Has anyone here actually gone through the streamlined process and then received confirmation from the IRS that everything is OK? I submitted mine about 10 months ago and haven't heard anything... getting anxious about whether they accepted it or if there's still some problem I don't know about.

I went through the streamlined procedure about 18 months ago as a dual US-German citizen, so I can share some specifics about costs and the process. I ended up paying around $2,800 for a specialist who handled everything, which was actually less than some of the quotes I got from traditional CPAs. A few things that helped keep costs down: I organized all my documents beforehand (bank statements, German tax returns, employment records), which saved billable hours. Also, since you've been paying Austrian taxes, you'll likely qualify for Foreign Tax Credits that should eliminate any US tax owed - this makes the process more straightforward and less expensive. One surprise cost I hadn't anticipated was getting certified translations of some German documents. Not sure if you'll need this for Austrian documents, but budget maybe $200-400 for translations if your tax preparer requests them. Also, if you have any Austrian pension contributions or investment accounts, those can complicate things and increase preparation fees. The peace of mind was totally worth it though. Now I'm compliant and can sleep at night without worrying about surprise IRS issues!

wait are we supposed to be reporting money from zelle?? I got like $22k last year from clients and didnt report any of it... am i gonna be in trouble??

This is a really important question, and I'm glad you're asking now rather than later! You're correct that Zelle doesn't issue 1099-K forms because it facilitates direct bank-to-bank transfers rather than acting as a third-party payment processor like PayPal or Venmo. However, the absence of a 1099-K absolutely does NOT mean you don't need to report the income. All income from your tutoring and freelance work is taxable and must be reported on your tax return, regardless of whether you receive any tax forms. The IRS is very clear on this - income is income, no matter how you received it. With $14,800 in business income, you're definitely over the threshold where this becomes significant. I'd strongly recommend: 1. Keep detailed records of all your Zelle transactions - dates, amounts, and what each payment was for 2. Separate business payments from personal transfers (like money from family/friends) 3. Consider setting up a separate business bank account to make tracking easier 4. Save money throughout the year for taxes since you won't have withholding Don't let the lack of official forms fool you into thinking this income is somehow "under the radar." The IRS has ways of detecting unreported income, and it's always better to be proactive about compliance than to deal with problems later.

Has anyone used TurboTax for home office deductions? I'm worried it doesn't ask enough detailed questions about exclusive use and business startup costs. Is there better software for small business owners?

Don't panic - IRS inquiries about home office deductions are actually pretty common, especially when there's a significant expense with no corresponding income. The fact that they're asking for documentation doesn't necessarily mean you did anything wrong. However, there are a few potential issues with your approach. Business startup costs over $5,000 typically need to be amortized over 15 years rather than deducted all at once. Also, home improvements generally must be depreciated rather than expensed immediately, even for business use. The key things the IRS will be looking for: 1) Receipts and invoices showing the actual costs, 2) Evidence the basement is used exclusively for business (photos, floor plans), 3) Documentation showing legitimate business intent, and 4) Proper categorization of which expenses qualify as immediate deductions vs. depreciation. Gather all your renovation receipts, take photos of the current business setup, and consider consulting a tax professional who can help you amend your return if needed. Being proactive and transparent with the IRS usually leads to better outcomes than trying to defend questionable positions.

I actually work in payroll software development. The technical challenge isn't separating overtime hours (we already do that), but in how withholding calculations work. Current systems calculate tax withholding based on total gross pay, with certain pre-tax deductions (like 401k) subtracted before calculating. Creating a new type of non-taxable income that's still reported on W-2s would require: 1) Updated database schemas across payroll systems 2) New tax calculation modules 3) Modified reporting to handle the new income type 4) Updated integration with tax filing systems Most modern payroll systems could adapt, but it would take 8-12 months of development work. Legacy systems would struggle more. Companies using outdated payroll software might need to completely replace their systems.

As someone who's worked in both HR and accounting, I can add that the audit implications would be massive. Currently, overtime calculations are relatively straightforward to verify - did the employee work over 40 hours? Are they classified correctly as non-exempt? But with tax-free overtime, the IRS would need to verify not just that overtime was paid, but that it was properly classified as tax-exempt. This would require much more detailed recordkeeping. Companies would need bulletproof timekeeping systems and clear policies about what constitutes "overtime" versus other premium pay. I've seen how much trouble companies get into during DOL audits when overtime calculations are wrong. Adding a tax exemption layer would multiply that complexity. Every misclassified hour could result in both labor law violations AND tax compliance issues. The transition period would be brutal - companies would essentially be running two different systems simultaneously while ensuring compliance with both old and new rules.

I went through this last year. Let me tell you what worked for me: Get on a payment plan as soon as possible after filing. IRS Fresh Start program was a lifesaver. They let me pay a small amount monthly based on my actual ability to pay. Also, after you file all required returns, you can request penalty abatement through Form 843. I was able to get first-time penalty abatement which eliminated a ton of the failure-to-file penalties for my earliest unfiled year. Didn't help with interest, but still saved thousands. Don't forget about state taxes! Each state has different requirements and lookback periods. Some states (like CA where I am) can be even more aggressive than the IRS about collection.

I really appreciate everyone sharing their experiences here. As someone dealing with anxiety and depression like you mentioned, I want to emphasize that taking action - even small steps - really does help reduce the overwhelming feeling about this situation. One thing that helped me personally was breaking it down into very manageable chunks. Week 1: just request transcripts. Week 2: organize what I found. Week 3: tackle one year at a time. The mountain becomes much more climbable when you're not trying to solve everything at once. Also, don't beat yourself up about the COVID relief programs you missed. Focus on what you can control moving forward. The IRS genuinely wants people to get back into compliance, and there are more options available than most people realize. Consider reaching out to a Low Income Taxpayer Clinic (LITC) in your area if money is tight. They provide free or low-cost representation and can help navigate the process. You can find one through the IRS website or by calling the Taxpayer Advocate Service at 1-877-777-4778. You're taking the right steps by addressing this now. It's never too late to get back on track.