One important thing nobody mentioned - if you had a refund coming on your original return, the IRS will hold it until your amendment is processed. So if youre expecting money back, prepare to wait a LONG time.

I've been in a similar situation and definitely agree with everyone saying to wait for the letter. The IRS correspondence will have specific notice codes and exact amounts that you'll need for your amendment. Phone agents sometimes give incomplete or slightly incorrect information, and you don't want to file an amendment based on partial details. The letter will also tell you exactly what documentation you need to include with your 1040X. I know it's frustrating to wait when you just want to get it resolved, but doing it right the first time will save you months of additional delays. In the meantime, you could gather any missing tax documents (like that 1099 you mentioned) so you're ready to go once the letter arrives.

Something important no one's mentioned - the Child Tax Credit amount phases out at higher income levels. Since your ex makes more than you ($78k vs $59k), you might actually benefit more from the credit than he would. For 2024, the phase-out begins at $75,000 for single filers. So your ex is already in the phase-out range while you're still under it. Depending on his exact income, he might not get the full benefit of the credit. If you're trying to maximize the total benefit between both households, it might make financial sense for you to claim both children in some years, especially if his income continues to rise. You could then work out some other financial arrangement to make things fair.

You're absolutely right to want to handle this fairly! As someone who went through a similar situation, I can confirm that splitting the Child Tax Credit with 50/50 custody is completely doable and legitimate. Since your divorce decree doesn't specify who claims the children for tax purposes, you have flexibility. The two most common approaches are: 1) Each parent claims one child every year, or 2) Alternate years where one parent claims both children. Given that you mentioned covering most of their healthcare costs, you might want to factor that into your negotiation with your ex. You could propose that you claim one child each year, or even suggest alternating who gets to claim both kids with the understanding that whoever doesn't claim them that year contributes more to certain expenses. The key is getting any agreement in writing - even a simple email or text exchange works. This prevents the "he said, she said" situations that can happen at tax time. Also, keep detailed records of your custody schedule and any expenses you pay for the children. While the IRS doesn't require you to prove who spent more money on the kids for the Child Tax Credit (unlike the dependency exemption rules), having documentation helps if there are ever questions. Don't let what happened last year repeat itself. Have this conversation now so you both know the plan going forward!

Don't overthink the building management fees! I spent hours researching this same question last year. The admin fee and move-in fee are definitely deductible in year 1 as rental expenses. The working capital contribution is trickier - technically it's a deposit into the building's reserve, so it's not immediately deductible. Also, make sure TurboTax is prorating your expenses correctly for the partial year. For things like property taxes and insurance, you can only deduct the portion that applies to when the property was actually a rental (Oct-Dec in your case). So that would be 3/12 of your annual amounts. This might be why some of your numbers look off.

I had a very similar situation with my first rental property! Your cost basis calculation is definitely off - with a $520k purchase price, that $134,628 figure suggests there's an input error somewhere in TurboTax. A few things to double-check: 1. Make sure you entered the correct land/building allocation. Based on your tax assessment ($215k land, $100k improvements), you should allocate roughly 68% to land and 32% to building from your purchase price. 2. Verify you didn't accidentally enter a partial ownership percentage or put in the wrong purchase price. 3. The bathroom renovation ($15k) should be added to your depreciable basis since it was done before placing in service. Your depreciable basis should be approximately: ($520k - $353k land value) + $15k renovation = ~$182k for the building portion. For the closing costs, most of what you listed (recording fees, title insurance, legal fees) get capitalized into your basis rather than expensed immediately. The admin fee and move-in fee to building management can typically be expensed in year 1, but the working capital contribution is usually treated as a capital asset. Also make sure TurboTax is correctly prorating your expenses for the 3-month rental period (Oct-Dec). Your actual deductible expenses should be much higher than $257 for three months of operation.

Does anyone know if tax software like TurboTax automatically calculates the Social Security tax overpayment refund? Or do I need to manually enter something specific?

This is such a relief to read! I'm in almost the exact same boat - left my job in July after hitting the SS tax cap, then started a new position where they've been withholding SS tax for the rest of the year. I've been losing sleep over whether I'd have to deal with separate payments and refunds. Based on what everyone's saying here, it sounds like the IRS will just net everything out on my 1040, which makes way more sense than having to juggle multiple transactions. The safe harbor rule explanation was especially helpful - I definitely paid over 110% of last year's tax through withholding, so that should protect me from penalties. Thanks to everyone who shared their experiences and tools. It's nice to know this is a common situation and there are resources to help navigate it!

Don't overlook the importance of state tax knowledge! I used an out-of-state preparer once to save money and ended up missing out on several state-specific deductions. Cost me way more than I saved. At minimum, make sure whoever you use has experience with your specific state's LLC tax requirements, even if they're not physically located there.

I completely understand your stress about this situation - I was in a similar boat with my consulting LLC a couple years ago. Here's what I learned from my experience: You absolutely don't need a CPA for LLC tax preparation, especially if budget is a concern. An Enrolled Agent (EA) can handle everything you need and typically charges 20-40% less than CPAs. EAs are federally licensed and can represent you before the IRS, which is crucial when dealing with multiple years of unfiled returns and potential penalties. For the location question - physical proximity doesn't matter, but state tax expertise absolutely does. I made the mistake of using someone from out-of-state who didn't understand my state's specific LLC requirements and it ended up costing me more in the long run. Look for someone who specifically mentions experience with your state's tax laws, even if they're not physically located there. Given your multi-year backlog, focus on finding someone with experience in penalty abatement and catch-up filings. They can often get penalties reduced or waived entirely by properly explaining your circumstances to the IRS. Don't let the stress paralyze you - the longer you wait, the worse it gets. Getting accurate returns filed ASAP is what matters most, regardless of whether it's done by a CPA or EA. The IRS cares about accuracy and compliance, not the credentials of who prepares your returns. Good luck!