PSA: ALWAYS get a copy of any tax document filed on your behalf, whether original or amended. Your preparer should have provided this automatically. The fact that she doesn't even know if an amendment was filed is incredibly unprofessional and potentially fraudulent. I'd be getting a new tax preparer ASAP.

Based on what you're describing, this sounds like the IRS initiated an internal adjustment to your return, not something your tax preparer filed. The 971/977 codes with a February 2025 date are typically system-generated when the IRS finds discrepancies between what was reported to them (W-2s, 1099s, etc.) and what's on your filed return. Your tax preparer's vague response about "maybe her assistant did it" is definitely concerning though. Any professional tax preparer should have complete records of what was filed under your name and when. I'd strongly recommend: 1. Demanding copies of your original return AND any amended returns they may have filed 2. Getting a detailed explanation of any communications they've had with the IRS on your behalf 3. Consider finding a new preparer for future years The good news is that these IRS-initiated adjustments often result in refund releases, especially if they're correcting calculation errors in your favor. Keep monitoring your transcript weekly - you should see additional transaction codes appear that will show exactly what they're adjusting. If you want definitive answers, try calling the IRS directly at 1-800-829-1040 (though be prepared for long hold times). An agent can tell you exactly what triggered the review and what changes are being made.

whatever u do DO NOT IGNORE THE LEVY!!! i did that and ended up homeless for 3 months when they took my whole paycheck. call the irs ASAP and explain ur situation. they can do hardship stuff if ur gonna lose housing. installment plans aren't that bad - i pay like $175/month on what i owed and they stopped the levy when i set it up. the ppl on the phone r actually kinda nice if ur honest with them.

First, take a deep breath - you DO have options and the IRS doesn't want to make you homeless. Call them immediately at 1-800-829-1040 and explain your hardship situation. Be honest about how the levy will affect your housing and employment. Based on your income situation, you'll likely qualify for one of these solutions: 1. **Economic Hardship Release** - Request immediate levy release since you can't afford basic living expenses. They can often process this within days. 2. **Currently Not Collectible (CNC) Status** - If your necessary living expenses exceed your income, they'll temporarily stop collection actions. 3. **Installment Agreement** - Set up affordable monthly payments (could be as low as $25-50/month based on your financial situation). Before you call, gather documentation of your monthly expenses: rent, utilities, transportation, food, and medical costs. Fill out Form 433-F (Collection Information Statement) which shows your complete financial picture. The key is acting NOW - don't wait another day. The IRS agents are actually pretty reasonable when you're upfront about genuine hardship. They'd rather have you employed and housed making small payments than unemployed making no payments. You can get through this!

Just a heads up - don't forget about the self-employment tax deduction! You can deduct half of your self-employment tax on your 1040. A lot of new contractors miss this. Also, track ALL your business expenses - internet, cell phone (% used for business), home office if you have a dedicated space, mileage for any client meetings, software subscriptions, etc. These can significantly reduce your taxable income.

As someone who just went through this exact situation last year, I'd recommend starting with the safe harbor rule to avoid any penalties. If you paid at least 100% of last year's total tax liability through withholdings and estimated payments (or 110% if your previous year's AGI was over $150k), you won't owe any underpayment penalties regardless of what you owe this year. For your quarterly payments, I'd suggest calculating based on your actual income each quarter rather than trying to predict the whole year upfront. Since your freelance work is unpredictable, this gives you more flexibility. Also, don't forget to factor in business deductions! As a graphic designer, you can likely deduct software subscriptions (Adobe Creative Suite, etc.), equipment, a portion of your home internet, and any other legitimate business expenses. These can significantly reduce your taxable contracting income. One more tip - keep detailed records of everything from day one. I learned this the hard way and spent way too much time at tax season trying to reconstruct my expenses from bank statements and random receipts!

If you filed with earned income tax credit or child tax credit, those returns automatically get extra scrutiny and take longer to process. The IRS is trying to cut down on fraudulent claims of these credits, but in the process, they're making honest taxpayers wait forever.

I totally feel your frustration - the waiting game with the IRS is absolutely maddening, especially when you're dealing with financial stress. Based on what you've described and the transcript codes you mentioned (570 and 971 from June 22), it sounds like your return is definitely under review in their Error Resolution Department. Here's what I'd recommend doing immediately: 1. Call the Taxpayer Advocate Service at 1-877-777-4778 since you mentioned this is causing financial hardship with moving expenses and bills piling up. They can sometimes expedite cases when there's genuine hardship. 2. When you call the IRS again, specifically ask about the notice dated June 22 that shows as code 971 on your transcript. Even if you didn't receive it, they should be able to tell you what it said and potentially email or fax you a copy. 3. Since you have EITC and multiple income sources (W-2s + unemployment), your return likely got flagged for income verification. This is super common but unfortunately adds weeks to processing time. The silver lining is that once they resolve whatever they're reviewing, you should see your refund released pretty quickly. And if they've held it longer than 45 days past the filing deadline, you'll get interest added to your refund amount. Hang in there - I know it's incredibly stressful when it's your money they're sitting on!

Anybody know if solar panels on rental properties have the same recapture issues? I just installed a $28k system on my rental and I'm getting conflicting info about whether it's 5-year depreciation or 27.5 years like the house itself.

You're definitely not alone in feeling confused about this - depreciation recapture is one of the most misunderstood aspects of rental property investing. The key insight that helped me was realizing that even with recapture, you're essentially getting an interest-free loan from the government through the tax savings. Think about it this way: if you're in a 22% tax bracket and claim $3,636 in depreciation annually on a $100k building ($100k ÷ 27.5 years), you save about $800 in taxes each year. Over 10 years, that's $8,000 in tax savings you can invest or use to improve cash flow. When you eventually sell and face recapture at 25%, you'll pay back $9,090 (25% of $36,360 in total depreciation claimed). But you've had the use of that $8,000 for years - and if you invested those savings, they could have grown significantly. The "forced depreciation" rule others mentioned is crucial - the IRS will assume you took the depreciation whether you claimed it or not, so there's really no benefit to skipping it. You might as well take the tax savings now and deal with recapture later when you have more options (1031 exchange, installment sales, etc.).