No, we didn't have any unusually large deductions or one-time payments. We just have the standard mortgage interest deduction, and we each contribute to our 401ks at work but nothing extraordinary. We've been in the same house for 5 years and our medical expenses were minimal. I think you guys hit the nail on the head about the dual income thing. We're both making good salaries but neither of us checked the box for "multiple jobs or spouse works" on our W4s. I'm going to have us both submit new W4s with that box checked and see if that helps!

This is such a good point! My company was still using the old allowances-based W-4 until mid-2023. When I finally submitted the new version, my withholding was much more accurate. The old system was terrible for dual-income households.

Omg thank you for mentioning this! I didn't realize there was a difference between withdrawing contributions vs earnings from my Roth. Is there an easy way to tell which is which when I go to make a withdrawal? And yeah I'll definitely try for the payment plan route first!

Your Roth IRA provider should be able to tell you exactly how much of your account balance is from contributions versus earnings. Generally, withdrawals come from contributions first, so if you've contributed more than you're planning to withdraw, you should be able to take that amount out without tax consequences. For example, if you've put in $12,000 over the years and your account is now worth $14,000, you can withdraw up to $12,000 penalty-free. Just contact your provider before making any withdrawals to confirm the exact amount of your contributions. And definitely pursue that payment plan with the IRS - they offer reasonable terms, especially for first-time issues.

I amended returns for 2 years of unreported scholarship income about 3 years ago. The process wasn't as bad as I expected. I used Form 1040-X for federal and had to fill out amended state returns too. The IRS charged interest on the unpaid taxes (inevitable), but I qualified for First Time Penalty Abatement which saved me hundreds in failure-to-file penalties. I wrote a letter explaining that I genuinely didn't understand scholarships were taxable, and they were pretty reasonable. Set up a payment plan for $150/month and it's almost paid off now.

Do you know if there's any way to check if you already received the payments? It's been so long I honestly can't remember if we got those monthly deposits or not.

Yes, you can check if you received the advance payments by creating or logging into your online account at IRS.gov. Look for the "Child Tax Credit Update Portal" or check your account for 2021 payments. You can also request a 2021 account transcript from the IRS which will show all transactions, including any advance Child Tax Credit payments that were sent to you. If you can't access the online system, you can call the IRS or file Form 4506-T to request the transcript by mail.

How long did your amendment take to process? I heard the IRS is super backed up with processing amended returns.

Thanks so much for sharing your experience! That's really helpful. Did you guys use any specific software to compare both options? I'm worried about making a mistake if I try to calculate everything manually.

We used TurboTax and just ran through the process twice - once for joint and once for separate. It was tedious but worth it. I'd definitely recommend using some kind of tax software that lets you save different scenarios. The student loan part was trickier - had to use the loan servicer's calculator separately to figure out how much payments would change under each filing status.

This is such an important point! We got hit with this last year and had to file an amendment. Cost us extra in prep fees and delayed our refund by months.

Yep, it's one of those weird tax rules that nobody tells you about until you make the mistake! The other thing that surprised us was that if you file separately, you often can't contribute to a Roth IRA if your income is over a certain threshold, which is much lower for separate filers than joint.

I second this! My closing agent was super helpful when I had a similar question. Sometimes the simplest solution is best.

I didn't even think of that! I just emailed my agent and she got back to me right away. You're right - she had everything on file and sent me the state withholding form with the ID number clearly printed at the top. I was definitely overthinking this whole thing. Thanks for suggesting the obvious solution that I completely missed! Just finished my taxes and everything went through perfectly.

I had the opposite problem! TurboTax kept rejecting my entry when I included the dashes, but accepted it when I removed them. Seems like it might vary by state.

That's so strange! Must definitely depend on the state then. I'm in Illinois - where are you located? Maybe we should specify which states have which requirements when sharing advice like this. I guess the safest approach is to try both with and without special characters if the first attempt gets rejected. TurboTax isn't always clear about the exact format they want for these state-specific entries.