Quick tip from someone who's filed 1120-F for 5+ years: Don't forget to include Form 8833 for any treaty-based return positions you're taking. I see so many foreign corps miss this and it immediately flags your return. Also, if you have any US real property interests, make sure you're properly handling Form 8288 withholding requirements. These are audit magnets if handled incorrectly.

Maya, I've been through this exact situation with our UK subsidiary filing 1120-F. A few additional points that might help: For your R&D allocation question, consider maintaining a detailed allocation study that documents not just the methodology but also the business rationale. We had success using a combination approach - gross receipts for general R&D, but direct attribution for specific projects where we could clearly identify US vs. global benefits. Regarding your software licensing revenue question, be very careful here. The IRS has been increasingly scrutinizing income attribution between related entities. If your US operations are involved in customer relationships, technical support, or customization for those licenses, you may have ECI even if the contracts are signed in Japan. Document all US activities related to that revenue stream. One thing I didn't see mentioned - make sure you're considering the branch profits tax implications. With $2.4M in receipts, you're likely subject to it, and proper planning around deemed repatriation can save significant tax. Also, file Form 5472 for related party transactions if you haven't already. Missing this can trigger automatic penalties even if your 1120-F is perfect.

If this is your first time getting a CP2000, make sure you check if they calculated the taxes correctly. Last year they sent me one claiming I owed $4k, but when I looked closely I realized they had double-counted one of my 1099s. Sent in my explanation with documentation and they completely canceled the proposed amount. These notices aren't always accurate!

I went through something very similar last year and want to share what I learned. First, don't panic - these CP2000 notices are super common and usually straightforward to resolve. The key is to carefully review every line on the notice against your actual tax documents. In my case, the IRS had records of a small 1099-MISC that I had completely forgotten about from some freelance work I did. Once I found that document, everything made sense and I just had to pay the additional tax owed plus a small amount of interest. My advice: gather all your tax documents (W-2s, 1099s, bank statements, etc.) and go through them systematically. Look for anything that might match the income amounts the IRS is claiming you didn't report. Sometimes it's something really simple like a forgotten savings account interest statement or a small side job payment. If you find the missing income and the IRS calculation looks correct, it's usually easiest to just pay it. But if you genuinely can't find what they're referring to or you think they made an error, definitely respond with your documentation before the deadline. Don't let it slide - that's when penalties and interest really start to pile up.

Have you considered Short-Term Treasury Bills instead? They're yielding around 5.3-5.4% right now, and they have a tax advantage over HYSAs because they're exempt from state and local taxes. If you're in a high-tax state, this could give you a better after-tax return than a HYSA.

I'd echo what others have said about Treasury bills being worth considering. The state tax exemption can be a real advantage depending on where you live. One thing I haven't seen mentioned yet is considering a CD ladder as another option. Some banks are offering competitive rates on CDs (around 4.5-5.2%) with terms that could align with your 12-18 month timeline. While they don't have the state tax advantage of T-bills, they might offer slightly better liquidity planning since you can time the maturities exactly when you expect to need the funds. You could also look into money market accounts, which sometimes offer rates competitive with HYSAs but with check-writing privileges that might be useful during the home buying process when you need to move money quickly for earnest money deposits, inspections, etc. Given your substantial down payment amount ($325k), you might also want to consider spreading across multiple institutions to stay within FDIC limits if you go the HYSA route. Most banks have $250k FDIC coverage per depositor, so you'd want to split your funds to ensure full protection.

One thing no one's mentioned - if you're getting paid regularly for these gigs, you should be making quarterly estimated tax payments to avoid this problem next year. The IRS expects you to pay taxes throughout the year, not just at filing time. If you only pay at tax time, you might even get hit with underpayment penalties.

Anyone know if you can deduct a portion of streaming service subscriptions (Spotify, Apple Music) if you use them to learn songs for paid gigs? I've got three 1099-NEC forms this year from different venues and I'm trying to find every legitimate deduction.

Don't forget part-year resident returns! Since you moved to Idaho, you're a part-year resident there, and you were a part-year resident of the last state you lived in. Part-year returns can be tricky but they're designed to make sure you're only taxed once on each dollar you earn.

I went through a very similar situation a few years ago when I worked in multiple states! One thing that really helped me understand the double taxation issue was checking whether any of the states you worked in have reciprocity agreements with each other. For example, if you lived in Pennsylvania but worked in a neighboring state with a reciprocity agreement, you might only need to file in your home state. However, since you worked in Wisconsin, Nevada, and Pennsylvania, you'll likely need to check each combination. Also, keep all your W-2s handy and look at Box 17 (State income tax) on each one. If you see state taxes withheld, that state will expect you to file a return there. The key is that when you file multiple state returns, each state's tax software should ask about taxes paid to other states - that's where you claim the credit to avoid double taxation. Since Nevada has no state income tax, that's one less return to worry about! But definitely file in Wisconsin and Pennsylvania for the income earned there.