. It's completely counterintuitive since that column is clearly designed for professional credentials, but that's what they want. So yes, just write "son" in the licensing jurisdiction column and leave the license/certification number column blank. The form will be processed much faster once you make that correction. One additional tip: if your cousin doesn't already have durable power of attorney documents from a lawyer, you might want to consider getting those too while his mom is still able to understand and sign legal documents. The Form 2848 only covers IRS matters, but having broader POA documents will help with other financial institutions and situations that might come up as her condition progresses. Hope this helps and you get it resolved quickly!

I went through this exact same situation with my elderly aunt last year! The Form 2848 instructions are genuinely terrible for family members - they're clearly written with professional representatives in mind. You're absolutely right to be confused. When you select "f" for family member, that "licensing jurisdiction" column gets repurposed to show the specific family relationship. So yes, just write "son" in that column, even though it feels wrong because of the column header. Here's what worked for me after two rejections: - Put "f" in the designation column (which you already did correctly) - Write "son" in the licensing jurisdiction column - Leave the license/certification number column completely blank - Make sure he signs and dates in the signature section The key thing the IRS is looking for is the specific relationship, not just "family member." They want to know HOW he's related to his mom. One more tip: when you resubmit, include a brief cover letter that says "Resubmitting Form 2848 with corrections per your request dated [date of their rejection letter]." This helps the processor understand it's a corrected resubmission, not a duplicate filing. Good luck! Once you get past this bureaucratic hurdle, having the POA in place will make everything so much easier for managing her tax affairs.

As someone who's been through an IRS audit for my freelance business, I can confirm that the process is much more thorough than people realize. The examiner didn't just look at my receipts - they wanted to see my business bank account statements, credit card records, and even asked about specific vendors I'd worked with. What really surprised me was how they cross-referenced everything. They noticed when I claimed a large office supply expense but couldn't find a corresponding withdrawal or charge in my financial records from around that time. They also questioned why I had claimed meals with "clients" but couldn't provide names or business purposes for several of them. The key thing I learned is that consistency across all your records is what they're really looking for. It's not just about having a receipt - it's about having a complete paper trail that tells a coherent story about your business expenses. They're trained to spot when things don't add up, even if individual receipts look legitimate.

One thing that hasn't been mentioned yet is that the IRS also uses third-party data matching extensively. They receive information from credit card companies, payment processors like Square and PayPal, and even some major retailers about business transactions. So if you claim a $2,000 office equipment purchase but there's no record of you making that purchase from any tracked vendor, that's another red flag. I learned this when I got a CP2000 notice because I had underreported some 1099-K income - the IRS already knew about payments I'd received through my payment processor. It made me realize they have access to way more transaction data than most people think. This same system would likely catch discrepancies if someone tried to claim fake business expenses, especially from major retailers that report sales data back to the IRS. The bottom line is that the honor system isn't really an honor system anymore - it's backed by increasingly sophisticated data cross-referencing that makes fraud much riskier than it used to be.

I had a very similar situation when my partner moved in with me after I bought our house solo due to his student loan debt affecting his credit. What really helped us was setting up clear documentation from the start. We created a simple expense-sharing agreement that outlined exactly what costs we'd split (mortgage payment, utilities, groceries, etc.) and what percentage each person would pay. This made it crystal clear that the monthly transfers were for legitimate shared expenses, not rental payments or income. For the banking/reporting side, our monthly transfers of around $1,200 never triggered any IRS reporting. Banks generally only report specific types of transactions - like interest over $10, business payments over $600 through payment apps, or cash transactions over $10,000. Regular personal transfers between individuals for expense sharing don't fall into these categories. One tip: if you use payment apps like Venmo or PayPal, always categorize the transfers as "personal" or "friends & family" rather than "goods & services." This keeps them clearly marked as personal transactions rather than business payments that might trigger reporting. The key thing the IRS cares about is whether you're making profit from the arrangement. Since you're just splitting actual household costs and not charging above market rates, these transfers are reimbursements, not taxable income. Keep basic records of your shared expenses and you'll be all set!

One thing that might give you additional peace of mind is understanding that the IRS receives millions of bank transaction reports annually, and they're primarily looking for patterns that suggest unreported business income or tax evasion - not legitimate expense sharing between partners. Your situation is actually very common. Many couples handle finances this way when only one person qualifies for the mortgage. The $800-900 monthly amount you mentioned is well within the range of normal household expense sharing and wouldn't raise any red flags. I'd suggest keeping it simple: maintain basic records of your shared expenses (maybe just save your monthly utility bills and mortgage statements), and if you want extra documentation, a simple text message or email chain between you two about the expense arrangement can serve as evidence of your intent. Also remember that even if somehow these transfers were ever questioned, the burden would be on the IRS to prove they represent unreported income rather than legitimate expense reimbursements. As long as you can show the money is going toward actual household costs you both benefit from, you're in good shape. Don't overthink it - you're being responsible by planning ahead, and your arrangement sounds completely legitimate!

I went through this exact situation about 8 months ago and totally understand that initial panic! LTR 324c notices are actually pretty routine - the IRS just needs to verify income when their automated systems can't match what you reported with what's in their database. Since you have PayPal records and client emails for your $6,700 in side gig income, you're in great shape. Here's what worked for me: **Essential documents to include:** - PayPal transaction history (use their export feature under "Activity" for a clean PDF) - Bank statements showing the PayPal deposits - Client emails confirming work and payment amounts - A simple summary sheet listing each payment with dates and amounts totaling $6,700 **Response tips:** - Write a brief cover letter referencing your notice number and date - Organize everything chronologically by payment date - Highlight the key payment amounts so they're easy to spot - Send via certified mail to the address on your notice (usually page 2) The whole process took about 7 weeks for me, but I got my full refund without any adjustments. The 30-day deadline might feel tight, but you have plenty of time to gather your documentation properly. Don't stress - you reported everything correctly and have proof. This is just the IRS doing their due diligence to match records. You've got this!

I've been following this thread and wanted to add my experience with LTR 324c from about 6 months ago. Like many of you, I initially panicked when I got the letter, but it turned out to be much more straightforward than expected. The advice here about organization is spot-on. What really helped me was creating what I called a "reviewer's roadmap" - basically a one-page document that walked through my entire response packet step by step. I listed each section (cover letter, summary sheet, PayPal exports, client emails, bank statements) with page numbers so the reviewer knew exactly what they were looking at. One thing I haven't seen mentioned yet: if any of your side gig income was seasonal or project-based (which it sounds like yours was), consider adding a brief timeline in your cover letter. I explained that my freelance work was concentrated during summer months, which helped contextualize why all my payments clustered in that period rather than being spread throughout the year. Also, don't underestimate the power of a well-written cover letter. I kept mine to half a page but made sure to directly address their concern about "information not matching their records" and explain exactly how my documentation would resolve their questions. The whole process took about 8 weeks for me, but the peace of mind from being thorough was worth it. You clearly have good documentation - just present it in the most organized, reviewer-friendly way possible!

Great question Samuel! As a newcomer to S-corp ownership myself, I went through this exact confusion recently. The key thing I learned is that the IRS requires what they call "adequate records" which means more than just credit card statements. You'll want to keep receipts and document the business purpose for each expense. I use a simple system where I snap photos of receipts immediately and add a quick note about the business purpose right in my phone's photo app. For example, "lunch meeting with potential client" or "office supplies for workspace setup." Regarding payment - definitely pay from your business account only. This maintains what's called the "corporate veil" which protects your personal assets. Mixing personal and business funds can actually jeopardize your S-corp status and liability protection. One thing that helped me was setting up automatic payments from my business checking to the credit card, so I never have to think about accidentally using personal funds. Also consider using expense tracking apps or simple accounting software from the start - it's much easier than trying to organize everything at tax time! The IRS generally looks for consistency and good faith effort in record keeping, so starting with proper habits now will serve you well long-term.

As someone who made every mistake in the book during my first year with an S-corp, let me add a few hard-learned lessons to this great discussion: **The "business purpose" documentation is CRITICAL** - I got burned on this during a correspondence audit. The IRS rejected several thousand dollars in deductions because my credit card statements showed the vendor and amount, but I couldn't prove business purpose. Now I write the purpose directly on receipts before filing them. **Mixed personal/business use items need extra attention** - Things like your phone bill, internet, or a laptop that you use for both personal and business need to be prorated. Keep detailed logs of business vs personal usage percentages. **Timing matters for S-corp specifics** - Unlike other business structures, S-corp owners who work in the business must take reasonable salary before distributions. This affects how you categorize certain expenses, especially if you're using the credit card for owner-related expenses. **Consider a separate "owner draw" tracking system** - If you occasionally need to cover business expenses personally (like when traveling), set up a formal reimbursement process rather than just paying the credit card from personal funds. This maintains clean separation and proper documentation. The good news is that once you get these systems in place, it becomes second nature. But the IRS definitely scrutinizes S-corp expense documentation more closely than sole proprietorships, so the extra effort is worth it!