The bonus was paid separately with the 22% supplemental rate when I first received it. My employer hasn't mentioned anything about Social Security or Medicare taxes being returned to me - is that something I need to specifically ask them about?

Yes, you should definitely ask your employer about the Social Security and Medicare taxes. When you repay wages in the same year you received them, employers typically adjust everything including those taxes. But for repayments that cross tax years (like yours), the employer is only required to provide documentation of the repayment. For the Social Security (6.2%) and Medicare (1.45%) taxes withheld on that bonus, you'll need to specifically request a refund of those amounts from your employer. They're not automatically included in the Claim of Right calculation. If your employer won't refund these directly, you may be eligible to claim them as a credit on your tax return using Form 8919, but that gets complicated so you might want to consult with a tax professional about the specific process.

This is super important! My brother had to repay a bonus and his company didn't provide proper documentation. He got audited and it was a huge mess. Make sure to get everything in writing from your employer.

Thank you all for the advice! I feel much better about waiting now. Quick follow-up question - once I do get my refund, should I file the amendment immediately or is there any benefit to waiting a bit longer? And will FreeTaxUSA walk me through the process step by step?

I'd recommend waiting about 2-3 weeks after receiving your refund just to be sure everything has fully processed in the IRS systems. That timing worked well for me with no issues. Yes, FreeTaxUSA has a pretty straightforward amendment process. When you log in to your account, there should be an option for "Amend Return" that will walk you through each step. It will pull all your original information and then guide you through adding the 1099-G details. It automatically generates the 1040-X form with the correct before/after columns that the IRS requires.

Georgia does the same thing! I had to go hunting for mine this year too. They claim they send an email notification but I never got one. I think most states are moving this direction to save money on postage.

Thanks for confirming I'm not alone! Makes me feel slightly better about missing it. I really wish they'd at least send a text or email reminder that the forms are available. Seems like states are saving money at the expense of taxpayer convenience.

Where did you find your crypto-friendly accountant? I've been looking for someone who won't charge me these insane rates but have had trouble finding anyone who seems knowledgeable about crypto tax rules.

I found mine through a local crypto meetup group. There are also some online directories specifically for crypto-friendly accountants - try searching "crypto tax professional directory" and you'll find a few options. The key questions to ask are: what software do they use for crypto tax preparation, how do they handle missing cost basis information, and if they have a flat fee structure for crypto reporting regardless of transaction count. Any accountant who acts like crypto is some mysterious new technology or charges by the transaction is probably not your best option in 2025.

This is really good advice. I'd add that you should sit down with your accountant and go through the forms together before filing to make sure everything transfers correctly. And keep copies of EVERYTHING, including all the work you did to calculate your crypto basis. The IRS has been focusing more on crypto compliance lately.

That's a great point about the state agencies. Do you know if there's an easy way to find out which agency handles this in my state? I'm in Michigan if that helps.

For Michigan specifically, you'd want to contact the Department of Licensing and Regulatory Affairs (LARA). They handle professional licensing and regulation for tax preparers. Their website has a complaint form you can fill out. If your preparer claimed to be a CPA but wasn't, that's also something LARA would be interested in knowing about. In addition to filing with them, the Michigan Attorney General's office has a Financial Crimes Division that takes complaints about financial fraud, which this could qualify as.

Exactly! Check box 128 on your Form 1040 from last year (or corresponding box if it was a different tax year). A legitimate preparer must sign and include their PTIN. If they didn't, that's an immediate violation.

Thanks for this advice! I'm still waiting on those statements from T-Rowe, but this gives me a good framework for organizing everything. Do you think I should attach some kind of explanation with my tax return explaining why I'm reporting different figures than what's on the 1099-Q?

You don't need to attach an explanation to your regular tax return. When you report a distribution from an education account on Form 8863, you're only reporting the taxable portion anyway. If you're concerned, you can certainly keep a written explanation with your tax records that you could provide in case of questions. But don't send additional documentation unless specifically requested by the IRS.

I had this issue spanning 4 years of distributions. What worked for me was calculating the initial ratio of contributions to earnings before ANY distributions started, then applying that same ratio to all distributions. So if your account was 80% contributions and 20% earnings when you first started taking money out, you'd consider all distributions to be split that same way.

Thanks, that makes sense. I think I've actually been doing it wrong then. I've been trying to recalculate the ratio each year which has been a total nightmare with all the market fluctuations. I'll try using the initial ratio approach instead.