This is incredibly helpful, thank you! We still have all our bank statements showing the transfers, but I hadn't thought about creating a written agreement. We'll definitely put something together documenting our 50/50 arrangement. Did you just create a simple letter that you both signed or did you use some kind of template?

I just created a simple one-page letter stating that we agreed to split the mortgage payments and property taxes 50/50, with both our names, addresses, and signatures. I also included a spreadsheet showing all the payments made throughout the year from each of us. Nothing fancy, but it was enough to satisfy the IRS when they asked for documentation.

Good point! My accountant actually suggested something similar when I was in this situation. If only one person benefits from itemizing, it might make sense to adjust the "economic reality" of who pays what going forward. Of course, this needs to be actually implemented, not just claimed on paper.

Is Publication 15 easy to understand for someone who isn't great with tax stuff? Or is there a simplified version somewhere? Also, what specific parts should I look at to check my withholdings?

Publication 15 isn't the most user-friendly document if you're not familiar with tax terminology, but the withholding tables are actually pretty straightforward. Look for the section called "Income Tax Withholding Tables" - there are separate tables for different pay periods (weekly, biweekly, monthly). The key sections to check are the Federal Income Tax tables, the Social Security tax rate (currently 6.2% on earnings up to a certain limit), and Medicare tax (1.45% on all earnings). For most people, verifying these three calculations will catch the majority of potential errors. If you have state income tax, you'll need to check your state's department of revenue website for those rates.

I work in HR for a large company that uses ADP. Most bigger companies finish processing W-2s around mid-January, but they often don't release them until closer to the January 31 deadline. Sometimes this is because they're still making final adjustments or quality checks. With ADP specifically, employees can usually get early access through their online portal before paper copies are mailed. Check if you have an ADP login - if so, your W-2 might be available electronically 1-2 weeks before the paper version is sent.

Thanks for the insider info! I do have an ADP login but never really use it except to download paystubs occasionally. I'll definitely check there in mid-January. Hopefully I can get a head start on filing since we're planning to use our refund for a down payment on a house!

Do you know if they consider future earning potential? I'm in school right now with low income but will likely have higher income in a couple years. Would that affect my OIC chances?

Yes, they absolutely consider future earning potential, especially for younger taxpayers or those in educational programs. If you're in school for a high-earning profession, they may be less likely to accept a low offer since they anticipate your income will increase significantly. The IRS looks at your specific situation - age, education, profession, industry, employment history, and health status - to make reasonable projections about future income. If you're young, healthy, and gaining qualifications in a lucrative field, they'll factor that into their decision even if your current income is low.

Does applying for OIC extend that 10-year collection period? I'm wondering if I should just wait since my assessment was back in 2015.

Wouldn't paper filing significantly delay your refund though? I heard the IRS has a massive backlog of paper returns.

Yes, it does delay your refund - mine took about 12 weeks last year compared to the typical 3 weeks for e-filing. But I figured it was better than paying thousands in self-employment taxes I didn't actually owe. If you need your refund quickly, the software solutions others mentioned are probably better options. Paper filing is more of a last resort if you can't get the software to handle the situation properly.

I claimed it for three years now with no issues. The key is proper documentation. Make sure you clearly label the exclusion referencing Notice 2014-7, and keep records of the Medicaid waiver program documents. A mismatch alone won't trigger an audit if it's properly explained.

That's reassuring to hear! I'll make sure to document everything clearly. My state's Medicaid office actually provided a letter confirming the payments qualify under the notice, so I'll keep that with my tax records too.

Thanks for the advice. She's not a CPA, just has a PTIN. Is there still a state board that would handle complaints for non-CPA preparers? I'm in Illinois if that helps. Also, would filing these complaints potentially help me recover the payment, or are these just punitive measures?

In Illinois, tax preparers who aren't CPAs are regulated through the Illinois Department of Financial and Professional Regulation if they're registered. Even if they only have a PTIN, you can file a complaint with the Illinois Attorney General's Consumer Protection Division since this is essentially a consumer fraud issue. Filing these complaints might not directly get your money back, but they often create substantial motivation for the preparer to resolve the payment issue to avoid further regulatory scrutiny. Many preparers will settle once they realize formal complaints have been filed. These actions also create an official record of the dispute, which can strengthen your case if you do pursue payment through small claims court. The documentation from these complaints can serve as evidence of your good-faith attempts to resolve the situation.

Is there a time limit on how long they have to file these amended returns? Like if the original poster just sits on them while trying to get paid, could it cause problems for the businesses?