Has anyone dealt with this issue when you have HSA contributions as well as Cafeteria Plan deductions? Our situation is similar but more complex: - W-3 Box 5: $412,000 - Section 125 Cafe deductions: $24,500 - HSA contributions: $15,300 - ADP Gross: $451,800 Should our G/L expense still match the ADP gross of $451,800?

This is such a common source of confusion! I went through the exact same thing last year when our bookkeeper quit right before tax season. The key thing to remember is that your business tax deduction should reflect the actual economic cost to your company, which is the full gross payroll amount of $250,250. The Section 125 deductions don't disappear - they just get redirected to employee benefits before hitting their W-2s. I found it helpful to think of it this way: if you wrote individual paychecks, you'd write them for the gross amount, then the payroll company handles directing some of that money to benefits. Your checkbook (and G/L) still shows the full amount going out. Also, make sure your payroll tax returns (941s) reconcile properly with these numbers. The wages subject to federal income tax withholding on your 941s should match the W-3 Box 5 amount, while your total wages paid should match the ADP gross. This creates a nice audit trail if anyone ever questions the discrepancy.

This thread has been incredibly helpful! I work as a freelance graphic designer and ran into this exact Box 6 issue with three different 1099-NEC forms this year. Like many of you, I was really stressed about "filling in" information that wasn't on my original forms. After reading all these experiences, I decided to go with the state abbreviation approach. I entered "IL" for Illinois (where my state withholding went) in Box 6, and TurboTax accepted it immediately. My return has already been processed and accepted by both the IRS and Illinois Department of Revenue with no issues. What really clicked for me was understanding that Box 6 isn't asking for some mysterious number - it's just asking which state received the withholding taxes shown in Box 5. If your client withheld state taxes but forgot to include their state ID number, using the state abbreviation is actually the most accurate information you can provide. For anyone still hesitating: don't let this hold up your filing! The state code solution works and makes complete logical sense. You're not falsifying anything - you're providing the correct state identifier for where your withholding taxes were sent.

I've been following this discussion and wanted to add my perspective as someone who handles tax compliance professionally. The state abbreviation solution everyone is discussing is absolutely correct and widely accepted. When Box 6 is blank but Box 5 shows state withholding, entering the two-letter state code is the standard practice. This isn't a "workaround" - it's actually what tax professionals do routinely when payers fail to include their complete state identification information. The IRS and state tax agencies understand that businesses sometimes omit this information on 1099 forms. What matters most is that you're accurately reporting your income and the actual withholding amounts. The state identifier in Box 6 is primarily used for administrative matching, and using "PA" (or whatever your applicable state is) provides exactly the information needed for that purpose. Don't let this technical issue delay your filing. Use the state abbreviation where your taxes were withheld, and you'll be in full compliance. I've seen hundreds of returns processed this way without any issues.

Your return was delivered in July. When did you contact the IRS? I’m trying to determine the amount of time that passed between the delivery of your return and the date you reached out to them

I've been dealing with IRS issues for years and want to emphasize something important that others have touched on - the difference between "lost" and "stuck in processing" returns. Based on your description, your return likely isn't truly lost but rather caught in a specific processing queue. Since you filed MFS in a community property state with Form 8958, your return almost certainly triggered an automatic flag for manual review. The problem is that these manual review queues are severely backlogged, and returns can sit there for 6+ months without any movement. Here's my specific recommendation: When you call (and definitely try the 7am timing others suggested), ask to speak with someone in the "Exam Support" function who can check for "TC 971" notices on your account. These are internal codes that indicate when a return has been flagged for manual review but not yet assigned to a reviewer. If they find a TC 971 code, you can request that they expedite the review since you're well past normal processing times and are owed a refund. I've seen this approach work when other methods failed. Also, since you made an extension payment that resulted in an overpayment, make sure to mention this upfront - returns with refunds due often get different handling priorities than those where additional tax is owed. The key is getting to someone who understands these specific processing codes rather than just looking in the basic "Where's My Refund" system that most customer service reps use.

Has anyone tried handling this by separating the transactions? Like paying for business travel with cash, then reimbursing yourself personally with miles for other trips? Seems like that might solve the problem.

I dealt with this exact situation when I started my consulting business! The key thing to understand is that the IRS looks at actual cash outflow, not the "value" of rewards used. Here's what I learned from my tax attorney: When you use personal miles/points for business travel, you can't deduct anything because there's no actual business expense - you're essentially using a personal asset (the miles) that you already "paid for" through past personal spending. However, don't forget about the ancillary costs! If your husband paid any booking fees, taxes, or upgrade costs when redeeming those miles, those actual cash payments can be deducted as legitimate business expenses. For future planning, consider doing what Mateo suggested - pay cash for business travel (fully deductible) and save your personal miles for vacations. This maximizes your tax benefits while keeping everything clean and audit-proof. Also keep detailed records showing the business purpose of any travel, regardless of how you paid for it. The IRS will want to see that it was genuinely business-related.

For anyone else with this issue - check your previous years' W2s if you've been with the same employer. If boxes 3 and 5 had amounts in previous years but are suddenly empty this year, that's a red flag that something changed or there's an error.

Just want to add another perspective here - I'm a CPA and see this situation fairly regularly. Before you panic, definitely check if you're in any of these categories that Mason mentioned. But also look at your pay stub from your last paycheck of the year. Sometimes there are timing differences where the final payroll processing might not have been completed when the W2 was generated. Also, if you're dealing with multiple employers during the year, sometimes one might be exempt while another isn't, which can create confusion when you're comparing different W2s. One more thing to check - if you had any pre-tax deductions like a 401k, health insurance, or flexible spending account, those reduce your social security wages but not necessarily your regular wages in box 1. So boxes 1 and 3 might legitimately be different amounts, but box 3 should never be completely empty unless you're in one of those exempt categories. If none of these situations apply to you, definitely get that corrected W2 before filing!