This is really helpful information! I've been dealing with a similar excess contribution situation and was worried I'd have to withdraw everything including the earnings. One question I have - when you carry forward the excess contribution, do you need to file Form 5329 every year until the excess is "absorbed," or just for the first year? And is there any limit to how many years you can carry it forward? I'm also curious about the practical side - how do you track this on your own records? Do you just make a note that part of next year's contribution is actually the carried-forward excess from this year?

You need to file Form 5329 each year that you have an excess contribution until it's fully absorbed. So if you carry forward $3,000 excess and can only contribute $2,000 the next year, you'll still have $1,000 excess that requires another Form 5329 filing. There's no specific limit on how many years you can carry it forward, but you'll pay the 6% excise tax each year until it's resolved. For tracking, I keep a simple spreadsheet with: - Original excess amount - Year of excess - Annual 6% tax paid - Amount "absorbed" each subsequent year - Remaining excess balance When I make my regular Roth contribution each year, I subtract any carried-forward excess from my maximum allowed contribution. So if I have a $2,000 excess and the limit is $7,000, I can only contribute $5,000 in new money that year. Most tax software handles Form 5329 well once you know you need to file it. The key is entering the excess contribution amount correctly and making sure it carries forward to subsequent years until fully absorbed.

Anyone know if this is different in Quebec? I have a similar situation but with Revenu Quebec and they seem to have different rules for everything...

I went through almost the exact same situation last year with my first bit of freelance income. Here's what I learned from my tax preparer: You absolutely need to report the $520 income on your T2125 - there's no minimum threshold for reporting self-employment earnings. The good news is that with such a small amount, you likely won't owe any income tax on it due to the basic personal exemption. For the expenses without receipts, I'd strongly recommend NOT claiming them. I made the mistake of estimating some expenses my first year and it caused headaches later when CRA requested documentation during a routine review. It's better to miss out on legitimate deductions than risk issues with unsupported claims. One thing that helped me going forward was setting up a simple system: I use a dedicated email folder for all business-related receipts and confirmations, plus I take photos of physical receipts immediately. Even something as basic as a spreadsheet tracking expenses by date and category makes tax time so much easier. Since this is your first time with self-employment income, consider keeping better records even for small gigs - you never know when that side work might grow into something bigger!

One thing I'd add to the great advice already shared - make sure you get written documentation from the bank about the account structure. Ask them for a letter or official document that states you were a joint account holder with rights of survivorship (if that's what it was). This documentation could be valuable if you ever face questions from the IRS or need to prove the account's status. Also, consider opening a separate account and transferring the funds there rather than keeping them in the original account. This creates a cleaner paper trail and separates any future transactions from the original joint account history. Plus, you'll want to update the account to remove your aunt's name from any remaining documentation. The fact that you're being so careful about doing this right shows you're on the right track. Most people in your situation don't owe any federal taxes on joint accounts, but having proper documentation gives you peace of mind and protects you if any questions arise later.

I went through almost the exact same situation when my grandfather passed and I discovered I was on his checking account. The key thing that helped me was getting a copy of the original account signature card from the bank - this document showed exactly how the account was set up and whether it had survivorship rights. One thing I learned is that even though you didn't know about the account, the IRS treats joint ownership based on the legal structure, not your knowledge of it. Since you were already a legal owner, you're generally not receiving an "inheritance" in the taxable sense. However, I'd strongly recommend consulting with a tax professional or CPA, especially since $42,000 is a significant amount. They can review your specific situation and ensure you're handling everything correctly. The consultation fee is worth it for the peace of mind, and they can help you understand if there are any state-specific rules in your area that might apply. Also, don't feel rushed to make any decisions about the money right now. Take time to get proper advice and documentation first.

This thread has been incredibly helpful! I'm dealing with a very similar situation where my property management company discovered they'd been incorrectly applying a "technology fee" that wasn't actually authorized in our leases. They're issuing refunds going back about 18 months. Reading through all these responses, I feel much more confident that I don't need to worry about tax implications on my end. The explanations about this being a correction of an overpayment rather than new income make perfect sense, especially the analogy about getting refunded for paying twice for something. I'm definitely going to follow the advice about taking a check for documentation purposes and keeping detailed records. The tip about writing an explanation directly on the deposit slip is brilliant - I never would have thought of that but it creates a perfect paper trail. It's also reassuring to hear from the property management professional that these kinds of corrections are actually pretty common and that legitimate companies handle them properly. I was starting to wonder if this was some kind of red flag, but it sounds like responsible property managers actually need to make these corrections when they discover billing errors. Thanks everyone for sharing your expertise and experiences - this community is amazing for getting real-world guidance on tricky tax situations!

Great discussion everyone! As someone who's been through tax audits before, I wanted to emphasize one more documentation point that might help. When you deposit that refund check, consider also scanning or photographing the check itself before depositing it, along with any accompanying letter from the management company. I learned this the hard way during an audit a few years back - the IRS wanted to see the actual check for an unusual deposit, but of course the bank had already processed it and their image quality wasn't great. Having my own high-quality scan saved me a lot of headaches and follow-up requests. For a $2,750 refund, it's definitely worth the extra 30 seconds to create that backup documentation. Store it in the same place as your other tax records for that year. Even though this isn't taxable income as everyone has correctly explained, unusual deposits sometimes catch the attention of IRS systems, and having crystal-clear documentation makes any potential questions much easier to resolve quickly. Your management company sounds like they're handling this professionally, which is always a good sign. The transparency and proper documentation they're providing suggests they know exactly what they're doing from a tax compliance standpoint.

Hey guys, wanted to share what worked for me as a 6th-year student from Canada. My statement for Form 8843 was actually pretty simple and got accepted without issues. I basically wrote 2 paragraphs: Paragraph 1: Stated my permanent address in Canada, mentioned my family there, noted that I maintain my Canadian health insurance, bank accounts, driver's license, and voter registration. Paragraph 2: Explicitly stated my plans to return to Canada immediately after finishing my program (with specific date), mentioned the job sector I plan to work in back home, and stated clearly "I do not intend to permanently reside in the United States." I signed and dated it, attached it to Form 8843, and had zero issues. No need to overthink it!

As someone who just went through this process successfully, I want to emphasize that the key is being specific and genuine in your statement. Don't overthink it, but make sure you cover the essential elements the IRS is looking for. Here's what I included in my statement that got accepted without any issues: 1. **Clear statement of intent**: "I do not intend to permanently reside in the United States and plan to return to [country] upon completion of my studies in [specific month/year]." 2. **Permanent residence details**: Address where you maintain your permanent home, who lives there (family members), and how long you've maintained that residence. 3. **Financial ties**: Bank accounts, investments, property, or other financial commitments in your home country. 4. **Personal/family ties**: Immediate family members, dependents, or close relatives who rely on you or whom you support financially. 5. **Professional plans**: Specific career plans, job applications, or professional licensing you're pursuing in your home country. 6. **Cultural/civic ties**: Things like voter registration, professional memberships, religious affiliations, or community involvement that demonstrate ongoing connection to your home country. The statement doesn't need to be lengthy - mine was about 1.5 pages, typed, signed, and dated. Keep it professional but personal. The IRS wants to see that your presence in the US is genuinely temporary and that you have compelling reasons to return home. Remember, this exception exists specifically for students like us, so don't be afraid to use it if you legitimately qualify!