I think everyone's missing something important here. If your employer isn't including that $650/month on your W-2, they're handling it incorrectly. They should either be treating it as taxable wages (included on your W-2) OR requiring you to substantiate your actual expenses under an accountable plan (in which case it wouldn't be taxable if your actual expenses equaled or exceeded the allowance). You should talk to your payroll department ASAP. They might need to issue a corrected W-2, or they might need to change how they're administering the car allowance program.

This situation is more common than you'd think! I dealt with something very similar last year. The key thing to understand is that your company is essentially running two different reimbursement systems - one accountable (the credit card for documented expenses) and one non-accountable (the flat $650 allowance). Based on what you've described, you'll likely need to report the $7,800 annual allowance ($650 x 12) as "Other Income" on your tax return since it's not tied to substantiated expenses. However, since you're using your personal vehicle for business, you can potentially offset some of this by deducting vehicle expenses that aren't covered by your company's credit card. The tricky part is you can't use the standard mileage rate since your employer is covering gas and maintenance. You'll need to calculate the actual expenses for things like depreciation, insurance, registration fees, and loan interest - but only the business percentage (which sounds like it would be nearly 100% given your 48k miles). I'd strongly recommend getting this clarified with a tax professional since the interaction between the allowance income and allowable deductions can get complex. Also, definitely check with your payroll department about why this isn't appearing on your W-2 - that seems like an error on their part.

This is such a comprehensive discussion! As someone who just went through this process myself, I wanted to add one more consideration that saved me from a costly mistake. Make sure to research your state's specific LLC operating agreement requirements, especially if you're planning to bring in investors or partners later. Some states have very basic default rules that might not work well for franchise operations. I initially formed my LLC without a custom operating agreement (just used the state default), but when I tried to bring in a silent investor 18 months later, we discovered the default rules didn't properly address profit distributions, management responsibilities, or what happens if someone wants to exit the business. Had to spend $3,000 on legal fees to create a proper operating agreement retroactively, plus it delayed my investor funding by 6 weeks. If I had done a custom operating agreement from the start (costs about $1,500-2,000), it would have been much smoother. Also worth noting - many franchisors now require you to submit your operating agreement as part of their approval process, so having a professional one from the beginning can actually speed up franchise approval too. The extra upfront cost for proper legal documents is definitely worth it when you're making a six-figure franchise investment!

This thread has been incredibly helpful! I'm in the early stages of franchise research myself and the level of detail here is amazing. One question I haven't seen addressed - how does workers' compensation insurance work when you have an LLC structure? I'm looking at a franchise that will require 8-10 employees, and I want to understand if having the LLC own the franchise creates any complications for workers' comp requirements or costs. In my state (Ohio), I know sole proprietors can sometimes exclude themselves from workers' comp, but I'm not sure how that works when you're an LLC member/manager. Also, does the franchise agreement typically specify anything about workers' comp requirements, or is that purely a state regulatory issue? I want to factor the insurance costs into my financial projections before making the LLC vs. personal ownership decision. Thanks to everyone who has shared their experiences - this is exactly the kind of real-world insight I needed!

Has your cousin checked her mail carefully for the past 2 years? The IRS would have sent a CP79 notice if they disallowed her EIC. Sometimes these letters look like junk mail and people throw them away. Also, did she move in the last couple years? The notice might have gone to an old address.

I went through this exact same situation with my sister two years ago! The Form 8862 requirement caught us completely off guard too. What we learned is that the IRS has automated systems that can flag and adjust EIC claims months after you've already received your refund. Here's what I'd recommend: First, have your cousin create an online account at irs.gov and check her transcript. This will show any adjustments or notices from previous years that she might have missed. Second, when filling out Form 8862 in FreeTaxUSA, be extra careful with the qualifying child requirements - the IRS is very strict about things like the residency test (child must live with her more than half the year) and making sure the SSNs are valid for work. Don't panic about the 10-year ban someone mentioned - that's only for intentional fraud cases. As long as your cousin answers truthfully and has legitimate qualifying children, she should be fine. Keep good records though - school enrollment forms, medical records, anything that proves the kids lived with her. The IRS may audit EIC claims more closely after a Form 8862 is filed. Also, make sure she hasn't claimed these same children on previous years' returns where someone else (like their father) also claimed them. That's a common reason for EIC disallowance that people don't realize happened.

This is exactly why I always tell people to keep detailed records of everything! I went through something similar with my mom's estate last year. The key thing that saved us was having her maintain a simple spreadsheet tracking all her insurance policies, loans, and any transactions. For your dad's situation, I'd also suggest requesting Form SSA-89 from Social Security if this involves any retirement accounts - sometimes there are cross-references between agencies that can help verify whether money was actually received. Also, don't overlook checking with the post office if you suspect mail theft. They can sometimes provide delivery confirmation records going back several years. One more thing - if your dad has moved addresses in recent years, make sure the IRS has his current address on file. Sometimes 1099s get sent to old addresses and the IRS assumes you received it even when you didn't. You can verify this by calling the IRS directly or checking online.

I've been through a similar nightmare with my elderly father and an incorrect 1099-MISC last year. One thing that really helped was documenting EVERYTHING with dates and reference numbers. Every phone call, every letter sent, every response received - keep a detailed timeline. Also, consider filing Form 911 (Request for Taxpayer Advocate Service) if this drags on. The Taxpayer Advocate Service is a free IRS service that can intervene when normal channels aren't working. They're especially helpful when there's financial hardship or the IRS systems have clearly made an error. Another tip - when you contact the insurance company, ask to speak with their "compliance department" or "tax reporting department" rather than general customer service. These folks actually understand 1099 issues and have access to the detailed records you'll need. Regular customer service reps often can't access the specific transaction data that proves where payments actually went. Don't give up! The burden of proof is actually on the IRS to show the income was properly reported and received. Document everything and stay persistent.

I'm so sorry to hear about your extended wait, Mae. 20 weeks is definitely beyond the normal timeframe, and your frustration is completely understandable. After reading through all these helpful responses, I wanted to share my own experience - I waited 26 weeks for my FICA refund last year and it was absolutely maddening. What finally worked for me was a combination approach: First, I called the IRS at 800-829-1040 right when they opened (7 AM) on a Tuesday morning and specifically asked to be transferred to "Accounts Management" - this is the specialized unit that handles FICA refunds. The regular customer service reps often don't have access to the right systems. Second, I also contacted the Taxpayer Advocate Service since I was well past the 12 weeks + 30 days threshold that qualifies as an "unreasonable delay." They assigned a case worker who was able to track down exactly where my application was stuck. It turned out my refund was sitting in what they called the "correspondence review" queue because the IRS had questions about one of my supporting documents, but they never sent me a letter requesting clarification. Once the advocate's office flagged this, they expedited the review and I had my refund within 3 weeks. I'd definitely recommend trying both approaches - the direct call to get immediate information about your case status, and the Taxpayer Advocate for longer-term resolution if needed. Don't give up - these refunds do eventually come through, the system is just frustratingly slow and poorly designed for tracking. Keep all your documentation handy when you call, including your certified mail receipt if you have one. Good luck!

I'm dealing with a very similar situation and this thread has been a lifesaver! I filed my FICA refund application in February 2025 (also by mail with certified delivery) and I'm now at 25 weeks with zero communication from the IRS. Like many others here, I tried the "Where's My Refund" tool multiple times before realizing it doesn't work for FICA refunds. What's really frustrating is that the IRS website makes it sound like 12 weeks is the standard processing time, but clearly that's not realistic given everyone's experiences here. I wish they would just be upfront about the actual timeframes instead of giving false hope. Based on all the advice shared here, I'm planning to call 800-829-1040 first thing Tuesday morning and ask specifically for "Accounts Management" - thanks Dylan for that tip! I'm also going to contact the Taxpayer Advocate Service since I'm well past their delay threshold. One thing I wanted to add that might help others - I've been keeping a detailed log of every attempt I've made to contact the IRS, including dates, times, and any reference numbers. Even when I get disconnected or can't get through, I document it. I have a feeling this documentation will be helpful when I finally get someone on the phone who can actually help. Mae, I really hope you get some movement on your case soon. It's ridiculous that we have to become detective investigators just to get our own money back from the government!