I'm going through this exact same situation right now with my new S Corp! Reading through all these responses has been incredibly helpful. It's such a relief to see the consensus that you don't need to file Form 941 until you actually start paying wages. The Form 8822-B recommendation keeps coming up and seems like a no-brainer - definitely adding that to my immediate to-do list. I'd rather be proactive about preventing IRS confusion than deal with notices later. One thing I'm curious about that I haven't seen addressed - for those of you who have S Corps but haven't started paying wages yet, are you doing anything special with bookkeeping or accounting during this "zero wage" period? I'm tracking business expenses and keeping everything separate, but wondering if there are other best practices I should be following to stay organized for when I do start generating revenue. Also, the state-specific requirements mentioned by @Zainab Ismail are definitely something I need to research further. I'm in Florida, so I'll need to check if there are any state-specific S Corp payroll registration requirements here. Thanks to everyone who shared their experiences - this has been way more helpful than the conflicting advice I was getting elsewhere!

I'm a fellow new S Corp owner and went through this exact same confusion about 3 months ago! After reading through all the great advice here and doing my own research, I can confirm you absolutely do NOT need to file Form 941 until you actually start paying wages to yourself or employees. What really helped me was calling the IRS directly (using one of the callback services mentioned here actually - saved me hours of hold time) and getting official confirmation. The agent was very clear that the Form 941 requirement is triggered by wage payments, not by S Corp election. Here's what I ended up doing based on similar advice: - Filed Form 8822-B to update my business info with the IRS (as @Natalia Stone suggested) - this was a game changer for peace of mind - Set up proper bookkeeping even with zero activity to track startup expenses for future deductions - Made sure I'm staying on top of the annual 1120-S filing requirement (due March 15th for calendar year S Corps) - Researched "reasonable compensation" requirements for when I do start paying myself For anyone hesitant about the Form 8822-B filing - it literally took me 15 minutes and potentially saved me from years of IRS notices about "missing" 941s. Totally worth it. The waiting period while building clients is actually perfect for getting all this administrative stuff sorted out. Hang in there - once the revenue starts flowing, you'll be glad you have all these compliance pieces figured out in advance!

This has been an incredibly helpful thread! I'm fairly new to T-bills (just started this year) and was honestly pretty confused about the tax implications until reading through all these responses. The clarification about Box 3 on the 1099-INT is exactly what I needed - I was wondering why my bank interest and T-bill interest showed up in different boxes. And knowing that the state tax exemption applies is huge for me since I'm in Massachusetts where we have a pretty hefty state income tax. One follow-up question for the group: I've been buying 4-week T-bills and rolling them over consistently. Does anyone know if there are any special considerations for this kind of frequent rolling strategy from a tax perspective? I'm assuming each maturity is just treated as a separate taxable event, but want to make sure I'm not missing anything. Also really appreciate all the practical tips about record keeping and setting aside money for taxes. I definitely learned that lesson the hard way with my first few maturities!

This has been such an informative discussion! I'm a CPA and wanted to add a few technical points that might be helpful for folks dealing with T-bills: 1. **OID vs Regular Interest**: Someone mentioned getting a 1099-OID instead of 1099-INT. This typically happens with Treasury notes or bonds (not bills) that were issued at a significant discount. T-bills should generally appear on 1099-INT Box 3, but if you see 1099-OID, don't panic - it's still treated as interest income for tax purposes. 2. **State Tax Exemption Documentation**: For those in high-tax states benefiting from the state tax exemption, make sure to keep good documentation. Some state tax software doesn't automatically recognize Box 3 interest as exempt, so you may need to manually adjust or provide additional schedules. 3. **Estimated Tax Safe Harbor**: For the quarterly payment discussion - remember the safe harbor rules. If you owe less than $1,000 in additional tax or paid at least 100% of last year's tax liability (110% if AGI > $150k), you won't face penalties even if T-bill maturities create lumpy income. The advice about setting aside taxes immediately is spot-on. I see too many clients get caught off-guard when multiple T-bills mature simultaneously. Great thread overall!

I think there's some confusion here about business deductions vs. tax credits for education. If you're taking courses to advance your career (like getting a higher degree), you might qualify for the Lifetime Learning Credit which wasn't affected by the tax law changes. It's worth up to $2,000 and is available even for W2 employees. It's different from deducting work expenses and has its own rules about what qualifies.

You're absolutely right about the Lifetime Learning Credit limitations! I ran into the same issue when I tried to claim it for my pharmacy technician continuing education requirements. The credit only applies to qualified educational institutions that are eligible for federal student aid programs, which excludes most professional CE providers, online platforms, and industry organizations. However, there's one workaround I discovered: some community colleges and universities now offer continuing education programs specifically designed for healthcare professionals that DO qualify for the Lifetime Learning Credit. For example, my local community college partners with our state nursing association to offer CE courses that meet licensing requirements but are delivered through the college system. It's worth checking with colleges in your area to see if they offer any CE programs in your field. The courses might cost slightly more than traditional CE providers, but the tax credit can make up for the difference. Plus, you get the same credits toward your license renewal. Not a perfect solution since it limits your CE options, but it's one way to still get some tax benefit for required education expenses as a W2 employee.

One important thing nobody's mentioned - be careful with the date you claim it became worthless. The IRS is very specific that you must claim it in the year it actually became worthless, not when you discovered it was worthless. From my experience, the reorganization transaction date (your Oct 17) is typically when the broker is recognizing it as worthless, but you should check if that's actually when the company bankruptcy was finalized or if something else happened on that date.

Based on your situation with HealthPlus (HPIQ), it sounds like you're dealing with a classic worthless security scenario. The "Reorganization - 950" transaction on 10/17/2024 is likely when your broker processed the stock as worthless following the bankruptcy proceedings. Here's what you need to do: 1. **Documentation is key** - Contact Schwab immediately and request a letter confirming that HPIQ became worthless on 10/17/2024. Also ask for account statements showing the stock before and after that date. Save any bankruptcy court documents or news articles about HealthPlus's final liquidation. 2. **Report on Schedule D and Form 8949** - You'll need to manually report this since it won't appear on your 1099-B. Use 10/17/2024 as your sale date (not 12/31/2024 as some suggest - use the actual date it became worthless), $0 as the sale price, and your original cost basis. Enter code "W" in column (f) on Form 8949. 3. **Capital loss treatment** - Your $15,800 loss will first offset any capital gains you have this year. Any remaining loss can be deducted up to $3,000 against ordinary income, with the rest carried forward to future years. The fact that HPIQ doesn't appear in Schwab's worthless securities lookup actually supports that it's been officially deemed worthless. Just make sure you have proper documentation before filing, as the IRS scrutinizes worthless security claims closely.

One thing that helped me with my eBay 1099-K was creating a simple spreadsheet to track everything. I made columns for: Item Sold, Sale Price, Original Cost (if I could remember/find receipts), eBay Fees, Shipping Cost, and whether it was a personal item or business inventory. The key insight I learned is that the IRS doesn't expect you to have perfect records for personal items you bought years ago. If you sold old clothes, electronics, or household items at a garage sale price, you can reasonably estimate the original cost. For example, if you sold a jacket for $25 that you originally bought for $80, that's clearly a non-taxable personal loss. Just make sure your estimates are reasonable and conservative. The IRS is more concerned with people not reporting obvious business income than they are with someone who sold their old iPhone for less than they paid for it. Document your reasoning and keep any receipts you do have - even credit card statements showing when you bought something can help establish the original cost.

This thread has been incredibly helpful! I'm dealing with a similar situation but with a twist - I received 1099-Ks from both eBay and PayPal for the same transactions. Apparently this can happen when you use PayPal as your payment processor on eBay. From what I've researched, you should NOT double-report the same income. The key is to carefully review both forms and identify any duplicate reporting. Usually, if you're getting both, you'd report the eBay 1099-K (since that's the platform where the actual sales occurred) and then make a note or adjustment to avoid counting the PayPal 1099-K for the same transactions. Has anyone else run into this double-reporting issue? I'm worried about both under-reporting (if I ignore one form completely) and over-reporting (if I include both). The amounts don't match exactly either, which is making it even more confusing to figure out which transactions overlap. I'm thinking I might need to call the IRS about this specific situation since I haven't seen it addressed clearly in any of the standard guidance about 1099-K reporting.