My accountant told me that with the per diem LTC policies, you should look at IRS Form 8853 instructions first. There's also a calculation worksheet in there that helps figure out the taxable amount. Don't forget that the per diem limit is adjusted each year for inflation! The 2023 limit was $370, 2024 is $390, and 2025 will be different again. Make sure you're using the correct year's limit when you do your math.

This is such a helpful thread! I'm dealing with a similar situation for my dad's LTC benefits and had no idea about all the additional qualified expenses that could be included. One thing I wanted to add - make sure you also check if your mom had any premium payments for the long-term care insurance policy itself during the year. Depending on her age, a portion of those premiums might be deductible as medical expenses, which could further reduce the taxable portion of the benefits. Also, if she received care from family members who aren't licensed care providers, those payments generally don't count as qualified LTC expenses, so don't include informal care payments in your calculations. The Form 8853 instructions are definitely your best friend here - they walk through the calculation step by step. Good luck with getting this sorted out!

Has anyone had the IRS actually question their 1099-K reporting when using Schedule 1 for personal items? I did this last year and now I'm freaking out because I just got a notice asking for more information about the "other income" I reported.

I went through this exact same situation last year and it was so stressful! I sold a bunch of old electronics, furniture, and clothes from moving and got a 1099-K for about $850, but everything was sold for way less than I originally paid. I ended up using the Schedule 1 approach that Diego mentioned - reported the full 1099-K amount as "other income" and then subtracted my cost basis on the same line. I created a simple spreadsheet listing each item, what I sold it for, and what I estimated I originally paid (even without receipts for most things). The key thing that gave me peace of mind was being very descriptive in the "other income" description field. I wrote something like "eBay sales of personal household items sold at loss - net $0 after cost basis adjustment." Filed in March, got my refund on schedule, and never heard a peep from the IRS about it. The important thing is just making sure you report the 1099-K income somewhere so the IRS computers can match it up, even if the net effect is zero taxes owed.

Clear your browsers cache and try again. Sometimes WMR just acts stupid tbh

Had this exact same issue last month! After banging my head against the wall for days, I realized I was using my AGI from last year's return instead of this year's. The WMR tool is super picky about having the EXACT numbers from your current return. Also make sure you're not including cents if your refund amount is a whole number - that little detail trips people up all the time. Hope this helps!

Filed March 1st, got my refund last week. No rhyme or reason to how they process these things honestly

I'm in the same boat - filed mine in late January and still showing "processing" on the NYS website. It's really frustrating not knowing what's going on or having any realistic timeline. At least with federal returns you usually get some kind of update, but NYS just leaves you hanging. Has anyone tried calling their taxpayer services line? Wondering if it's worth the inevitable hold time.

I've been dealing with similar complexity in my returns for the past few years, including foreign accounts and investment income. After going through a correspondence audit in 2022 (thankfully not a full audit), I can share what I learned about audit protection services. First, definitely get protection if your returns are this complex. The peace of mind alone is worth it. I ended up going with a standalone policy through a company that specializes in international tax issues rather than the basic protection from tax software companies. Cost me about $400/year, but it covers representation for all types of audits and includes some penalty protection. One thing I wish I'd known earlier: some protection plans have waiting periods, so you can't buy coverage after you've already been selected for audit. Also, make sure whatever service you choose has experience with FBAR issues specifically - the penalties for those can be brutal and not all tax professionals are familiar with the nuances. The preventive approach mentioned with taxr.ai sounds interesting too. Catching issues before filing seems smarter than just hoping you don't get audited. Given your situation with foreign accounts and multiple income sources, I'd probably recommend both - prevention analysis before filing AND audit protection for peace of mind.

Based on my experience with complex returns including foreign accounts, I'd strongly recommend getting audit protection - but be strategic about it. The key is finding coverage that specifically handles international tax issues, not just generic audit protection. A few things to consider: 1. **Look for FBAR expertise**: Many basic audit protection services don't have staff familiar with foreign account reporting requirements. The penalties for FBAR mistakes can be devastating (potentially 50% of account balances), so you need someone who knows this area. 2. **Consider the timing**: Most protection plans only cover audits for returns filed AFTER you purchase the coverage. So if you're thinking about it, don't wait. 3. **Combine approaches**: Given your complex situation, I'd suggest both preventive analysis (like the taxr.ai tool others mentioned) AND traditional audit protection. Prevention is always cheaper than dealing with problems after they happen. 4. **Ask your CPA first**: Since they already know your situation, see if they offer audit protection services or can recommend someone who specializes in international tax issues. For someone with your level of complexity (foreign accounts, investment income, side business), the annual cost of good protection ($300-500) is probably much less than what you'd pay to resolve even a minor audit issue. The stress reduction alone makes it worthwhile in my opinion.