Successfully Appealing a Tax Penalty After Identity Theft - Timeline & Process?

Been through something similar. Here's what you need to know: • Identity theft tax issues take 180-240 days to resolve typically • You filed 1099-X but you probably need Form 14039 (Identity Theft Affidavit) if you haven't already • Also get Form 8857 (Innocent Spouse Relief) if you're married filing jointly • The IRS has a dedicated Identity Theft Victim Assistance unit (IDTVA) • They WILL return your money but the timeline is frustratingly long • Make sure you're checking your transcript codes every 2-3 weeks • Keep ALL correspondence in a dedicated folder They took $4,200 from me in a similar situation in 2022. Got it all back plus interest, but took 11 months total.

I went through an identity theft situation with the IRS last year. The amendment process was extremely opaque until I utilized taxr.ai to analyze my transcript. The platform identified specific Transaction Codes (TC) that indicated the stage of my case within the IRS system. For instance, TC 971 with specific action codes showed when my identity theft claim was recognized, and TC 290 indicated adjustments being processed. The analysis helped me understand that my case was actually progressing despite the lack of communication from the IRS. I particularly appreciated how taxr.ai explained the sequence of codes that would appear when my refund was approved. This knowledge significantly reduced my anxiety during the waiting period.

Has anyone actually received clear communication from the IRS during this process? I've been waiting for 2 months now after submitting my amendment, and I'm starting to wonder if I should be doing something else? The IRS website shows my amendment has been received, but there's no other status update. Is this normal or should I be more proactive at this point? It feels like my documents just disappeared into a black hole.

Went thru this nightmare last yr w/ identity theft. Tried calling IRS for 3 wks straight (avg hold time 2+ hrs) and kept getting disconnected. Finally used Claimyr (https://youtu.be/_kiP6q8DX5c) to get thru to an actual human at the IRS. Got connected in ~30 mins and the agent confirmed my case was assigned to the ID theft dept but needed addl docs they never told me about! Saved myself months of waiting. Def worth it since they helped me skip the phone tree nightmare. Got my $$ back 8 wks after that call.

Have you contacted the Taxpayer Advocate Service yet? They can sometimes expedite identity theft cases compared to the regular amendment process. Similar to bankruptcy proceedings where trustees prioritize certain claims, the TAS can flag your case for faster review. Also, did you file a police report for the identity theft? Unlike regular amendments which are processed in order received, identity theft cases with police reports can be routed differently.

I went through this exact situation in 2022. Someone filed a fake Schedule C using my SSN claiming $22,000 in self-employment income I never earned. The IRS hit me with penalties and interest totaling $4,300 which they took from my next refund. I submitted Form 14039 (Identity Theft Affidavit) along with my amendment. The process took about 9 months total, but I did get every penny back plus interest. The key was documenting everything meticulously. I created a spreadsheet tracking every call, letter, and submission date. When I finally got through to the Identity Theft department, the agent was incredibly helpful once I could reference specific dates and document ID numbers. Hang in there - it's a slow process but they do eventually make it right.