Think of Tax Topic 151 like a yellow light at an intersection - it's not telling you to stop completely, but it is telling you to proceed with caution. Without the "Take Action" message, it's like that yellow light just came on, rather than being about to turn red. I had this exact situation in early March, and it turned out they were just verifying my healthcare premium tax credit. The refund was delayed by about 3 weeks, but I didn't have to submit anything additional. They resolved it internally and then the status changed to approved.

I can relate to your anxiety about this - medical bills waiting definitely adds pressure to the situation. Based on what I've seen in this community, Tax Topic 151 without the "Take Action" message is generally a more manageable situation than the full version. It typically means the IRS is doing an internal review but hasn't identified anything that requires immediate action from you. That said, I'd recommend checking your account transcript on the IRS website if you haven't already - it often shows more detailed codes that can give you a clearer picture of what's happening. Code 570 usually means they've put a hold on your refund, while code 971 indicates they've issued or are preparing to issue a notice. The timing can be frustrating, but many people in similar situations have seen their refunds process within 2-4 weeks without needing to take any action. Keep monitoring both your WMR status and your mail, and try not to stress too much in the meantime. The fact that you don't have the urgent action message is actually encouraging.

I dealt with this exact situation two years ago. Send a response to the CP2000 notice with: 1. A copy of your W-2 showing the Code V amount 2. A letter explaining that this amount was already taxed as ordinary income 3. The corrected Form 8949 showing the proper basis adjustment 4. Any brokerage statements showing the exercise and sale If you're worried, call the number on the CP2000 notice and explain the situation. Be prepared to wait, but once you get someone on the phone they can usually see the issue pretty quickly. Don't just pay it - you're right that this would be double taxation.

I went through this exact same scenario last year with my NSO stock options and you're absolutely correct to question the CP2000 notice. The IRS receives a 1099-B from your broker showing the gross proceeds from the stock sale, but they don't automatically know that part of your "gain" was already taxed as compensation income when you exercised the options. Here's what worked for me: I responded to the CP2000 with a detailed letter explaining that the $49,000 (or whatever your exact amount is) shown in Box 12 Code V was already included in my Box 1 wages and subjected to income tax withholding. I included copies of my W-2, my final paystub showing the stock option exercise as taxable wages, and the brokerage statements showing the exercise and subsequent sale. The key is completing Form 8949 correctly - you need to show that your cost basis includes the amount already taxed as ordinary income. In Column (e), your basis should be the fair market value at exercise (which equals the amount in Box 12 Code V), not just what you paid for the options. Don't pay this assessment! The IRS accepted my explanation and the proposed tax was reduced to zero. This is a common mix-up with stock options, and once you provide the proper documentation, they usually resolve it quickly.

Has anyone noticed that verification cases seem to follow a pattern? My tax preparer handles about 50 clients who needed verification this year. Almost all of them had their transcripts update within 14-21 days after verification. The ones who verified online through ID.me were faster (average 14 days) than those who had to call in (average 19 days). And here's the interesting part - returns with Child Tax Credit seemed to take 3-5 days longer than those without. Anyone else seeing similar patterns in their experience?

After going through verification three years in a row (yes, really!), I can tell you that the April timeline is the worst-case scenario. The IRS tells everyone the maximum time to manage expectations. My personal experience: 2022 took 8 weeks (during COVID backlog), 2023 took 4 weeks, and this year took only 17 days from verification to deposit. The system is getting more efficient. Just make sure you've actually completed verification correctly - check your email for confirmation and log into your IRS account to confirm your identity status shows as verified.

To all those having trouble reaching a human at the IRS. I just ran across this video that gave me a shortcut to reach a human. Hope it helps! https://youtu.be/wMf29SmRU-I

I'm seeing the same message too! It's been showing for about 2 weeks now and it's so frustrating not knowing what's actually going on. Based on what others are saying here, it sounds like this is pretty common right now and we might just need to wait until after the 15th for any real updates. At least it's reassuring to know I'm not the only one dealing with this vague message. Thanks for posting this - sometimes it helps just knowing you're not alone in the tax refund limbo! 😅

Has anyone used TurboTax for this situation? I'm in the same boat with no 1099 from PayPal and wondering if the software handles it smoothly or if it gets confused when you report income without a corresponding form.

This is a great question and you're absolutely on the right track by wanting to report everything properly! I went through this same situation last year with my freelance work. You definitely want to report all $8,000 as self-employment income on Schedule C, even without a 1099-K. The IRS expects you to report all income regardless of whether you receive tax forms. In fact, they're well aware that many people earn income below the various reporting thresholds. Here's what I did that worked well: - Downloaded my complete PayPal transaction history for the tax year (you can export this as a CSV file) - Created a simple spreadsheet tracking each client payment with date, amount, and client name - Kept screenshots of key transactions as backup documentation The lack of a 1099-K won't trigger any red flags - it's actually very common. What would cause problems is NOT reporting income that the IRS might later discover through their data matching systems. Make sure you also track any business expenses related to earning that income (equipment, software subscriptions, etc.) since those can be deducted on your Schedule C. Every little bit helps when you're paying self-employment taxes! You're doing this exactly right by being proactive about proper reporting.