This thread has been absolutely incredible - I'm amazed by the depth of practical advice everyone has shared! As someone who's been hesitating about making this same transition for months, reading through all these real-world experiences has given me the confidence to move forward. I particularly appreciate how the discussion evolved from the basic filing requirements to all the broader business implications. The points about updating operating agreements, reviewing insurance coverage, handling existing contracts, and coordinating state requirements were eye-opening - I definitely would have overlooked most of these aspects if I'd just focused on the IRS filings. The emphasis on documentation and verification throughout the process is also really valuable. Using certified mail, keeping detailed records, including cover letters that explicitly link the revocation statement and Form 8832, and following up with the IRS for written confirmation - these are the kinds of practical details that can make the difference between a smooth transition and months of headaches. One quick question for those who've been through this - did any of you encounter unexpected costs during the transition beyond the obvious items like legal/accounting fees? I'm trying to budget for this process and want to make sure I'm not missing any hidden expenses. Thanks again to everyone who took the time to share their experiences. This community is an incredible resource!

This has been an incredibly thorough and helpful discussion! As someone who's currently working through a similar S corp to disregarded entity transition, I wanted to add one more consideration that came up during my planning process. If you have any state-specific business licenses or permits that were issued based on your S corporation status, you may need to update or reapply for these after the classification change. In my case, I discovered that my state contractor's license was tied to my S corp EIN and classification, and I needed to file an amendment with the state licensing board to reflect the change back to disregarded entity status. This isn't something that would necessarily show up in the IRS guidance or even in discussions with your tax attorney, but it could affect your ability to continue operating legally in certain regulated industries. I'd recommend reviewing any professional licenses, permits, or certifications your business holds to see if they have entity-type requirements. Also, if you accept credit cards for your business, your merchant services provider may require notification of the entity classification change. Some processors have different fee structures or requirements based on entity type, so it's worth checking with them during your transition planning. The step-by-step filing approach everyone has outlined is excellent - just wanted to add these operational considerations to the comprehensive list that's been developed here. Thanks to everyone for sharing such detailed and practical advice!

Has anyone tried using the free file fillable forms from the IRS for a zero-income return? I don't want to pay for tax software if I'm not getting anything back.

This is really helpful info! I had no idea about refundable credits for people with zero income. Just to clarify though - when you say "enter $1" as a workaround, does that create any problems later? Like, am I technically lying on my tax return if my actual income was $0? I want to make sure I'm doing this correctly and not accidentally committing tax fraud or something. Also, does anyone know if there's a time limit on filing these zero-income returns? Like if I should have filed last year but didn't, can I still go back and file for 2023 to claim any credits I might have missed?

Just wanted to share my recent experience as another Australian developer who went through this exact process! I submitted my W-8BEN for iTunes Connect about 3 months ago and learned a few things that might help. First, don't stress too much about the foreign tax ID field - I left mine blank initially because I didn't have an ABN at the time, and Apple still processed it without issues. You can always update your tax info later in iTunes Connect if you get an ABN down the track. The key thing that made the biggest difference was definitely checking box 9 for the treaty benefits. I can confirm the reduced withholding rate (5% instead of 30%) showed up on my very first payment, so it takes effect immediately once Apple processes your form. One tip I wish I'd known earlier: after you submit the W-8BEN, it can take Apple anywhere from 24-48 hours to process it. You'll get an email confirmation once it's approved, and then you can see the updated tax rate in your payments section. Also, make sure your legal name on the W-8BEN exactly matches what you used when setting up your Apple Developer account - any mismatch can cause delays. Good luck with your game launch! It's such an exciting milestone getting your first app ready for the store.

As someone who went through this exact same struggle last year, I completely understand the confusion! The W-8BEN form is definitely intimidating when you're dealing with it for the first time. Here's what I learned after making a few mistakes and having to resubmit: **The essentials for Australian developers:** - Leave the US taxpayer ID field blank (you don't need an ITIN for app royalties) - For the foreign tax ID, you can use your TFN or ABN if you have one, but it's actually optional - I left mine blank for privacy reasons and it was accepted - Reference number field stays empty - **Most important:** Check box 9 for treaty benefits - this drops your withholding from 30% to 5% - Leave box 10 blank unless you're claiming special exemptions (which you're not as a standard developer) **Pro tip:** Make sure your name on the form exactly matches your Apple Developer account. Even small differences like using a middle initial on one but not the other can cause rejection. The good news is once Apple processes it (usually within 48 hours), the reduced tax rate applies immediately to all future payments. It made a huge difference to my first few months of revenue! Don't overthink it - you've got this! Your game sounds exciting and this tax form is just a small hurdle before you can start earning from your hard work.

One additional thing to watch out for - if you're planning to continue trading T-Bills, you might want to consider making the de minimis election under Section 1273(a)(3). If the market discount is less than 0.25% of the face value multiplied by the number of complete years to maturity, you can elect to treat it as zero (meaning no interest income to report). For example, if you have a T-Bill with a face value of $10,000 maturing in 6 months, and the market discount is less than $12.50 (0.25% × $10,000 × 0.5 years), you could potentially elect to treat the discount as zero. This can simplify your tax reporting significantly if you're doing a lot of short-term T-Bill trading. The election is made by attaching a statement to your return, but like the constant yield method election, it needs to be made in the year you acquire the security. Worth considering for future purchases if you find yourself dealing with small market discount amounts regularly!

This thread has been incredibly helpful! I just want to add one more practical tip for anyone using TurboTax specifically. When you're entering the accrued market discount as interest income, make sure to enter it in the "Other Interest Income" section rather than trying to add it to any existing 1099-INT entries you might have. In TurboTax, go to Federal Taxes > Wages & Income > Interest and Dividends, then scroll down to the "Other Interest Income" section. Enter the $437 (or whatever your amount is) there and label it clearly as "Accrued Market Discount - T-Bill" in the description field. This keeps it separate from your regular interest income and makes it easier to track if you ever need to reference it later. The investment sales portion (for the proceeds and cost basis from your 1099B) should be entered separately in the Investment Income section under "Stocks, Mutual Funds, Bonds, Other." TurboTax will automatically calculate any capital gain/loss from that information. I learned this the hard way after initially trying to modify my 1099-INT entries and creating a mess that took forever to untangle. Keeping the market discount separate as "other interest income" is definitely the cleaner approach!

This thread has been incredibly helpful! I'm in a similar situation doing freelance graphic design without any formal business registration. I've been terrified about reporting the income because I wasn't sure if I was "official" enough. Reading everyone's experiences really clarifies that reporting income and having proper licensing/registration are two completely separate issues. The IRS wants to know about ALL income regardless of whether you have the right permits or certifications. I'm definitely going to start implementing some of the tracking systems mentioned here - especially using an app to photograph receipts right away. I've probably missed out on so many legitimate deductions because I'm terrible at keeping paper receipts organized. The advice about setting aside 25-30% for taxes is also a wake-up call. I've been treating all my freelance income as "fun money" and would be in serious trouble come tax season. Starting a separate savings account for taxes this week! Thanks to everyone who shared their real experiences - it's so much more helpful than trying to figure this stuff out from confusing government websites.

This whole discussion has been a lifesaver! I've been doing mobile pet grooming without proper licensing and was losing sleep over whether to report my income. Seeing everyone's experiences makes it so clear that the IRS and state licensing boards operate completely independently. I'm definitely going to implement the expense tracking tips mentioned here - I had no idea I could deduct things like my phone bill or even YouTube Premium if I use it to learn new grooming techniques! I've probably been leaving hundreds of dollars in deductions on the table. The 25-30% tax savings rule is going to be a game changer too. I've been spending everything I make and would have been in serious trouble come tax time. Opening a separate savings account tomorrow and starting fresh with better habits. One thing I wanted to add for other mobile service providers - don't forget to track your mileage between clients! I drive all over town for appointments and apparently that's a legitimate business deduction I've been missing out on. Every mile adds up! Thanks everyone for sharing your real-world experiences. It's so much more helpful than trying to decode IRS publications on your own!