re: Babysitter (Niece) received 5071c letter. Never Filed A Return

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But he didn’t 1099 her right? He simply tried to get a tax benefit (writing off childcare) and the byproduct affected his niece.

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Exactly

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I’m just curious though how did she get roped in? You named her? I guess I didn’t realize you had to specify who did the babysitting.
How would he have claimed childcare credits without affecting his niece?

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Yes I had to list her. That is why I said her mother (my sister) knew I was claiming her cause she’s the one who gave me the info. Pretty much went like this “I think I can get a credit from *my niece* for watching the kids. I have to list her on my taxes though. You mind?” My sister “That’s nice! Go ahead.” We both thought she would fall under the minimum income and didn’t consider the self employment side of it. As Zzyzx said, I didn’t 1099 her. I simply took a credit that unintentionally affected her. Yes I’m going to pay her part and file for her. I just wanted to make sure the 5071c letter was because of this and not something else. Thanks for the non help from most of you guys. I really appreciate it..

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At least he didn’t post his stupidity on the OT. Imagine that roasting

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Oh if there was a thread made for the OT this is absolutely THE ONE. People would trip over themselves to comment.

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OP could file a return for her, pay the taxes, and help her open a Roth IRA.

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You trust the OP with opening a retirement account at this point?

congrats on being a giant fricking douchebag, OP.

I hop she doubles her rate and asks for benefits after this.

Don’t listen to these people. Kids need to learn the hard way that the IRS will frick them. You did your niece a solid by letting the IRS frick her over. Great job.

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I’m just curious though how did she get roped in? You named her? I guess I didn’t realize you had to specify who did the babysitting.

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I don't either, perhaps he should actually call the IRS and make sure it's not just identity theft.

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However, the 5071c is a prove your identity letter, so you might want to get her to log on the special irs site to confirm her identity before doing anything.

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Thanks, this was the point of the post. The letter read:
“Dear TAXPAYER, We received a federal income tax return, Form 1040, for the tax year above (2021) using your name and Social Security number (SSN) or individual taxpayer identification number (ITIN). To protect you from possible identity theft, we need to verify your identity at www.idverify.irs.gov before we process the tax return, issue a refund, or credit any overpayments to your account”.

As I said earlier my return has already been processed and refunded. This reads as if someone used her info to file a return but I guess someone could get that her info was used in a return from that as well. I would think one of us would have received an audit notice and not a 5071c if they suspected one of us for fraud, correct?

We need an update.

Why would you do this?