Has anyone tried negotiating with their foreign clients to have them cover these fees? I've started adding a clause in my contracts that the client is responsible for ensuring I receive the full invoiced amount, which effectively means they pay any intermediary banking fees. About half my clients were fine with this approach.

I've been dealing with this exact issue for the past two years with my international consulting clients. After going through different approaches and consulting with my CPA, I can confirm that reporting the full invoiced amount as income and deducting the intermediary fees as business expenses is the most defensible method. What helped me tremendously was creating a simple tracking system: I keep a monthly spreadsheet with columns for Invoice Date, Invoice Amount, Amount Received, Fee Amount, and Client Country. This creates a clear paper trail showing the pattern of these unavoidable business costs. One thing I learned the hard way - make sure to categorize these fees correctly on Schedule C. They should go under "Commissions and fees" (line 10) rather than "Other expenses" since they're directly related to collecting your earned income. My CPA emphasized that consistency in reporting method and good documentation are key if the IRS ever has questions. For anyone dealing with this regularly, I'd also suggest reviewing your contracts annually to see if you can shift some of these costs to clients, but having a solid reporting method is essential either way.

Have you looked into Wave Accounting? It's completely free for invoicing and accounting (they make money on payment processing if you use that feature). I've been using it for my LLC for 2 years and it's been great for basic bookkeeping. For tax time, I just work with a local CPA who charges me about $650 for my business and personal returns. All total I'm spending way less than $1000/year on accounting and tax prep. Just another option to consider!

I'm dealing with the exact same situation as a new LLC owner! Reading through everyone's experiences here has been super helpful. I'm leaning away from the $3700 option after seeing the mixed reviews. Quick question for those who've gone the local CPA route - do most CPAs offer payment plans for their services? That upfront cost is still a concern even if it's less than 1-800Accountant. Also, is there a particular time of year that's better to establish a relationship with a CPA, or should I reach out now even though we're not in tax season? Thanks for all the practical advice in this thread - it's exactly what I needed to hear!

Great thread with solid advice! I went through this exact situation with my daughter two years ago. She made $18k from her summer internship plus some part-time work during the school year, and I was panicking thinking I couldn't claim her anymore. The key insight that helped me was realizing that "support" includes everything - not just cash. When I actually added up her tuition ($35k), room and board ($12k), health insurance ($3k), car insurance ($1.2k), phone bill ($1k), and other expenses I covered, it came to over $52k total. Her $18k contribution was less than half, so I could still claim her. One tip: keep good records of what you pay for throughout the year. If you ever get audited on this, you'll want documentation showing you provided more than half the support. I started tracking everything in a simple spreadsheet after that experience - makes tax time much less stressful!

This is such a helpful thread! I'm dealing with a similar situation with my 21-year-old who's a junior in college. He made about $15k from a co-op program last semester, and I was worried we'd lose the dependency exemption. Reading through all these responses really clarifies the difference between qualifying child vs qualifying relative rules. It sounds like as long as we're covering his tuition, housing, and other major expenses (which we definitely are), his income doesn't disqualify him from being our dependent. One question though - does anyone know if there are any other tax benefits we might lose or gain by claiming him? I know someone mentioned education credits earlier. Should we be thinking about whether it's actually better tax-wise for him to claim himself, or are we generally better off claiming him as our dependent?

Just a heads up - if you file and pay your back taxes, make sure you also remember to CHARGE AND COLLECT the correct sales tax going forward!!! Seems obvious but I made this mistake. I was so focused on fixing the past problem that I didn't immediately update my online shop to start collecting sales tax, and it caused me a whole second headache. Most e-commerce platforms (Shopify, Etsy, etc.) have built-in tools to automatically calculate and collect the right sales tax rates. Turn those on ASAP so you don't dig yourself a deeper hole while trying to fix the original problem.

I work for a state revenue department and wanted to clarify something important about marketplace facilitator laws. As of 2019-2021, most states (including yours likely) passed laws requiring large online marketplaces like Etsy, Amazon, eBay, etc. to collect and remit sales tax on behalf of sellers. HOWEVER - this only applies to sales made THROUGH those platforms. If you're selling directly through your own website, at craft fairs, or through other channels, you're still responsible for collecting and remitting the tax yourself. The good news for your situation is that if some of your sales were through marketplaces during the period in question, you can subtract those amounts from your total liability since the platforms should have already handled the tax collection and remittance for those transactions. When you respond to the revenue department, make sure to break down your sales by channel - marketplace sales vs. direct sales. This could significantly reduce what you actually owe. Also, don't forget that many states have small seller exemptions (usually around $100K in sales or 200 transactions annually), so double-check if you even exceeded the threshold that would require registration.

According to the IRS.gov support page at https://www.irs.gov/help/account-help, you need to use the "Secure Access" recovery process. I'm in a similar boat - need my transcript ASAP for a mortgage application! The quickest way is to call the IRS Transcript request line at 800-908-9946 and request a mailed transcript (takes 5-10 business days) while you sort out your online access. You can also use Form 4506-T from the IRS website to request transcripts by mail.

I went through this exact same frustration last year! The key thing to know is that you can't actually "reset" your old account if you don't have access to that email anymore - you'll need to create a completely new account. Here's the step-by-step that worked for me: 1. Go to IRS.gov and click "Get Transcript Online" 2. Instead of trying to sign in, click "Create Account" 3. You'll be redirected to ID.me for identity verification 4. Have your driver's license ready - you'll need to take a photo of it 5. You might need to do a video call for verification (took about 10 minutes for me) 6. Once verified, you can immediately access your transcripts The whole process took me about 30 minutes, but it was so worth it to finally get access again. Since you mentioned this is urgent for your mom's medical expenses, I'd also suggest calling the transcript line at 1-800-908-9946 as a backup - they can mail you a transcript in 5-10 business days while you work on getting online access sorted out. Hope this helps and hope your mom is doing okay!