@Aisha Mahmood, given your specific situation with the significant income drop and new businesses, I'd strongly recommend actually consulting with a tax professional rather than just using software to compare. With your income going from $85k to $25k, you might qualify for certain credits or deductions that weren't available before - like the Earned Income Tax Credit or premium tax credits if you get health insurance through the marketplace. These can be substantial and the eligibility rules are complex. Also, since you mentioned two new businesses with $3k combined profit, there might be startup costs, equipment purchases, or other business expenses you can deduct that could significantly impact which filing status is better. A good tax pro can help you identify legitimate business deductions you might miss. The audit concern is really overblown - the IRS doesn't care if you switch filing status year to year. They're much more interested in unreported income, excessive business deductions relative to income, or mathematical errors. Given the complexity of your situation (income change + new businesses), spending a few hundred on professional advice could easily save you more than that in taxes and give you peace of mind.

I've been dealing with a similar filing status decision and wanted to share something that might help. Beyond just comparing the immediate tax impact, consider how your choice affects other financial areas. Since your income dropped significantly to $25k, filing separately might actually make you eligible for income-based benefits that you wouldn't qualify for with your combined $83k household income. Things like premium tax credits for health insurance, certain state benefits, or income-driven student loan payments (if applicable) could be affected. The small businesses are another factor - even at $3k profit, make sure you're tracking all legitimate expenses throughout the year. Things like mileage, home office use, equipment, supplies, and even business-related meals can add up. Sometimes the business deductions alone can tip the scales toward one filing status being clearly better. One practical tip: if you're using tax software, don't just look at the refund amount. Look at your actual tax liability under each scenario. Sometimes a smaller refund actually means you paid less tax overall (which is better for your finances). The audit concern really isn't something to worry about with a simple filing status change. The IRS processes millions of returns where people switch between joint and separate filing - it's completely normal.

The IRS is such a joke fr fr... why they gotta make everything so complicated 🤡

I'm going through this right now too! Got flagged for identity verification about 10 days ago and still waiting for the 4883C letter. From what I've researched, the IRS says it can take up to 30 days to receive the letter, but most people seem to get it within 2-3 weeks like others mentioned. The verification process itself is pretty straightforward once you get the letter - you can do it online or by phone. Just make sure you have your documents ready like Victoria suggested!

22 Has anyone used the IRS Identity Protection PIN system to prevent this from happening again in future years? I'm thinking about requesting PINs for my kids after dealing with this same issue.

This is such a frustrating situation! I went through something very similar last year with my ex claiming our daughter when it was clearly my year according to our divorce decree. Here's what worked for me: I filed a paper return with a cover letter explaining the situation and included the relevant pages from my court order (highlighted the specific language about alternating years). The IRS processed it and sent my ex a notice that their return was being adjusted. One tip - make sure your court order language is very specific about tax years. Mine said "odd numbered years" vs "even numbered years" which made it crystal clear to the IRS. If your agreement just says "alternating years" without specifying which parent gets which years, you might need to provide additional documentation showing the pattern. Also consider getting an Identity Protection PIN for your son next year - it prevents anyone from using his SSN on a return without the PIN that only you would know. Saved me from dealing with this headache again this year! Good luck - the paper filing route is slow but it does work when you have proper documentation.

I'm in almost the exact same boat as you! Filed on February 5th through TurboTax, got accepted the next day, and I'm also claiming child tax credit for my son. Been stuck on "processing" for about 2.5 weeks now and starting to get anxious too since I need the money for some home repairs. Reading through these responses is actually making me feel a lot better - sounds like the child tax credit does add some processing time, and 3 weeks isn't unusual at all. The fact that Jackie got hers in 23 days with both EIC and child tax credit gives me hope that mine should be coming soon. I think I just need to be patient for another week or so before I start worrying that something's actually wrong. Thanks for asking this question - it's reassuring to know I'm not the only one feeling antsy about the timing!

I filed on February 7th through FreeTaxUSA and I'm in the exact same situation - claiming child tax credit for my two kids and stuck on "processing" for almost 3 weeks now. After reading all these responses, I'm feeling much more relieved! It sounds like returns with child tax credits are just taking the full 21+ days this year, which is totally normal. What's really helping my anxiety is seeing the specific timelines people are sharing - Jackie's 23 days with both EIC and child tax credit is super reassuring. I think the key takeaway is that "processing" status is completely normal and doesn't mean anything is wrong with our returns. The IRS is just working through their queue and credit-related returns seem to be taking the longer end of the normal timeframe. Thanks for starting this thread - it's so much better getting real experiences from actual people rather than just the generic "21 days" from the IRS website!

This is definitely one of those "technically vs. practically" situations that's becoming more common with mobile betting. I went through something similar last year when I had winnings from multiple states during business travel. The reality is that most states' tax systems aren't set up to handle the granular tracking that would be required for mobile betting across state lines. The sportsbooks are focused on legal compliance (making sure you're in an authorized state when betting), not creating detailed tax trails for every bet placement. For your $3,500 in winnings, I'd suggest this approach: 1. Check each state's minimum filing requirements - many don't require filing unless winnings exceed $600-$1,200 2. Look at what your 1099s actually show - they'll typically report to your home state or the sportsbook's license state 3. Keep records of your travel and betting activity in case questions arise later The enforcement risk is relatively low for smaller amounts like yours, especially if you're properly reporting the income somewhere. Most audits in this area focus on unreported income rather than which specific state it was reported in. If you're really concerned about compliance, consider consulting with a tax professional who handles gambling income, but for many people in your situation, reporting everything on your home state return is the most practical approach.

As someone who's dealt with this exact situation, I can tell you that the multi-state mobile betting tax question is becoming incredibly common. The legal framework just hasn't caught up with the technology yet. Here's what I learned after consulting with a tax attorney who specializes in gaming: while you're technically supposed to file in each state where you physically placed winning bets, the practical enforcement is nearly impossible. The sportsbooks use geolocation to verify you're in a legal betting state, but they don't create detailed tax reports showing exactly where each bet was placed. For your $3,500 in winnings, I'd recommend this approach: 1. Check if any single state had winnings over $1,200 - if so, definitely file there 2. Look at your 1099 forms to see which state(s) they're reported to 3. For smaller amounts spread across multiple states during brief travel, reporting on your home state return is generally the most practical approach The key is that you're still reporting the income - you're just not filing multiple state returns for small amounts that likely fall below most states' minimum thresholds anyway. Keep good records of your travel and betting activity just in case, but the audit risk for this type of situation is quite low for amounts like yours. Most tax professionals I've spoken with agree that the current system isn't designed to handle the complexity of mobile betting across state lines, and enforcement agencies are focusing on much larger cases of unreported gambling income rather than which specific state properly reported smaller winnings.