How can you tell if a CP2000 is legit? I got one recently but now I'm worried it might be fake. Are there specific things to look for?

A legitimate CP2000 will always come by U.S. mail (never email), include your tax ID number, the tax year in question, and a detailed explanation of the proposed changes. It will have specific contact information for the IRS, including a toll-free number. The notice will also include your rights as a taxpayer and explain the appeals process. Fake notices often have spelling/grammar errors, demand immediate payment (especially via gift cards, wire transfers, or cryptocurrency), don't provide clear explanation of the discrepancies, or direct you to unofficial websites. You can always verify a notice by calling the IRS directly at 800-829-1040 (not using any number on the suspicious notice itself).

Does asking for an extension stop the interest from continuing to accrue though? I'm worried about making the amount owed even higher by delaying.

Thanks for the suggestion! Does TurboTax handle foreign income well? I have earnings from two different countries plus some US investments, so my situation is a bit complicated.

TurboTax does handle foreign income pretty well in my experience. They have specific sections for foreign earned income exclusion (Form 2555) and foreign tax credits (Form 1116). They'll walk you through determining which is better for your situation. For multiple countries, they can handle that too, though you'll need good records of how much you earned in each place and what taxes you paid to each country. The investment income adds another layer, but their premium version specifically covers investment income scenarios. Just be prepared to pay more for the versions that handle international situations.

I used OLT for my 2021 return and it worked fine, but when I tried to do my 2020 return, they only offered paper filing. This was about 6 months ago though, so maybe things have changed. Their customer service was pretty responsive when I asked about it.

Thanks for the info! Guess I'll check with their customer service directly to see if anything's changed. Really hoping to avoid paper filing if possible.

That's really good to know! Do you have any recommendations for keeping track of all these potential deductions throughout the year? I feel like I might be missing stuff.

I just use a simple spreadsheet with categories for each potential deduction - mortgage interest, property tax, charitable donations, medical expenses, etc. I update it monthly so I don't forget anything. Some tax software also has year-round tracking features or apps. The key is being consistent about saving receipts and documentation. I take photos of donation receipts immediately and save them to a specific folder. For medical expenses, I request year-end summaries from all my providers. It's also smart to check your itemized deductions against the standard deduction amount mid-year to see if you're on track to benefit from itemizing.

Not all points are deductible though. I learned this the hard way. Points for lowering your interest rate are deductible, but points that are really just fees disguised as points aren't. Check IRS Publication 936 for the full details.

That's incredibly frustrating to learn! I had no idea there was actually a proposed system that got killed by industry lobbying. I just looked up that ProPublica article and wow... the fact that other countries have been doing this for decades while we're stuck manually entering numbers that the government already has is ridiculous. Do you know if there's any movement to revive this idea? Seems like the kind of common sense thing that both political parties could potentially get behind.

There have been several attempts over the years, most recently the Tax Filing Simplification Act that's been introduced a few times but hasn't passed. The current administration has made some promises about simplifying the tax filing process, but meaningful change faces the same powerful lobbying obstacles. The Free File agreement was actually modified in 2019 after the ProPublica reporting, removing the provision that explicitly prevented the IRS from creating its own system. That's a start, but there's still strong resistance. The best hope is continued public pressure and awareness - the more people understand that better options exist and are being deliberately blocked, the more momentum builds for change.

This makes me want to move to Australia just for the tax system lol. Do they at least buy you dinner before they take your money? The US system is just insult to injury - "figure out how much you owe us or go to jail, but also we won't make it easy, and ps we already know the answer.

Didn't they actually try to make a "postcard-sized" tax form a few years back? Whatever happened to that? Seems like my tax return gets thicker every year.

They did try to make that simplified postcard form around 2018 as part of the tax law changes. It was basically a marketing gimmick - they just moved all the calculations to separate worksheets and schedules that you still had to fill out. The whole thing was abandoned pretty quickly because it actually made filing more complicated, not less. Now tax returns are definitely getting thicker every year with more worksheets and schedules than ever. The 2023 tax year is no exception with all the special credits and deductions they keep adding without simplifying the old ones.

Try using tax software. It walks you through all that stuff step by step. TurboTax, H&R Block, or even the free options like FreeTaxUSA handle all those worksheets and calculations behind the scenes.