I've been dealing with Code 810 for about 5 weeks now and it's been such a rollercoaster! Initially I was panicking thinking I did something wrong on my return, but after reading through all these responses I feel so much better knowing it's just routine verification. I filed with EIC and child tax credit so that definitely explains it. The hardest part is just not knowing what's happening or how long it'll take. Seeing everyone mention taxr.ai has me curious - might be worth the $5 just for peace of mind since I've probably lost that much in productivity from constantly worrying about this lol. Thanks to everyone sharing their experiences, it really helps to know we're not alone in this! The IRS needs to do better with communication but at least we have this community to support each other through the waiting game 🤝

Code 810 is definitely stressful when you first see it! I went through this exact same thing about 2 months ago and was convinced I'd messed something up on my return. Turns out it was just routine verification for my EIC claim - they were cross-checking my income against employer records. The good news is that most 810 freezes do resolve, it just takes patience (which I know is easier said than done when you're waiting on your refund!). Mine took about 9 weeks total but I've seen others clear faster. One thing that really helped my anxiety was getting a clear explanation of what was actually happening instead of just guessing. Keep checking your transcripts weekly and definitely don't miss any mail from the IRS - sometimes they'll send requests for additional documentation that can speed things up if you respond quickly. Hang in there, you're definitely not alone in dealing with this! 💪

Your best bet is to check your transcripts every Friday morning since youre cycle 01. Thats when updates usually hit. But honestly just use taxr.ai and save yourself the headache. It breaks everything down in plain english

Cycle codes can definitely be confusing at first! Just to add to what others have said - the 20250701 breaks down as: 2025 (tax year), 07 (week 7 of processing), 01 (Friday processing cycle). While it gives you an idea of timing, don't stress too much about it. Focus on looking for transaction codes like 150 (return filed) and eventually 846 (refund issued) with actual dates. Those are the ones that really matter for your refund timeline!

I've analyzed hundreds of tax returns with side income like yours. The exact amounts matter here: With $2,500 in babysitting income, your self-employment tax will be approximately $353.16 (calculated as 15.3% of 92.35% of $2,500). For the 2023 tax year, the Child Tax Credit is $2,000 per qualifying child under 17, so potentially $4,000 total. Your income tax liability on $2,500 would be determined by your overall tax bracket, but the CTC would likely eliminate it entirely. Keep in mind that if your total income is between $11,750 and $46,560 (for two children), you may qualify for EITC worth up to $6,604 depending on your filing status and other income.

Just wanted to add my experience as someone who went through this exact situation! I had $2,800 in babysitting income in 2022 with two kids. The self-employment tax was definitely a shock at first - I wasn't expecting to pay both sides of Social Security and Medicare taxes. But like others mentioned, the Child Tax Credit completely wiped out my income tax liability, and I actually got a decent refund. One thing I learned the hard way: keep track of ANY expenses related to your babysitting work. I wish I had saved receipts for gas driving to their house, snacks I bought for the kids, even a small first aid kit I purchased specifically for babysitting. Every little deduction helps reduce that self-employment income! Also, if you plan to continue babysitting this year and expect to make more than $1,000, you might want to look into making quarterly estimated payments to avoid owing a big chunk next year.

Has anyone seen the proposals to eliminate the stepped-up basis? I know it was part of Biden's initial tax plan but I'm not sure if it's still being considered. Would significantly impact a lot of estate planning strategies if that happened.

The stepped-up basis rule has always seemed counterintuitive to me too. From a tax policy perspective, it essentially creates a permanent forgiveness of capital gains tax that can amount to billions in lost revenue annually. One aspect that often gets overlooked is the interaction with charitable giving. The current system actually encourages people to give appreciated assets to charity during their lifetime (since they avoid capital gains tax entirely) while holding other appreciated assets until death. This creates some interesting estate planning dynamics. I think the strongest argument for keeping it is administrative simplicity, but with modern record-keeping and digital asset tracking, that justification feels weaker than it did 50 years ago. The policy does seem ripe for reform, especially as wealth inequality has grown and these benefits increasingly flow to the very wealthy who can afford to hold assets indefinitely.

Dealing with tax debt is rough! But dont worry, the system is actually designed to only take from federal refunds for state tax debt. Its part of the Treasury Offset Program. I work with tax issues and seriously recommend using taxr.ai to get a clear picture of your situation. It breaks down exactly how offsets will affect your refund and when youll get paid. Its been a game changer for my clients dealing with offset confusion. Shows you everything from processing dates to expected deposit times. Best part is it only costs a dollar!

Just went through this exact situation last month! The good news is they'll only take from your federal refund for state tax debt. I owed about $800 to my state and was worried they'd hit both refunds too, but they only took it from federal. Got my full state refund a few weeks later. The offset letter should tell you exactly how much they're taking - definitely save that for your records!