Something important that nobody has mentioned yet - you need to make sure you're still explicitly electing Section 179 on your Form 4562 even though the deduction is completely phased out this year. If you don't make the election, you can't carry forward the disallowed amount!

This is such a helpful discussion! I'm dealing with a similar situation where we purchased $3.2 million in equipment this year and got completely phased out of Section 179. Reading through everyone's responses, I think I need to seriously consider the bonus depreciation route that Natalie mentioned instead of carrying forward the Section 179. Quick question for the group - if I'm understanding correctly, with bonus depreciation at 80% for 2024, I could potentially deduct $2.56 million this year ($3.2M × 80%) versus waiting to use a Section 179 carryforward in future years when bonus depreciation will be lower? That seems like it could be significantly more advantageous, especially since bonus depreciation drops to 60% next year. Has anyone done the math comparison between taking bonus depreciation now versus Section 179 carryforward for large equipment purchases?

Has anyone had success requesting abatement online through the IRS account portal rather than mailing in Form 843? I thought I saw something about being able to do it electronically now but can't find clear instructions.

Based on your situation, you have an excellent case for both penalty and interest abatement. Since you maintained perfect compliance for years while overseas and the IRS clearly had your correct address on your filed returns, this is a textbook example of IRS error causing unnecessary penalties and interest. Here's what I'd recommend doing immediately: 1. **Get your account transcripts** - Download transcripts showing your filed returns with the correct address vs. the notices with the wrong address. This is your smoking gun evidence. 2. **File Form 843** - Request both penalty AND interest abatement. Be very specific about the interest abatement request citing IRC 6404(e) and explain how the IRS error in using the wrong address caused unreasonable delay. 3. **Document everything** - Include copies of your returns showing correct address, copies of notices showing wrong address, and evidence of your clean compliance history. The fact that you paid immediately upon discovering the issue actually strengthens your case - it shows good faith and that you're not trying to avoid payment, just seeking relief from charges that shouldn't have accrued. Don't be surprised if the penalty abatement gets approved quickly (you clearly qualify for First Time Penalty Abatement) but the interest takes longer. Interest abatement has a higher bar but your address documentation should meet the "unreasonable IRS error" standard.

Has anyone used one of those tax relief companies that advertise on the radio for an OIC? They claim they can settle for "pennies on the dollar" but I'm wondering if they're worth the fees they charge.

I'm currently in the middle of my OIC process (submitted about 4 months ago) and wanted to share what I've learned so far since you're just getting started. The biggest thing that's helped me is staying incredibly organized with a dedicated filing system for every single document. I created separate folders for initial application materials, correspondence with the IRS, financial documentation, and backup copies of everything. This has been a lifesaver when they've requested additional info. One thing I wish I'd known upfront - the IRS can take 6-24 months to process your offer, and during that time you MUST stay current on all new tax obligations. If you fall behind on estimated payments or filing requirements while your OIC is pending, they'll automatically reject your offer. I almost learned this the hard way. Also, don't let the anxiety get to you too much. Yes, it's intimidating dealing with the IRS directly, but if you're thorough with your documentation and honest about your financial situation, the process is more straightforward than it seems. The IRS agents I've spoken with have actually been professional and helpful when I've had questions. Good luck with your application! Feel free to ask if you have specific questions about the forms - I'm still fresh on all the details.

Have you checked if you accidentally included Form 8949 with basis not reported to IRS? I had this same error and it turned out I had checked the wrong box for some stock sales, indicating the basis wasn't reported to the IRS when it actually was. TurboTax is really bad about explaining which specific forms are causing e-file issues. Sometimes it helps to go through your return using the Forms view rather than the interview format to spot issues.

I've been following this thread and wanted to share another common cause of e-filing rejections that hasn't been mentioned yet - Form 1116 for foreign tax credits. Even if you don't think you have foreign income, sometimes investment accounts or mutual funds generate small amounts of foreign tax that create this form automatically. Also check if you have any estimated tax payments (Form 1040ES) that might have been entered incorrectly. If the payment dates or amounts don't match what the IRS has on record, it can trigger an e-file rejection. One more thing to try: in TurboTax, go to Federal Taxes > Wages & Income > Show All Income, then look for any items marked with warning triangles or error indicators. Sometimes there are validation issues that only show up in this summary view, not during the regular interview process. If all else fails, you might need to temporarily remove sections of your return one by one and try to e-file after each removal to isolate which specific area is causing the problem. It's tedious but often the only way to identify the culprit when TurboTax won't tell you directly.

Has anyone calculated how much money you lose by getting a huge refund like this? I mean $22k sitting with the IRS for a year instead of in your pocket is a serious opportunity cost.

The $22k refund is definitely a sign of significant overwithholding! Based on what you've shared, the most likely culprit is that both you and your spouse selected "Married Filing Jointly" on your W4s without accounting for having two incomes. Here's what probably happened: The withholding tables assume when you check "Married Filing Jointly" that you're the primary or only earner. When both spouses do this, you end up withholding as if each income is taxed at lower brackets, but when you file jointly, your combined income pushes you into higher tax brackets - creating a massive overwithholding situation. Quick fixes to try: 1. Both of you should check box 2(c) on new W4s ("If there are only two jobs total, you may check this box") 2. Stop that extra $175/paycheck your spouse is withholding 3. Consider using the IRS withholding estimator to fine-tune You'll want to submit updated W4s ASAP since you're essentially giving the government an interest-free loan on $22k. At current savings rates, that's nearly $1,000 in lost opportunity cost per year!