Reading all these replies reminds me how RIDICULOUS the healthcare system is in this country. Form 8962 is stupidly complicated for no reason... why should we need special services just to figure out how to tell the IRS "my parents already claimed this"??

Hey @Annabel Kimball! I went through this exact same situation last year and it's really not as complicated as it seems once you understand the basic concept. Since your parents claimed 100% allocation on their Form 8962, you essentially need to file your own 8962 to show the IRS that you're claiming 0% of the premium tax credit. Think of it as officially "passing" on your share. Here's what you need to do: 1. Get a copy of the 1095-A from your parents (make sure it's the exact same one they used) 2. Fill out Form 8962 with your personal info in Part 1 3. In Part 2, enter zeros for all months since you're not claiming any premium tax credit 4. In Part 4, show that your parents are taking 100% allocation while you're taking 0% The key thing is that the IRS computers need to see that 100% of the premium tax credit has been accounted for between all the tax returns filed. Your parents claimed 100%, so you need to officially claim 0% to balance it out. Make sure to send it certified mail with your 1095-A copy, and don't stress too much - this is a very common situation for young adults on their parents' plans who file independently!

Make sure you look into the Innocent Spouse Relief options too. If your ex-husband did anything fishy with taxes during your marriage, you might qualify. I found out my ex had been underreporting income for years, and I got relief from those joint tax liabilities after our divorce.

I went through something very similar when my divorce was finalized in late December a few years ago. That year-end filing status rule is brutal and catches so many people off guard. A few things that might help beyond what others have mentioned: 1. **Check if you qualify for Head of Household** - This is huge. Since your kids lived with you 70% of the time, you very likely qualify even though your ex claims them as dependents. The tax savings between Single and HOH could be $3,000-5,000 in your income range. 2. **Look into estimated tax payments for 2025** - Set up quarterly payments now to avoid this happening again. The IRS has a safe harbor rule where if you pay 110% of last year's tax liability (since you make over $150K), you won't owe penalties even if you end up owing more. 3. **Payment plan options** - The IRS has gotten much more flexible with payment plans. You can set up an online payment agreement for up to 72 months if needed. The setup fees are lower if you do it online vs. calling. 4. **Consider amending your 2024 return** if you discover you qualify for HOH after filing as Single - you have up to 3 years to amend and get a refund. The financial hit is awful, but you do have options. Don't let this crush you - it's fixable, just takes some time and planning.

I went through this exact same situation two years ago and it was incredibly stressful! Here's what I learned: definitely try to stop that direct debit through your bank first - that's your best bet to avoid the double charge altogether. If you can't stop it in time, the IRS will process it as an overpayment, but you'll need to be proactive about getting your money back. I found that calling early in the morning (around 7-8 AM) gave me the best chance of getting through to someone without waiting hours. One thing that really helped me was keeping a detailed log of every call I made, including date, time, who I spoke with, and what they told me. The IRS representatives sometimes give conflicting information, so having that record was invaluable when I had to call back. Also, don't be afraid to escalate if you're not getting results. After about 6 weeks of getting nowhere, I asked to speak with a supervisor and that's when things finally started moving. Got my refund about 3 weeks after that call. Hang in there - I know it feels overwhelming right now, but this absolutely can be resolved. The IRS deals with overpayments regularly, so you're not asking them to do anything unusual.

I feel for you - this is such a stressful situation! I actually went through something similar last year when I accidentally set up both electronic withdrawal and mailed a check for the same tax payment. Here's what worked for me: First, definitely call your bank ASAP to stop that scheduled direct debit if possible. Even if it's the weekend, many banks have 24/7 customer service lines that can help with stop payments. If both payments do end up processing, the IRS will recognize it as an overpayment, but you'll need to be proactive. I had success using Form 843 (Claim for Refund and Request for Abatement) rather than Form 8888 that was mentioned earlier - my tax preparer said 843 is specifically designed for situations like this where you've made an erroneous payment. The waiting is definitely the hardest part. In my case, it took about 7 weeks to get the refund check, but I called every 2 weeks to check status which seemed to help keep things moving. Also, if you have a local Taxpayer Assistance Center, they can sometimes help expedite these situations better than the phone lines. Don't lose hope - I know it's scary to have that much money tied up, but the IRS really does handle overpayments routinely. Just document everything and stay persistent!

Just wanted to add that the dealer might be able to transfer the tax credit directly at point of sale starting soon! That way you get the benefit immediately instead of waiting for tax time. Not sure if this helps with your income limit situation though. Check if your dealer participates in this program.

I went through this exact situation last year with my Model Y purchase! We were also just over the $300K limit when filing jointly, so I did extensive research on the married filing separately option. Here's what I learned: Yes, if your individual AGI is under $150K and the Tesla is titled in your name only, you can qualify for the credit when filing separately. However, you need to run the complete numbers because filing separately often costs more than the $7,500 credit saves. In our case, we lost about $3,200 in various tax benefits (mainly child tax credits and dependent care credits) but gained the $7,500 EV credit, so we still came out ahead by $4,300. The key things that hurt us were: 1) Only one spouse can claim the kids as dependents, 2) We couldn't take the child and dependent care credit, 3) We both had to itemize instead of one taking standard deduction. My advice: Use tax software to model both scenarios with your actual numbers before deciding. Also consider maxing out your 401(k) contributions this year to lower your AGI - that might get you under the joint filing limit without needing to file separately at all.

I'm dealing with the exact same situation right now - code 840 appeared on my transcript about 5 days ago and I've been stressed about whether I'll get my refund via direct deposit or if they'll switch to a paper check. Reading through everyone's experiences here has been incredibly reassuring! It sounds like the consensus from multiple people who've actually been through this is that 840 is just a temporary review hold and doesn't change your payment method. I'm particularly relieved to hear from the tax preparer that direct deposit info stays intact during the 840 process. My situation is similar to yours @Naila Gordon - I need this refund for business cash flow and can't afford unexpected delays. Based on all the timelines people have shared (mostly 11-21 days), I'm going to plan for about 3 weeks total and check my transcript daily. Thanks everyone for sharing your real experiences - this community knowledge is so much more helpful than trying to decipher IRS publications on my own!

I went through this exact situation about 8 months ago and wanted to share my experience to hopefully ease some concerns. I had code 840 appear on my transcript after filing my Schedule C return with significant home office and equipment deductions. Like many of you, I was worried about cash flow timing for my business. The 840 stayed on my transcript for exactly 14 days, then switched to 846 on a Tuesday morning, and I had my direct deposit in my business account by Thursday. The key thing that helped me was calling the Taxpayer Advocate Service after about 10 days - they couldn't speed up the process but confirmed my direct deposit info was still valid and that 840 reviews are actually quite common for business returns with larger deductions. One practical tip: I started tracking the cycle dates on my transcript because the IRS typically updates accounts on specific processing days each week. Once you know your cycle, you can focus your daily checks on the days when changes are most likely to occur. This saved me from constantly refreshing and helped manage my stress levels while waiting for resolution.