Quick warning from someone who handles these regularly - the 1042-S withholding might be for different types of income (dividends, capital gains, etc.) which get treated differently under the treaty. Line 1 of your 1042-S will have an "Income Code" that tells you what type of income it is. Code 06 = dividends (eligible for 15% treaty rate) Code 09 = capital gains (might be completely exempt) Code 15 = scholarship/fellowship (different rules apply) Make sure you know which type you're dealing with before filing anything!

This is exactly the situation I found myself in a few years ago! As a US citizen receiving UK stock dividends, you're absolutely right that the 30% withholding seems excessive. Here's what worked for me: First, submit a W-8BEN form to your company's stock plan administrator (not the IRS directly) to get the withholding reduced from 30% to 15% going forward under the US-UK tax treaty. Second, file Form 1116 with your tax return to claim a foreign tax credit for the taxes already withheld. Since you mentioned this has been going on for 12 years, you can file amended returns (Form 1040-X) for up to the past 3 years to recover the excess withholding. The potential refund could be substantial depending on your dividend amounts. The process is definitely doable as a DIY project if you're comfortable with tax forms, but given the years of potential overpayments involved, it might be worth consulting with a tax professional who specializes in international taxation to make sure you maximize your recovery and handle everything correctly.

I'm a CPA and see this situation frequently. When Box 2a is blank and Box 5 equals the gross distribution, it means the distribution is nontaxable return of principal. The distribution code 7D confirms this is from a nonqualified annuity. FreeTaxUSA is correct to warn you because $0 taxable can sometimes trigger a review, but if the information is reported correctly on your return matching the 1099-R, there's no real risk. The IRS computers can see that Box 5 equals the gross distribution. For anyone dealing with annuities: always keep your purchase documentation! It's critical for establishing your cost basis if there's ever a question.

This is a great question and one I've helped clients navigate many times. You're absolutely right to be confused - the 1099-R instructions aren't very clear about this situation. When Box 2a is blank (not zero, but actually blank) and the full distribution amount appears in Box 5, this definitively means the entire distribution is a return of your aunt's after-tax contributions to the annuity. It's not taxable income because she already paid taxes on this money when she originally purchased the annuity 12 years ago. The key here is that this is a nonqualified annuity (funded with after-tax dollars), which is confirmed by the 7D distribution code. The company left Box 2a blank rather than entering $0 to clearly indicate this is return of principal, not taxable earnings. Don't worry about the FreeTaxUSA warning - enter $0 for the taxable amount. The IRS matching systems will see that Box 5 equals the gross distribution and understand this is proper treatment. I've filed hundreds of returns with this exact scenario and never had an issue. Keep the 1099-R and any original annuity purchase documents as backup. Once your aunt eventually recovers her entire original investment through these distributions, future payments will become taxable and start showing amounts in Box 2a.

I'm so sorry for your loss and the additional stress this tax situation is adding during an already difficult time. Given everything you've described, an OIC for the estate sounds very promising. The key factors working in your favor are: 1. **Property condition documentation**: The severe damage, pest infestation, and structural issues you described significantly reduce the actual marketable value of these assets, regardless of their assessed values. 2. **Estate-only liability**: As others mentioned, you won't be personally liable for your father's tax debt - this is strictly an estate matter. 3. **Reasonable collection potential**: The IRS will evaluate what the estate could realistically generate in cash, not theoretical values. I'd recommend taking these immediate steps: - Document everything with photos and get written assessments of repair/cleanup costs - Obtain current appraisals that reflect the actual condition and marketability - Calculate all selling costs (realtor fees, closing costs, outstanding property taxes) - File the OIC using Form 656-L specifically for estates Given the condition you've described, there's a real possibility the mobile home has negative net value once cleanup and disposal costs are factored in. This could actually strengthen your OIC position significantly. The fact that your father struggled with addiction issues is also relevant for the hardship narrative - the IRS does consider circumstances that led to the tax situation when evaluating offers. Don't lose hope. Many estates in similar situations have successfully negotiated reasonable settlements that allow heirs to retain some assets while satisfying the IRS's collection requirements.

I'm so sorry for your loss, Amina. Dealing with a parent's tax debt on top of grief is incredibly overwhelming. The good news is that an OIC for your father's estate is definitely worth pursuing given what you've described. The IRS will evaluate the estate's "reasonable collection potential" - which is the actual cash the estate could generate, not just paper values. A few critical points for your situation: **Document everything immediately**: Take extensive photos of the mobile home's condition - the pest damage, structural issues, utility problems, debris piles. Get written estimates from contractors for cleanup, pest remediation, and repairs needed to make it marketable. These costs may actually exceed the property's value. **Professional appraisals**: Get current appraisals for both properties that account for their actual condition and marketability, not just theoretical values. **Consider environmental issues**: Given the neglected condition, there may be mold, asbestos, or other hazardous materials that would require expensive remediation before sale. **Calculate all selling costs**: Realtor fees, closing costs, outstanding property taxes, and cleanup costs all reduce what the estate would actually net from any sale. The fact that your father struggled with addiction is relevant for the hardship narrative - it helps explain how the tax situation developed. You mentioned already filing probate - this creates some time pressure since the IRS can file claims against the estate. I'd recommend moving quickly to get your OIC package together while you still have maximum negotiating flexibility. There's real hope here that you could settle for significantly less than the full amount owed.

One thing nobody's mentioned yet is that Republic, Pathward, and SBTPG are all third-party processors that only handle refunds if you've chosen to have your tax preparation fees deducted from your refund. If you pay for tax preparation upfront, your refund comes directly from the IRS to your bank, which is typically faster and avoids those processing fees mentioned above. Direct IRS deposits usually arrive on the exact DDD or the next business day. Those third-party processors are essentially giving you a short-term loan for your preparation fees, and they're charging you for it.

This is such a helpful initiative! As someone who's been through the refund waiting game multiple times, I think tracking all this data will really benefit the community. One additional column I'd suggest adding is "Return Complexity" - like whether you itemized deductions, had multiple W-2s, or reported self-employment income. In my experience, simpler returns (standard deduction, single W-2) tend to process faster than complex ones. Also, for those mentioning trace numbers - you typically only get one if your refund is more than 28 days late and you call to initiate a refund trace. It's not something that's automatically generated for every return. Looking forward to seeing what patterns emerge from this data! It's always reassuring to know we're not alone in this waiting process.

Quick warning about Venmo - they've been updating their reporting requirements almost yearly. In 2022, they were supposed to start reporting $600+ to the IRS but then it got delayed. Keep an eye on the news because this is changing all the time and the "friends and family" loophole might not work forever.

I'd also recommend your cousin start keeping detailed records now if he hasn't already - not just for this year's taxes, but for future audits. The IRS can go back 3-6 years (or longer in cases of suspected fraud), so having organized records of income and expenses is crucial. Since he's essentially running a business, he should consider opening a separate business checking account and getting a business credit card for expenses. This makes tracking so much easier and looks more professional if he ever gets audited. Plus, many business credit cards offer cash back on tools and supplies. One more thing - if he's planning to continue this handyman work, he might want to look into getting proper business insurance. If he gets injured on a job or accidentally damages someone's property, personal insurance might not cover it since it's business activity.