Has anyone ever had success getting the withholding returned directly from the IRA custodian instead of waiting for tax filing? I had a similar situation last year with Fidelity and after enough complaining they actually reversed the transaction completely and reprocessed it correctly as a return of contribution with no withholding.

This is a frustrating situation but definitely fixable! You're right that this should have been processed as a return of contribution rather than a regular distribution. The 20% withholding was unfortunate but standard procedure when custodians process regular withdrawals. A few key points to help you navigate this: 1. **Timing matters**: Since this was a same-year contribution and withdrawal, you have a good case for treating it as a return of contribution, which would avoid the 10% early withdrawal penalty. 2. **Documentation is crucial**: When you file your 2025 return, include a clear statement explaining that this was intended as a return of excess contribution made in the same tax year. Be specific about the dates of both the contribution and withdrawal. 3. **Check your 1099-R**: Look at Box 7 for the distribution code. If it shows "1" (early distribution), you might want to contact your IRA custodian to see if they can issue a corrected form with code "8" (return of contribution). This could save you headaches later. 4. **The withholding will come back**: You'll get that $1,400 back when you file your return - it will be credited as taxes paid, likely resulting in a larger refund. The silver lining is that this is a common enough situation that tax software and preparers know how to handle it properly. Just make sure to document everything clearly!

Code 571 means they lifted the freeze on your account and 846 is the actual refund issuance! Based on your transcript, looks like the 810 freeze from March got resolved. The 846 date is usually pretty accurate - that's when it should hit your account. After 8+ months of waiting, you're finally in the clear! 🎉 Just make sure your direct deposit info is still current in case they need to update anything.

Congrats! Those are definitely the codes you want to see! 🎉 The 571 code means the IRS released whatever hold was on your account (that 810 freeze from March), and 846 is the golden ticket - that's your refund being issued. The date next to the 846 is when it should hit your bank account, usually pretty accurate within 1-2 days. After waiting since March with that freeze, you're finally at the finish line! Just double check that your bank info is still correct in case anything changed since you filed. Been through this myself and those codes delivered exactly when promised!

Something important to remember about AMT and self-employment income: the self-employment tax deduction (the employer portion of FICA taxes) doesn't get added back for AMT purposes. This is one adjustment that actually works in your favor! Also, if you're using Section 179 expensing for business equipment, be aware that AMT might require you to depreciate those assets over a longer period, which affects your AMTI calculation.

Speaking from experience, don't forget to check if you qualify for the AMT exemption phaseout with your combined income. When I added my side hustle to my W2 job last year, it pushed me into the phaseout range which really screwed up my calculations. For 2025, the exemption begins phasing out at $1,079,800 for married filing jointly and $539,900 for single filers. The exemption reduces by 25 cents for each dollar of AMTI above these thresholds.

My sister and I both got these notices. She used taxr.ai to figure out what was up and got her refund 2 weeks later. Something about her W2 triggering a review. Im gonna try it too tbh

Got mine about 10 days ago too! Super frustrating because I was counting on that refund for some bills. From what I've read online it's happening to a lot of people this year - seems like they're being extra cautious with reviews. Hang in there, hopefully it doesn't take the full 120 days 🤞

Welcome to the high-tax club! I'm also a recent grad in California and went through the exact same shock. A few things that helped me understand what was happening: First, that 31% includes both your portion AND what feels like every tax California can think of. You've got federal income tax (probably around 12% at your salary), California state income tax (6-9% depending on your exact income), Social Security (6.2%), Medicare (1.45%), and that SDI (State Disability Insurance) at about 1.1%. The good news is you'll likely get some of this back when you file taxes, especially if you have student loan interest, contributed to a 401k, or qualify for other deductions. I got back about $2,800 my first year. Also check if your employer offers pre-tax benefits like health insurance, HSA, or 401k contributions - these reduce your taxable income and can lower your withholding. Even contributing just 3% to a 401k would save you money on taxes while building retirement savings. It sucks seeing such small paychecks, but you're not alone! California is expensive but the career opportunities often make up for it in the long run.

I feel your pain! Just went through this exact same situation last year when I started my first job in San Francisco at $58k. That 31% withholding rate hit me like a truck too. Here's what I learned: California really does have some of the highest tax rates in the country, but there are legitimate ways to optimize your situation. First, double-check that you filled out your W-4 correctly - the new form can be confusing and small mistakes can cost you hundreds per month. Second, if your employer offers a 401k with matching, definitely take advantage of it even if money is tight. Contributing even 3-4% pre-tax will reduce your taxable income and lower your withholding immediately. For example, on a $55k salary, contributing 3% ($1,650/year) could save you roughly $400-500 in taxes, which comes back to you throughout the year in smaller withholdings. Also look into whether you qualify for the California Earned Income Credit or other state credits. And keep track of any work-related expenses, student loan interest, or other deductible items. The first year is always the hardest financially, but once you get your withholdings optimized and understand the system better, it gets much more manageable. Hang in there!