After helping several people through this process, here's what you need to know about verifying a 5071C letter: • Real 5071C letters have your truncated SSN (last 4 digits only) • They reference a specific tax year • They direct you ONLY to IDVerify.irs.gov or 800-830-5084 • They never ask for direct payments • They contain specific information about your tax return • They have the official IRS letterhead and formatting If your letter doesn't have these elements, it's likely fraudulent. If you're still unsure, call the general IRS customer service line at 800-829-1040, not the number on the letter.

As someone who works in cybersecurity, I'd add that you should also check the physical characteristics of the letter itself. Legitimate IRS correspondence uses specific paper stock and printing quality that's difficult to replicate. Look for perforated edges if it's a multi-part form, consistent font spacing, and clear, high-resolution printing of the IRS seal. Scammers often use lower-quality paper or inkjet printing that looks slightly "off" compared to official government correspondence. Also, the mailing envelope should have official IRS return addresses and postmarks - never from generic PO boxes or private mailing services. When in doubt, take photos of both the letter and envelope and compare them to samples on the official IRS website before proceeding with any verification steps.

My tax guy told me something different... he said any money that passes through your hands potentially needs to be reported, even if you're just a "middleman." I've been declaring it on Schedule C for years. Am I doing this wrong??

Something nobody's mentioning - if you regularly drive far distances specifically to run these errands, you might actually be able to deduct mileage! Not as a business expense, but you could potentially classify it as charitable miles if you're helping elderly or disabled folks. Worth looking into.

Ugh, these tax rules for students are so confusing! I had a similar issue with my postdoc "salary" which they insisted on calling a "fellowship" for some reason. Ended up having to refile taxes after getting bad advice. Whatever you do, make sure your roommate keeps documentation of everything in case there's an audit later.

This is such a helpful thread! I'm dealing with a similar situation as a new grad student. One thing I'd add is that your roommate should also check if her university has a tax office or financial aid office that can help clarify how her specific stipend should be classified. My school's financial aid office was actually really helpful in explaining which parts of my funding package counted as earned income vs. unearned income. They see this question all the time and often have examples of how similar stipends have been treated by the IRS in the past. Also, if she does end up needing to withdraw the excess contribution, make sure she requests to withdraw the "excess contribution plus earnings" specifically - the IRA provider will calculate exactly how much earnings are attributable to that excess amount. Don't just guess at the number or withdraw a round amount, because that could create additional tax complications. Good luck to your roommate! The fact that she's addressing this now instead of ignoring it shows she's being really responsible about fixing the situation.

I analyzed 37 different tax transcripts last year while helping friends with their taxes. The code 150 amount is precisely your tax liability calculated on Form 1040 line 16. To determine if you owe or will receive a refund, you need to subtract this amount from the sum of your withholdings (code 806), estimated payments (code 826), and credits (codes 766, 768, etc.). For example, if your code 150 shows $2,480, and your withholdings (code 806) total $3,000, you would receive a $520 refund ($3,000 - $2,480 = $520).

Hey Yuki! I totally understand the confusion - those transcript codes are like reading hieroglyphics at first! 😅 Code 150 just means "tax return filed" and shows your calculated tax liability before any withholdings or credits are applied. Think of it as the starting point, not the finish line. Your $2,480 is what the IRS calculated you owe based on your income, but you've probably already paid some of that through payroll withholdings throughout the year. Look for code 806 (withholdings from your paychecks) and any 7xx codes (tax credits) - those will show what you've already paid or earned as credits. The bottom line of your transcript will show your actual account balance - that's whether you owe money or get a refund. Don't stress too much until you see the whole picture!

Has anyone tried just taking screenshots of each expense category in Simplywise and sending those to your accountant? That's what I did last year and my CPA said it was fine, but now this year she's saying she needs "proper documentation" whatever that means.

Am I the only one who thinks these expense tracking apps are more trouble than their worth? I went back to the old school spreadsheet method after trying 3 different apps. None of them categorize expenses correctly for tax purposes and I always end up redoing everything manually anyway.