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One additional thing to consider - if you had any income from your home country while studying in the US (like rental income, investments, etc.), you might still need to report it on your US tax return, even if you're paying taxes on it in Indonesia already. The US tax system is based on worldwide income for citizens and residents, but for nonresidents (which you likely are as an F-1 student in your first 5 years), you generally only pay US taxes on US-source income. However, you still need to disclose certain foreign accounts if they exceed $10,000 at any point during the year (FBAR requirements). I learned this the hard way when I almost got penalized for not reporting my home country savings account that my parents were contributing to while I was studying here.
Wait, I do have a savings account back home with about $12,000 in it. My parents put money in there for emergencies. Do I seriously need to report that? What form would I even use for that?
Yes, if your foreign account(s) exceeded $10,000 at any point during the calendar year, you need to file a Foreign Bank Account Report (FBAR), which is FinCEN Form 114. This is separate from your tax return and filed electronically through the Financial Crimes Enforcement Network's BSA E-Filing System. This doesn't mean you owe taxes on that money - it's just a disclosure requirement. The deadline is typically April 15, but there's an automatic extension to October 15 if you miss the April deadline. The penalties for not filing can be severe, especially if they consider it a willful violation, so definitely take care of this!
Don't forget about state taxes too! Federal and state taxes are separate in the US. Depending on which state your university is in, you might also need to file a state tax return. California (where UCLA is) definitely requires international students to file a state tax return if they earned income in California. You'll likely need to file Form 540NR. The state doesn't always honor the same tax treaty benefits that the federal government does, so you might end up owing state tax even if you're exempt from federal tax. State tax rules can vary widely, so check with your university's international student office for California-specific guidance.
Quick note about using PayPal specifically - they've lowered their reporting threshold to $600 as of last year. So even fairly small amounts of side income will trigger them to generate a 1099-K. Also, PayPal has been known to freeze accounts that they suspect are used for certain types of content sales. You might want to look into platform-specific payment options that cater to content creators as an alternative.
That's really good to know about the account freezes! Do you know if other payment platforms like Venmo or Cash App have similar issues? Or would you recommend something completely different?
Venmo is actually owned by PayPal so they have similar policies. Cash App can be more flexible but still has its limitations. Many content creators use platforms specifically designed for their industry that have built-in payment processing - these tend to be much more stable since they're designed for that purpose. Some also use multiple payment methods to diversify risk. Another option is to set up a proper business entity (like an LLC) and get a business bank account. This provides an additional layer of separation between your personal finances and business activities, and gives you more professional payment options. It costs a bit to set up but provides much better protection and legitimacy.
I don't see anyone mentioning quarterly estimated taxes yet! This is super important. If you're making consistent money from self-employment (including selling content online), you need to make estimated tax payments throughout the year. The IRS expects you to pay as you earn, not just at the end of the year. If you wait until April to pay everything, you might get hit with underpayment penalties.
14 Just FYI, the Free File Fillable Forms on the IRS website only work for the current tax year. For 2021 and 2022, you'll need to use tax software that offers prior year filing or download the PDF forms from the IRS and mail them in. I had to file a 2020 return last year and ended up using an older version of TurboTax I found on sale.
14 For prior years, you actually don't have a choice anymore - you have to file paper returns. The IRS only allows e-filing for current year and sometimes the year immediately before (during the beginning of filing season). Paper returns for prior years do take longer to process - typically 6-8 weeks minimum, and sometimes longer if there's a backlog. Make sure you send them via certified mail so you have proof of when you submitted them. Also, file each year separately in different envelopes to avoid confusion at the processing centers.
22 Has anyone tried contacting their employer for duplicate W2s? My old employer's HR portal only keeps them for 2 years and I need one from 2021.
16 Yes! I had to do this. Even if they're not in the portal, the payroll department should be able to generate a duplicate W2. I just called and explained the situation and they emailed me copies within a few days. If that doesn't work, you can also request a wage and income transcript from the IRS which shows all reported W2 info.
This isn't directly about the negative number, but make sure you also check if you qualify for the Recovery Rebate Credit for 2020. When I got a similar letter, it turned out I was missing both the Additional Child Tax Credit AND the Recovery Rebate Credit (stimulus payment). Ended up getting back almost $4,000 extra!
How do you know if you qualify for that Recovery Rebate thing? I filed in 2020 but honestly can't remember if I got all the stimulus payments or not.
The easiest way to check is to look at your 2020 tax return - there should be a Recovery Rebate Credit Worksheet or a line on the Form 1040 itself (Line 30). If that line is blank or zero, you might have missed out. You qualify if you didn't receive the full stimulus payments you were entitled to in 2020. The first payment was $1,200 per adult and $500 per qualifying child, and the second was $600 per adult and per qualifying child. If your income wasn't too high and you didn't receive these full amounts, you might be eligible for the credit.
Does anyone know the deadline for claiming this additional refund for 2020? I'm in a similar situation with a negative line 3 but I've been putting off dealing with it.
You generally have 3 years from the original due date to claim a refund for a given tax year. Since 2020 taxes were originally due May 17, 2021 (extended due to COVID), you have until May 17, 2024 to file an amended return or respond to an IRS letter about potential additional refunds. I wouldn't wait too long though - processing times can be lengthy, especially for amended returns or responses to IRS inquiries.
Nia Jackson
I went through the Tax Court petition process last year. Here are some tips: 1) If you don't have the 90-day letter, call the IRS (I know, painful) and request a copy. Explain you need it to file a Tax Court petition. 2) The Tax Court petition form is pretty straightforward. Focus on clearly stating why you disagree with the IRS determination. Be specific about which expenses were improperly disallowed and why. 3) Consider using the Tax Court's "small tax case" procedure (check the box for this on the petition) since your amount is under $50,000. It's more informal and doesn't set legal precedent. 4) Include as much documentation as possible with your petition. 5) Be aware that after you file, the IRS will likely transfer your case to their Office of Chief Counsel, and they often reach out to settle before actually going to court.
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Chloe Anderson
ā¢This is really helpful! For the small tax case procedure, does that mean I don't need to hire a lawyer? I've been worried about the cost of legal representation on top of everything else.
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Nia Jackson
ā¢For small tax cases, you don't need to hire a lawyer - many people represent themselves successfully. The process is designed to be more accessible. Judges in these cases tend to be more patient with self-represented taxpayers and will often help guide you through the process. That said, you might want to consider a consultation with a tax professional who has Tax Court experience, even if just for an hour, to review your petition before filing. Some Low Income Taxpayer Clinics (LITCs) offer free or low-cost help if you qualify based on income. Many law schools also run tax clinics where law students supervised by professors can help with Tax Court cases.
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Mateo Hernandez
Have you tried contacting the Taxpayer Advocate Service? They're an independent organization within the IRS that helps taxpayers resolve problems. If the same auditor is blocking your appeals, that seems like exactly the kind of situation they're designed to help with. You can reach them at 877-777-4778 or find your local office on the IRS website. They can often intervene when normal IRS channels aren't working properly.
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CosmicCruiser
ā¢The Taxpayer Advocate Service is completely overwhelmed right now. I submitted a request in January and still haven't heard back. They're prioritizing cases where people are facing immediate financial hardship like eviction or utility shutoffs.
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