That's a great point I hadn't considered! So even though I don't need to file taxes for these small amounts now, I should be keeping detailed records of all transactions for future basis calculations? Does your brokerage help with this or do you need to track it separately?

Most brokerages now track cost basis for acquisitions after 2011, so you'll have records available in their systems. However, I still recommend keeping your own spreadsheet or file with annual statements. This is especially important for dividend reinvestments which create tiny new tax lots every time they occur. While the brokerage tracks these, having your own backup documentation is valuable. Also, if you ever switch brokerages or when the account eventually transfers to your child, having your own complete history makes everything much smoother. Think of it as an insurance policy against future tax headaches!

Wow, I hadn't even thought about state taxes being different! I'm in Illinois - does anyone know what the threshold is here for custodial accounts and kiddie tax?

I don't know Illinois specifically, but many states either follow the federal guidelines or have their own thresholds. Your best bet is to check the Illinois Department of Revenue website or call them directly. Another option is to look at your tax software if you use any - most good tax software will alert you to state-specific filing requirements for dependents when you input their information. That's actually how I discovered the NJ requirement after initially missing it. Don't assume state and federal rules align, as that was the mistake I made!

My accountant never mentioned anything about earned income credit... what are the requirements for that? I make about $52,000 a year if that matters.

For the 2024 tax year (filing in 2025), a single parent with one child can qualify for the Earned Income Credit if they earn less than about $53,120, so you'd be right under the threshold! The maximum credit for your situation would be around $3,995, which could completely wipe out what you owe and possibly even give you a refund. Your accountant should have absolutely checked this for you. The qualifications are different from the child tax credit - your 17-year-old would still count for the EIC as long as they lived with you for more than half the year, have a valid SSN, and meet the relationship test. Definitely look into this or get a different tax preparer who's more thorough!

You can file an extension with Form 4868, but that only extends the time to FILE your return, not the time to PAY what you owe. You'll still accrue penalties and interest on any unpaid amount after the April deadline. BUT - the IRS has payment plans that are actually pretty reasonable. Look into the short-term payment plan (120 days) which has no setup fee!

Does VITA help with W8-BEN forms though? I thought they only helped with actual tax returns, not bank forms.

VITA programs can vary by location, but many university-based VITA sites do assist international students with W8-BEN forms since it's such a common question. You're right that their primary purpose is helping with tax returns, but most VITA volunteers at universities are trained on the basic international student forms too. It's definitely worth checking with your specific university's VITA program to see what they cover. Even if they don't directly help with the W8-BEN form, they might be able to point you to resources that can help. They're generally much more knowledgeable about these issues than the front desk staff at international student offices.

Good advice about keeping copies! My roommate had issues because he submitted the form to his bank but then couldn't remember some of what he put when another organization asked for the same form later.

Oh wow, I had no idea about the hobby loss rule. So even if I am legitimately reinvesting in my business, I need to show some profit occasionally? Does the amount of profit matter or just the fact that there is some?

The amount of profit doesn't have a specific threshold - it just needs to be genuine profit. The key is demonstrating that you have a profit motive, not just a tax reduction motive. Small profits are fine as long as they're real. What helps is having a business plan that shows your reinvestment strategy is part of a long-term growth plan that will eventually result in greater profits. Documentation is your friend here - keep records showing how your business decisions are commercially reasonable and aimed at eventual profitability.

What kind of business do you have? I'm wondering because different industries probably have different standards for what counts as a necessary expense.

I second this! The transcript was the only way I found out my refund was delayed because they needed to verify my W-2 with my employer. The WMR tool just said "processing" for weeks but the transcript showed exactly what was happening.

I filed electronically for both federal and state. My state refund (about $430) actually came through about a week ago, which makes the federal delay even more annoying! I don't understand why the state can process it so quickly but the federal is taking forever.