I hadn't even thought about checking my Social Security statement! Just logged in and interestingly there's no record of that employer or the $78k on my Social Security earnings record. Does that mean it's more likely just an IRS error than actual identity theft? Should I still follow all the identity theft steps everyone mentioned or is there a faster way to resolve this?

If it's not showing up on your Social Security earnings record, that's actually good news! It suggests it's more likely an IRS processing error rather than someone actually using your info to work somewhere. I'd still take precautions like monitoring your credit, but you might be able to resolve this more quickly by calling the IRS and specifically telling them it appears to be a processing error since the income doesn't appear on your Social Security record. Ask to speak with someone in the Wage and Income department rather than Identity Theft. In my case, they were able to remove the incorrect W-2 and release my refund within about 6 weeks of identifying the error. Still frustrating, but faster than the full identity theft resolution process!

Smart advice! But how do you approach a company you've never worked for? I'm dealing with a similar issue and worry they'll just ignore me since I'm not an employee.

Thanks for this suggestion. It's been about 7 weeks since the birth and application, so I probably should check on the status. Do you know if there's a way to check online or do I have to call/visit the SS office?

Unfortunately there's no online tracking for first-time SSN applications for newborns. You'll need to contact your local Social Security office directly. I recommend calling first to make an appointment rather than just showing up. When you call, ask specifically for a confirmation letter showing you've applied for your child's SSN - this document itself can sometimes satisfy tax preparers while you wait. The confirmation letter usually includes your child's name and your address, which might even satisfy the residency requirement your tax preparer is asking for. Bring your child's birth certificate when you go in person.

Most tax places are accepting birth certificates + hospital documents this year. Just call different preparers if Jackson Hewitt is being difficult. I switched from them to a local place that was much more helpful with my situation.

What's the difference between a tax preparer and a CPA? Would a regular tax preparer be able to handle real estate investments from another country or is that something only a CPA should handle?

A CPA has more extensive education, passed the CPA exam, and maintains specific continuing education requirements. Tax preparers like me have various levels of certification (I'm an Enrolled Agent which means I'm licensed by the IRS). For international real estate investments, I would strongly recommend a CPA with specific experience in that area. While some experienced EAs could handle it, CPAs typically have more training with complex international tax issues. Foreign real estate can involve foreign tax credits, FBAR filings, and other complex reporting requirements that go beyond basic tax preparation. This is definitely a situation where expertise matters more than price.

This depends entirely on the complexity. For simple returns, sure. But for real estate investments, especially with foreign ownership, earlier meetings can be crucial for gathering all the required documentation. Sometimes these returns require information that takes weeks to track down.

That's really helpful to hear a real-world example! Did you have to do anything special on your tax return to document the rollover and subsequent withdrawal? And did your 401k plan administrator automatically provide that contribution/earnings breakdown, or did you have to specifically request it?

You'll receive a 1099-R from your 401k provider showing the total distribution, and you'll need to report the rollover on your tax return. For the withdrawal, you'll get a 1099-R from your IRA custodian the following year. I didn't need to file any special forms since my withdrawal was less than my total contributions, but I did keep detailed records of my basis. My plan administrator provided the contribution/earnings breakdown automatically as part of the distribution paperwork. If yours doesn't, definitely request it - you need this documentation to establish your basis. Some administrators have this readily available, while others might require you to specifically ask for a "distribution statement showing contribution and earnings portions.

Wait I'm confused. So if I open my first ever Roth IRA today at age 55, then immediately roll over my Roth 401k that I've had for 20 years, I still have to wait until age 60 to access the earnings tax-free even though I'll be past 59.5?

That's exactly right. The 5-year rule for Roth IRA earnings requires that your first Roth IRA was established at least 5 tax years ago AND you're 59½ or meet another exception (disability, first-time home purchase, etc.). So in your example, if you open your first Roth IRA at 55 and roll over your 20-year Roth 401k, you could access all the contribution portions immediately without tax or penalty. However, for the earnings to come out tax-free, you'd need to wait until both: 1) you're 59½ (which you already are), and 2) it's been 5 tax years since you established your first Roth IRA - so that would be at age 60.

Did you use a tax professional to help with your Offer in Compromise or did you handle it yourself? I'm wondering if it's something I can navigate on my own or if I should budget for professional help.

I started the process myself but ended up hiring a tax resolution specialist about halfway through. The forms themselves aren't super complicated, but determining the right offer amount is tricky. The IRS rejected my first submission because I miscalculated my "reasonable collection potential." The professional helped me resubmit with the correct calculations and stronger documentation of my hardships. It cost me about $1,500 for their help, which felt worth it since they got my offer accepted. If your situation is straightforward you might be able to do it yourself, but having someone who knows what the IRS is looking for definitely improved my chances.

Is that automatic or do you have to apply for that specific benefit? My tax debt is around $14k so I'm worried about liens affecting my credit.