So wait, if your amended return actually gets processed and accepted, you have to keep amending going forward? You can't just call the IRS and say "nevermind, use my original"? That seems weirdly inflexible.

Exactly - once the IRS processes and accepts an amended return, it becomes your official return of record. Your original return is essentially overwritten in their system. The IRS doesn't have a "just kidding, go back to the original" option. They can only move forward with processing additional amendments. It's one of those bureaucratic things that makes sense from a record-keeping perspective but is super frustrating for taxpayers who realize they made a mistake on their amendment.

I ignored a rejected amended return in 2023 and nothing bad happened. My original return remained in effect, got my refund from that with no delays, and never heard anything from the IRS about it. Just make sure you actually got a formal rejection and not just a math error notice or something else.

Thanks for mentioning the code M thing - I had no idea about that. Is that something I need to include in my response to the CP2000, or is that only relevant for filing my tax return?

For responding to the CP2000 notice, you don't necessarily need to reference code M specifically, but it's helpful to understand that's how it should have been reported. What's most important for your CP2000 response is to clearly show your original cost basis for the CERN shares and the conversion value. If you're disputing the amount on the CP2000, you'll want to complete the response form they provided, attach your supporting documentation from Morgan Stanley showing your purchase history and the conversion details, and provide a clear explanation of why you believe the notice amount is incorrect. If you're not disputing the amount and just paying it, you can simply follow the payment instructions.

This is really good advice. I went through a similar situation with Adobe acquiring another company and initially got a CP2000. After digging through all the paperwork, I found documentation that it qualified as a tax-free reorganization. Saved me thousands in unexpected taxes!

Thank you for this heads-up! The funds did go directly to my bank account, not to providers. Do you know what specific documentation your sister needed to provide to resolve the issue? Did she need anything from the crowdfunding platform itself?

She needed to provide a few things to resolve it. First, she printed out the crowdfunding campaign page showing it was clearly for medical purposes. She also created a spreadsheet showing all the medical bills paid with the funds, along with copies of those bills and payment receipts. She didn't need any special documentation from the platform itself, though she did include the statements showing the transfers to her account. The most important thing was demonstrating the money was both received and used for the stated medical purpose. She wrote a simple letter explaining the situation and attached all this documentation. It took about 8 weeks, but the IRS eventually closed the case without requiring any taxes to be paid.

I went through this with TurboTax last year after my son's fundraiser. There's actually no place to report gifts you RECEIVE on your tax return since they're not taxable to you. TurboTax might ask if you received gifts over the annual exclusion amount, but that's just asking if someone needs to file a gift tax return (the giver, not you). The only exception would be if you received interest on the money after depositing it - then you'd report that interest income, but not the gift itself. Just keep good records of everything in case of questions later!

I tried that last year and it worked great! Just go to the investment income section, choose "Enter on my own" instead of import, and select the summary option. As long as your 1099-B has the summary totals clearly stated (Box 5 on most forms), this satisfies IRS requirements.

Thanks! That sounds much easier than trying to reconcile hundreds of individual transactions. My broker's 1099-B does have clear summary totals in Box 5, so I'll try this approach. Would be so much simpler than spending hours trying to figure out why specific wash sale calculations don't match.

Omg this might be exactly what's happening! I did sell some losers in late December and then bought back some positions in January when I got my bonus. So TurboTax might actually be correct and my broker's 1099-B could be missing these cross-year wash sales?

Exactly! This is a common situation that causes these exact discrepancies. The IRS wash sale rule definitely applies across tax years, but brokers can only report transactions that occurred within the calendar year on your 1099-B. So if you sold at a loss on December 28, 2024, and repurchased on January 5, 2025, that's 100% a wash sale according to IRS rules. Your broker might not flag it on your 2024 1099-B because the repurchase happens in the next reporting year. TurboTax, however, is correctly looking at your full transaction history across the year boundary and applying the wash sale rule properly. In this case, TurboTax's calculation would be the correct one to use on your tax return!

Thanks for mentioning VITA! I had no idea my school might offer that. Do they help with multiple years of back taxes though? And do you know if I need to make an appointment or can I just walk in during tax season?

Most VITA programs can help with back taxes, especially for relatively straightforward situations like yours. They typically handle the current tax year plus previous years. The IRS provides VITA volunteers with training for handling back tax returns. You'll definitely need to make an appointment, especially for multiple years of taxes. These services get extremely busy during tax season. I'd recommend calling your university's financial aid or student services office now to find out when their VITA program starts accepting appointments for the 2025 filing season. Some programs start booking as early as January, and slots fill up quickly!

One thing to add - if the amount you owe is under $10,000 and you can pay it off within 3 years, the IRS generally automatically approves payment plans. You can set it up online without even having to talk to anyone.