Thanks everyone for all the helpful information! As someone who just went through incorporating my freelance business in Canada, this thread has been incredibly valuable. I want to add one more tip that saved me some headaches: make sure your Canadian business registration information (business number, registered address, etc.) exactly matches what you put on the W-8BEN-E form. Apple's tax validation system is pretty strict about consistency between documents. Also, if you're like me and procrastinated on getting your CRA business number, you can actually get it online instantly through the CRA website once your corporation is registered. You don't have to wait for mail anymore - they give you the number immediately after completing the online application. The combination of properly completing the W-8BEN-E for the 0% withholding rate AND making sure you're enrolled in the Small Business Program for the 15% commission rate can make a huge difference in your bottom line. Don't forget about either one!

This is an incredibly thorough discussion! As someone who works with international tax compliance, I want to add a few additional points that might help other Canadian developers: 1. **Documentation retention**: Keep copies of your submitted W-8BEN-E and any correspondence with Apple. The IRS can request these during audits, and having proper documentation of your treaty claim is crucial. 2. **Quarterly estimated taxes**: Don't forget that as a Canadian corporation earning US-source income, you may need to make quarterly estimated tax payments to the CRA. The reduced withholding from the treaty means less tax is being withheld upfront, so plan accordingly. 3. **Transfer pricing considerations**: If you have any related entities or if your business structure becomes more complex, be aware of transfer pricing rules. This isn't usually an issue for simple owner-operated corporations, but it's worth understanding if you plan to expand. 4. **State tax implications**: While the federal W-8BEN-E handles federal withholding, some US states have their own sourcing rules for digital products. Most don't tax foreign corporations on royalty income, but it's worth researching if you have significant revenue. The resources mentioned in this thread (taxr.ai for form guidance and Claimyr for IRS contact) seem to have helped several people navigate this successfully. Good luck with your incorporation!

One option nobody's mentioned yet - check out Quickbooks Desktop instead of Online if your business doesn't need multiple user access from different locations. You can often find the Desktop version on sale at office supply stores like Staples or Office Depot, especially during back-to-school or end-of-year sales. I bought mine for about 40% off retail price last December and it's a one-time purchase rather than a subscription.

Another angle to consider - if you're comfortable with a bit more complexity, you could look into QuickBooks Simple Start and supplement it with free tools for the features you might be missing. Simple Start is their cheapest tier but lacks some functionality like bill management and time tracking. I've seen small businesses use Simple Start for core accounting and then add free tools like Wave for invoicing or Google Sheets templates for expense tracking. It's not as seamless as having everything in one platform, but it can keep your costs way down while you're getting established. Also, don't overlook the possibility of buying a slightly used QuickBooks Desktop license from someone upgrading to Online. Just make sure you can transfer the license properly and that it's a legitimate copy. I've seen these go for 50-70% of retail price on business forums.

I've been following this thread as someone who had a very similar foreign account reporting situation a few years back. What really helped me was understanding the IRS's perspective on these issues - they're primarily focused on whether taxpayers are trying to hide income or evade taxes, not whether every form was perfectly attached. Since you reported all the income and filed your FBARs correctly, you've demonstrated good faith compliance with the substantive requirements. The Schedule B omission is more of a procedural oversight than a compliance failure. One practical tip that hasn't been mentioned yet: if you do decide to consult with a tax professional about this, bring copies of your filed FBARs and the pages from your tax returns showing the foreign interest income. This will help them quickly assess that you've met the core requirements and can provide more targeted advice about whether any action is needed. The peace of mind from knowing you've handled this correctly going forward is often worth more than the stress of trying to "fix" something that may not actually need fixing.

Reading through all these responses has been incredibly reassuring! I was in a very similar situation last year where I properly reported foreign interest income and filed my FBAR correctly, but completely forgot to include Schedule B with my tax return. After going through the same anxiety you're experiencing, I ultimately decided not to file an amendment based on advice similar to what everyone here has shared. The key insight that helped me was understanding that I had met all the substantive compliance requirements - the income was reported, the FBAR disclosed the accounts to the government, and there was no attempt to hide anything. It's been over a year now and I haven't heard anything from the IRS about it. I made sure to include Schedule B properly on my next year's return and kept detailed documentation of everything. Sometimes the fear of what might happen is worse than the actual consequences, especially when you've done everything right from a substance perspective. Your situation sounds very similar to mine, and based on all the excellent advice in this thread, I think you can feel confident that you've handled the important parts correctly. Focus on getting it right going forward rather than stressing about a technical omission when you've been fully compliant with the core requirements.

For anyone still confused about Box 10 on W-2, here's a super simplified explanation: Your employer takes money from your paycheck BEFORE taxes (so you don't pay tax on that money at that time) and puts it in a special account for dependent care expenses. When tax time comes, the government says "hey remember that money you didn't pay taxes on? We need to account for it." It's not that you're paying extra taxes - you're just "settling up" on money that wasn't taxed during the year. The BENEFIT is that if you have other child care expenses beyond the $5000, you might qualify for additional tax credits. So you get the $5000 tax-free PLUS potentially more tax benefits for additional expenses.

I went through this exact same frustration last year! The key thing that helped me understand it was realizing that Box 10 isn't showing money your employer paid FOR you - it's showing money YOU earned that was set aside pre-tax for dependent care. Think of it this way: Let's say you earned $50,000 total, but $5,000 went to your Dependent Care FSA before taxes. Your taxable wages (Box 1) would show $45,000, and Box 10 would show the $5,000 that was excluded from taxation. When you file your taxes, the IRS needs to "remember" that $5,000 existed but wasn't taxed. The increase you're seeing in your tax software isn't a penalty - it's just calculating what you WOULD have owed on that money if it had been regular wages. The benefit is real though! If you're in the 22% tax bracket, you saved about $1,100 in federal taxes alone ($5,000 x 0.22), plus you avoided Social Security and Medicare taxes on that amount (another $382.50). So your total tax savings was around $1,482.50 throughout the year via smaller tax withholdings from each paycheck.

Has anyone considered the insurance implications here? Your standard homeowner's insurance might not cover you if you're renting out rooms and something happens. I learned this the hard way when a roommate's cooking started a small kitchen fire and my insurance initially denied the claim because I hadn't disclosed I had renters!

Great advice from everyone here! I'm dealing with a similar situation and wanted to add one more thing - make sure you're keeping detailed records of EVERYTHING from day one. I made the mistake of being casual about tracking expenses in my first year and it was a nightmare trying to reconstruct everything at tax time. I created a simple spreadsheet where I log every rent payment received, every expense that might be deductible (utilities, repairs, supplies, etc.), and what percentage applies to the rental portion. Also keep all receipts and bank statements. The IRS can audit rental income, and having organized records makes a huge difference if that ever happens. One tip that saved me time: take photos of receipts immediately and store them digitally. I've lost too many paper receipts over the years! Also, if you do any improvements to the house, track those separately since they might need to be depreciated differently than regular maintenance expenses.