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Don't overthink this - just report it as "Other Income" on Schedule 1 and move on with your life. It's not self-employment income since you weren't actively involved in the business, and it's not a gift since there was an expected return. The key with situations like this is to make a reasonable, defensible choice and be consistent. The last thing you want is to get creative with tax reporting and then have to explain yourself later. People get in trouble with the IRS when they try to get too clever with borderline cases. Reporting as other income is straightforward, accurate, and won't raise any red flags.
I've been through something very similar and can share what I learned after consulting with a tax professional. The key factor is that you provided money with a clear expectation of return based on performance - this makes it an investment arrangement, not a gift. Here's what I'd recommend: Report this as "Other Income" on Schedule 1, Line 8z. You don't need Schedule C unless you're regularly in the lending business. The amount isn't subject to self-employment tax since you weren't actively participating in the house flipping business itself. A few important considerations: Make sure you keep records of when you provided the money and when you received the return, as this could affect whether it's treated as short-term or long-term investment income. Also, if your friend issues you any tax forms (like a 1099), make sure your reporting is consistent with whatever he files. The "gift" route is risky because the IRS looks at substance over form - a payment that's exactly 25% of profits clearly shows an investment arrangement rather than generosity. Better to report it correctly as investment income and avoid any potential issues down the road.
Has anyone dealt with the issue of DeGiro not providing proper French tax forms? When I was with a French broker, they used to give me a "ImprimΓ© Fiscal Unique" that made declarations super easy, but DeGiro doesn't do this.
This is a common issue with foreign brokers. You'll need to compile the information yourself from their annual statement. DeGiro should provide you with an annual overview that shows all dividends received, interest paid/received, and any realized gains/losses. You then need to manually transfer this information to your French tax forms.
I went through this exact same situation last year when I opened my DeGiro account. Here's what I learned from speaking with a tax advisor: 1. **Form 3916** is mandatory every year for ANY foreign account, regardless of balance or activity. Even if you just opened it and haven't invested anything yet, you must declare it. 2. **Form 2047** is for reporting actual income (dividends, capital gains, interest) from foreign sources. If you haven't earned anything yet, you still need the 3916 but can skip the 2047 for now. 3. **Timing matters** - you need to declare the account for the tax year in which it was opened, even if it was December 31st. 4. **Documentation** - Keep all your DeGiro statements and correspondence. The French tax authorities can ask for proof of the account details at any time. One thing that caught me off guard was that even my unused cash sitting in the DeGiro money market fund counted as a "foreign investment" and needed to be reported differently than just cash in a bank account. The good news is that once you've done it the first time, subsequent years are much easier since you just update the same forms with current balances and any new income.
This is incredibly helpful! I had no idea about the money market fund distinction. I've been keeping some cash in DeGiro's default money market sweep and assumed it was just like having cash in a regular bank account. Do you know if there are different tax implications for the money market fund earnings versus regular dividends from stocks? Also, when you mention "reported differently" - does that mean it goes on a different section of Form 2047 or requires a completely different form?
Something nobody's mentioning - if you regularly drive far distances specifically to run these errands, you might actually be able to deduct mileage! Not as a business expense, but you could potentially classify it as charitable miles if you're helping elderly or disabled folks. Worth looking into.
Thanks for bringing this up! My actual situation is that I'm driving to these places anyway for my own shopping needs. I wouldn't make special trips just to get stuff for others. Does that change the potential for deductions?
If you're already making the trips for your own purposes, then unfortunately you probably can't deduct the mileage for helping others. The IRS generally doesn't allow deductions for expenses you would have incurred anyway. The charitable mileage deduction only applies if you're making additional trips specifically to help qualifying organizations or individuals. Since you mentioned you're going to these cities for your own shopping regardless, the errands for others would be considered incidental to your personal trip.
This is a great question that comes up more often than you'd think! You're handling this correctly from a tax perspective. Since you're acting as an agent for your family and friends - essentially just facilitating their purchases without any markup or service fee - the money they give you isn't considered taxable income to you. The key factors that make this not taxable are: 1) You're not charging any fees or keeping any profit, 2) You return exact change, and 3) You're acting as their purchasing agent rather than selling goods or services. The credit card rewards you earn are also not taxable since they're considered rebates on your purchases. Just keep good records of these transactions (receipts showing you spent what they gave you) in case there are ever any questions. But you're definitely not required to report this money as income on your tax return.
Just to add to what everyone's saying - even if you only worked 3 weeks, if you received ANY pay, it counts as taxable income for 2024. The IRS matches up employer reports with your tax return, so they'll definitely notice if something's missing. Better to report everything upfront than deal with notices later. If you haven't received the W-2 by early February, you can file Form 4852 as a substitute, but try contacting your old employer first.
This is super helpful info! I didn't know about Form 4852 - that's good to know as a backup option. Thanks for breaking it down so clearly @Oliver Wagner π
Thanks everyone for the helpful advice! I'm definitely going to wait for the W-2 from my short-term job and report all income. Better safe than sorry with the IRS. Really appreciate all the responses - this community is awesome for getting real answers about tax stuff π
Totally agree @Jamal Carter! This community has been so helpful for navigating tax questions. I'm in a similar boat with some freelance work from last year and all these responses really cleared things up for me too. It's reassuring to know there are knowledgeable people here willing to share advice π
Oliver Zimmermann
Protip: Check your VA tax account online instead of TurboTax status. Sometimes TT is slow to update the state status
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Lydia Santiago
Just wanted to chime in with some additional perspective - I've been dealing with VA state returns for years and this level of delay is unfortunately becoming more common. The identity verification measures Zainab mentioned are part of their effort to combat fraud, but it's definitely creating longer wait times for legitimate taxpayers. If you're really anxious about it, you can try calling the VA Department of Taxation directly at (804) 367-8031, though expect long hold times. Hang in there - your refund will come through!
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Zara Rashid
β’Thanks for sharing that phone number! I've been hesitant to call because I figured they'd just tell me to wait, but maybe it's worth a shot. Did you have any luck when you called in previous years, or do they pretty much just confirm what we already know about the delays?
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