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.

I used TurboTax for 3 years of unfiled 1099 taxes last year. It worked ok but you have to buy each year separately which adds up fast. They don't make it super clear how to find the previous year versions either - you have to specifically search for "TurboTax 2019" etc. on their site. The business version is what you need for 1099s, which is their most expensive tier.

Thanks for the info! That's helpful to know about having to buy each year separately. Did you find the business version was worth it in terms of finding deductions for your 1099 income? I'm trying to decide if the higher cost is justified compared to cheaper options.

That's actually really helpful - I hadn't thought to ask my attorney about the tax implications. Were you able to claim head of household status since you had the kids, or did you have to use married filing separately? I'm trying to figure out which status would give me the best outcome.

I couldn't claim head of household that year because my divorce wasn't final yet and my ex and I were still living together for part of the year. I had to use married filing separately, which wasn't ideal tax-wise but gave me peace of mind. For your situation, since you've been living separately since June and have the kids primarily with you, you might qualify for head of household status even while still technically married. You'd need to meet certain requirements like paying more than half the cost of keeping up your home and having a qualifying dependent living with you for more than half the year. This status gives you better tax rates than married filing separately and access to certain credits you'd otherwise lose.

That's actually genius but also kinda hilarious. Did your lawyer suggest this or did you figure it out yourself? I wonder if judges ever get annoyed by people strategically timing their divorces around tax season lol

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.

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.