I just called my ProSeries rep about this exact issue. They said it's a known limitation in their software validation rules and they're working on fixing it for next year. The workaround they suggested was to paper file this year, but they gave me a specific diagnostic code to note in my files so I can follow up with them once they have the fix. Might be worth calling your software support to see if they have any solutions brewing.

I've been dealing with this exact same issue across multiple client returns this year. What I've found helpful is creating a detailed client letter explaining the delay and the legitimacy of the Farm Optional Method for EITC purposes. I include references to the specific IRS publications mentioned earlier (225 and 596) and explain that this is a software limitation, not a tax law issue. For managing client expectations, I've started quoting 8-10 weeks for paper filing processing times instead of the usual 6-8 weeks, since the IRS seems to be running behind on manual processing. I also make sure to explain that their refund amount is correct and won't be reduced - it's just the delivery method causing the delay. One thing that's helped reduce my stress about these returns is keeping detailed documentation of the Farm Optional Method calculation and the EITC eligibility reasoning in the client file. If the IRS does question it later, having that paper trail makes any correspondence much easier to handle.

Former DOR employee here. One thing to clarify - "net income" definitions vary slightly between states. Most want Line 21 from 1120S, but some states (like CA and NY) have their own calculation that starts with Line 21 and adds back certain items. Call your specific DOR office and ask exactly which line they use for "net income" on THEIR form. Will save you tons of headache.

Just went through this exact situation last month! The confusion is totally understandable because different agencies sometimes use "net income" differently. For most state DOR payment plans, you'll want Line 21 (ordinary business income/loss) from your Form 1120S - this shows your actual business profit after all deductible expenses. However, I'd strongly recommend calling your specific state's DOR payment plan department to confirm. Some states have their own modifications to this number. When I called, they told me exactly which line to use and even emailed me a worksheet showing the calculation. It's worth the phone call to avoid having your payment plan delayed or rejected for using the wrong figure. Also, make sure you have your most recent filed return - sounds like that would be your 2023 Form 1120S in your case. Good luck getting it sorted out!

Your documentation approach is really thorough - taking photos and using ItsDeductible puts you in a great position regardless of which route you choose. I've been dealing with similar donation decisions and wanted to share a few practical considerations. The audit risk concern is understandable, but in my experience, the IRS is more focused on unreasonable valuations than properly documented donations over $500. Your detailed spreadsheet with conservative valuations actually demonstrates good faith compliance. One factor to consider is your time value. If splitting the donations saves you several hours of Form 8283 paperwork and you're comfortable with the slightly delayed deduction timing, that might be worth it. On the other hand, if you expect to have large donations regularly, getting comfortable with the Form 8283 process now could save hassle in future years. Also worth noting - if you do go over $500, you can group similar items on the form rather than listing each piece individually. So "men's business shirts (12 items)" with a total value is acceptable, which makes the paperwork much more manageable than it initially appears. Given that you're already itemizing and in a high bracket, you'll get the same tax benefit either way. I'd lean toward whatever approach gives you more confidence and peace of mind in your record-keeping.

Great question about documentation! For grouped items on Form 8283, you can absolutely use a reasonable per-item average multiplied by quantity - you don't need to track every single item's individual valuation. However, I'd recommend keeping your detailed spreadsheet with individual valuations as backup documentation, even if you don't submit it with your return. The IRS expects "reasonable" valuations, and having the individual breakdown shows you put thought into each item rather than just assigning arbitrary round numbers. Plus, if you're already doing the detailed work for your own peace of mind, it doesn't hurt to keep those records. One practical tip: when I group items, I usually separate by type AND condition. So instead of just "men's shirts (12 items) - $120", I might do "men's dress shirts, excellent condition (5 items) - $75" and "men's casual shirts, good condition (7 items) - $45". This shows more thoughtful valuation while still keeping the form manageable. Your point about future cleanouts is spot-on. Once you get comfortable with Form 8283, it becomes much less intimidating for future donations. And honestly, the peace of mind from knowing you're fully compliant often outweighs the small amount of extra paperwork, especially when you're already being so thorough with documentation.

This is actually more common than people think. Make sure your parents get a corrected 1098-T from your school showing the ACTUAL amounts paid for qualified expenses. The form should show no scholarships in Box 5. This will support their tax credit claims if they're audited.

From a practical standpoint, you need to gather all documentation first before having any conversations. Get copies of your actual 1098-T forms from the school, bank records showing the transfers from your parents, and any tuition payment receipts. This will help you understand exactly what's been reported to the IRS versus what your parents believe. The good news is that this situation, while stressful, is fixable without major penalties if handled correctly. Since your parents are actually paying more in qualified education expenses than they're currently claiming credits for, they're not in an overclaim situation that would trigger penalties. They may actually be entitled to larger education credits than they've been taking. The key is transparency and proper documentation going forward. When you do come clean (which you absolutely should), have all the paperwork ready to show exactly what was paid and when. This will make it much easier for them to file any necessary amended returns and claim the correct credits they're entitled to. The IRS generally views honest corrections favorably, especially when they result in proper reporting rather than tax avoidance.

Just wanted to chime in as someone who dealt with this exact scenario two years ago. The advice here is spot-on - you definitely need to report the full 1099-K amount and then deduct your losses separately if you itemize. One thing I'd add is to check if your gambling sites provide annual win/loss statements. Most legitimate online poker and sports betting sites will generate these for you if you request them, and they're incredibly helpful for documenting your actual losses. I had to contact customer service for a couple of sites, but they were able to provide detailed breakdowns that made filing much easier. Also, if you're thinking about using any of the services mentioned here, just make sure you understand the costs upfront. Sometimes the stress of dealing with tax issues makes spending money on help seem worth it, but you want to make sure it actually saves you money in the long run. Good luck with your filing!

I'm dealing with a similar situation but with a twist - I got a 1099-K from Venmo for what appears to be a mix of gambling winnings AND some legitimate freelance work I did. The gambling portion represents maybe 60% of the total amount on the form. Has anyone dealt with a mixed-use 1099-K like this? I'm wondering if I need to somehow split the reporting between Schedule C (for the freelance income) and Schedule 1 (for the gambling winnings), or if there's a different approach I should take. The Venmo transaction descriptions don't always make it super clear which payments were for what, so I'm trying to figure out the best way to document this split if the IRS ever asks. Also, for the gambling portion, I'm definitely net negative like the original poster, but the freelance work was legitimate income. This seems to complicate things even more in terms of how to handle the deductions and whether itemizing makes sense.