Tax pro here. The 810/151 combo usually means they need more documentation from you. Have you checked your mail carefully? They sometimes send letters that look like junk mail. Also, I've been recommending taxr.ai to my clients lately - it's an AI tool that breaks down your transcript and tells you exactly what's happening and what steps to take. It's seriously revolutionizing how we handle these delays.

I went through the exact same thing last year - 810 freeze and 151 for almost 4 months. Here's what finally worked: I submitted Form 911 (Request for Taxpayer Advocate Service) online through the TAS website. You don't necessarily need financial hardship if you can show you've been waiting an unreasonable amount of time (which 3 months definitely is). Make sure to include all your documentation - copies of your return, any correspondence, and a timeline of your attempts to resolve it. The advocate assigned to my case got it sorted in about 2 weeks once they took it on. Don't give up!

bruh the IRS is so broken. why we gotta jump thru hoops just to get our own money back smh

Ugh I feel your pain! I had a code 810 freeze for almost 10 months last year 😭 The examiner kept telling me "just wait" too but honestly what worked for me was being super persistent about getting specifics. When you're on the phone, ask them exactly what documentation they still need and get a case number. Also ask for the direct fax number to send additional docs - don't rely on mail. Keep records of every call with names and dates. The whole system is frustrating but you gotta stay on top of them or they'll just let it sit there forever.

bruh the IRS is straight up playing games with our money. we need to start charging them interest fr 😤

I'm in almost the exact same situation! Filed 2/8, got the 60-day letter, congressman got involved in April, and now I'm just waiting on my TAS advocate too. The whole "IRS won't talk to you once TAS is involved" thing is so frustrating - like we're stuck in limbo. At least we know we're not alone in this mess. Hoping both our cases get resolved soon! 🤞

I had a very similar experience last year! The key thing to understand is that the IRS processes S corp elections even if you don't receive confirmation. Since your 1120 was rejected, that's actually strong evidence your S election went through. Here's what I'd recommend: First, try logging into your IRS business online account at irs.gov - sometimes you can see your entity status there without calling. If that doesn't work, you can also request a transcript of your business account online or by mail using Form 4506-T, which will show if your S election is active. For the immediate filing issue, you'll need to prepare and file Form 1120-S instead of the 1120. The good news is that if you can show you never received the CP261 notice (reasonable cause), you may qualify for penalty relief when you file the correct return late. Just make sure to include a letter explaining the situation when you submit your 1120-S. One quick tip - check your spam/junk folder for any IRS emails, and also verify they have your correct mailing address on file. Sometimes these notices get lost due to address issues.

I just went through this exact situation a few months ago! The rejection of your 1120 is actually good news - it means your S election likely did go through. Here's what worked for me: Call the IRS Practitioner Priority Service line at 866-860-4259 instead of the regular business line. The wait times are usually much shorter (I got through in about 20 minutes vs. hours on the main line). When you reach an agent, ask them to check your "Entity Control Date" - this will show when your S election became effective. In my case, they confirmed my S corp status was active even though I never received the CP261. The agent explained that mail delivery issues are common with these notices, and the rejection of a 1120 filing is actually one of their standard ways to alert taxpayers about the status mismatch. You'll need to file Form 1120-S for 2023, but don't panic about late filing penalties. Include Form 2210 requesting reasonable cause relief and explain that you never received confirmation of your S election. I got my penalties completely waived this way. Also, make sure to update your address with the IRS and consider having future notices sent to your accountant if you have one - this prevents missing important correspondence in the future.

I'm glad to see this thread has been so helpful for understanding the Medicare tax situation! As someone who works in tax preparation, I see this confusion a lot with clients who are maximizing retirement contributions and don't understand why they're still hitting payroll tax thresholds. One additional point that might be useful - if you're planning to continue with MFS filing in future years for your student loan strategy, consider setting up quarterly estimated tax payments specifically for that Additional Medicare Tax. Since it's calculated on your Medicare wages (which include your 401k contributions), your employer's withholding might not cover the full amount, especially if your income fluctuates throughout the year. You can use Form 1040ES to calculate and pay estimated taxes quarterly. This way you won't get hit with a surprise tax bill next April, and you'll avoid any potential underpayment penalties. The Additional Medicare Tax doesn't have the same "safe harbor" rules as regular income tax, so it's worth being proactive about it. Also, keep detailed records of your student loan payment savings vs. additional tax costs each year. The income thresholds and payment calculations can change, so what makes sense financially this year might not be optimal in future years as your income grows or your loan balance decreases.

This has been such an informative thread! I learned a ton just reading through all the responses. I'm in a somewhat similar situation with MFS filing for student loan benefits, though my income is a bit lower at around $115k. One thing I wanted to add that I didn't see mentioned - if you're close to these thresholds, it might be worth looking into whether your employer offers a Roth 401k option alongside the traditional pretax 401k. While Roth contributions won't help you now (since they're made with after-tax dollars), they could be beneficial if you expect to be in a higher tax bracket in retirement. More importantly for your current situation, you could potentially split your contributions between traditional and Roth based on where you expect to land relative to the Medicare tax threshold. For example, if you know you'll be over $125k regardless, you might put enough in traditional 401k to optimize your income tax situation, then put additional savings into Roth to avoid making the Medicare tax situation even worse with a higher salary next year. The flexibility of being able to adjust your pretax vs after-tax contribution mix throughout the year (most employers allow this) could help you fine-tune your strategy as you get a better sense of your actual year-end income. Just another tool in the toolkit for managing these complex MFS + high income situations!