Thank you for sharing your expertise! Is the 30-day appeal window strict or is there any flexibility? The notice arrived about 2 weeks ago, so we're getting close to that deadline.

The 30-day window is fairly strict, but I'd recommend filing the appeal request even if you're close to the deadline. Use Form 12203 (Request for Appeals Review) and send it via certified mail so you have proof of the date it was submitted. If you're very close to the deadline, you can also call the IRS (using whatever method works to get through) and request a brief extension to file the appeal. Sometimes they'll grant a 15-day extension, especially if you explain that you're gathering documentation and seeking professional assistance. Make sure to document who you spoke with and when. The main thing is to get something formal submitted before the deadline, even if your documentation isn't complete yet. You can supplement the appeal later with additional information.

This!! Property valuation is HUGE for gift tax purposes. We had a similar issue and hiring an independent appraiser who specialized in retrospective valuations (valuing the property as of the date of the gift) saved us thousands. The IRS will often accept a professional appraisal if it's well-documented.

Thank you everyone for the advice! I checked my IRS transcript like you suggested and it looks like my return is still being processed. I think I'll try the Claimyr route to speak with someone before filing the amendment. One question - if I do end up needing to amend, should I wait until I receive my original refund first or can I submit the amendment while the original is still processing?

Definitely wait until your original return is fully processed and you receive your refund before filing an amendment. Filing an amendment while the original is still in process creates a high risk of the two filings conflicting with each other, which can lead to significant delays or even trigger unnecessary review flags. When you call the IRS, ask them to check if they're already planning to adjust your Recovery Rebate Credit automatically. Many taxpayers are finding that the IRS is fixing these stimulus payment issues without requiring an amendment. The agent should be able to tell you if you need to amend or if they can handle it on their end.

I had the same experience with my 2019 amended return. The tool showed "received" for almost 8 months before finally updating to "adjusted." If you need a more accurate status, you'll have better luck calling and speaking with a representative. They can see more detailed status info in their system than what shows on the public tracker.

What's the difference between an EA and a CPA? Is one better than the other for tax issues?

An EA (Enrolled Agent) specializes exclusively in taxes and is licensed directly by the IRS, while CPAs have a broader accounting background and are licensed by states. For pure tax issues, especially back taxes and IRS problems, EAs often have more specialized experience and can be more affordable. CPAs are great for complex financial situations where you need broader accounting expertise along with tax knowledge. Neither is inherently "better" - it depends on your specific needs. For straightforward back tax filing and IRS negotiations, an EA is usually sufficient and cost-effective. For business owners or people with complex investments and financial planning needs, a CPA might be worth the higher cost.

Fresh Start isn't actually a program you apply for - it's a set of policies the IRS implemented to make it easier for taxpayers to resolve tax debts. It includes expanded installment agreements, easier Offer in Compromise qualifications, and some tax lien relief. The main benefits: you can now get installment agreements with simplified procedures if you owe up to $50K (used to be much lower), and they made it easier to qualify for Offers in Compromise by changing how they calculate your ability to pay. You don't apply for "Fresh Start" specifically - you just take advantage of these more flexible options.

Did you get penalized when you finally filed those old returns? Was it complicated to do the back filing?

I didn't get penalized because I was actually owed refunds for both years - turns out I had way too much withheld from my paychecks. There's generally no penalty when the IRS owes you money, but you only have 3 years to claim those refunds. Back filing wasn't too complicated, but it was annoying having to track down old documents and W-2s from employers I no longer worked for. I had to contact the IRS for wage transcripts since one employer had gone out of business. The whole process took about a month to gather everything and file. If I'd owed money, I would have faced failure-to-file penalties plus interest for those years.

This is such an important point! My first job I made about $4000 over a summer and got back almost $300 in federal taxes. For an 18 year old that's a nice chunk of change just for filing a simple tax return.

Thanks for the additional info! Yes, this would be her first year of the AOTC since she's a freshman. Does it have to be 4 consecutive years or just 4 years total? Like if she takes a gap year, would we lose one of the years?

It's 4 years total for the student's lifetime, not necessarily consecutive. So if your daughter takes a gap year, you won't lose a year of eligibility. You can claim it for any 4 tax years, as long as she meets the other requirements each year (enrolled at least half-time in a degree program, hasn't completed first 4 years of education, etc.). Just keep good records of which years you've claimed it, especially if she transfers schools or takes time off, so you don't accidentally go over the 4-year limit.

I tried it but found it to be too basic for my situation. It didn't help much with the more complicated scenarios like how to handle scholarships vs loans vs out of pocket expenses. The questions were too general.