Is FreeTaxUSA actually user-friendly? I tried using the IRS free file system directly once and it was a nightmare to navigate. I ended up going back to paying for TurboTax because the interface was better, but I'd love to save some money.

FreeTaxUSA is surprisingly user-friendly! It's not as flashy as TurboTax, but the interface is clean and straightforward. It walks you through each section with simple questions and explanations. You can save and come back to it, and it has a good review system to catch common errors. The best part is they don't do that annoying bait-and-switch that some other "free" services do where they surprise you with fees at the end for slightly more complex returns. Federal is actually free for almost all personal tax situations, and state is a flat $15 fee.

Exactly! Tax evasion charges are for people hiding millions in offshore accounts or completely fabricating businesses, not someone who made a mistake entering their dividend income. Your friend needs to realize the IRS has bigger fish to fry than simple returns with minor errors.

This is so helpful! Do you need any special information to create an account on these payroll sites? My company uses ADP I think but I've never logged in before.

For ADP, you usually need your company code (ask HR for this), your employee ID or SSN, and sometimes other identifying information like your date of birth or zip code. Some companies pre-register employees so you just need to set up your password, while others require you to go through a registration process. If you're not sure about the process, you can go to ADP's main website and look for "employee login" or "first time user" options. They have different portals (like Workforce Now, iPay, etc.) depending on what service your employer uses, so it might take a bit of trial and error to find the right one.

I tried calling the IRS but couldn't get through at all... just constant busy signals. Is there an email or specific number to use for W-2 issues?

Does this actually work? I tried creating an IRS account last year and they couldn't verify my identity online so I had to mail in a form. Never heard back after that.

It can definitely work, but not everyone can successfully create an online account. The IRS has pretty strict identity verification requirements. If you have certain credit freezes, recently moved, or don't have specific types of accounts they use for verification, you might get rejected. In that case, you can request a transcript by mail, but that defeats the purpose of getting quick access to solve an e-filing problem. Using the $0 AGI trick or calling the IRS directly might be faster options.

Don't mail your return if you can avoid it!!! I paper filed last year and it took 9 MONTHS to get my refund. The IRS is still processing paper returns from last year. Electronic is way faster if you can solve the AGI issue.

Wait WHAT? You had to pay $800 for a business that never operated? That seems absolutely ridiculous! Is that legal?

Yes, unfortunately it is legal. California charges an $800 minimum franchise tax to all LLCs registered in the state, whether they do business or not. Many states have similar fees, though California's is notoriously high. The logic behind it is that you're paying for the privilege and benefits of having limited liability protection, regardless of whether you use it. First-year LLCs in California now get a break on this fee, but after that, you owe it annually until you properly dissolve the entity. That's why it's so important to formally dissolve an LLC you're not using - otherwise these fees keep accumulating year after year.

I actually haven't done that part yet - I only dealt with the tax returns through the revenue department! Thanks for pointing this out. Looks like I need to file dissolution paperwork with the Secretary of State as well to completely close everything down.

Thanks for this tip! I looked more carefully at the error screen and found a tiny "proceed with caution" link in gray text at the bottom. When I clicked it, there was another screen asking me to confirm I wanted to continue despite the warning. After I clicked through that, it actually did let me submit! My return has been accepted by the IRS already. Can't believe the solution was that simple after all the stress. Do you think I need to worry about this $1 discrepancy causing problems later? Like will I get a letter from the IRS about it?

Glad it worked for you! You shouldn't worry about that $1 discrepancy at all. The IRS has a tolerance threshold for small differences - they don't pursue amounts that small because the processing cost would exceed the collection amount. I've had small discrepancies like this in previous years (usually from rounding differences) and never received any follow-up letters or notices. The fact that your return was accepted means their system didn't flag it as an issue worth pursuing. You're all good!

I actually work in software development (not for tax software though) and this is unfortunately common with complex calculation systems. The ACA premium tax credit calculation involves multiple variables and lookups that can create edge cases the developers didn't anticipate. The software companies prioritize fixing the most common scenarios first, and partial-year coverage affects a smaller percentage of users.

That makes sense but it's still super frustrating as a user! Seems like after several years of the ACA being in place, they should have figured out these calculations by now. These aren't exactly obscure scenarios - people change insurance all the time. What bothers me most is how the average person would have no way of knowing if their calculation is wrong. We just trust what the software tells us. Makes me wonder how much money the IRS collects from people who overpay because of software errors.