How do you properly document these expenses if you didn't track them throughout the year? I'm in a similar situation and I use my personal computer and cell phone for work all the time, but I don't have any special receipts or anything.

You can still claim those expenses even without perfect documentation. For things like cell phone and internet, determine what percentage is used for work (be reasonable and honest) and deduct that percentage of your bills. Pull your statements from 2023 to calculate the total. For a home office, measure the square footage of your dedicated work space compared to your total home size. That percentage can be applied to rent/mortgage, utilities, etc. For computer equipment you already owned, you can deduct the business-use percentage based on current fair market value if you started using it for business in 2023. Going forward, keep better records - a simple spreadsheet works, along with taking photos of receipts. Remember, in an audit you need to prove these were legitimate business expenses, so some documentation is better than none.

I had partial success. Filed the SS-8 and 8919 forms, and after the IRS determination (took like 8 months), my employer had to pay their share of FICA taxes. They were annoyed but ultimately it worked out. We're still on good terms. The key was being super professional about it and framing it as "just following tax law" not a personal issue.

Do you know if these forms matter for the Premium Tax Credit? My sister gets insurance through the marketplace and she's trying to figure out if these forms affect her refund.

Great question! The 1095-B and 1095-C forms themselves don't directly impact the Premium Tax Credit. However, if your sister receives insurance through the marketplace, she should receive Form 1095-A, which IS needed to claim the Premium Tax Credit. The 1095-A is different from the B and C versions and contains essential information for calculating the Premium Tax Credit on Form 8962. So while the B and C forms are just for your records, the 1095-A is actually needed for filing if you got marketplace insurance and want to claim the credit.

Same! I tossed mine and then panicked afterward. Called the IRS and they said it wasn't a big deal as long as I had health insurance. The forms are mostly for their records.

Our HR department keeps saying they "don't have the bandwidth" to set up anything like this. Is there a simple template or explanation I could bring them? Any idea roughly what percentage of home internet/utilities is typically covered in these accountable plans? I'm trying to come with a specific proposal rather than a vague request.

Yes, the IRS publication 463 covers accountable plans and can be referenced. For a simple template, many payroll providers (ADP, Paychex, etc.) have standard forms. For internet/utilities, most companies I've worked with typically approve 30-50% of internet costs for full-time remote workers. Start with a specific proposal of what you're seeking reimbursement for and approximate amounts. For internet, calculate your monthly cost and request half if you use it significantly for work. Include any one-time costs like ergonomic equipment. HR departments respond better to specific, reasonable requests with clear documentation requirements than open-ended programs they have to design from scratch.

Thanks for the reality check. I hadn't considered the exclusive use requirement or the home sale complications. Does this exclusive use requirement also apply to the simplified method (the $5 per square foot deduction)? And does claiming home office expenses increase audit risk significantly?

Wait, do you need to register for a HST number right away when you start, or only after you hit the $30k threshold? I'm in a similar situation and just realized I might be over that amount already.

You only need to register for HST once you exceed $30,000 in revenue in any consecutive 12-month period. Once you hit that threshold, you need to register within 29 days. If you're just starting out and don't expect to hit $30K right away, you don't need to register immediately. If you've already exceeded the threshold and haven't registered yet, I'd recommend registering ASAP and talking to an accountant about how to handle the HST you should have collected. The CRA is usually reasonable if you self-correct and explain the situation, especially for first-time issues like this.

I've used TurboTax Self-Employed for my US-Canada income situation for the past two years and it works fine. Just make sure you convert all your USD income to CAD (I use the Bank of Canada annual average exchange rate to keep it simple). The software walks you through the T2125 form pretty well. The only tricky part is tracking all your business expenses throughout the year - TurboTax doesn't help with that part. I use a separate expense tracking app and then just input the totals by category at tax time.

Does this Rev Proc 2013-30 actually work though? I've read horror stories about people thinking they qualified for relief but then getting rejected.

It absolutely works, but you have to make sure you meet ALL the requirements. The most important is that your shareholders (which is just you if you're a single-member LLC) have filed their personal returns consistent with S-corp status. That means if you're trying to get S-corp status for 2023 after the deadline, you'd need to have filed your 2023 personal return as if you were an S-corp owner (reporting K-1 income, not Schedule C). The IRS is actually pretty lenient with this relief procedure for small businesses. I submitted mine with a simple statement explaining I didn't understand the election timing requirements, and it was approved without any questions.

What's a "reasonable salary" though? I've heard everything from 30% to 70% of profits and I'm confused about what's actually required.