This is definitely frustrating! Based on what you've described and the timing with your POS system update, I'd strongly recommend getting a detailed breakdown from payroll ASAP. Here's what I'd do in your situation: 1. **Compare paystubs line by line** - Look at your last normal paycheck versus these $0 ones. Check if federal withholding, state withholding, FICA, or any other deductions changed dramatically. 2. **Ask specifically about the POS system change** - Since this started around the time they updated systems, ask your manager exactly how tip reporting changed. The new system might be auto-declaring 100% of credit card tips instead of letting you declare a portion. 3. **Verify your W-4 info** - Sometimes system updates reset withholding preferences. Make sure your filing status and allowances are still correct in their system. 4. **Document everything** - Take photos of all paystubs and keep records of conversations with management. If your employer can't give you a clear explanation, consider contacting your state's Department of Labor. You shouldn't have to guess why your pay suddenly disappeared, especially when nothing changed on your end. This sounds like either a system configuration error or incorrect tax calculation that needs to be fixed immediately.

I'd also recommend checking if your employer changed their tip allocation method or if there's an issue with how they're calculating your "allocated tips" versus your actual reported tips. Under IRS regulations, restaurants with more than 10 employees must allocate tips to ensure total reported tips equal at least 8% of gross receipts. If the new POS system is automatically allocating additional tips to you (beyond what you actually received), you'd be taxed on that phantom income even though you never got the money. This is different from the credit card tip reporting issue others mentioned - allocated tips are essentially the IRS forcing restaurants to assign additional tip income to workers when total reported tips fall below the 8% threshold. You'd see this as a separate line item on your paystub, often labeled "allocated tips" or similar. If this is happening, you can file Form 4137 with your tax return to report the actual tips you received versus what was allocated to you. But first, check with payroll to see if tip allocation is now part of their new system and whether that's causing your withholding to spike.

One thing nobody's mentioned is that you should check if you can use the simplified method for home business deductions instead of calculating actual expenses. If the rented room is under 300 sq ft, you might be able to use the $5 per square foot deduction (up to 300 sq ft) which is MUCH easier than tracking all those individual expenses and doing all those calculations. Not sure if it applies perfectly to your situation but worth looking into!

I've been through a similar situation with my duplex in Florida while living in Georgia. One important thing to add that I don't see mentioned yet - make sure you're tracking your "days of personal use" very carefully. The IRS has specific rules about what constitutes personal use vs rental use. If you're keeping part of the house available for family visits, those days when family actually stays there count as personal use days, which can affect your ability to deduct rental losses if you have any. Also, any days you spend there yourself for maintenance or repairs don't count as personal use, but days spent there for vacation or personal reasons do. For the Colorado filing requirement, you'll definitely need to file a nonresident return there since that's where the rental income is generated. Most states have this requirement regardless of where you live. The good news is you can usually claim a credit on your Texas return (though Texas has no state income tax, this would apply if you lived in a state with income tax). Documentation is key - keep a calendar marking rental days, personal use days, and vacant days. This will be crucial for your depreciation calculations and expense allocations.

I'm really glad you posted this question before sending any money! This is definitely a scam - I've seen dozens of these exact same schemes targeting people in tax distress. The biggest red flag is their claim that you've been "pre-approved" for $7,500 but need to pay $1,195 to "release" those funds. This is completely fictional - the IRS doesn't work this way at all, and legitimate tax resolution companies don't hold approved relief funds that you access by paying release fees. Here's what's really happening: scammers create official-looking communications (logos, legal language, fake portals) to convince you they're legitimate, then use the "pay money to get money" hook to steal your cash. Once you pay, they'll either disappear or keep finding new "fees" you need to pay. If you're genuinely concerned about your tax situation, go directly to IRS.gov and create a free online account to see exactly what you owe. From there, you can explore legitimate IRS programs like payment plans or hardship options without paying middlemen. Please report this scam to the FTC at ReportFraud.ftc.gov and file IRS Form 14157. Your gut instinct that something felt off was absolutely right - trust it and don't send them a penny!

This is absolutely a scam - don't pay them a single dollar! I'm a CPA and see these fraudulent schemes constantly. The "pre-approved for $7,500 but pay $1,195 to release it" is the classic hallmark of tax relief scams. Here's the reality: The IRS doesn't "pre-approve" specific dollar amounts that third-party companies hold until you pay release fees. That's complete fiction. Legitimate tax resolution involves working directly with the IRS on payment plans, offers in compromise, or other programs - but no legitimate service holds "approved funds" on your behalf. Your instinct that something feels off is absolutely correct. These scammers specifically target people who are stressed about tax issues and make their communications look incredibly official with logos and legal language. Here's what you should do immediately: 1. DO NOT respond to any more communications from them 2. Check your actual tax account status for FREE at IRS.gov 3. If you do owe taxes, you can often set up payment plans directly with the IRS 4. Report this scam to the FTC at ReportFraud.ftc.gov and file IRS Form 14157 Trust that gut feeling - it just saved you over $1,000! These criminals count on people being too desperate or embarrassed to ask questions like you smartly did here.

Just want to add one more thing that might help - make sure to keep detailed records of the entire timeline. Document when you left your employer, when you completed the rollover, when you were notified of the ADP test failure, and when you requested the distribution from your IRA. The IRS sometimes asks for this chronology if there are questions about the tax treatment. Since you're dealing with a corrective distribution after a rollover, having clear documentation will help if you need to explain the situation to a tax professional or during an audit. Also, don't stress too much about the withholding you requested - that was actually smart planning since this distribution will be taxable income. You'll just reconcile any over/under withholding when you file your return.

As a former tax preparer, I can confirm most of what's been said here is accurate. The key point everyone should understand is that ADP test corrections are essentially the IRS forcing highly compensated employees to "give back" some of their 401k contributions to maintain the plan's tax-qualified status. Since you already completed your rollover before the test failure was discovered, you're in a somewhat unusual situation. The distribution you took from your IRA will be treated as a regular IRA distribution for tax purposes, but the underlying reason (ADP correction) means it shouldn't be subject to early withdrawal penalties. One thing I'd recommend - when you get your 1099-R, double-check that the taxable amount calculation is correct. Sometimes there can be errors in how the earnings portion is calculated, especially when the correction happens after a rollover. The $135 NIA you estimated sounds reasonable, but verify it matches what appears on the form. Most importantly, don't try to estimate the 1099-R values for your 2024 return. Wait for the actual form and report it accurately. The IRS matching systems will flag any discrepancies between what you report and what the custodian reports on the 1099-R.

Why not just put your money in tax-advantaged accounts instead? I moved most of my savings into I-bonds and my Roth IRA. The I-bonds defer the tax until you cash them out, and the Roth grows tax-free. Solved my withholding problem completely!

You're absolutely right to be proactive about this! I faced a similar situation last year with unexpected interest income from CDs that matured. One thing to consider is that if you're consistently earning significant interest income, it might be worth setting up automatic quarterly estimated payments rather than adjusting your W-4. This keeps your regular paycheck withholding stable and lets you handle the investment income separately. That said, if you prefer the "set it and forget it" approach, using line 4c for extra withholding is usually more precise than changing dependents. You can estimate your annual interest (maybe use last year's amount plus 10-15% as a buffer), calculate the tax on it, then divide by your pay periods. For example, if you expect $6,000 in interest and you're in the 22% bracket, that's roughly $1,320 in extra tax. If you're paid bi-weekly, adding about $50-55 per paycheck to line 4c would cover it without affecting your dependent claims or other withholding calculations.