One thing to check that nobody has mentioned - sometimes the withholding error can be triggered by inconsistencies with your social security numbers. Check that your SSNs are entered exactly the same way on all forms (no extra spaces, dashes in the right places, etc). I had the exact same error last year and spent forever checking withholding amounts only to discover it was because my SSN was entered with dashes on some forms and without dashes on others. Free Fillable Forms treated them as different people with withholding that didn't match up!

I feel your pain with Free Fillable Forms! I had a similar nightmare last year with multiple W-2s. One thing that worked for me was to completely clear out all the withholding entries and re-enter them one by one, making sure to save after each W-2 entry. Also, double-check that you're not accidentally including any estimated tax payments or prior year overpayments in your withholding calculations. Sometimes those get mixed in and cause validation errors. If you're still stuck, try printing out the PDF of your return and manually calculating the totals yourself to compare against what the system is showing. That's how I caught my error - the system was somehow adding an extra $200 that I couldn't account for until I traced through every single line item. Good luck! These technical glitches are so frustrating when you know your numbers are right.

Does anyone know if distributions from a BDIT count as earned income? Like, will I have to pay self-employment tax on it? I'm in the same boat with a trust my grandparents set up, and I'm wondering if I should be making quarterly estimated tax payments this year.

I'm dealing with a similar trust situation and found this thread super helpful! One thing I want to add is that if you're having trouble getting organized information from your trustee, you might want to request a copy of the trust's accounting records too. The trustee should be keeping detailed records of all income, expenses, and distributions. This can help you understand exactly what happened during the tax year and verify that the information on your K-1 is correct when you finally get it. Also, for anyone else in this situation - make sure you keep copies of all the trust-related documents you receive. I learned the hard way that you'll probably need to reference them again next year, and trustees aren't always the most organized about keeping beneficiaries informed throughout the year. The tax implications of these trusts can be really complex, but don't let that scare you away from understanding the basics. Even if you end up using a professional, having some knowledge of how your trust works will help you ask better questions and catch any potential errors.

Be careful about amending unless you're absolutely certain something is wrong. I was in this situation, got impatient, and filed an amendment thinking it would speed things up. It actually reset my 120-day clock AND put me in a different processing queue that took even longer. If the IRS agent didn't specifically tell you what to fix, don't amend. Just wait it out or call again to get more specific information about why you were selected.

I'm currently going through this same process - got the 570/971 codes about 3 weeks ago and was told the same thing about random verification. What's frustrating is that the IRS website just says "processing" with no real timeline. I've been checking my transcript weekly and nothing has changed. Has anyone here actually received their refund after one of these reviews? I'm curious if the July timeline is accurate or if people are getting theirs sooner. Also wondering if there's any pattern to what triggers the "random" selection - I claimed EITC and CTC this year, which seems to be common among people getting selected based on what I'm reading here. The waiting is the hardest part when you're counting on that money for bills and expenses!

Did you claim EIC or child tax credit? Those usually take longer to process and can cause status changes like this

I wouldn't worry too much about it. The IRS systems are notoriously glitchy and status changes like this happen all the time. "Still being processed" just means they're working through their backlog - it's not necessarily a red flag. Tax Topic 152 is just their generic reference for refund processing info. As long as you don't have any actual issues with your return (like missing forms or math errors), you should be fine. The timing can vary but most people still get their refunds within the normal 21-day window even with these status changes.

Wait I'm confused... if a single-member LLC that's disregarded can't pay W-2 wages to its owner, when DOES it make sense to pay yourself a salary from your business? I've heard so many conflicting things about this.

This is a great discussion that highlights a really important distinction. I've seen this confusion come up repeatedly with small business owners who think paying themselves a W-2 salary will somehow legitimize their business or provide better tax benefits. The key takeaway here is that tax structure should follow legal structure, not personal preferences. A disregarded single-member LLC cannot create an employer-employee relationship with itself - it's legally impossible. Your friend's reasoning that it "feels more like a real business" doesn't change the fundamental tax law. Beyond the compliance issues everyone's mentioned, there are practical problems too. If your friend is filing employment tax returns (940, 941) for these phantom wages, he's creating a paper trail that doesn't match his actual business structure. This inconsistency is exactly what can trigger IRS scrutiny. The irony is that if he wants the benefits of paying himself a salary (like potential self-employment tax savings), he should consider making an S-Corp election. Then he'd be legally required to pay himself reasonable compensation as a W-2 employee, and any additional profits could be distributed without self-employment tax. But that's a completely different tax structure with its own requirements and limitations. Bottom line: work with the structure you have, not against it.