I went through this exact same confusion last year! After getting my 5071C letter, I completed the ID.me verification online and was paranoid about whether I needed to call back. I ended up calling the IRS just to be safe, and after waiting on hold for 2+ hours, the agent told me the online verification was already complete and I didn't need to do anything else. She actually seemed a bit annoyed that I called unnecessarily. My refund was processed 11 days later. Save yourself the headache - if you successfully completed the online verification and got the confirmation screen, you're done. The system really does work automatically once you verify through the letter.

I just went through this process 3 weeks ago and can confirm - you do NOT need to call back after completing online verification! I was in the exact same situation as you. Got the 5071C letter, completed the ID.me verification online, and spent days worrying if I needed to take additional steps. My refund showed up exactly 10 days later without any further action on my part. The confusion your friend experienced might be because some people receive different types of verification letters or have issues during the online process that require follow-up. But if your online verification went smoothly and you received a confirmation, you're all set. The IRS systems are actually pretty good at updating automatically once you complete the required verification steps. Don't overthink it - follow exactly what your letter says and nothing more. The online verification through the letter is designed to be a complete solution, not just the first step in a longer process.

Question - if a trust has zero income for the year, do you still need to file a 1041? Our family trust just holds some property but didn't generate any income last year.

Great question! I went through this exact situation last year. As others have mentioned, you don't need the grantors to file personal 1040s just for your trust filing purposes. However, I'd recommend getting a clear understanding of whether your trust is actually a "grantor trust" or not - this makes a huge difference. If it's a standard irrevocable trust (not a grantor trust), then the trust files its own 1041 and issues K-1s to beneficiaries for any distributions. The grantors' personal income levels are irrelevant to the trust's filing requirements. One thing to watch out for: even if the grantors don't normally need to file because of low income, if they receive distributions from the trust that push them above the filing threshold, they'll need to file to report the K-1 income. But that's their responsibility, not yours as trustee. Make sure you have the trust's EIN and keep good records of all trust income and distributions. The 1041 filing requirements are based on the trust having $600+ in gross income OR any taxable income, regardless of the grantors' situation.

something ppl overlook - make sure ur nephew isn't counting on claiming educational tax credits himself!! if u pay tuition directly to school as a gift, he cant claim the lifetime learning credit or tuition deduction on that amount even if he meets income requirements. had this happen in my family and my cousin lost out on like $2000 tax credit bc grandpa paid tuition directly to school.

Great question! I went through this exact situation when helping my daughter with her master's program. The educational expense exclusion under IRC Section 2503(e) absolutely applies to graduate school tuition - there's no distinction between undergraduate and graduate levels. However, I'd strongly recommend considering the tax credit implications that others have mentioned. For your nephew's MBA, you might want to explore a hybrid approach: pay a portion directly to the school (to take advantage of the unlimited exclusion) and gift him some funds directly (within the $17,000 annual limit) so he can potentially claim education credits. Also, make sure to keep detailed records of any direct payments to the institution. I always request a receipt showing the payment was made directly for tuition on behalf of the student - this documentation has been helpful for my own tax records. The $35,000 you mentioned is substantial, so definitely worth running the numbers on which approach maximizes the overall tax benefit for your family!

Just checked my account too and wow, what a difference! The site is actually working properly for the first time in forever. I'm seeing the same $0.00 balance across all years that everyone else is reporting. What's really encouraging is how responsive the system is now - no more timeout errors or that spinning wheel of death we've all been dealing with. The fact that we're ALL seeing identical results after this maintenance period definitely feels like more than just coincidence. I know we shouldn't read too much into it, but between the major system improvements and everyone having the same $0.00 balance experience, it really does seem like they might be actively processing returns behind the scenes. That disclaimer about "recently filed or processing returns" not being reflected yet is starting to make a lot more sense now. Fingers crossed this means we're finally going to see some real movement on our refunds! At minimum, it's just nice to be able to log in without wanting to throw my computer out the window 😅

As a newcomer to this community, I just wanted to add that I'm experiencing the exact same thing! Just logged into my IRS account about an hour ago and was shocked to see it actually working properly - no error messages or endless loading screens like I've been dealing with for the past few weeks. My account balance page is showing $0.00 across all tax years (2022-2024) just like everyone else is reporting. What really caught my attention reading through these comments is that literally EVERYONE is having the identical experience after this maintenance period. That can't be a coincidence, right? The system performance improvement is honestly night and day. Usually I'd get frustrated and give up after multiple timeout errors, but today everything loaded instantly. Combined with that disclaimer about recently processed returns not being reflected yet, I'm starting to think they might actually be working through our returns in the background. I know we shouldn't get our hopes up too much given past disappointments, but the timing of system maintenance + universal $0.00 balances + major performance improvements really does feel like they're making actual progress. At minimum, it's just nice to be able to check my account without wanting to scream at my computer! Anyone else feel like this might finally be the breakthrough we've been waiting for? 🤞

This is really helpful information! I'm dealing with a similar situation but with a twist - my lock-off condo is part of a hotel rental program where the management company can rent either unit when I'm not using it. From what I'm reading here, it sounds like I should still calculate personal vs rental days for each unit separately, even though I don't control when the management company rents them out. Is that correct? And for the days when the management company has both units available for rent but neither gets rented, do those count as "available for rent" days or just vacant days? Also, has anyone dealt with the situation where the management company pools rental income from multiple units? I get a percentage of the total pool rather than specific rental amounts for my individual units, which makes the expense allocation even more confusing.

I've been reading through all these responses and wanted to add something that might help others avoid a costly mistake I made. When you have a lock-off unit and use one portion while renting the other, make sure you're tracking utilities separately if possible. I was allocating my electric and water bills based on square footage, but during an audit, the IRS agent pointed out that the studio portion I was renting actually used disproportionately more electricity (separate AC unit that ran constantly for guests) compared to the main suite where I controlled usage. The agent required me to install separate meters for a full year to establish actual usage patterns, then apply those percentages retroactively. It ended up costing me about $3,000 in additional taxes because my square footage allocation was significantly understating the rental portion's actual utility costs. Now I keep detailed records of utility usage for each portion, which actually increased my deductible rental expenses substantially. Just something to consider for anyone in a similar situation - the square footage method is a good starting point but isn't always the most accurate for every expense category.