


Ask the community...
Make sure you're also documenting everything about this "friend" who prepared the taxes. The IRS has a form specifically for reporting tax preparers who file fraudulent returns - Form 14157 (Complaint: Tax Return Preparer). Even if he wasn't a professional preparer, you should include all his information with your response. Also, request a copy of the actual return that was filed using Form 4506. This will show exactly what was submitted and might help identify if other fraudulent claims were made besides the fuel tax credit. Some scammers file for multiple fake credits hoping some will slip through.
Thank you for this suggestion - I didn't know about Form 14157 or that I could request a copy of the return. Would getting the return also show who actually prepared it? I'm worried the "friend" may have used someone else's information too.
The tax return copy will show who signed as the preparer, though in fraud cases, they sometimes leave that section blank or use fake information. However, it will definitely show all the forms and schedules that were filed, which helps you understand the full extent of the fraud. When you file Form 14157 to report the preparer, you can include any information you have about them - full name, address, phone number, etc. If your brother received any paperwork from this person or has text messages discussing the tax preparation, include copies of those as evidence.
I work at a disability services organization, and unfortunately we've seen similar cases where vulnerable adults are targeted for tax fraud. Here's what else you should consider: 1) Contact your state's Adult Protective Services to report financial exploitation of a vulnerable adult 2) File a police report for identity theft/fraud - this creates an official record that helps with the IRS case 3) Check your brother's credit reports at all three bureaus to ensure no other financial fraud has occurred 4) Consider seeking a limited guardianship or conservatorship if this situation shows your brother needs more protection
Do you recommend getting a specialized tax attorney who has experience working with people with disabilities? I had a similar situation with my sister and found that regular tax pros weren't very helpful with the special considerations.
Just to clarify something important - there's a difference between a qualified employer annuity plan (like a 403b) and actually annuitizing your retirement savings. Many employer "annuity" plans don't automatically provide lifetime income - they're just tax-qualified retirement plans that give you the OPTION to convert to an annuity later, but you don't have to. I think people get confused about this all the time.
Wait, so when my work says I have an annuity plan option, I might not actually get guaranteed income for life? That's literally the only reason I was considering it!
That's exactly right. Many employer "annuity plans" are really just tax-qualified retirement savings vehicles that give you the option to convert to an income annuity when you retire, but don't require you to. When you retire, you typically have several options for what to do with the money - take a lump sum, set up systematic withdrawals, roll it over to an IRA, OR convert it to an income annuity. Unless you specifically choose the annuity option at retirement, you won't automatically get guaranteed lifetime income. I'd suggest asking your HR department for the Summary Plan Description which should clarify exactly what options will be available to you at retirement.
My company added a qualified annuity option last year alongside our 401k. I did some research and ended up splitting my contributions - 10% to 401k invested in index funds for growth and 5% to the annuity for guaranteed income later. Best of both worlds! The annuity portion will give me a base of guaranteed income in retirement, and the 401k gives me growth potential and flexibility. Both are tax-deferred.
That's exactly what I was thinking of doing! Did you find any downsides to splitting contributions this way?
Can you have both a 401k and qualified annuity at the same company? I thought it was usually one or the other. Do they share the same annual contribution limit?
Something not mentioned yet that's important with these inflation adjustments - the Lifetime Learning Credit and American Opportunity Tax Credit phase-out thresholds have also increased. Important for parents with kids in college or anyone taking classes themselves. For 2025, the AOTC begins to phase out at $90,000 (single) and $180,000 (married filing jointly). That's about a 5% increase from 2024. The full LLC phases out between $80,000-$90,000 for single filers and $160,000-$180,000 for joint filers. Also, contribution limits for retirement accounts have increased. IRA contribution limit is up to $7,000 ($8,000 if you're 50+) and 401k limit increased to $23,500 ($30,500 for 50+).
Do you know if the Child Tax Credit amount changed too? I have 3 kids and that makes a huge difference in my refund every year.
Yes, there are changes to the Child Tax Credit for 2025 as well. The maximum credit amount remains $2,000 per qualifying child, but the refundable portion (Additional Child Tax Credit) maximum has been inflation-adjusted to $1,700 per qualifying child (up from $1,600 in 2024). The income thresholds where the credit begins to phase out have also been adjusted upward. For 2025, phaseout begins at $210,000 for married filing jointly and $160,000 for other filers. With 3 kids, that could potentially mean an extra $300 in refundable credits depending on your income level.
Has anyone seen what's changing with the health insurance premium tax credit for 2025? I'm on an ACA plan and these inflation adjustments usually affect the subsidy amounts too.
The premium tax credit thresholds are definitely adjusted for 2025. The amount of premium you're expected to contribute based on your income percentage has been adjusted downward slightly. Also, the federal poverty level guidelines used to calculate the credit will be the updated 2025 numbers, which typically means larger subsidies for most people. If you're near 400% of the federal poverty level, the American Rescue Plan provisions that removed the "subsidy cliff" have been extended through 2025, so you'll still benefit from that regardless of income.
One thing to keep in mind - the deadline for filing 1099s was January 31st. If you're filing corrections after this date, you might be subject to penalties depending on how late they are and the nature of the correction. The penalty structure is: - Within 30 days: $50 per form - After 30 days but by August 1: $110 per form - After August 1: $290 per form Penalties can be reduced if you can show reasonable cause for the delay or error.
The good news is that penalties for corrections typically apply from when the correction is due, not the original deadline. Since you filed the original forms on time, and you're correcting within 30 days of the original deadline, you should be in the lowest penalty tier if they assess one at all. Often the IRS is reasonable about corrections, especially for small businesses making good-faith efforts to correct mistakes promptly. Make sure to keep documentation of when you discovered the error and how quickly you acted to correct it in case you need to show reasonable cause.
Oh no, I didn't even think about penalties! My original forms were sent before the deadline, but the correction is happening about 2 weeks after. Do they count the
Has anyone else noticed that the IRS has been MUCH slower processing paper forms this year? I submitted some 1099 corrections in January and the IRS still hasn't processed them according to my business account. Just pointing this out so you don't panic if it takes a while to see the updates reflected.
Jasmine Quinn
Had the same error and found another solution! I checked my IRS account online and downloaded my "Account Transcript" (not Return Transcript) for 2023. On line 150, it showed "total tax" and then the AGI was on a different line. The AGI on this transcript was different from my return copy by about $340. Used that number and my e-file went through instantly!
0 coins
Oscar Murphy
β’Where exactly do you find the AGI on the account transcript? I'm looking at mine and see the line 150 for total tax, but I don't see anything labeled as AGI. Is it under a different code?
0 coins
Jasmine Quinn
β’You're right, it's not explicitly labeled as AGI on the transcript. Look for line item 150 (tax per return) first to orient yourself. Then look for the code 11701 which usually appears above that - it shows your "Adjusted Gross Income Per Return". The number next to that code is what you want to use. If you don't see code 11701, you may need to check for any transaction codes like 290 or 291 which indicate adjustments were made to your original return. These adjustments could be why your known AGI doesn't match what the IRS has on file.
0 coins
Nora Bennett
Remember this error can also happen if you didn't file taxes last year! If that's your situation, enter 0 as your prior year AGI. TurboTax should give you this option somewhere. I didn't file in 2023 (wasn't required to) and was getting the same error until I realized this.
0 coins
Ryan Andre
β’This is the correct answer for my situation! I didn't need to file last year because I was a student with minimal income. Tried putting 0 as last year's AGI and my return was accepted immediately. Thanks for mentioning this!
0 coins