Thanks for sharing your experience! Do you think it matters that my contract with the Malaysian company says "employment agreement" in the title, even though the substance of the relationship is more like self-employment? Did you have a similar issue with your German contract?

The title of the contract isn't as important as the actual terms within it. My German agreement also said "employment contract" but the IRS looks at the substance of the arrangement more than the labels. Make sure you highlight aspects of your arrangement that support self-employment: you paying your own expenses, setting your own schedule when possible, using your own equipment, and the lack of typical employee benefits. In my case, I included a memo with my tax return briefly explaining why I was filing as self-employed despite the contract title, focusing on these substantive factors. The key is being consistent and having documentation to back up your position if questioned.

I used TurboTax last year for a similar situation working in Thailand. It does handle Schedule C for self-employment and Form 1116 for Foreign Tax Credit, but honestly the questionnaire was confusing for international situations. I ended up having to manually override some things and do quite a bit of research on my own. If your situation is straightforward self-employment, it might work fine, but if there are complexities, you might want a professional who specializes in expat taxes.

Thanks for the insight! I might try TurboTax first since my situation isn't super complex, but keep a tax professional as backup if I get stuck. Did you find any specific resources that helped you figure out the overrides you needed to make?

Is that true across all states? I'm in Florida and starting a similar business. Did your broker explain why there's a difference in rates between the two structures?

From what our broker explained, it's not universal across all states but is common in many. The difference comes from how insurance companies assess risk based on historical claims data. They have more data on contractor LLCs than LLPs since LLCs are much more common in the construction industry. In Florida specifically, I've heard the difference can be even more pronounced because of how your state handles construction defect claims and the associated liability. Insurance companies have specific rating factors for different business structures, and LLCs in contracting tend to have more favorable loss histories in their actuarial data. Definitely worth getting quotes for both structures from a broker who specializes in contractor insurance.

Can you explain more about how that works? We're just starting but hoping to grow quickly. How complicated was switching to S-Corp taxation?

What if you don't have the last paystub either? Is there a way to calculate approximately how much was withheld based on your income? Like is there a standard percentage or something?

Unfortunately, there's no standard percentage that would be accurate enough for tax filing purposes. Withholding varies based on your income level, filing status, number of allowances you claimed on your W-4, and sometimes other factors like benefits or retirement contributions. That's why getting the actual information from the IRS transcript is the most reliable option. Making a guess could result in serious discrepancies that might trigger notices or audits later.

That's actually a really good tip! I tried this about 3 weeks ago and got through much faster than with the IRS. The SSA rep was able to give me my wage information, though they couldn't provide the exact federal withholding amount. Still gave me enough info to file Form 4852 with a pretty accurate estimate.

Wait, seriously? My accountant has been using Form 1116 every year even though my foreign taxes are just around $550 and I file jointly with my spouse. Is this something TurboTax would automatically detect?

Yes, TurboTax should absolutely detect this and give you the option to use the simplified approach if you qualify. It's called the "exemption from filing Form 1116" and it applies when your qualified foreign taxes are under $600 for married filing jointly. Your accountant might be using Form 1116 because there are some situations where using it could be more advantageous even below the threshold, especially if you have carryover credits from previous years. But for most people under the threshold, taking it directly on Schedule 3 is much simpler and works just fine.

I've used both and honestly H&R Block's handling of Form 1116 is more transparent. It shows you the actual form as you're working and explains the limitations better. TurboTax hides a lot of the calculations behind the scenes. H&R Block also has better handling of multi-country calculations if you have investments in different regions. The downside is their interface isn't as sleek as TurboTax.

That's reassuring to hear! Have you ever heard of the IRS taking back a refund once it was deposited? That's my main worry - spending the money and then suddenly finding out there was some mistake and owing it all back.

I've never personally heard of the IRS taking back a refund after it was deposited unless there was actual fraud involved or a massive calculation error. If you filed honestly and the amount matches what your tax software calculated, you should be absolutely fine. If it gives you peace of mind, you could keep the bulk of it in your checking account for a week or so before moving it to savings or spending it. But really, once it's in your account, it's almost certainly legitimate and yours to keep.

Great advice. I just checked my transcript and it showed my refund was processed even though the tracker still says "received" like OP's situation. The transcript is definitely more reliable!