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Does anyone know if the $500 threshold is per donation or for the entire year? Like if I donated clothes worth $300 in March and then more clothes worth $300 in October, would that count as over $500 for "similar items"?
It's for the entire tax year. The IRS considers similar items donated throughout the year as a group. So your example of $300 clothes in March and $300 more in October would be considered $600 total of "similar items" - requiring Form 8283 and completion of Section A, Part II (including the extra information about acquisition date, etc.
Pro tip: Take clear photos of your donated items and get an itemized receipt from the charity. The IRS has been getting stricter about documentation for noncash donations. I use the Salvation Army donation value guide to determine FMV - you can find it online and it makes filling out Form 8283 much easier.
A quick tip from someone who's dealt with this before: If you're filing an amended return to change from 1040 to 1040-NR, make sure to include a clear statement explaining the reason for amendment. Something like "Amended to correct filing status from resident alien (1040) to nonresident alien (1040-NR) based on failure to meet Substantial Presence test due to F1 visa exempt status." Also be aware that you might have different deduction eligibility as a nonresident alien - standard deductions work differently on 1040-NR, and certain credits may not be available. Your tax liability could change significantly.
Would this also apply if changing from 1040-NR to 1040? I think I might have filed the wrong way (opposite problem from OP). Is there a time limit for fixing this?
Yes, the same general process applies when amending from 1040-NR to 1040, but the tax implications might be more favorable since resident aliens generally have access to more deductions and credits than nonresident aliens. Regarding time limits, you typically have 3 years from the original filing deadline to file an amended return. So for a 2022 tax return originally due in April 2023, you'd have until April 2026 to amend it. However, if there's a significant refund involved, I wouldn't wait - the sooner you correct it, the sooner you'll receive any refund you're entitled to.
A heads up on the treaty benefits too - if your home country has a tax treaty with the US, you might be eligible for certain benefits as a nonresident that could reduce your tax liability. These are claimed on Form 8833 with your 1040-NR. I almost missed out on thousands in tax savings because I wasn't aware of the treaty provisions between my country and the US. Might be worth looking into depending on your citizenship!
This is so important! What countries typically have the best tax treaties with the US? I'm from Brazil and wondering if I should be looking into this.
I'm surprised nobody mentioned this but if you file late without an extension, you're looking at penalties if you owe money. Like 5% of unpaid taxes for every month you're late, up to 25%. If you're getting a refund there's no penalty for filing late BUT you only have 3 years to claim your refund.
For the future, I learned my lesson and now I take pics of all my important tax docs with my phone as soon as I get them. Store them in a secure folder and you'll never lose them again, even if you move or misplace the paper copies.
This is good advice! There are also secure document apps specifically for this purpose that encrypt your tax documents. I started using one after having a similar issue a few years back.
One thing nobody has mentioned yet - if you receive over $100,000 from a foreign person (including inheritance), you also need to file Form 3520. It's different from the FBAR and Form 8938. The penalties for not filing this form are pretty severe - can be 5% of the inheritance amount PER MONTH up to 25%. I learned this the hard way after receiving money from my relatives in Germany. Had to do a delinquent filing and pay penalties. Don't make my mistake!
That's really helpful info about Form 3520! I had no idea the penalties could be that severe. ā¬37,500 is under $100,000, but if exchange rates shift or if I decide to bring over some additional savings I have there, it could potentially cross that threshold. Better to know this ahead of time than find out the hard way. Is this form something I file along with my regular tax return or is it a separate filing deadline?
Form 3520 is filed separately from your regular tax return, but it's due on the same date as your individual income tax return (including extensions). So if you file for an extension on your 1040, you also get an extension on Form 3520. Be very careful with the currency conversion rates too. The IRS wants you to use the conversion rate on the date you received the money, not when you transfer it to the US. So document the exact date you legally received the inheritance and the exchange rate on that date.
Has anyone here used a tax treaty to their advantage with Greece specifically? I'm in a similar situation but the inheritance is much larger (around ā¬200,000) and I'm worried about estate tax implications.
The US-Greece tax treaty doesn't provide significant advantages for inheritances specifically. For an inheritance that size (ā¬200,000), your biggest concern should actually be proper reporting, not US taxation. You'll definitely need to file: 1. FinCEN Form 114 (FBAR) 2. Form 8938 (Foreign Financial Assets) 3. Form 3520 (since it's over $100,000) The US doesn't typically tax foreign inheritances received by US persons regardless of size, but the reporting requirements become stricter with larger amounts. The penalties for non-compliance with these forms are substantial, so I'd recommend working with a tax professional who specializes in international taxation for an inheritance of that magnitude.
Zara Mirza
Did you check if they applied some of your refund to a past debt? This happened to me last year - my expected refund was $4,200 but I only got $2,700 because they took part of it to cover an old student loan debt I didn't even realize was in default. The notice had some code about "offset" in it. Might be worth checking if that's what happened?
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Ravi Patel
ā¢I don't think that's what happened in my case. The notice specifically mentions adjustments to the child tax credit and earned income credit calculations, not an offset for previous debt. But thanks for mentioning this - I didn't know they could take your refund for other debts without telling you first! That's pretty scary.
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NebulaNinja
ā¢They definitely can and do take refunds for various debts - federal student loans, back taxes, child support, etc. It's called a "Treasury Offset" and they're supposed to send you a notice before doing it, but those notices sometimes arrive after they've already taken the money. If you think this might be happening, you can call the Treasury Offset Program at 800-304-3107 to check if you have any debts in the system.
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Luca Russo
Double check that no one else claimed your kids on their taxes. My ex and I had an agreement about who would claim which kid each year, but one year he claimed both without telling me. When I filed my taxes claiming one child (as was our agreement), the IRS adjusted my return and reduced my refund significantly. Had to go through a whole dispute process to fix it.
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Nia Wilson
ā¢This is actually super common. If two people claim the same dependent, the IRS will generally give the benefit to whoever filed first while the second person gets an adjustment. Then you have to provide documentation showing you're the rightful person to claim the dependent. It's a huge hassle.
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