Great information in this thread! I'm dealing with a similar FSA situation but with a twist - my parents live in a different state. Does anyone know if there are any special considerations for paying out-of-state relatives for childcare with FSA funds? I'm worried there might be additional tax complications since they'd be reporting income in a different state than where I'm claiming the FSA benefit. My mom has been flying in to watch my kids during school breaks and I'd love to use my leftover FSA funds to compensate her for the childcare (not travel expenses, I know those aren't covered). Has anyone dealt with cross-state family caregiver situations before?

Good news - the cross-state situation shouldn't create any additional complications for your FSA! The federal tax rules apply regardless of which state your parents live in. Your mom will simply report the childcare income on her tax return in her home state, and you'll use your FSA funds and claim the benefit on your return in your state. The IRS doesn't care about state boundaries for this purpose. Just make sure you have the same documentation you'd need for any family caregiver: her Social Security number, detailed receipts showing the dates and times of care provided, and confirmation that she's not claimed as your dependent. Since she's traveling to provide care at your location, that actually strengthens the case that this is legitimate childcare rather than just a family visit. The only thing to be extra careful about is clearly documenting that the payments are specifically for childcare services, not reimbursement for travel expenses (which aren't FSA eligible). Keep detailed records of the childcare hours/dates versus any travel costs you might cover separately.

Does anyone know if RSUs get reported on a 1099-B or just on the W-2? I've been getting conflicting information.

Welcome to the RSU club! One thing I wish someone had told me when I first got RSUs - consider the timing of when you might want to sell after vesting. Since the vested shares are already taxed as ordinary income at vesting, any future gains will be taxed as capital gains. If you hold for more than a year after vesting, you get the more favorable long-term capital gains rate instead of short-term (which is taxed as ordinary income again). Also, don't forget that RSUs can push you into a higher tax bracket in the year they vest, especially if you have a large vesting event. It might be worth talking to a tax professional about estimated quarterly payments if your regular paycheck withholding won't cover the extra tax burden from the RSUs.

guys. i just had an idea. what if we all agreed to not pay taxes? they cant audit all of us right? 😈

@Giovanni, I went through something similar last year. One thing that helped me was making sure I was logged into my IRS account BEFORE trying to set up the payment plan. Sometimes the system gets confused if you try to do it all in one session. Also, if you're getting error messages, try doing it during off-peak hours (like early morning or late evening) when fewer people are using the system. The IRS website can get overloaded during busy times. If you're still stuck after trying the browser/cache suggestions, definitely go with the phone route - it's frustrating but sometimes necessary!

I've been reading through all these responses and wanted to add something that might be helpful - the IRS actually has a specific procedure for handling mixed personal/business transactions in S-Corps called the "loan vs. contribution analysis." What you're describing with treating personal expenses as additional paid-in capital and then netting that against personal withdrawals as a return of capital is actually a recognized approach, but you need to be very careful about the documentation. The key is establishing that these were intended as capital contributions at the time they occurred, not loans. This means you'll need to document that: 1. There was no expectation of repayment 2. No interest was charged or expected 3. The payments were made to benefit the corporation, not the individual 4. The shareholders had the intent to make capital contributions For your return of capital approach, make sure you can clearly show that the amounts withdrawn don't exceed your actual basis in the corporation. S-Corp shareholders can only receive tax-free return of capital up to their adjusted basis in the stock. One practical tip: create a shareholder basis schedule showing opening basis, plus contributions (including your personal expenses paid for business), plus/minus your share of income/losses, minus any distributions. This will help you determine how much can legitimately be treated as return of capital versus taxable distributions. The mixed personal/business situation isn't uncommon for small S-Corps, and the IRS has seen it all before. As long as you can demonstrate legitimate business purposes and maintain consistent treatment, your approach should be defensible.

Reading through all these responses, I want to emphasize something that might save you significant headaches down the road - the importance of establishing a clear paper trail NOW, even though these transactions already occurred. I've seen several small S-Corps get into trouble not because their approach was wrong, but because they couldn't adequately document their intentions when the IRS came asking. Here's what I'd recommend based on the discussion above: 1. Create a comprehensive transaction log showing every mixed personal/business expense with dates, amounts, business purpose, and supporting documentation. This becomes your evidence that personal expenses were legitimate business costs intended as capital contributions. 2. Draft a retroactive shareholder agreement acknowledging that personal funds used for business purposes were capital contributions, not loans. Include specific language about no expectation of repayment or interest. 3. Calculate your shareholder basis carefully (initial investment + additional contributions + allocated income - distributions) to ensure your return of capital treatment doesn't exceed your actual basis. 4. Most importantly - implement proper procedures going forward. Set up payroll for reasonable compensation, establish an accountable plan for expense reimbursements, and maintain clear separation of personal and business finances. The good news is that your situation isn't unusual for new S-Corps, and the approaches discussed in this thread are legitimate if properly documented. The bad news is that without proper documentation, even the correct tax treatment can be challenged successfully by the IRS. Consider getting a tax professional involved to review your documentation before filing - the cost now could save you much more in penalties and professional fees later if you face scrutiny.

Has anyone here dealt with the certification required for treaty benefits on 1040NR? I'm trying to claim benefits under Article 20 of my country's treaty, but I'm confused about Form 8833. Is it always required or only in certain cases?

I went through a similar situation last year as a non-resident on an F1 visa. The key thing that helped me was understanding that 1040NR deductions are much more limited than regular 1040 deductions. For your specific situation: - Your $1,800 in charitable contributions to US charities should be deductible on Schedule A - Student loan interest is generally NOT deductible for non-residents (this is a common misconception) - Moving expenses are no longer deductible for most people after 2017 tax changes Since you're on J1 as a teacher, definitely check if there's a tax treaty between the US and your home country. Many treaties have special provisions for teachers and researchers that could provide additional benefits or exemptions. One thing to watch out for - make sure you're actually filing as a non-resident. The substantial presence test can be tricky, especially if you've been in the US before or plan to stay longer. If you haven't been here long enough to become a resident for tax purposes, then 1040NR is correct. Consider getting help from someone who specializes in non-resident returns, especially for your first year. The rules are complex and different from regular US tax filing.