Is there a minimum amount that would trigger an audit for amended returns? I'm in a similar situation but only looking at around $400 in potential credits for last year.

There's no official minimum threshold that guarantees safety from an audit. The IRS doesn't disclose their exact selection criteria. However, smaller amendments are generally less likely to raise red flags than larger ones. For a $400 credit, the risk is relatively lower, but remember that any amended return has a slightly higher chance of review than an original return. The key is ensuring you have proper documentation to support your position if questioned - keep all your tuition statements, proof of payment, and any documentation about your fellowship/tuition reduction status.

How do you determine which category your funding falls into? My stipend paperwork just says "Graduate Assistant Stipend" but doesn't specify if it's for services or just support.

That's really helpful - I'll make sure she focuses on those specific credits first. Is there anything else she should have ready besides the Form 8867 and supporting documentation?

She should also have her written due diligence procedures available - even if it's just a basic checklist of what she asks clients and what documents she collects. The IRS wants to see that she has a consistent process. Also have her review her records for any cases where she might have rejected claiming a credit when a client couldn't provide adequate documentation. This shows the IRS she's not just rubber-stamping everything. And remind her that they'll likely ask questions about her knowledge of the eligibility requirements for these credits, so a quick review of the current rules wouldn't hurt.

Is there a way to know which returns they'll select? My practice got notice of a visit too and I'm freaking out trying to organize everything!

What about companies formed in 2023? I thought we had different deadlines than older companies. Does this pause affect all businesses the same way?

Companies formed in 2023 fall under the "existing entities" category, which originally had until January 1, 2025 to file their initial reports. Companies formed in 2024 have 90 days from formation to file. The enforcement pause affects all businesses subject to the CTA equally - regardless of when they were formed. However, it's important to note that the technical legal requirement still exists for all applicable businesses, even though there's no enforcement mechanism currently in place. My recommendation remains to prepare your information so you're ready when enforcement resumes, which it almost certainly will.

You didn't waste your time. If anything, you're ahead of the game. The database still exists and your information is properly recorded. When enforcement resumes (which most experts think it will), you won't have to scramble like everyone else.

Thanks, that's reassuring but quick follow-up question - what if my brother ends up not filing at all? Would that mean we only claimed 80% of the policy (my 20% + parents 60%)? Would that cause issues?

If your brother doesn't file at all, that wouldn't necessarily create problems regarding the Premium Tax Credit. The IRS is primarily concerned with making sure no more than 100% of a policy is claimed. Claiming less than 100% might mean some of the credit goes unclaimed, but it's not a compliance issue. However, if your brother was required to file a tax return (based on his income and situation) and received advance premium tax credits, he actually must file a return to reconcile those credits even if he otherwise wouldn't be required to file. Failure to file in this case could result in him being ineligible for advance premium tax credits in future years.

Yes, CashApp Taxes (formerly Credit Karma Tax) does generate Form 8962 correctly including Part IV allocations, even though the user interface doesn't explicitly show this section. I was worried about this too, so I actually downloaded the PDF of my complete return after filing and checked - the allocation was there on the generated 8962.

Thanks, this is helpful! My relocation paperwork does mention a "tax gross-up" for some of the benefits, but not all of them. So for the ones that weren't grossed-up, I'll end up owing taxes on those out of pocket, right?

That's exactly right. For the benefits that weren't grossed-up, you'll need to pay taxes on that amount out of your own pocket. For example, if you received a $3,000 lump sum that wasn't grossed-up, you might owe roughly $750 in taxes (depending on your tax bracket) that comes out of your pocket. The ones that were grossed-up should be fine - the extra amount your employer added should cover the tax liability for those specific benefits. Just be prepared for your W-2 to look higher than you might expect, since it includes both your regular salary and all these additional taxable benefits.

I got that same warning last year but just ignored it. TurboTax throws up caution flags for any significant changes year-over-year. As long as your W-2 accurately reflects everything (including the relocation benefits), you're fine to proceed past that warning. It's just an automated check, not an actual problem with your return.