Slightly different situation but related - I got a 1099-K from PayPal for money friends sent me to split bills and rent. Completely personal transfers, not business income! Anyone know how to handle this?

I went through this exact nightmare last year with Uber and PayPal! The duplicate 1099-K situation is incredibly frustrating, especially when each company just points fingers at the other. Here's what I learned after finally getting it sorted out: You absolutely need to report both 1099-Ks on your return since the IRS gets copies of both. But the key is making sure your actual taxable income is correct on Schedule C. What worked for me was creating a simple reconciliation document that showed: - Total gross income from gigs (the real amount before any fees) - Platform fees paid to WorkGig as business expenses - How both 1099-Ks relate to the same income stream I attached this as a statement with my return explaining the situation. No issues from the IRS, and my CPA said this approach was exactly right. The most important thing is keeping detailed records showing the money flow - from the gigs through WorkGig to CashApp to your bank account. This proves it's the same money being reported twice, not separate income streams. Don't stress too much - this is becoming super common with the new reporting thresholds, and the IRS understands the situation as long as you document it properly.

Another option nobody mentioned - if you're really stuck, you can get free tax help from VITA (Volunteer Income Tax Assistance) or TCE (Tax Counseling for the Elderly) programs. They can help with amendments too! I volunteer with VITA and we help with amendments all the time, especially for EITC issues. The service is completely free if your income is $60,000 or less. Most sites are open until April 15, but some locations offer year-round assistance. Google "VITA locator" or call 800-906-9887 to find a site near you. Just bring your original return, any W-2s/1099s, and they'll help you complete the amendment for free.

I went through this exact same situation last year! Here's what I learned the hard way: First, don't feel bad about the system being confusing - you're absolutely right that it's unnecessarily complicated. The fact that different tax software companies can't work together for amendments is ridiculous. For your specific situation, I'd actually recommend trying the VITA program that Grace mentioned. Since you have 1099 income AND need to claim EITC, having a trained volunteer double-check everything could save you from future headaches. They're used to dealing with mixed income situations and EITC calculations. If VITA isn't available in your area or you want to handle it yourself, here's a practical tip: TaxSlayer's $57 fee might actually be worth it if your additional EITC refund is substantial (which it often is - could be $1,000+ depending on your situation). Think of it as paying for convenience and faster processing time. Whatever you do, don't let this slide because you're frustrated with the process. The IRS has a three-year window for you to claim refunds you're entitled to, but why leave money on the table? You earned that EITC credit. Also, for next year - consider keeping digital copies of all your tax documents in a cloud folder. Makes amendments way easier when you have everything organized in one place.

Building on the excellent advice already given, I want to emphasize a few critical points that could save you significant headaches: First, regarding the estate vs. direct distribution issue - while technically the promissory note should have gone through probate as personal property, the practical impact may be minimal if beneficiaries are receiving their correct proportional shares. However, you should definitely consult with your estate attorney about whether to file a Form 1041 for the estate or issue K-1s to beneficiaries. This decision affects where the tax liability sits. Second, the step-up basis issue is unfortunately clear-cut - installment obligations don't receive step-up treatment under IRC Section 1014(c). The original sale created the installment obligation, and that's what was inherited, not the underlying property. Even with the security interest, you inherited the right to payments, not ownership of the real estate. For reporting, you'll need your father's final Form 6252 to determine the gross profit percentage that continues to apply. Each payment you receive will be split between: (1) return of basis (not taxable), (2) gain recognition (capital gains), and (3) interest (ordinary income). Given the multi-state complexity (NC/WV) and the estate administration questions, I'd strongly recommend getting professional help from a tax attorney or CPA experienced with installment sales and estate taxation. The potential tax savings from proper planning could easily justify the professional fees. One last note - make sure you're keeping detailed records of all payments received and how they're being distributed among beneficiaries. The IRS will want to see this documentation if they ever examine the returns.

I'm dealing with a somewhat similar situation right now with my mom's estate, and I wanted to share a few additional considerations that might help. One thing I learned from my estate attorney is that even though you've been distributing payments directly to beneficiaries, you might want to consider having the estate "adopt" those distributions retroactively through proper accounting entries. This can help establish a clear paper trail showing the estate received the income and then distributed it, which might be cleaner for tax reporting purposes. Also, regarding the WV/NC state tax issue - I'd definitely recommend checking if West Virginia has any special provisions for inherited installment obligations. Some states have different rules for inherited vs. original installment sales, and a few even provide partial basis adjustments in certain circumstances, though this is rare. From a practical standpoint, since you're the executor and dealing with monthly payments, consider setting up a dedicated estate account just for these transactions going forward. It makes the accounting much cleaner and gives you better documentation if the IRS ever questions the distributions. Have you considered whether it might make sense to accelerate the remaining payments or sell the note entirely? Sometimes the administrative burden and ongoing tax complexity of installment reporting makes it worth exploring other options, especially if the security interest gives you leverage with the buyer. The multi-state complexity alone probably justifies getting professional help, but don't let anyone tell you this is impossible to sort out - it's just a matter of getting the right guidance and documentation in place.

Check if these are actually from the IRS or Department of Treasury, or if they might be scams. Real IRS letters have a notice number (usually CP followed by numbers) in the upper right corner. If the letter just says "Department of Treasury" without specific IRS markings, be suspicious!

This is definitely a serious situation that needs immediate attention. Given the amounts involved ($22K and $123K) versus your actual income during college years, this screams either identity theft or a major IRS error. The fact that the letters cut off mid-sentence is also a red flag that something went wrong in their system. Here's what I'd do right away: 1. Call the IRS immediately using the number on the notices to get complete information 2. Request your tax transcripts for 2010-2011 online at irs.gov or by calling 1-800-908-9946 3. Pull your credit reports to check for any accounts or employment you don't recognize 4. Gather all your tax documents from those years (W-2s, 1099s, tax returns) Don't panic, but also don't delay. Even if this is completely wrong, ignoring it will only make things worse. The IRS has powerful collection tools, but they also have procedures to fix errors when they happen. You have rights as a taxpayer, and if this is identity theft or their mistake, it can be resolved - it just takes persistence and proper documentation.

I see so many of these stories lately! The IRS systems are completely overwhelmed and their error rate seems to be getting worse. One thing to consider if this doesn't get resolved quickly - the Taxpayer Advocate Service can help with these kinds of issues, especially when there's a risk of financial hardship. They're an independent organization within the IRS. Just remember to document EVERYTHING. Every call, letter, the name of every IRS employee you speak with, dates, times - create a paper trail so detailed that nobody can question your due diligence. It might seem excessive, but if this drags on, that documentation will be your best defense.

I'm glad to see you're making progress on this! Just wanted to add a few more tips that helped me when I dealt with a similar CP2000 issue: 1. When you send your written response, use certified mail with return receipt requested. This gives you proof the IRS received it and when. 2. Keep calling that same IRS number periodically to check on the status. Sometimes these cases get stuck in the system and a follow-up call can move things along. 3. If you haven't already, pull your Social Security earnings record from ssa.gov to verify what employers actually reported wages under your SSN. This can help identify if there are other discrepancies you're not aware of. The fact that they already identified it as a clerical error with someone else's information is a great sign. Usually once they acknowledge the mistake internally, the resolution moves pretty quickly. You should be in the clear soon!