Don't forget about FATCA and FBAR requirements! When you have financial accounts outside the US exceeding certain thresholds, you need to report them. FBAR (FinCEN Form 114) is required if your foreign accounts exceed $10,000 at any point during the year, and FATCA forms are required at various thresholds depending on your filing status. The penalties for not filing these forms are CRAZY high even if you don't owe any tax. Like, $10,000+ for non-willful violations. Make sure you're tracking all your NZ bank accounts, including any business accounts for that B&B venture.

Just wanted to add another perspective on the business structure aspect. Since your wife would be the owner of the B&B as a NZ citizen, you'll also need to consider whether this creates any issues with US gift tax rules if you're contributing funds to a business you don't legally own. Also, regarding the rental property in the US - even if you're breaking even cashflow-wise, don't forget that you'll be taking depreciation deductions which will reduce your basis. When you eventually sell, you'll have depreciation recapture to deal with, which is taxed as ordinary income up to 25%. This could create a significant tax bill down the road that many people don't anticipate. One more thing to research: NZ has something called the "bright-line test" for property investments, which could affect the tax treatment of your B&B if you sell within a certain timeframe. Since you're planning to reinvest profits initially, this might not be immediate concern, but it's worth understanding for long-term planning. The international tax situation is definitely complex, but with proper planning and the right resources, it's totally manageable. Good luck with the move!

This is such helpful information! I'm in a similar situation with a Japanese client and have been putting off dealing with the Form 8802 because it seemed so complicated. Reading through everyone's experiences makes it feel much more manageable. One question I have - when you submit Form 8802, do you need to include copies of your previous tax returns or other supporting documents? Or is just the completed form sufficient? I want to make sure I have everything ready before I submit so I don't get delayed like some of you experienced. Also, for those who successfully got their withholding reduced, did your Japanese clients require any advance notice before they could implement the lower rate? I'm wondering if I should give my client a heads up that this certificate is coming.

I went through this exact process last year and wanted to add a few practical tips that really helped me. First, when you're filling out Form 8802, make sure to be very specific in Section 6 about your business activities with Japan. Don't just write "consulting" - describe exactly what services you provide because the IRS needs to determine which treaty article applies to your income. Also, keep detailed records of all your Japanese withholding statements (the documents showing the 10.21% withheld). You'll need these for your U.S. tax return to claim foreign tax credits, and having them organized makes the whole process smoother. One thing that surprised me was that my Japanese client's accounting department needed about 6 weeks to update their systems once I provided the Form 6166 certificate. They had to coordinate with their local tax office and update their payroll system. So even after you get your certificate, there might be a delay before you see the reduced withholding in your payments. Just plan for that timing when you're budgeting your cash flow. The whole process was definitely worth it though - going from 10.21% to 0% withholding made a huge difference in my monthly income!

Called the IRS about this exact thing last week. Was on hold for 2.5 hours just to get disconnected 😭

Had this exact same situation last year! The key thing to remember is that these are two separate review processes that can run parallel. For the 4464, you'll need to verify your identity either online through ID.me or by scheduling an appointment at a Taxpayer Assistance Center. Don't wait on this one - it has strict deadlines. The CP05 income verification will continue its own timeline regardless. Pro tip: once you complete the identity verification, call the number on your CP05 letter to let them know - sometimes it can speed up the income review process since they'll have confirmation you're legit.

Quick tip: If you filed with a IP PIN make sure it was correct, that was my issue last year when this happened to me

I went through this exact same thing last month! The non-filing letter is actually a good sign - it means the IRS has your return in their system but it's still processing. When I was obsessively checking (guilty as charged lol), I noticed the transcripts typically update Friday mornings around 2-3 AM EST. Pro tip: bookmark the direct transcript page and check it Friday mornings instead of multiple times throughout the week. The system only updates once weekly for most people. Also keep an eye on "Where's My Refund" tool - sometimes that updates before the transcript does. Hang in there, you should see movement soon! 🤞

Have you tried running your return through a second tax software just to double check? I always do mine on both TurboTax and FreeTaxUSA. They're usually within a few dollars of each other, and it gives me confidence that the calculations are correct. It only takes about 30-45 minutes to enter everything into the second system once you've already gathered all your documents.

Your situation sounds very similar to what I experienced two years ago! I had gotten married, bought a house, and had a baby all in the same year. My refund jumped from around $2,000 to over $9,000 and I was absolutely terrified I had made a mistake somewhere. Here's what I learned: major life changes really can cause dramatic swings in your tax situation. The child tax credit ($2,000), mortgage interest deduction (especially in your first year when you're paying mostly interest), and education credits can add up quickly. Plus, if you had multiple employers with different withholding rates, you very well could have overpaid throughout the year. I'd strongly recommend having a tax professional review your return before filing, especially given the amount involved. Many CPAs will do a quick review for $100-200, which is a small price to pay for peace of mind on a $12,000 refund. They can spot common errors that software might miss and explain exactly why your refund is so high. Don't let fear keep you from filing though - if you're entitled to that refund, you deserve to get it! Just make sure everything is accurate first.