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Has anyone had their energy efficiency credits audited? I'm worried about claiming the full credit with my rental situation.
I had an audit last year that included my solar panel credit. The key was having good documentation - the certification that the panels qualified, the receipt showing what I paid, and a floor plan showing my calculation of the rental percentage. They didn't give me any trouble once they saw I had everything organized.
I went through this exact situation last year with a new HVAC system and 14% rental use. You're absolutely right that you can claim the full credit since you're under the 20% threshold. The IRS does consider rental activity as "business use" even though it's passive income. A few practical tips from my experience: Keep detailed records of your square footage calculation (I drew up a simple floor plan with measurements), save all your heat pump documentation including the Energy Star certification, and make sure your contractor can provide proof that the system meets the efficiency requirements. The IRS wants to see that you can justify both the qualifying equipment and the business use percentage. Also, don't forget that you'll need to use Form 5695 when you file. The credit gets applied directly to reduce your tax liability, which is great since it's not dependent on your income level like some deductions are.
Based on the Internal Revenue Manual section 25.25.6, what you're experiencing is likely an RPD (Return Processing Department) verification hold. The system detected a discrepancy that requires manual verification. There are precisely three types of verification letters the IRS typically sends in this scenario: 1. Letter 4883C - Identity Verification Letter 2. Letter 5071C - Identity Verification Letter (more common) 3. Letter 5447C - Taxpayer Protection Program Verification Letter The verification process typically takes 2-3 weeks from the date you complete verification. If you haven't received a letter within 14 days of being told one was sent, you should contact the IRS Taxpayer Protection Program directly at 800-830-5084 between 7am and 7pm local time.
I'm going through something very similar right now! Filed in late February and have been checking my transcripts obsessively. They were blank for about 3 weeks, then WMR suddenly showed a refund date but transcripts still blank. When I called last week, they told me the same thing about verification and expecting a letter. I'm really hoping this doesn't delay things too much because I have some important expenses coming up. It's reassuring to see that others have gone through this process successfully, even though it sounds like the timing can be unpredictable. Has anyone who's been through this process noticed if there are certain situations that trigger verification more often? I'm wondering if major life changes (like divorce) make returns more likely to get flagged for this kind of review.
Has anyone used TurboTax to handle switching methods mid-year? I'm confused about how to set this up correctly in the software.
TurboTax handles it pretty well. When you get to the vehicle section, it asks if you want to use standard mileage or actual expenses. Choose actual expenses for the year with the big repair. It will walk you through entering all your costs and your business percentage. The next year, you can switch back to standard mileage by selecting that option instead.
Just went through this exact situation last year with a $7,200 transmission replacement! You're absolutely right that you can switch to actual expenses for 2023 to capture that repair deduction, then switch back to standard mileage for 2024. A few things I learned the hard way: 1. Start keeping meticulous records NOW - not just for the repair, but for ALL vehicle expenses (gas, oil changes, registration, insurance, etc.) since you'll need to claim actual expenses for the entire year, not just the repair 2. The business use percentage applies to ALL expenses, so make sure you're consistent with that 33% across everything 3. If you do increase your business percentage for the rest of the year, document WHY (like "purchased personal vehicle on X date, now using work vehicle exclusively for business") One gotcha I discovered: if you've been depreciating the vehicle under standard mileage, switching to actual expenses means you need to figure out the "adjusted basis" for depreciation purposes. It's not super complicated, but definitely something to get right. The silver lining is real though - I saved about $1,800 in taxes by making the switch for my repair year. Just make sure you have a solid bookkeeping system in place for tracking everything!
If you need to contact the IRS about identity theft concerns, call their dedicated Identity Theft Hotline at 800-908-4490. They can help with getting an IP PIN and filing the Identity Theft Affidavit (Form 14039). Also the IRS NEVER asks for personal info via text, email or social media so that's another red flag about your dad's request.
I'm so glad you took action and froze your credit! That was absolutely the right move. The combination of red flags you described - the SSN request, unauthorized authorized user addition, and credit offers to his address - definitely warranted immediate protective action. For anyone else reading this who might be in a similar situation, it's worth noting that legitimate tax preparers and software will clearly explain WHY they need any family member's SSN (like for dependents, education credits, etc.). Vague requests like "the software is asking for it" without explanation are major warning signs. Also, consider setting up account monitoring with your bank and credit card companies if you haven't already. Many offer free alerts for any new account inquiries or applications using your SSN. It's another layer of protection that can catch potential misuse early. The IRS Identity Protection PIN is definitely your best next step - it essentially locks down your tax filing so no one can submit returns with your SSN without that PIN. Stay vigilant and trust your instincts like you did here!
Sydney Torres
For future reference, there are better ways to track your refund than just WMR: ⢠Create an IRS online account and check your transcript directly ⢠Look specifically for Transaction Code 846 which indicates a refund has been issued ⢠The transcript typically updates before WMR does ⢠Pay attention to cycle codes (last two digits indicate which day of the week updates happen) ⢠Many banks process deposits early, especially online banks I'm glad your money arrived! It's actually fairly common for funds to appear before WMR updates, especially during the peak processing weeks of March and early April. The IRS prioritizes getting payments out over updating their customer-facing tools.
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Amara Torres
This exact same thing happened to me just last week! Filed on 2/18, WMR stuck on "still processing" with Topic 152 for over a month, then boom - refund appeared in my account on 3/19 with zero warning. I was starting to think something was wrong with my return. What's funny is I actually called the IRS the day before my deposit hit because I was so worried. The agent told me my return was "in the final stages" but couldn't give me a timeline. Then literally the next morning, there was my refund! WMR didn't update until 2 days later. I think the lesson here is that WMR is more of a general status indicator than a real-time tracking tool. Once you hit that "still processing" stage, especially with credits involved, the actual deposit can happen anywhere from a few days to several weeks later. The important thing is that you got your money - that's the IRS's way of saying everything checked out fine with your return!
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