Ugh, I got a CP2000 last month about some crypto trades. Super annoying because their numbers were totally wrong! Make sure you carefully check every detail they've included in the notice. In my case, they were counting my transfers between wallets as income and hadn't accounted for my cost basis at all. Looked like I owed $12,000 in taxes when I actually had losses that year!

Hey Aisha! I totally understand that panic feeling when you first get a CP2000 - I went through the same thing last year. The good news is that these notices are actually pretty common and the IRS is generally reasonable about giving extensions when you need more time to respond properly. Since you mentioned your documents are at your parents' house, definitely don't rush into agreeing or disagreeing until you have everything you need to make an informed decision. A lot of CP2000 notices end up being resolved in the taxpayer's favor once they provide the missing documentation. From what others have shared here, it sounds like you have several good options for requesting that extension - calling the number on the notice, sending a certified letter, or even using one of those callback services if the phone lines are too busy. The key thing is just making sure you request it before your August 25th deadline. Take a deep breath - you've got time to figure this out and get it resolved properly!

Is there any software that specifically helps with optimizing the salary vs dividend split for C Corp owners? I'm using turbotax for business now but it doesn't really give guidance, just calculations after you've already decided.

Great question! You're absolutely right that the double taxation fear is often overblown for small C Corp owners. I've been running my consulting business as a C Corp for 3 years now and the salary deduction works exactly as you described. One thing I learned the hard way though - make sure you're paying payroll taxes on your salary (FICA, unemployment, etc.). Some new C Corp owners forget that even as the owner, you're technically an employee when you pay yourself a salary, so all the normal employment tax obligations apply. Also, don't overlook the benefits of being able to retain earnings in the corporation at the lower corporate tax rates (21% federal) if you're not ready to take distributions yet. Sometimes that's actually better than pass-through taxation depending on your personal tax bracket. The key is really understanding your specific cash flow needs and tax situation rather than just following generic "C Corps have double taxation" advice.

Another approach that nobody mentioned yet - if your contractor is in the process of getting legal status and will have an ITIN soon, you could potentially file for an extension on your taxes. This would give you until October 15th to file, which might give your contractor enough time to get their ITIN. This doesn't solve the backup withholding issue for payments you've already made, but it could help simplify the reporting if you can wait for their actual number rather than having to amend returns later.

I think everyone's overcomplicating this. I've been in this exact situation a few times, and here's what I did: just file the 1099 using "000-00-0000" for now, then later file an amended/corrected 1099 once they get their ITIN. The most important thing is to show you're making the effort to report all payments properly.

I was in EXACTLY your situation last month. After weeks of stress, I finally broke down and tried taxr.ai after seeing it mentioned here. It actually explained everything that was happening behind the scenes with my return and gave me an accurate timeline. Turns out my return was flagged for a simple discrepancy between what my employer reported and what I filed. Saved me so much anxiety knowing exactly what was happening! https://taxr.ai

I'm going through the exact same thing! Filed March 1st, accepted March 2nd, and my transcript has been completely blank for over a month now. The "as of" date keeps changing but nothing else updates. I've called three times and each agent tells me something different - first it was "normal processing delays," then "possible identity verification needed," and last week they said there was no issue at all and to just keep waiting. It's so frustrating not knowing what's actually happening. At least it sounds like we're not alone in this mess!

Does anyone know if theres special requirements for filing 1120S if you started the scorp mid year? My accountant wants to charge me extra for a "short year return" but im wondering if the software can handle this?

Just wanted to chime in as someone who's been through this exact situation. I started with an S-corp last year and initially tried to find free options but quickly learned that business returns are a whole different beast from personal taxes. After reading through these comments, I think the key takeaway is that while free options don't exist for 1120S filings, there are definitely cost-effective alternatives to paying $800+ to an accountant. The mid-tier software options mentioned here (TaxAct, TaxSlayer) or newer AI-powered solutions seem like reasonable compromises between cost and complexity. One thing I'd add is to make sure whatever software you choose can handle things like shareholder basis calculations and K-1 preparation - these are crucial for S-corps and where a lot of DIY filers mess up. If your business is really simple with just you as the sole shareholder, the learning curve isn't too bad. But if you have multiple shareholders or complex transactions, might be worth biting the bullet on professional help at least for the first year.