Just my two cents, but I think you should definitely tell your tax preparer about the unfiled 2023 return during your appointment for 2024. They deal with this situation ALL THE TIME, trust me. When I worked as a server, I had a similar issue where I owed money multiple years and got overwhelmed. My tax guy handled everything - filed my back taxes, set up a payment plan, and even got some penalties reduced. It was way less painful than I expected. Don't try to handle the 2023 return yourself if you're already planning to see a professional for 2024. Let them handle both and do it right. The peace of mind is worth it, and they might save you money in the long run.

You're definitely not in as much trouble as you think! Missing one year happens more often than you'd expect, especially with multiple W-2s and website issues like you experienced. The lack of IRS notices is actually pretty normal - they're still working through backlogs and it often takes 12-18 months before they start sending letters about unfiled returns. Don't let that false sense of security fool you though - it's better to get ahead of it. Since you mentioned most of your income was from serving, there's a decent chance you might have had enough taxes withheld to cover what you owe, or you might even be due a refund. Server wages often have higher withholding rates, and if you're young, you might qualify for credits you don't know about. Definitely bring up the 2023 situation with your tax preparer at your scheduled appointment. They can handle both years efficiently and help you understand exactly where you stand. In the meantime, start gathering those 2023 W-2s - contact the employer with the website issues directly if needed, or you can request wage transcripts from the IRS. Don't stress too much about this. You're being proactive now, which is what matters. The penalties for late filing aren't pleasant, but they're manageable, especially if you file before the IRS gets around to creating a substitute return for you.

The issue is 100% a software problem. Health insurance for partners reported as guaranteed payments reduces QBI at the partnership level. The software is making a second reduction at the individual level, which is incorrect. If you don't want to override, another approach is to NOT report the health insurance as a guaranteed payment on the 1065, and instead just show it as a footnote on the K-1 and have the partner deduct it on their 1040. This isn't technically correct per IRS instructions, but effectively gets the right QBI result. But honestly, just overriding the software calculation is cleaner.

This is such a widespread issue this filing season! I'm seeing it across multiple software platforms - UltraTax, ProSeries, Drake, and others all had similar bugs with the QBI calculations for partnership health insurance. What's really frustrating is that the software companies seem to understand the S Corp treatment (health insurance in W-2 wages shouldn't reduce QBI again on the individual return) but haven't applied the same logic to partnerships. The concept is identical - the guaranteed payment for health insurance already reduces QBI at the partnership level. For anyone still dealing with this, I'd strongly recommend documenting your override with a detailed workpaper. Include references to Reg. Sec. 1.199A-3(b)(1)(vi) and note that the guaranteed payment has already reduced QBI at the entity level. The IRS guidance is pretty clear on this point, even if the software implementation has been problematic. Has anyone heard if the major software companies have committed to fixing this for next filing season? It seems like such a basic issue that affects so many partnership returns.

Is your friend enrolled as an Electronic Return Originator (ERO)? If so, he can access e-Services online and might have an easier path to resolving this. Also worth checking if he has a dedicated IRS agent through the Practitioner Priority Service - experienced accountants often have this resource and it can bypass many of the normal wait times.

I work at a mid-size CPA firm and we've dealt with this exact scenario before. Here's what I'd recommend for your friend: 1) Call EFTPS immediately at 1-888-353-4537 (not the number mentioned earlier - that's the old one). Explain it's an emergency with multiple clients and pending deadlines. They can issue temporary PINs over the phone that are valid for 30 days. 2) If he can't get through quickly, have him fax a signed letter on his letterhead to 855-264-3287 explaining the situation with a list of all affected EINs. Include his PTIN number if he has one. They usually respond to emergency fax requests within 24-48 hours. 3) As a last resort, clients can make payments directly through their bank's online bill pay system using the "Federal Tax Deposit" option - most major banks offer this and it posts same-day if done before 8 PM ET. The key thing is to document everything he's doing to resolve this. Even if some payments are a day or two late, showing he took immediate action usually results in penalty abatement when you can prove reasonable cause. I've successfully gotten penalties waived in similar situations by providing this documentation to the IRS. Don't let him stress too much - this is more common than people think and there are definitely solutions!

Important thing to note - the substantial presence test isn't automatic just because you have an H1B! You need to be physically present in the US for: - 31 days during the current year, AND - 183 days during the 3-year period that includes current year + 2 previous years The 183 days are calculated as: * All days present in current year + * 1/3 of days present in 1st preceding year + * 1/6 of days present in 2nd preceding year If your H1B just started, you might not meet the threshold yet!

Just wanted to add a practical tip for anyone dealing with foreign accounts - make sure you keep detailed records of your account balances throughout the year, not just at year-end! I learned this the hard way when I had to file FBAR. The form requires you to report the maximum value of each account during the year, and I had to scramble to get monthly statements from my home country bank to figure out the highest balance. Some banks charge fees for historical statements, so it's much easier to track this yourself. I now keep a simple spreadsheet with month-end balances for all my foreign accounts. Also, don't forget that if you have signature authority over accounts that aren't yours (like if you help manage a family member's account), those might need to be reported too under certain circumstances. The key is to start keeping good records from day one - it makes tax time so much less stressful!

One more thing to consider is state taxes! Depending on which state you moved to, the rules for residency and taxation of foreign income can be completely different from federal. Some states don't recognize the federal first-year election and will still treat you as a part-year resident regardless.

This is such a helpful thread! I'm in a very similar situation - moved from Mexico to the US on a TN visa in August 2023. I've been trying to figure out whether to make the first-year election or file as dual-status. One thing I'm wondering about that hasn't been mentioned yet: how does the timing of when you moved affect the decision? Since I only had 5 months as a US resident vs Brianna's 8 months, would that change the math significantly? I'm thinking the shorter period might make dual-status more favorable since I'd have less worldwide income to report during the resident portion. Also, for anyone who's used the tax analysis tools mentioned above - do they take into account the different tax brackets and how your income distribution throughout the year affects the optimal choice? My income was higher in Mexico during the first 7 months compared to my US salary for the last 5 months, so I'm trying to figure out if bunching all that higher income into the US return (with the first-year election) would push me into higher brackets unnecessarily.