I went through almost the exact same situation last year with a rental property in Germany! That tax preparer gave you terrible advice - you absolutely need to report worldwide income as a US tax resident. Here's what worked for me: I ended up using TaxAct (mentioned by Luca above) and it handled everything smoothly. The software automatically calculated my foreign tax credit and properly allocated the income between the forms. For your $3,500 in Australian taxes, you should definitely claim every penny of that credit. One thing I learned the hard way - make sure you get an official tax certificate from the Australian tax authority showing exactly how much you paid. The IRS might ask for this documentation later, and having the official document makes everything much cleaner than just bank records of payments. Also, since you mentioned you're no longer an Australian tax resident, double-check that you're not missing any treaty benefits between the US and Australia that might affect how your rental income is taxed. The tax software should catch this, but it's worth researching.

Your tax preparer gave you absolutely terrible advice! As a US tax resident on a work visa, you're required to report your worldwide income to the IRS, including that Australian rental property income. That preparer either doesn't understand international tax law or was trying to take shortcuts that could get you in serious trouble. Here's what you need to do: Report the rental income on Schedule E (Supplemental Income and Loss) and claim the foreign tax credit for those Australian taxes on Form 1116. FreeTaxUSA can definitely handle this - I've used it for similar situations and it walks you through both forms step by step. The $3,500 you paid to Australia should reduce your US tax liability dollar for dollar (subject to certain limitations). Make sure you have good documentation of those Australian tax payments and use the proper exchange rates (IRS publishes annual averages, or you can use the rates from the actual payment dates). Don't let that preparer's ignorance cost you thousands in overpaid taxes or potential penalties for underreporting income!

11 I'm facing a similar issue but with 2019 taxes - am I completely out of luck for getting that refund now?

Just want to add a practical tip for anyone in this situation - when you print out your PDF return, make sure to use black ink only and print on white paper. The IRS scanning equipment can have issues with colored ink or tinted paper, which could delay processing of your return. Also, don't forget to sign and date the return in blue or black ink (not just printed signatures). I learned this the hard way when my first mailed return got rejected for missing signatures even though I thought everything was complete. Double-check Form 1040 page 2 for your signature and your spouse's if filing jointly. One more thing - if you're claiming any tax credits or deductions that require supporting documentation, make sure to include copies (not originals) of those documents with your mailed return. The IRS processing of paper returns is much slower than e-filing, so having everything complete upfront saves months of back-and-forth correspondence.

Possible stupid question... but how do these scammers even profit from filing someone else's tax return? Like do they somehow get your refund sent to their bank account or something? I'm trying to understand the motivation behind tax identity theft.

This is absolutely infuriating - I can't imagine how stressful this must be for you! You're definitely on the right track with Form 14039. One thing I'd add to the excellent advice already given: make sure to keep detailed records of EVERYTHING - dates of phone calls, reference numbers, names of agents you speak with, copies of all documents you submit. Also, don't forget to notify your employer's HR/payroll department about the identity theft. They should be aware in case the IRS contacts them about discrepancies in your tax filings. Some employers can also provide extra documentation (like employment verification letters) that might help speed up your case. The waiting is the worst part, but you've caught this early and taken all the right steps. Hang in there!

Honestly, for small donation amounts like you're talking about, I wouldn't stress too much. The standard deduction is $13,850 for single filers or $27,700 for married filing jointly for 2023 taxes (filing in 2024). Unless your total itemized deductions (including these donations plus mortgage interest, state taxes, etc.) exceed your standard deduction, you won't even use the donation deduction. Most people don't itemize anymore since the standard deduction increased a few years ago. Maybe calculate whether you'd even benefit from itemizing before worrying about the documentation?

Great point about checking whether you'd even benefit from itemizing! For tax year 2023, the standard deduction is indeed $13,850 for single filers and $27,700 for married filing jointly. @Fiona Sand - before worrying about the documentation issues, add up ALL your potential itemized deductions: state and local taxes (capped at $10,000), mortgage interest, medical expenses over 7.5% of your AGI, and charitable contributions. If that total doesn't exceed your standard deduction amount, then you'd take the standard deduction anyway and the charitable contribution documentation becomes a moot point. That said, if you do end up itemizing, you'll definitely need to remove those donations made through family members as they don't qualify under IRS rules. Only direct donations to qualified 501(c)(3) organizations with proper documentation can be claimed. It's always better to be conservative with deductions you can't properly document - the penalties and interest from an audit aren't worth the small tax savings from questionable deductions.

This is such a common issue that it's almost becoming the norm rather than the exception! I went through this exact scenario in 2023 and learned some valuable lessons about how to handle it. The most important thing is to document EVERYTHING. When you call the IRS, ask for the representative's name, employee ID, and the date/time of your call. Ask them to put notes in your account about what was discussed and resolved. I also recommend asking them to email you a confirmation if possible, though not all reps will do this. One thing that really helped me was asking the representative to explain WHY the second verification was triggered. In my case, it turned out that my in-person verification cleared one flag but there was a separate automated flag that got triggered later when they processed my return. Understanding the "why" helped me know exactly what needed to be resolved. Also, if the first representative you speak with can't resolve it immediately, don't hesitate to hang up and call back to speak with someone else. I hate to say it, but the quality of help you get really depends on which agent you reach, and some are much more knowledgeable about these system issues than others. Keep pushing until you get someone who understands that duplicate verification requests are a known system issue that can be resolved on their end without requiring you to verify again.

I'm going through this exact same frustrating situation right now! I verified my identity in person at a local IRS office on February 15th, and just yesterday I received another verification notice in my online account. Like you, I'm meticulous about keeping records and I have all my paperwork from the February appointment. What's really bothering me is that when I verified in person, the IRS employee specifically told me that my verification was complete and that I wouldn't need to do anything else for this tax year. She even gave me a confirmation sheet that said my identity was successfully verified. I'm planning to call the Identity Verification line first thing Monday morning with all my documentation ready. Reading through everyone's responses here, it seems like this is unfortunately a widespread system issue rather than something we did wrong. It's reassuring to know I'm not alone in dealing with this, but it's also concerning that the IRS systems have such poor communication between departments. I'll update this thread once I get it resolved - hopefully it will just take one phone call to clear up whatever flag is stuck in their system!