That's a really good point I hadn't considered! He is a full-time college student, so I think I'm still eligible to claim him. He works part-time at the campus bookstore, but I'm definitely providing well over half his support (tuition, housing, food, car insurance, phone, etc.). Do you know if there's any form or documentation I should get from his college to prove he's enrolled full-time? I want to make sure I have everything in order before this becomes an issue with the IRS.

You'll want to get a transcript or enrollment verification from his college showing his full-time status for the tax year. Most schools can provide this through their registrar's office or student portal. This is important documentation to have on hand. For the support test, keep records of all those expenses you mentioned. Create a spreadsheet showing what you pay versus what he earns from his job to clearly demonstrate you provide more than half his support. Also, make sure you understand the difference between the Qualifying Child and Qualifying Relative tests for dependents - at 19, he's only a Qualifying Child if he's a full-time student, otherwise you'd need to see if he meets the tests for a Qualifying Relative.

This is what I was thinking too. At 19, why isn't the son just providing his own SSN to his parent? Something seems off about this whole situation. Maybe there's more to the story?

I've used both TurboTax and FreeTaxUSA in the past couple years. TurboTax actually does have a dedicated section for Box C transactions, but it's buried deep in their investing section and not intuitive to find. FreeTaxUSA is more straightforward overall and way cheaper, but like OP mentioned, it has this quirk with Box C. TaxAct was the worst of the ones I tried - it kept giving me errors with certain crypto transactions. H&R Block's software seemed decent for complex investment situations but costs more than FreeTaxUSA.

I've been looking into this more since posting. Apparently TaxHawk (which is basically the same engine as FreeTaxUSA) has the same limitation. TurboTax does technically support Box C transactions but I heard it's not easy to find. I'm sticking with FreeTaxUSA this year since I already entered everything, but might try TurboTax next year if I have more complex investments. The price difference is significant though - like $100+ more for TurboTax with investment support vs FreeTaxUSA.

That's super helpful! I didn't even think to check the final form. I just did that and you're right - even though I entered my Box C transaction in the Box B input section, on the actual 8949 PDF it shows up correctly under Box C. FreeTaxUSA must have some logic built in that recognizes certain types of transactions and moves them to the right category for the final form. That makes me feel a lot better about continuing to use them. Thanks for the tip!

That's a really good point about state taxes that I hadn't considered. I'm in Texas which doesn't have state income tax, but we did live in California for two years during our marriage. Should I be concerned about that?

Yes, absolutely contact California's tax authority (Franchise Tax Board) immediately! California is extremely aggressive about collecting back taxes, and they have a lookback period of up to 20 years for tax fraud. If your ex didn't pay proper taxes while you lived there, California could come after you separately from the IRS. California does have an innocent spouse program, but you need to be proactive about it. Don't wait for them to find you. The good news is that if you get innocent spouse relief from the IRS, California generally follows the federal determination, but you still need to file the proper paperwork with them.

Adding to this excellent advice - be prepared for a long process. My innocent spouse case took 14 months to resolve completely. The IRS isn't known for speed. Make sure you respond to every letter they send within the timeframe they specify, and always send things certified mail so you have proof of delivery.

Thanks for this insider perspective! Do you think I should be worried about penalties from the IRS? I'm stressed about potentially having to pay back some of the refund plus interest or penalties. Will filing an amended return soon enough prevent that?

If you amend your return promptly, penalties are usually minimal or can be waived entirely under a first-time abatement. The IRS generally recognizes good-faith efforts to correct errors, especially when the error wasn't your fault. As for the refund amount, you might have to repay some of it if you received tax benefits that non-residents aren't eligible for. But you might also qualify for certain treaty benefits as a non-resident that could offset this. Make sure H&R Block thoroughly researches any tax treaties between the US and your home country when preparing the amended return.

This is great advice! I used my university's free tax service for international students and they were way more knowledgeable about non-resident tax treaties than the commercial preparers. They even had specialists for each major country's tax treaty provisions.

Thank you for this detailed response. We've checked the letter more carefully and it does have a CP504 notice number on it, so I think it's legitimate. What's the difference between Currently Not Collectible status and an Offer in Compromise? Would either of these permanently resolve the debt or just delay collection?

Currently Not Collectible (CNC) status temporarily pauses collection actions when paying the tax debt would create an economic hardship. The debt doesn't go away, but the IRS stops trying to collect while you're in financial hardship. The IRS reviews your status periodically (usually annually) to see if your financial situation has improved. An Offer in Compromise (OIC) is a settlement agreement where the IRS accepts less than the full amount owed to resolve the debt permanently. You have to demonstrate that you cannot pay the full amount due to financial hardship, and they consider your income, expenses, asset equity, and ability to pay. If accepted, you fulfill the terms of the offer (usually a reduced lump sum or payment plan), and the debt is considered paid in full.

Innocent Spouse Relief only applies if the debt is from a joint tax return where one spouse didn't know about income that wasn't reported or incorrect deductions. From OP's post, it sounds like this is solely the wife's tax debt, not joint debt, so probably wouldn't apply here.

Thanks for clarifying! You're right - I missed that detail that it's solely in her name. In that case, exploring the hardship provisions others mentioned is probably the better route.