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Not to get all philosophical, but technically almost everything is taxed multiple times as money moves through the economy. Your employer pays various taxes before paying you, then you pay income tax, then sales tax when you buy something, then the store pays taxes on their profit from your purchase, then their employees pay income tax on their wages... it's taxes all the way down lol. Some countries use a VAT (Value Added Tax) system instead which is a bit more transparent about the whole thing. Different approach but same result really.
That's an interesting way to look at it. So is there any country that does this better or more fairly? I'm curious if this is just how all modern economies work or if there are alternatives that don't feel so grabby.
There are definitely different approaches around the world, but most developed economies have multiple layers of taxation. Countries with VAT systems like in Europe are more upfront about it - the tax is built into the displayed price rather than added at checkout like our sales tax. Some countries rely more heavily on income taxes and less on consumption taxes, which can be more progressive since consumption taxes hit lower-income people harder as a percentage of their income. There's always tradeoffs though - countries with higher income taxes and lower sales taxes often have higher overall tax burdens to fund more government services.
Sales tax is so random too! In my state clothes are tax free but only if they cost less than $175 per item. And basic groceries aren't taxed but prepared foods are. And don't get me started on digital purchases and subscription services - the rules are all over the place depending on where you live. Pro tip: keep track of all the sales tax you pay throughout the year - you can deduct either your state income tax OR your sales tax on your federal return, whichever is higher. If you make big purchases in a year like a car or major appliances, the sales tax deduction can sometimes be better!
Really? I didn't know you could deduct sales tax instead of state income tax. How do you keep track of all that though? Do you need to save every single receipt?
You don't need to save every single receipt! The IRS has tables that estimate your sales tax based on your income and family size. You can use those numbers, or if you made big purchases like a car or home renovations, you can add the actual sales tax from those receipts to the table amount. I learned this the hard way after keeping a shoebox full of receipts for a year - turns out the IRS table method was actually higher than what I calculated manually! Now I just save receipts for major purchases over $1000 and use the table for everything else.
I'm in almost the exact same situation! Just completed my ID verification through ID.me yesterday after being stuck since I filed in May. Got the same "Verification is Complete" screen with the 9-week warning that had me panicking. Reading through everyone's experiences here is really reassuring - seems like most people are getting their refunds way faster than that worst-case timeline. I'm definitely going to follow the advice about checking my transcript weekly instead of obsessing over WMR. Already pulled it up and I can see the 570 code that Emma mentioned, so hopefully I'll see that 571 and then 846 sequence soon. The fact that later filers seem to be moving through faster gives me hope too. Thanks for posting this question @AstroAce - exactly what I needed to see today! Hopefully we'll both have good news in the next few weeks instead of waiting the full 9 weeks they quoted us.
@AstroAce @Ethan Campbell - glad this thread is helping! I m'actually going through the same thing right now too. Just verified my identity last week after filing in March and getting that dreaded letter. It s'so nerve-wracking when they give you that 9-week timeframe, but seeing all these real experiences from people who got their refunds in 1-3 weeks is definitely calming my anxiety. I ve'been checking WMR obsessively but clearly need to shift to monitoring my transcript instead. Really hoping we all see movement soon - keeping my fingers crossed for all of us! π€
Just went through this exact process 3 weeks ago! Filed in April, got the identity verification letter in late January, and completed the ID.me verification process. I was terrified about the 9-week timeline too, but it ended up being much faster. Here's my timeline: - Verified identity on a Monday - Transcript updated the following Friday (4 days) with code 571 - Code 846 appeared the next Tuesday (10 days total) - Refund hit my bank account that Thursday (12 days from verification) The biggest thing that helped my anxiety was understanding that the 9-week timeframe is their legal CYA - they have to give you the worst possible scenario. In reality, once identity verification is complete, most returns process within 2-3 weeks unless there are other issues. Pro tip: Set up that IP PIN they mentioned ASAP once you get your refund. It'll save you from going through this verification nightmare again next year. I wish I had known about it sooner! You're past the hardest part now - just keep checking your transcript weekly and you should see movement soon. April filers who verify now are actually in a sweet spot timing-wise compared to those who got stuck early in the season.
This timeline gives me so much hope! 12 days is incredible compared to what I was mentally preparing for. I really appreciate you breaking down the exact sequence of events and codes - it helps me know what to look for when I check my transcript. The IP PIN tip is also super helpful, I definitely don't want to go through this stress again next year. It's reassuring to hear that April filers verifying now might actually have better timing than earlier in the season. Thanks for sharing your experience!
One thing to be careful about - make sure the information on your state return EXACTLY matches what you filed on your federal through Cash App. I made a small error where numbers didn't match up a few years ago and ended up getting a notice from my state tax authority. Also check if your state has a "standalone" filing option. Some states require you to enter your federal information first before completing just the state portion.
Does this mean I need to print out my federal return from Cash App first? And then manually enter all the exact same info into FreeTaxUSA before doing the state part?
Yes, that's exactly what you should do. Download and print your complete federal return from Cash App (or save it as a PDF). Then when you start your FreeTaxUSA filing, you'll need to enter all the same federal information first even though you're only going to submit the state portion. Pay special attention to things like adjusted gross income, deductions, credits, and any schedules you filed. These absolutely need to match exactly what's on your Cash App federal return. Even small differences could trigger a review or delay your state refund.
Has anyone had a similar issue but in reverse? I filed my state taxes first with a local company but need to do federal separately now...
That's actually much more unusual because most tax software requires you to enter federal info before state. But you can definitely file just a federal return through most major tax platforms. You'll still need to make sure all the information matches what was on your state return though.
Has anyone applied for an ITIN more recently? I've heard the process is faster now than it was a few years ago. Planning to apply in June for my parents who'll be moving here and wondering if the 7-11 week timeline is still accurate.
I applied for my wife in August last year and got it back in about 9 weeks exactly. Applied outside of tax season though - I've heard it's much worse January-April.
I went through this exact same process for my spouse last year! A few key things that helped us: 1. **Document requirements**: Your wife's passport is perfect - it covers both identity and foreign status requirements in one document. You MUST send the original or a certified copy from the issuing agency (regular photocopies won't work). 2. **Filing together**: You submit Form W-7 WITH your tax return, not separately. The IRS processes them together. 3. **Mailing options**: If you're nervous about mailing original documents (totally understandable!), look into IRS Taxpayer Assistance Centers or Acceptance Agents in your area. They can verify documents in person so you don't have to mail originals. 4. **Timeline**: Applied in September last year and got the ITIN in about 8 weeks. During tax season it takes much longer. 5. **Form completion**: Make sure you check the right box for why you're applying - sounds like it would be "spouse of U.S. citizen/resident alien" in your case. The process seems overwhelming at first but it's actually pretty straightforward once you have the right documents. Your wife's passport should be sufficient as the supporting documentation. Good luck!
Giovanni Ricci
If your ex files bankruptcy, be aware that child support and alimony debts are NOT dischargeable in bankruptcy! I learned this when my ex tried to claim they didn't have to pay the judgment after filing Chapter 7. The bankruptcy court specifically excluded the support judgment from discharge, and we were able to continue collection efforts even during the bankruptcy process. Tax-wise, this became relevant because we received a large lump sum payment after the bankruptcy that included interest, which has different tax treatment than the base support amounts.
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NeonNomad
β’What about the interest on the judgment? Is that treated the same way as the original support payments for tax purposes?
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Dylan Wright
Based on my experience with a similar situation, the interest on judgments for support payments is treated differently from the underlying support amounts for tax purposes. Interest income is generally taxable to the recipient regardless of whether the principal support amounts are taxable. So in your case, any interest that accrues on the $37,000 judgment would likely be taxable income to you, even though the child support portion ($22,000) isn't taxable and the alimony portion ($15,000) may not be taxable due to your 2019 divorce timing. The IRS treats judgment interest as investment income, not as support payments. This means you'd report it on Schedule B of your 1040 as interest income. Keep detailed records separating the principal amounts from any interest awarded, as you'll need to report them differently. Also worth noting - if your state adds interest or penalties to the judgment, those typically follow the same tax treatment as regular interest income. Your court judgment should specify how much of the total award is principal versus interest/penalties.
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