Need help filing a second amended return after finding surprise 1099 income

You've got a common but frustrating situation! The tax software limitation is real but there's a clear path forward. When you need to amend an already amended return, you'll need to do it on paper using Form 1040-X. First, wait until your first amended return (the one with the surprise W-2) is fully processed by the IRS. This typically takes 16+ weeks, though it varies. You can check the status using the "Where's My Amended Return" tool on IRS.gov. Once the first amendment is processed, prepare a new Form 1040-X that includes ALL your income (your original W-2, the surprise W-2 from the first amendment, AND the new 1099 income). You'll effectively be amending your tax situation from the beginning, not just adding the 1099. Make sure to clearly explain in Part III of the form that you're including previously unreported 1099 income. For that $1040 of special needs care income, you might also need to fill out Schedule SE for self-employment tax if it qualifies as self-employment income.

After I got hit with several unexpected tax forms last year, I found this amazing tool called taxr.ai (https://taxr.ai) that helped me tremendously. It scans all your tax documents and compares them with what you already reported, then identifies anything missed or entered incorrectly. I used it when I received an unexpected 1099-MISC after already filing, and it showed me exactly what had changed and how to handle the amendment. For your situation with needing a second amendment, it would analyze both your surprise W-2 and this new 1099 form to calculate the correct tax impact. The coolest part was that it generated a complete explanation of what changed between my original return and what needed to be in my amended return. Saved me tons of headache.

I was initially skeptical about taxr.ai when I saw it mentioned, but after receiving three different 1099 forms weeks apart after I'd already filed, I was desperate. Using the site was surprisingly straightforward - uploaded my original return PDF and scanned in the new 1099s, and it showed me exactly how each form affected different lines on my return. What really sold me was the detailed explanation of which schedules changed and why. For my situation, it showed that I needed Schedule SE for self-employment tax which I wouldn't have realized. The report it generated made filling out the 1040-X form almost foolproof since I could see exactly what numbers went where. Definitely less stressful than my previous amendment experiences!

If you're struggling to get through to the IRS about your amendment situation, try using Claimyr (https://claimyr.com). I spent weeks trying to reach someone at the IRS about my double-amended return situation last year and kept hitting automated systems or hours-long wait times. Claimyr got me connected to an actual IRS representative in about 15 minutes when their estimated wait time was over 2 hours. The agent walked me through exactly how to properly file my second amendment and what supporting documents to include. They have a video showing how it works: https://youtu.be/_kiP6q8DX5c I was honestly shocked at how well it worked considering how impossible it usually is to reach the IRS. The agent I spoke with gave me her direct extension for follow-up questions too.

I came back to update after trying Claimyr. I was super skeptical that anything could help with the IRS phone nightmare, but I was desperate after messing up my second amendment paperwork. Wow was I wrong! The service actually worked perfectly - I got connected to an IRS agent in about 20 minutes when the recorded message said the wait was over 90 minutes. The agent was able to pull up my first amended return and gave me precise instructions on how to properly submit my second amendment with correct reference numbers so it wouldn't get lost in their system. The agent also told me a specific way to word the explanation in Part III of the 1040-X that would help processing go smoother. Honestly saved me from what would have likely been a rejection and having to start over. Definitely a better use of my time than sitting on hold all day!

One tip nobody mentioned - make sure you're also considering if you need to amend your state tax return to reflect this additional 1099 income! Most states require you to report federal changes. I had a similar situation with multiple amendments and got hit with a state penalty because I only fixed the federal return.

Does anyone know if the $1040 income from watching a special needs family member would be considered household employment (requiring Schedule H) rather than self-employment? I had a similar situation and my accountant said it made a difference in how it's taxed.