One strategy that worked for me in a similar situation was filing Form 8857 (Request for Innocent Spouse Relief) again, but with significantly more documentation. I was denied the first time like your friend, but on my second attempt I included much more detailed evidence of my ex's financial concealment and control. The key was getting very specific about which tax items on the return were attributable solely to my ex-spouse. I went line by line through our joint returns and documented with bank statements, emails, and other records showing which income items were completely unknown to me and which deductions were fraudulent. Has your friend considered this route? The appeal being exhausted doesn't necessarily mean she can't file again with new, more compelling evidence.

Your friend's situation is unfortunately very common, and I've seen several people in similar circumstances successfully resolve their tax debt despite having a non-cooperative ex-spouse. The key is understanding that the IRS treats joint filers as "jointly and severally liable" - meaning they can collect from either spouse regardless of who actually earned the income. For the OIC process, your friend can absolutely proceed without her ex's participation. The IRS will evaluate her current financial situation independently. Given her $110K income, she'll need to demonstrate that paying the full amount would create genuine economic hardship, especially considering her ongoing expenses for her college-age children. One important point about potential civil recovery: if her OIC is accepted and she pays a reduced amount, she could potentially sue her ex for his proportional share of what she paid (not the original debt). This would be handled in state court as a contribution claim, but she'd need to prove his share of the original tax liability. I'd strongly recommend she work with a tax professional who specializes in OIC cases involving divorced couples. They can help structure the offer to highlight the hardship created by her ex's deliberate asset concealment and non-cooperation.

As a newcomer to this community, I'm finding this discussion incredibly valuable! I'm dealing with my first Section 751 situation and was feeling overwhelmed by the complexity, but reading through everyone's responses has really clarified the process. I particularly appreciate the consensus that emerged - trust the partnership's Section 751 calculation on the K-1 and let the ordinary income flow through to Schedule E naturally. The practical tips about documentation, client communication, and estimated tax planning considerations have been especially helpful. One question I have as someone new to this: are there any red flags I should watch for on K-1s that might indicate the partnership made an error in their Section 751 calculation? I want to make sure I'm not just blindly accepting the partnership's work without doing my due diligence as the individual return preparer. Also, does anyone have recommendations for continuing education resources specifically focused on partnership taxation? This thread has shown me how much more I need to learn about these complex interactions between partnership and individual reporting. Thanks to everyone who shared their expertise here - this community is an incredible resource for practitioners at all levels!

As a newcomer to this community, I'm really impressed by the depth and quality of this discussion! I'm currently studying for the EA exam and partnership taxation has been one of my most challenging areas, so reading through this thread has been incredibly educational. I wanted to ask about one aspect that hasn't been covered yet - when dealing with Section 751 gain from PTP sales, are there any special considerations for state tax reporting? I know some states have different treatment for partnership income, and I'm wondering if the Section 751 ordinary income characterization always flows through consistently at the state level, or if there might be state-specific adjustments needed. Also, for those who mentioned using various software solutions and services like taxr.ai and Claimyr, do you find that state tax complications are something these tools help with, or do you typically need to research state-specific partnership rules separately? The consensus here about trusting the partnership's K-1 characterization and letting it flow to Schedule E makes perfect sense for federal purposes, but I want to make sure I'm not missing any state-level nuances that could affect the overall tax picture for partners. Thanks to everyone who has contributed to this thread - it's been an amazing learning experience!

I'm currently going through this exact same situation and it's so frustrating! My employer from 2023 apparently never submitted my W-2 to the SSA, and I've been in this 60-day review limbo since early February. What's really helpful reading through all these responses is seeing the specific steps people took to resolve it. I think I've been too passive just waiting for the IRS to figure it out on their own. Based on what everyone's sharing, it sounds like I need to: 1. Get that wage and income transcript to show my employer exactly what the IRS has on file (or doesn't have) 2. Push my employer's payroll department specifically to file the W-2c 3. Consider filing Form 4852 as backup documentation 4. Be more aggressive about following up rather than just waiting The mention of specific transaction codes like TC 570 and TC 571 is really useful too - I should probably get my transcript analyzed to understand exactly where I am in the process. It's reassuring to hear that most people who took proactive steps got their issues resolved in 70-90 days rather than the "much longer than 60 days" timeline the IRS rep told me. Thank you all for sharing your experiences - this gives me a much clearer roadmap for moving forward!

I'm dealing with a nearly identical situation right now - my former employer apparently never filed my W-2 with the SSA for 2023, and I've been stuck in this review process since late February. Reading through all these responses has been incredibly eye-opening about how proactive I need to be. What's really striking is how consistent the advice is across everyone's experiences: don't just wait for the IRS to resolve it automatically. I've been making the mistake of assuming they'd eventually figure it out on their own, but it sounds like the people who took charge of the situation got much faster results. I'm definitely going to request both my wage and income transcript AND my account transcript this week to see exactly what codes are showing up and what the IRS actually has on file. Then I can take that concrete evidence to my employer's payroll team - no more letting them brush me off with "we'll look into it." The Form 4852 option is something I hadn't considered either, but it makes sense as a backup plan while pushing the employer to file the corrected W-2c. Has anyone here had experience with the IRS accepting Form 4852 documentation when the employer eventually does submit the corrected information? I'm wondering if filing both creates any complications or if it actually helps demonstrate that you're providing consistent wage information from multiple sources. Thanks to everyone who shared their timelines and specific steps - this thread is going to save me months of frustration!

11 Whatever you do, make sure to get the stock sale documented properly with a written agreement signed by all parties. I left an S corp a few years back without proper documentation and it was a nightmare when the IRS questioned the transaction later.

One additional consideration that hasn't been mentioned yet - since you're an S corp shareholder exiting at a significant discount to fair market value, you should also think about the impact on any buy-sell agreements or operating agreements that might exist. Many S corps have provisions that could be triggered by share transfers, and selling at par value when the actual value is much higher might create complications with existing shareholders' rights or trigger valuation disputes later. Also, if your S corp has ever made Section 1202 qualified small business stock elections, there could be additional tax planning opportunities or pitfalls to consider with the timing and structure of your exit. The 5-year holding period and other QSBS requirements might affect whether a redemption vs. cross-purchase makes more sense from a long-term capital gains perspective. I'd definitely recommend running this by both a tax professional and the company's attorney before finalizing anything, especially given the complexity that can arise when there's a big gap between sale price and fair market value.

Don't forget about state tax requirements too! I found out California recommends keeping records for 4 years from filing date, not 3. Different states have different rules.

Just wanted to add my experience as someone who went through an actual IRS audit last year. I kept 7 years of records and it was MORE than enough. The audit was for my 2021 return (filed in 2022) and they only asked for documents from that specific tax year - nothing older. The auditor told me that unless there's suspected fraud or you drastically underreported income (like 25%+ missing), they rarely need to go back further than the return they're examining. Most audits are triggered by specific items on a particular return, not patterns across multiple years. That said, definitely keep property records until you sell + 3 years like others mentioned. I still have my house purchase docs from 2019 and all improvement receipts because those will matter when I eventually sell. But for regular W-2s, 1099s, and basic tax documents? 7 years has been perfectly fine in my experience.