I see so many of these stories lately! The IRS systems are completely overwhelmed and their error rate seems to be getting worse. One thing to consider if this doesn't get resolved quickly - the Taxpayer Advocate Service can help with these kinds of issues, especially when there's a risk of financial hardship. They're an independent organization within the IRS. Just remember to document EVERYTHING. Every call, letter, the name of every IRS employee you speak with, dates, times - create a paper trail so detailed that nobody can question your due diligence. It might seem excessive, but if this drags on, that documentation will be your best defense.

I'm glad to see you're making progress on this! Just wanted to add a few more tips that helped me when I dealt with a similar CP2000 issue: 1. When you send your written response, use certified mail with return receipt requested. This gives you proof the IRS received it and when. 2. Keep calling that same IRS number periodically to check on the status. Sometimes these cases get stuck in the system and a follow-up call can move things along. 3. If you haven't already, pull your Social Security earnings record from ssa.gov to verify what employers actually reported wages under your SSN. This can help identify if there are other discrepancies you're not aware of. The fact that they already identified it as a clerical error with someone else's information is a great sign. Usually once they acknowledge the mistake internally, the resolution moves pretty quickly. You should be in the clear soon!

Has anyone used the IRS Identity Protection PIN system? After my sister went through this nightmare last year, our whole family signed up for IP PINs to prevent fraudulent filings. You get a new PIN each year that must be used when filing.

I went through this exact same situation last year with the IND-517-01 reject code, and I totally understand the panic! In my case, it turned out my ex-spouse had claimed our shared dependent without discussing it with me first (we alternate years but he got confused about whose turn it was). Here's what I learned: Don't assume it's identity theft right away - sometimes it's just miscommunication between divorced parents, or like someone mentioned, a FAFSA filing error. But definitely don't ignore it either. My recommendation is to call the IRS Identity Protection line that Zoe mentioned, but also think through anyone else who might have a legitimate reason to claim your dependents - ex-spouses, grandparents who provided significant support, etc. Sometimes a quick phone call can resolve things faster than going through the full identity theft process. The paper filing route is unavoidable at this point, but include a detailed cover letter explaining your situation. The IRS agents reviewing these cases see them all the time and are usually pretty good at sorting out the legitimate vs fraudulent claims. Good luck!

Since you'll be transitioning between different arrangements (pre-LLC temp work, LLC work, and potentially regular employment), make sure you keep extremely detailed records of: 1) Dates worked for each family/client 2) Amount paid and payment method 3) Who controlled the work terms for each position 4) Any expenses you incurred This will be super helpful when tax time comes. I learned this the hard way after working as both a nanny and running a small childcare service from my home. Also, don't forget that even if the family doesn't need to issue a W-2 because you're under the threshold, ALL income still needs to be reported on your tax return, regardless of where it came from.

As someone who navigated a similar situation with my own childcare business, I'd recommend keeping it simple while you're in this transition period. Since you're under the $2400 threshold and it's temporary, you can continue with the current Venmo arrangement, but make sure you're documenting everything properly. Here's what I learned from my experience: 1) Keep detailed records of all payments, dates, and hours worked - this protects both you and the family 2) Even though they won't issue a W-2, you still need to report all income on your personal return (not your LLC return) since you're technically their household employee 3) Consider having a simple written agreement that outlines the temporary nature of the arrangement and expected end date Once you transition to finding regular babysitting clients through your LLC, you can then operate as a true independent contractor with proper business practices. The key is keeping these two income streams separate in your records - the nanny income goes on your personal return, and future LLC babysitting income goes through your business. Don't overthink it for now - just focus on good documentation and proper reporting when tax time comes!

Just a heads up, the taxation of scholarships also depends on what type of visa you have. I'm on F-1 and discovered that we're generally considered "non-resident aliens" for tax purposes during our first 5 calendar years in the US, which means different tax rules. I messed up last year by using TurboTax, which doesn't handle international student taxes correctly. Sprintax is actually better for our situation, so I think you're using the right software.

I completely understand your panic - I went through the exact same shock last year! The $3,300 bill sounds about right if a significant portion of your scholarship was used for living expenses rather than tuition. Here's what likely happened: when you entered your total scholarship amount into Sprintax, it correctly identified that only the portion used for qualified educational expenses (tuition, required fees, books) is tax-free. The rest - anything used for housing, meals, personal expenses - is taxable income for international students. As an F-1 student, you're considered a non-resident alien for tax purposes, which means stricter rules apply to scholarship taxation compared to US citizens. The good news is that if you can document exactly how much of your scholarship went directly to tuition and required fees, you can reduce the taxable amount. I'd recommend going back through your Sprintax filing and double-checking that you properly separated qualified vs non-qualified expenses. Also, since you're from Malaysia, check if the US-Malaysia tax treaty provides any student benefits that might apply to your situation. Don't lose hope - there are often ways to reduce what you owe once you understand the rules better!

17 Has anyone dealt with state taxes for NRAs? I understand the federal rules a bit better now, but I worked in California and they're notorious for aggressive tax collection. Do the same NRA exemptions apply at the state level?

This thread has been incredibly helpful! As someone who just moved from the US back to my home country and is facing similar capital gains questions, I wanted to add a few points that might be useful: 1. **Documentation is key** - Keep detailed records of when you received company shares, your employment dates, and when you left the US. The IRS may need this to determine if gains are ECI. 2. **Vesting vs. Sale timing matters** - Even if shares vested while you were in the US, selling them after becoming an NRA can change the tax treatment. The "source" of the income becomes important. 3. **Watch out for Form 8833** - If you're claiming treaty benefits to reduce or eliminate US tax on capital gains, you might need to file this form along with your 1040-NR. 4. **FIRPTA considerations** - While most stock sales aren't affected, if you have any US real estate investments, there are different rules under the Foreign Investment in Real Property Tax Act. The tax treaty angle mentioned earlier is really important. Many countries have specific provisions for capital gains that can override the general ECI rules. Definitely worth looking into your specific country's treaty with the US. Thanks to everyone who shared their experiences - this kind of real-world insight is so much more valuable than trying to parse through IRS publications alone!