Isn't filing an SS-8 form basically declaring war on a client though? I've heard horror stories about businesses getting hit with huge penalties after these forms are filed. Seems like a nuclear option if you ever want to work in the industry again.

You're right that filing an SS-8 is definitely escalating the situation, and it should be a last resort after you've tried everything else. It's not something I recommend if you're concerned about maintaining relationships in your industry. However, I don't think it's fair to characterize it as "declaring war" - it's simply using the proper channels when someone is refusing to fulfill their legal obligations. The penalties only come into play if they were incorrectly classifying workers, which is a legitimate issue. But yes, there could be relationship consequences, so weigh that against the tax implications for yourself.

Yeah, it was definitely above the threshold - around $5,800 total for the work. They actually did provide the 1099 form itself (which means they know they were required to), they just blacked out their own identification number on it, which is super weird.

Even if it's under $600, you still need to report the income. The $600 threshold is just for when the payer is required to send a 1099. You always have to report all income regardless of the amount.

Thanks for mentioning this! I had no idea there was a separate credit. Does this replace the medical expense deduction or can I potentially use both? Also, does it matter that I'm not physically taking care of her myself (since she's in a facility)?

You cannot double-dip by claiming the same expenses for both the Dependent Care Credit and as medical expense deductions. You'll need to choose which is more beneficial based on your overall tax situation. Generally, credits are more valuable than deductions, but it depends on your specific numbers. The good news is that you don't need to physically care for her yourself to claim the Dependent Care Credit. Expenses paid to a care facility qualify as long as part of the expense is for the care of your mom. However, if the facility provides medical care, you need to separate out the cost of care from the medical expense portion if you want to use both benefits for different expenses.

Is there any way to fix this if you've already been giving the money to the parent? My sister and I deposit money in our dad's account and he pays his care facility.

Does specific identification actually save you money compared to FIFO? And how exactly do you indicate which specific coins you're selling when you execute a transaction? It's not like stocks where you can pick specific shares.

Specific identification can potentially save significant money compared to FIFO, especially if you've bought the same cryptocurrency at very different price points over time. It allows you to strategically "sell" the lots with the highest cost basis first, minimizing your reported gain. You don't need to specify which coins you're selling at the time of the transaction. What matters is your accounting method and documentation. You need to maintain clear records showing the date and time each unit was acquired, your cost basis, the date and time of sale, and the proceeds. This becomes your evidence for using specific identification. Most specialized crypto tax software can help maintain these records and will let you choose which method to apply when generating your tax forms.

The IRS clarified in 2019 that like-kind exchanges (Section 1031) were never applicable to cryptocurrency trades, even before the 2018 tax law change that explicitly limited 1031 exchanges to real estate. Unfortunately, those 2017 crypto-to-crypto trades were taxable events. If you haven't been reporting them correctly, you might want to consider filing amended returns for those years. The statute of limitations is typically 3 years, but it can be extended in certain cases, especially if the IRS considers it substantial underreporting.

That's helpful, thanks! I moved October 10th and was in the US until December 18th when we returned for the wedding. We stayed in Canada until January 2nd, so that's about 27 days total in Canada for 2024. Sounds like I should be well under the 183-day threshold. Do pre-move days count toward this calculation too? Like, I was obviously in Canada from January-October before moving.

Yes, all days physically in Canada during the calendar year count toward the 183-day threshold, including January-October before your move. So you'd have roughly 9 months plus 27 days, which would put you over the 183-day threshold for 2024. However, this doesn't automatically make you a resident for the whole year. The CRA can recognize a change in residency status during the year. For people leaving Canada, they often consider you a part-year resident up to your departure date if you've legitimately established non-residency after that point. This is why your accountants are focusing on your ties after October, because they're trying to determine if you successfully established non-residency upon your departure.

I'd be careful with NR73. It can be helpful but it's also known to trigger extra scrutiny. My cross-border tax specialist advised against filing it unless absolutely necessary because it essentially puts you on CRA's radar and can lead to additional questions and reviews. Sometimes it's better to take a reasonable position based on your facts and circumstances and be prepared to defend it if questioned, rather than proactively asking for a determination.

Did you need to submit receipts for all those expenses with your amended return? I'm trying to figure out what documentation I need to gather.

You don't submit receipts with your amended return, but you absolutely need to keep them in case you get audited. The IRS can ask for documentation up to 3 years after filing (longer in some cases). Just make sure you have a reasonable basis for any expense you claim. Things like a portion of your internet bill, cell phone, home office (if you have a dedicated space), software, and equipment are usually fine as long as they were genuinely used for your freelance work. I keep a spreadsheet with all business expenses and digital copies of receipts organized by tax year.

This is such a good point! I almost made the same mistake. It's sometimes easy to forget that most states tax income too.