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Something similar happened to me last year, and it turned out my tax preparer had accidentally submitted my extension twice. Double-check with whoever prepared your taxes (if you used someone) before assuming the worst!
I prepared everything myself using TurboTax. This was definitely my first submission attempt. I called the Identity Protection Specialized Unit like someone suggested above, and they confirmed someone else tried filing with my SSN! Currently working through the identity theft affidavit process now. Thankfully I caught it early.
That's definitely more concerning then. Glad you called and confirmed! The earlier you catch these things and get the identity theft affidavit filed, the better. Make sure you also request an Identity Protection PIN from the IRS for next year - it's an extra 6-digit code that prevents anyone from filing electronically with your SSN without the PIN.
Quick question - does anyone know if filing the identity theft affidavit automatically extends your filing deadline? Or do I still need to submit a separate extension if this happens to me?
You absolutely still need to file the extension separately! The identity theft affidavit (Form 14039) doesn't extend your filing deadline. Make sure to submit Form 4868 by mail ASAP with "POTENTIAL IDENTITY THEFT" written at the top so they flag it for special processing.
From my experience working with tax issues, you should definitely file a complete and accurate return even if you've already paid some bills. What you received were probably automated notices based on partial information. When you file your complete return, make sure you include a statement explaining that you've already made payments in response to IRS notices. List the notice numbers, dates, and payment amounts. This helps the IRS properly credit your account. Also, keep in mind that for 2021 returns filed in 2025, you're still eligible for any refund due until April 15, 2025 (the three-year statute of limitations for refunds). So if you overpaid, you can still get that money back.
Thanks for this advice! Should I attach copies of the notices and payment confirmations to my return? And would it be better to file electronically or mail a paper return in my situation?
You don't need to attach copies of the notices to your return, but do keep them for your records. Instead, include a brief statement referencing the notice numbers and payment amounts on a separate sheet if filing by paper, or in the comments section if filing electronically. For your situation, electronic filing is generally better because it processes faster and you'll get confirmation of receipt. However, if your return is very late (which 2021 would be in 2025), some tax software may not support e-filing for prior years, so you might have to mail it. If mailing, definitely use certified mail with return receipt so you have proof of filing.
One thing nobody mentioned - if you get a refund from your 2021 return after all this, the IRS probably won't pay you interest on it since the late filing was your responsibility. But if you end up owing more, they'll definitely charge interest on the unpaid amount from the original due date. The IRS is generally reasonable about honest mistakes, but they're very strict about deadlines and required filings. I learned this the hard way when I missed filing for 2 years during a rough patch in my life.
Actually, the IRS does pay interest on refunds that are issued more than 45 days after the return is filed, even for late-filed returns. The interest rate changes quarterly. It's not a lot, but it's something. I filed my 2019 taxes super late and still got interest on my refund.
Hey, I'm in Texas too and got the same Medicaid 1095-B form. My tax preparer told me to just keep it in my files but not to worry about filing it. She said the same thing about only 1095-A forms being needed for filing. I've done it this way for the past two years with no issues.
Did your tax preparer explain why the 1095-A is treated differently than the B form? I'm trying to understand the difference between them.
The 1095-A is for Marketplace insurance and involves tax credits that need to be reconciled on your tax return. Those credits directly impact your tax liability, so the IRS needs that information. The 1095-B just proves you had coverage through a government program like Medicaid, which doesn't involve tax credits that need reconciliation. Since there's no direct tax impact from having Medicaid (no credits to calculate), there's nothing for the IRS to process from the form.
I'm confused why we even get these forms anymore. Didn't the whole health insurance requirement (individual mandate) get removed a few years ago? Do we still need to worry about proving we had coverage?
I went through something similar in 2023. My advice: get a tax professional. I tried doing it myself and made things worse. Found a CPA who specializes in unfiled returns and IRS problems, and it was worth every penny. For the garnishment specifically, once you file those missing returns, you might qualify for a hardship reduction or removal. If you're actually owed refunds as you suspect, that will help your case tremendously. The CPA can file Form 911 (Taxpayer Advocate Service) to help expedite the garnishment release if you're experiencing financial hardship because of it. Don't beat yourself up about the delay - the pandemic was rough on everyone's mental health. Just focus on fixing it now.
How much did the CPA charge you for handling multiple years of unfiled returns? I'm in a similar situation but worried about the cost.
For three years of unfiled returns plus dealing with a lien (similar to garnishment), I paid about $1800. But honestly, it varies widely depending on your location and complexity. My situation included self-employment income and the tax pro had to reconstruct some missing records. The initial consultation was free, which helped me understand what I was getting into before committing. Many tax pros will work out payment plans too, especially if you're already in financial distress. Don't let potential costs stop you from at least talking to someone - most will give you a price estimate during the first conversation.
Don't panic! The good news is that if you've been overpaying and are due refunds, once you file those returns, you might actually come out ahead. But you need to act quickly because there's a 3-year limit on claiming refunds. For the house sale, make sure you have documentation for any improvements you made to the property while you owned it. These increase your basis and can reduce any capital gains. If it was your primary residence and you lived there at least 2 of 5 years before selling, you probably qualify for the capital gains exclusion ($250k for single, $500k for married filing jointly). I've used TurboTax to file back taxes before and it was pretty straightforward. They keep previous years' versions available. If your situation is complicated though, hiring a pro might save you money in the long run.
TurboTax is great but wouldn't a professional be better for dealing with the garnishment? That seems like the urgent problem here.
Ella Cofer
I've been using FreeTaxUSA for the past three years and it's been great. Federal filing is free and state is only $15. No hidden fees that I've encountered. I was paying $230 at a tax chain before this and getting the exact same refund. For a simple tax situation like yours, there's absolutely no reason to pay someone $1350. The software asks all the same questions a preparer would. Just be careful and double-check your info before submitting!
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Kevin Bell
ā¢Do they offer any support if you get confused during the process? I'm not super tax-savvy and that's why I've always used a preparer.
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Ella Cofer
ā¢They do offer customer support through email for free, and if you upgrade to their deluxe version (which is still only about $7), you get access to live chat support. Honestly though, their interface is really straightforward and they explain things in simple terms throughout the process. Their help sections are actually really good at explaining tax concepts in plain English, much clearer than what I got from my previous tax preparer who just rushed through everything. And even with the deluxe upgrade for priority support, you're still paying less than $25 total, which is a fraction of what you'd pay a professional.
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Savannah Glover
Just be careful with the "free" options advertised by TurboTax and H&R Block. They lure you in with "free" then halfway through tell you that you need to upgrade to a paid version because you have dependents or some other common situation. Happened to me last year and I ended up paying $120 when I expected it to be free!
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Felix Grigori
ā¢Yep, this happened to me too. Started with "free" TurboTax, ended up paying $175 after state filing and all their add-ons. Still better than the $350 I was paying before, but definitely not the "free" they advertised.
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