Don't overlook the advantages of S Corps for self-employment tax savings, but watch out for these common traps: 1) Reasonable compensation is THE biggest audit trigger. The IRS knows people try to minimize payroll by taking mostly distributions. Document why your salary is reasonable with industry data. 2) Health insurance is tricky - if you own >2% of the S Corp, your health insurance premiums paid by the business must be reported as income on your W-2, but then you get a self-employed health insurance deduction on your 1040. 3) Losses only offset other income to the extent of your basis in the S Corp. Track your basis carefully!

Great question about S Corp management! I've been running my S Corp for about 3 years now and learned a lot through trial and error. For your specific questions: **Quarterly taxes**: If you're not generating revenue yet, you don't need to file quarterly estimated taxes. However, once you start earning income, you'll need to make quarterly payments based on your projected annual tax liability. **Salary structure**: This is crucial - you can't just pay yourself hourly or skip salary altogether. The IRS requires "reasonable compensation" for services performed. Research what similar consultants in your area earn as employees and set an annual salary accordingly. Pay yourself regularly (monthly or bi-weekly) regardless of when clients pay you. The remaining profits can be taken as distributions, which aren't subject to self-employment tax. **Business losses**: Yes, S Corp losses pass through to your personal return and can offset your spouse's W2 income on a joint return, but only up to your basis in the S Corp (essentially your investment in the business). Any excess losses carry forward to future years. **Home office expenses**: You can use either the simplified method ($5 per square foot up to 300 sq ft) or actual expense method (percentage of actual home expenses). For phones/internet, document your business usage percentage - I track mine quarterly and use that percentage consistently. One tip: Keep meticulous records from day one. The IRS scrutinizes S Corps more closely than other entities, especially around reasonable compensation and basis calculations.

Don't panic! I've been through something similar. The most important thing is to FILE your taxes even if you can't pay the full amount right away. Not filing is way worse than filing and owing money. Since you're 20 and this is your first real tax situation, you might qualify for First Time Penalty Abatement if you end up with penalties. Also, as a contractor, you can deduct business expenses that could significantly reduce what you owe - mileage for driving to job sites, any equipment or supplies you bought for work, even part of your phone bill if you used it for work calls. The IRS has installment payment plans that are pretty reasonable. You can set up monthly payments online and the setup fees are low (especially if you qualify as low-income). They'd much rather get paid slowly than not at all. Also consider getting help from VITA (Volunteer Income Tax Assistance) - it's free for people with income under $60k and they're really good at finding deductions and credits you might miss. Don't let fear make this worse by ignoring it!

I understand how overwhelming this feels! I went through something similar when I was starting out. Here's what you absolutely need to know: 1. **File your taxes even if you can't pay** - The penalty for not filing is much worse (5% per month) than the penalty for not paying (0.5% per month). The IRS already knows about your income from the 1099 your employer filed. 2. **You likely owe less than you think** - As a 1099 contractor, you can deduct business expenses on Schedule C. This includes mileage for work travel (not commuting to a regular office, but travel between job sites), work supplies, equipment, even part of your phone/internet if used for business. 3. **Payment options exist** - The IRS offers installment agreements. You can pay as little as $25/month if that's what you can afford. Setup fees are around $31-130 but can be waived for low-income taxpayers. 4. **Get free help** - Look up VITA (Volunteer Income Tax Assistance) locations near you. They provide free tax preparation for people earning under $60k and are great at finding deductions you might miss. Don't let fear paralyze you into making this worse. File by the deadline and work out payments after. The IRS is surprisingly reasonable when you communicate with them proactively rather than hiding.

Just wanted to mention, don't forget that TurboTax has a built-in help feature where you can chat with tax experts for situations exactly like this! Since you're paying for the $79 version, you should have some level of support included. Look for the "Ask a Tax Expert" or "Live Help" button during your filing process. I used it last year for a similar question about unreported interest and the person was super helpful and walked me through exactly where to enter it.

I had this exact same situation last year! For small interest amounts under $10, you absolutely should still report them even without receiving 1099-INT forms. Banks are only required to send these forms for interest over $10, but the IRS still expects you to report all taxable interest. In TurboTax DIY, go to the Income section and look for "Interest and Dividends." There should be an option to add interest income manually. You can enter each bank separately with the institution name and amount, or if the total is really small (like yours), you can combine them under "Various Sources" or similar. To find the exact amounts, check your December bank statements - they usually show year-to-date interest earned. You can also log into your online banking and look for annual summaries or tax documents section. Don't stress too much about being off by a dollar or two if you can't find exact amounts - just make your best estimate. The key is showing good faith effort to report all income!

Don't forget to check if your settlement pushed you over the income threshold for any credits or deductions you normally claim! My back pay settlement last year unexpectedly put me over the income limit for child tax credits and I lost about $3,500 in credits I was counting on.

One thing that might help with your situation is to carefully review your settlement agreement to see if it breaks down the payment into different categories. Sometimes back pay settlements include components beyond just lost wages - like interest on the delayed payment, compensation for benefits you missed out on, or even damages for the wrongful termination itself. Each of these components can have different tax treatments. For example, interest portions are typically taxable as ordinary income, but certain damages might qualify for different treatment. If your settlement agreement doesn't break this down clearly, you might want to contact your union representative or the attorney who handled your case to get a detailed breakdown. Also, since you mentioned they subtracted what you earned at your temporary job in 2022, make sure that calculation is correct and that you're not being double-taxed on any income. The timing of when you received the money versus when it was "earned" can create some complex tax situations, but there may be options to help minimize the impact on your tax bracket.

FYI everyone, banking gets complicated too! When I moved to Canada but kept working for my US employer, I maintained US bank accounts for direct deposit. Just remember that Canadian residents must report foreign accounts on Form T1135 if the total cost of all foreign assets exceeds CAD $100,000. Also, Canadian banks may limit services for US citizens due to FATCA reporting requirements. I had to shop around to find a bank comfortable with my dual-status situation.

Great question about dual citizenship vs permanent residency! From a tax perspective, there's actually no difference - both Canadian citizens and permanent residents are taxed on worldwide income once they establish Canadian tax residency. The key factor is where you're considered a resident for tax purposes, not your citizenship status. What matters more is establishing your "tax residency" date in Canada, which is typically when you move and establish significant residential ties (home, spouse/family, personal property). This date determines when you start filing Canadian tax returns and claiming foreign tax credits. One thing to watch out for with your $95K income: make sure you understand the timing of when to start claiming Canadian residency. If you move mid-year, you might be able to optimize which country gets primary taxing rights for that transition year. Also, don't forget about potential state tax obligations - some states like California are notoriously difficult to escape from a tax perspective even after you move to Canada. The Foreign Tax Credit should handle most of the double taxation, but you'll want to run the numbers carefully since Canadian tax rates vary significantly by province. Your effective tax rate in Canada could be higher or lower than what you're currently paying in the US depending on which province you choose!