I made several Tira conversions to Roth in '24. I made IRS "direct payments" online to cover my anticipated taxes on the conversions. This totaled a 6 figure payment and were listed in TTax "Tax Payments Worksheet", Lines 18b & 18c. These payments were made at the time of the conversion. The payment is reported on the 1040 line 25c as a withholding.
The mutual fund company did not give me any tax forms for these transactions. I have reported the conversions on the 8606-T (and S).
My problem is that the IRS sent me a check for the 6 figure amount as an 'overpayment'. I marked this check void and returned it with a letter of explanation that it was for tax on the conversion.
The IRS replied to my letter saying in part "Our system shows tax of X and withholding of Y". The amounts X and Y are correct and listed on my 1040 line 24 and 25d. The letter further states "We received two payments of 'A' & 'B' on <Date, 2024>." A & B match the numbers reported above on lines 18b & 18c. And they sent a new 6 figure check as a refund.
IMO They seem to be confusing withholding with direct payment. Perhaps I did not place the direct payment numbers in the correct spot on my return. Whatever the case it appears I will get nowhere returning the 6 figure check again. I'd love to keep it but I would not love being discovered and explaining this stuff.
I tried calling them when I received the first check and after 6 hrs of getting no where not getting someone to help me I gave up.
If there is a glaring error in reporting with the info I gave, I will file an amended return. Assuming TTax put the numbers in the right spot, I am looking for advice on how to correct this apparent error on the part of the IRS.
