Does anyone know if the Form 1040X instructions cover the IRC 1341 claim of right situations? I'm thinking of amending my return because I didn't handle my bonus repayment correctly last year.

I went through a very similar situation last year with a $30k signing bonus that I had to repay. The IRC 1341 calculation definitely caught me off guard too - my credit was about $1,500 more than what was originally withheld on the bonus. What helped me understand it was realizing that the bonus didn't just get taxed at the flat withholding rate. It pushed me into the next tax bracket for part of my regular income AND caused me to lose eligibility for some education credits I would have otherwise qualified for. When you remove that bonus income and recalculate, you're getting back not just the direct tax on the bonus, but also the "ripple effect" it had on your entire tax situation. The math gets even more complex if you had any itemized deductions that were subject to AGI thresholds. A $25k bonus can easily create a tax impact that's 28-30% of the bonus amount rather than just the 22% flat withholding rate. Your $7,170 credit on a $25k bonus works out to about 28.7%, which seems reasonable given these factors.

Protip: Go first thing in the morning if you can. Lines get insane by lunch time and they might turn u away if they too busy

Been through this exact situation! Got my 5747C letter last year and the whole process was pretty stressful. After doing the in-person verification, it took about 6 weeks for my refund to come through. The key is making sure you bring all the right documents - I brought my driver's license, passport, and a utility bill just to be safe. Also, definitely schedule your appointment ASAP like others mentioned because the wait times are crazy. One thing that helped me was checking my transcript online every week to see if there were any updates. Good luck!

Did you check if the $581 is from a previous year? Sometimes they'll hold current refunds for old debts

My transcript had both 971 and 290 codes. The notice basically said they adjusted my refund amount. After that it took about 3 weeks to get the money deposited

Don't forget that any business expenses you had during those contractor months might be deductible on your Schedule C! This includes things like mileage if you drove for work, a portion of your phone bill if you used it for work, home office deduction if you worked from home, etc.

One thing to keep in mind is that when you file your 2025 taxes, you'll likely need to make quarterly estimated tax payments for 2025 if you expect to owe $1,000 or more in taxes. Since you now have both W-2 income and potential future contractor income, it's worth calculating this early to avoid underpayment penalties. Also, make sure your employer provides you with both a 1099-NEC for those contractor months AND a W-2 for your employee months. Some employers try to just issue a W-2 for the whole year, but that's incorrect - the contractor income needs to be reported separately on the 1099-NEC. If your employer pushes back on issuing both forms, you can point them to IRS guidelines that clearly state the income must be reported according to how you were classified when you earned it, not your status at year-end.

I went through something very similar with payusatax earlier this year and want to share what finally worked for me. After getting nowhere with their phone support, I found an old forum post suggesting to try logging into your payusatax account using the email address you used for payment rather than trying to search by confirmation number. When I did this, I was able to access a "Payment History" section that showed my EFT reference number - it was listed under a tab called "Federal Tax Payments" that I had completely missed before. The number was formatted differently than I expected (started with "EFT" followed by about 15 digits). If you can't remember which email you used or if you still can't access the account, there's another option: The IRS has a "Payment Verification" form (Form 3949-A) that you can submit along with your proof of payment. It takes longer to process, but they can manually research and apply your payment even without the EFT number. Also, make sure to call the IRS and request that they place a "payment tracer" on your account. This stops penalties from accruing while they investigate. You'll need your SSN, the payment amount, and the date you made the payment. They should be able to do this even if payusatax is being unresponsive.

I'm dealing with a very similar situation right now and this thread has been incredibly helpful! I made a payment through payusatax back in March and just got a notice saying the IRS never received it. Like others mentioned, payusatax customer service is completely unresponsive. One thing I wanted to add that might help others - if you're using a business credit card or bank account, sometimes the transaction details are more comprehensive than personal accounts. I called the business line at my bank and they were able to provide me with what they called an "ACH trace number" that wasn't visible in my online banking. Also, for anyone still struggling to reach the IRS by phone, I've found that calling right when they open (7am local time) significantly reduces wait times. I got through in about 20 minutes yesterday versus the 2+ hour waits I was experiencing calling later in the day. The agent I spoke with was actually very understanding about payment processor issues and said they see problems with payusatax fairly regularly. She was able to put a temporary hold on penalties while I work on getting the documentation sorted out. Don't give up - there are people at the IRS who want to help resolve these situations!