Has anyone suggested an Offer in Compromise? With her financial situation (limited assets, upcoming student loan payments), she might qualify to settle the debt for less than the full amount. When I went through something similar, I was able to settle a $23k tax debt for about $5k based on my financial circumstances.

I went through a very similar situation last year - CP504 notice, worker misclassification issues, and financial stress. Here's what I learned from the experience: 1. **Immediate action**: Call the IRS number on the notice TODAY. Explain the address issue and request a hold on collection activities. They're usually understanding about mail delivery problems and will give you extra time. 2. **Worker classification**: Since there's confusion about W-2 vs contractor status, definitely file Form SS-8 for an official determination. If she was misclassified, the employer becomes responsible for their portion of payroll taxes, which can significantly reduce her liability. 3. **Payment options**: Don't panic about the $19k lump sum. The IRS would much rather have you on a payment plan than deal with levy procedures. A streamlined installment agreement is very doable for this amount. 4. **Professional help**: Given the complexity (worker misclassification, financial hardship, timing issues), consider getting professional assistance. Sometimes having someone who knows the system can save you thousands in the long run. The key is acting quickly but not making decisions out of panic. The CP504 is serious, but it's a warning, not an immediate action. You have options, and the IRS is generally willing to work with people who communicate proactively rather than ignoring the notices.

I went through this exact situation with my mom's estate two years ago. The key thing to remember is that Form 56 is really about establishing communication with the IRS, not proving your legal authority. You can absolutely file it before your court appointment. When I filed mine, I checked the "Other" box in Part II and wrote "Named executor in will, court appointment pending." The IRS accepted it without any issues. What really helped me was keeping a detailed log of every action I took and every dollar I spent on behalf of the estate before my formal appointment. One tip that saved me a lot of headaches: when you do get your official court documents, file a new Form 56 right away with your updated status. This creates a clear paper trail showing the progression from pending to appointed executor. The IRS appreciates having that documentation in their files. Also, don't stress too much about paying taxes out of pocket initially. As long as you keep receipts and document everything properly, reimbursement from the estate is straightforward once you're appointed. I got every penny back without any complications.

I'm dealing with a very similar situation right now with my grandmother's estate. She passed away 6 weeks ago and I'm named as executor in her will, but the probate court is backed up and I'm still waiting for my formal appointment. What's been really helpful for me is creating a simple spreadsheet to track everything - date, action taken, amount spent (if any), and purpose. For example: "3/15/2024 - Filed Form 56 with pending executor status - $0 - Notify IRS of responsibility for tax matters" or "3/20/2024 - Paid estimated taxes from personal funds - $2,847 - Avoid penalties on grandmother's final return." I've also been taking photos of every document and keeping both physical and digital copies of receipts. My estate attorney said this level of documentation will make the reimbursement process much smoother once I'm officially appointed. One question I have for anyone who's been through this - should I be concerned about the IRS sending correspondence to my grandmother's address during this interim period? I've been checking her mail regularly, but I'm worried something important might get missed or returned.

Another thing to consider - make sure that promissory note is VERY detailed. My sister loaned me money for my house and we had a simple note, but our tax guy said it wasn't enough. He said we needed: 1) Fixed repayment schedule 2) Consequences for late/missed payments 3) Security/collateral details 4) Actual interest rate (even if small) Without these, he said the IRS might consider it a gift rather than a loan regardless of our intentions. We had to create a much more formal document later which was a huge hassle.

Just wanted to share my experience as someone who went through this exact situation last year. I loaned my son $180K for his house purchase with what I thought was a proper promissory note, but I made the mistake of not including any interest rate. Come tax time, I got hit with the imputed interest rules everyone's mentioning here. The IRS calculated that I should have charged about 4.2% interest (the AFR rate at the time), which meant I had to report roughly $7,500 in phantom income I never actually received. My son couldn't even claim the interest deduction because he never actually paid any interest. The lesson learned: always include at least the minimum AFR interest rate in your family loan, even if it's just 2-3%. It saves both parties from tax complications and makes the loan look legitimate to the IRS. I wish I had known about these rules beforehand - would have saved me a lot of headaches and unexpected tax liability.

My 2023 amended return was finally processed after 7 months!!! A few tips that might help others: 1) If you're using the "Where's My Amended Return" tool, try entering your info with slightly different formats. Sometimes it wouldn't work if I used dashes in my SSN but would work without them. 2) Amended returns seem to move in batches. My friend and I both submitted around the same time and both got processed within the same week. 3) Paper checks for amended returns seem to take about 3 weeks after approval to arrive. Hope this helps someone. The waiting is torture but they ARE processing them!

I'm in the exact same boat! Filed my 2023 amended return in March for about $2,800 and it's been radio silence ever since. The "Where's My Amended Return" tool has been stuck on "being processed" for months now. Reading through everyone's experiences here is both reassuring and frustrating - at least I know I'm not alone, but wow, 6-8 months seems to be the new normal. I might try that early morning calling strategy someone mentioned, though I've already wasted so many hours on hold. Has anyone noticed if certain types of amendments (like claiming missed deductions vs. correcting income) get processed faster than others? Just wondering if the nature of the amendment affects the timeline at all.

Has anyone considered the possible legal implications beyond just taxes? Letting someone else use your account on gig platforms usually violates their terms of service. Could she get in trouble with the platform too?

This is a really tricky situation that I've seen cause headaches for people. The key thing to understand is that the IRS computer systems automatically match 1099s to Social Security Numbers, so if Sarah doesn't report that $13,500 on her return, she'll almost certainly get a CP2000 notice (basically an automated "you forgot to report this income" letter). Her dad's promise to "take care of the taxes" doesn't change the fact that the income is tied to her SSN. Even if he somehow managed to pay taxes on it through his own return, the IRS systems would still be looking for that income on Sarah's return. The Schedule C approach mentioned by Carmen is probably the most practical solution at this point - Sarah reports the income, then deducts the full amount as payments to her father for contract services. This way the IRS sees the income reported under the correct SSN, but the tax burden effectively passes to the person who actually earned it. Just make sure there's proper documentation of this arrangement in case of questions later. And definitely learn from this situation - sharing gig accounts creates way more problems than it's worth!