Has anyone else noticed that HR Block software doesn't group wash sales properly? Last year I had similar issues and switched to TurboTax, which actually combined my wash sales into summary transactions correctly. Saved me about 100 pages on my return. Might be too late for OP this year but worth knowing for next time. Also, getting an ITIN for your spouse will solve the paper filing issue in future years too. The form is W-7 and you can submit it with your return.

I'm dealing with a very similar situation right now! Also married to a non-resident alien and having to file MFS with paper returns. The wash sale rules are definitely making everything more complicated than it needs to be. One thing I learned from my tax preparer is that you can actually request an extension (Form 4868) to buy yourself more time to figure out the best approach. This might give you breathing room to explore some of the summary options people mentioned here, or even get that ITIN application started for your spouse. Also, regarding the wash sales specifically - if you're showing a net loss anyway, you might want to double-check that HR Block is calculating the wash sale adjustments correctly. Sometimes the software can be overly aggressive in flagging transactions as wash sales when they might not technically qualify under the 30-day rule. Have you considered consulting with a tax professional who specializes in international tax situations? They might have experience with creative solutions for these exact circumstances that could save you from printing a novella!

One thing nobody mentioned yet - when you mail in your paper return claiming the dependent that was already claimed, it will trigger what's called a "duplicate dependent investigation" automatically. The IRS will send notices to both you and the other party who claimed the child. Don't be alarmed when you get this notice! It's just part of the process. Make sure you respond to any IRS letters within the timeframe they specify (usually 30 days).

I'm going through something very similar right now with my nephew who I've had custody of for two years. His mom claimed him even though she hasn't seen him since last spring. One thing I learned is that you should also keep detailed records of things like school enrollment forms, medical appointments, and even grocery receipts that show you're buying food for the child. The IRS wants to see proof that the child actually lived with you and that you provided more than half their support. Also, if you have any documentation from social services or the court system about the foster placement, make sure to include copies of those with your paper return. The clearer you can make it that you're the legal caregiver, the stronger your case will be when they investigate the duplicate claim. Don't let the bio parents intimidate you out of claiming what you're legally entitled to. You're doing the right thing by fighting this!

I'm completely new to dealing with tax transcripts and just discovered I have a 570 code too! Filed my return on February 22nd and the code showed up about a week ago. Reading through all these experiences has been incredibly reassuring - I had no idea this was so common! It sounds like most people's situations resolved within 2-3 weeks without needing to take any action, which is such a relief. I was worried I'd made some major error on my return. Quick question for those who've been through this - did anyone's "Where's My Refund" tool change at all while you had the 570 code, or did it just stay on "still processing" the entire time until it resolved? Also, when it did resolve, did your refund come pretty quickly after the code disappeared? Thanks so much to everyone sharing their experiences - this community is amazing for helping newcomers like me understand what's going on!

I'm also completely new to understanding tax transcripts and just found out I have a 570 code! Filed on February 20th and noticed the code appeared on my transcript just two days ago. This thread has been such a lifesaver - I was honestly panicking thinking I'd made some huge mistake on my return. It's incredibly reassuring to read that this is actually pretty common and that most people's codes resolve automatically within a few weeks without any action needed. I keep wanting to call the IRS immediately, but based on everyone's experiences here, it sounds like patience really is the best approach (even though the waiting is torture when you're counting on that refund!). For those of you who had your 570 codes resolve - did you notice any pattern in terms of what day of the week your transcript updated? I've been checking randomly but wondering if there's a better strategy. Thanks so much to everyone for sharing their experiences - this community is amazing for helping us newcomers navigate this confusing process!

I'm going through something similar right now. Did you write your Social Security number on your check when you sent the payment? I found out that if you don't include your SSN and tax year on the check, sometimes they have trouble applying it correctly.

This is exactly what happened to me last year! The CP503 is definitely more serious than the CP14, so you're right not to ignore it. Here's what I learned from my experience: First, gather ALL your payment documentation - the canceled check, bank statements showing it was cashed, and any payment confirmations you have. The IRS will need specific details like the exact date the check was processed and the check number. When you do reach someone at the IRS, ask specifically for a "payment tracer" - this is their internal process for tracking down misapplied payments. In my case, they had applied my payment to a different tax year because of a processing error on their end. One thing that really helped me was keeping detailed notes of every call - date, time, agent's ID number, and what they told me. If you get disconnected or need to call back, this information can help the next agent pick up where you left off. Also, if they do find the payment was misapplied due to their error, make sure to request that any penalties and interest be removed since it wasn't your fault. They can do this, but you have to specifically ask for it. Don't panic - this is fixable, it just takes persistence to get through to the right person who can trace your payment!

Just wondering - did the state notify you when they applied your overpayment to a different year? We had something similar happen but never received any communication. Only discovered it when preparing for this year's filing.

This is a common issue that many businesses face! Since you're on cash basis accounting, the journal entry suggested by others is correct - you'll want to debit your tax expense account and credit the franchise tax receivable to remove it from your balance sheet. One additional tip: consider setting up a monthly or quarterly reconciliation process for your tax accounts to catch these situations earlier. States often apply credits and make adjustments without notification, so regular review of your receivables against actual refunds received can help identify discrepancies before they become bigger accounting headaches. Also, make sure to keep detailed documentation of the state's communication about where they applied your overpayment. This kind of supporting documentation is invaluable if you ever face questions about the adjustment during an audit or review.