Did his written justification actually make a difference? I'm not sure what I would even write beyond "it makes the office look professional"... any specific suggestions for what to include?

The written justification absolutely made a difference. The auditor specifically mentioned it as a key factor. Don't just write "makes the office look professional" - be specific about how each item contributes to your business goals. For example, my brother-in-law's justification included how certain art pieces demonstrated architectural principles relevant to client projects, created talking points that helped establish rapport with clients, and showcased the aesthetic sensibilities that clients were hiring him for. For your law practice, you might explain how local sports memorabilia helps connect with local business clients and creates a comfortable atmosphere for discussing sensitive estate planning matters.

I've done this! Created an LLC that owns all office decor and leases it back to my main business. Makes depreciation super clean and creates a clear business purpose. Just make sure the lease agreement is properly documented and the rental amount is reasonable market value. My tax guy says this arrangement is much easier to defend in an audit.

What kind of documentation should I keep? I have confirmation emails from my brokerage showing the contributions, and I have last year's tax returns. Is that enough?

Confirmation emails are a good start, but you really want your account statements showing the contributions. Keep your Form 5498s that show IRA contributions for each year - these are usually sent out in May for the previous tax year. Your tax returns are crucial too, especially if you filed Form 8606 with them. If you didn't file 8606 forms for those non-deductible contributions, you should file amended returns to include them. Without the 8606 forms establishing your basis, it becomes much harder to prove which portions were already taxed.

I used TurboTax last year for my backdoor Roth and it worked fine. The interview questions specifically asked about non-deductible contributions and IRA conversions. Just make sure you answer the questions about having a basis in your IRAs correctly. The one tricky part was making sure I entered the 1099-R information exactly as it appeared on the form.

What kind of documentation would be best? I have credit card statements showing the purchases, but I didn't keep all the receipts. Will bank and credit card statements be enough, or does the IRS require more detailed proof?

Credit card and bank statements are a good start, but they only show that you spent money, not necessarily what it was for. The more detail you can provide, the better. If you don't have all receipts, include what you do have, along with a written explanation of each expense category and how it related to earning the 1099 income. Any contracts, emails with clients, or other documentation that shows the nature of your business activities will help support your case. The IRS is more likely to accept your expenses if you can clearly demonstrate they were ordinary and necessary for your business.

This is good advice. I went through something similar and was able to get the penalties removed by showing I had given all my documents to my preparer. The IRS form 843 can be used to request penalty abatement after you've resolved the CP2000 issue.

Thanks for the insider perspective! Should I be worried about this holding up my tax refund? I was planning to file next week and really counting on that money soon.

You shouldn't have any delay in your refund as long as you address the 1098-T properly on your return. If you can contact the university quickly and get clarification before you file, that's ideal. If not, you can still file and include the information from the 1098-T as reported. If you later find out it was an error and get a corrected form, you can always file an amended return. But ignoring it completely could potentially flag your return for review, which would definitely delay your refund. So it's better to include it now based on what you have and make corrections later if needed.

I've had better luck with H&R Block's online software for education stuff. Last year I had three 1098-Ts (don't ask lol) and TurboTax kept getting confused, but H&R Block handled it fine. They have a specific education interview section that walks through all the weird edge cases.

That makes me feel a bit better actually. I was worried something was wrong specifically with my return. Do you think I should still try calling them or just wait it out at this point?

If you're at the 21-day mark, it's definitely worth checking in. The IRS won't really give you much info before that timeframe since they consider it normal processing. Once you're past 21 days, they can actually look into what might be causing the delay. I'd recommend either using the "Where's My Refund" tool daily or trying to get through to a representative to make sure nothing's actively wrong with your return. Sometimes there are simple verification issues they can resolve quickly once you're in contact with them.

Yeah I did claim the Child Tax Credit for my two kids. And I think you're right about the amount—it's definitely the largest refund I've ever had. Guess that could be triggering extra scrutiny.

Those are definitely two factors that can extend processing times. The IRS is particularly careful with refunds that include tax credits for children because there's been fraud in that area. And yes, larger refunds generally receive more scrutiny. I'd recommend waiting until you hit the full 21 business days (not calendar days) before getting too concerned. If you e-filed on February 10, that would put you around March 12 for the 21 business day mark. If you still don't have an update by then, that's when I'd try contacting the IRS directly.