Just want to add something important - if you're claiming the Child Tax Credit with no income, make sure your child has lived with you for more than half the year (183 days). The IRS is really strict about this requirement, and it's one of the things they check carefully since this credit is frequently claimed incorrectly. Also, your child needs to be under 17 at the end of the tax year to qualify. If they turned 17 during 2023, unfortunately you can't claim the Child Tax Credit for them for that year.

I did this exact thing last year! Filed with zero income as a disabled parent and still got $1,500 for my daughter through the Additional Child Tax Credit. Used the free version of TaxAct to file. Just make sure to complete Schedule 8812 along with your 1040 - that's where you calculate the refundable portion. One thing nobody mentioned yet - your qualifying child must also not provide more than half of their own support. Shouldn't be an issue for young kids, but something to keep in mind if you have an older teen who might have had some income of their own.

Pro tip: sign up for informed delivery with USPS so you know when its coming

Just went through this last year - can confirm it's always a paper check for 1040X refunds. The IRS systems don't link your amended return to your original direct deposit info for security reasons. Since you mentioned it's a big amount, definitely set up that USPS Informed Delivery like Axel suggested. Also keep checking "Where's My Amended Return" on the IRS website for status updates. The wait is painful but hang in there!

Has anyone mentioned Form 6252 yet? You'll need to file this for the installment sale income. When I inherited part of my father's business note, I had to get a copy of his previous Form 6252 to see how he calculated the gross profit percentage. Also, don't forget that when you receive the 1099-INT from the payor for the interest portion, you need to make sure you're not double-reporting income. The interest goes on Schedule B, while the capital gain portion of each payment (calculated using the gross profit percentage) goes on the installment sale form.

Building on the excellent advice already given, I want to emphasize a few critical points that could save you significant headaches: First, regarding the estate vs. direct distribution issue - while technically the promissory note should have gone through probate as personal property, the practical impact may be minimal if beneficiaries are receiving their correct proportional shares. However, you should definitely consult with your estate attorney about whether to file a Form 1041 for the estate or issue K-1s to beneficiaries. This decision affects where the tax liability sits. Second, the step-up basis issue is unfortunately clear-cut - installment obligations don't receive step-up treatment under IRC Section 1014(c). The original sale created the installment obligation, and that's what was inherited, not the underlying property. Even with the security interest, you inherited the right to payments, not ownership of the real estate. For reporting, you'll need your father's final Form 6252 to determine the gross profit percentage that continues to apply. Each payment you receive will be split between: (1) return of basis (not taxable), (2) gain recognition (capital gains), and (3) interest (ordinary income). Given the multi-state complexity (NC/WV) and the estate administration questions, I'd strongly recommend getting professional help from a tax attorney or CPA experienced with installment sales and estate taxation. The potential tax savings from proper planning could easily justify the professional fees. One last note - make sure you're keeping detailed records of all payments received and how they're being distributed among beneficiaries. The IRS will want to see this documentation if they ever examine the returns.

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!