This is really helpful - I hadn't thought about the pass-through issue. In my case, the artists are receiving payment directly from their platforms and then sending me my percentage (usually 15-20%). So if they make $1000, they'd send me $150-$200 via Venmo. Does that simplify things since I'm only receiving my commission portion?

That definitely simplifies your situation! Since you're only receiving your commission portion directly, there's no pass-through income to worry about. The full amount you receive through Venmo is indeed your business income that should be reported on your Schedule C. Just make sure you're tracking each payment received with details on which artist it came from, what platform earnings it relates to, and the commission percentage applied. This documentation will help support your reported income if you're ever questioned. It's also smart business practice to send your artists an annual statement showing the total commissions they paid you, both for their records and yours.

This might be overkill for small payments though. I pay VAs in the Philippines less than $5k each per year and my accountant said as long as I have good documentation of the work performed and payments made, I don't need to worry about additional foreign reporting forms. Might depend on the dollar amount?

Do you know if there's an easy way to figure out which tax treaty benefits apply? I've tried reading through the actual treaties and they're practically unreadable with all the legal jargon.

The IRS Publication 901 (U.S. Tax Treaties) provides summaries of the major provisions in each treaty in more understandable language. It's still dense reading, but much better than the treaties themselves. For a quicker reference, check the IRS website section on tax treaties where they have tables showing the reduced tax rates for different types of income based on country. However, these only cover basic situations, so for complex scenarios like your colleague's, it might be worth consulting with a tax professional who specializes in international taxation.

Did you have to file a separate 1040-NR for the nonresident part of each year? My accountant is telling me different things each time I ask.

Is there any advantage to using an FSA instead of an HSA for braces? I have both options at my work and never know which one to pick during open enrollment.

HSAs are generally better since the funds don't expire and you can invest them, but FSAs sometimes make sense if you know you'll have a large expense in that specific year. For braces specifically, one advantage of FSAs is that many allow you to access your full annual election amount at the beginning of the plan year, even before you've made all the contributions. So you could pay a large orthodontic bill in January but the money comes out of your paycheck gradually throughout the year.

That's really smart! Did you end up getting a decent tax refund from being able to deduct it? I'm trying to decide if it's worth all the hassle of tracking these expenses versus just using my HSA.

Thanks for the UCB code tip! I'll definitely give it a try. And I didn't know about the VITA programs - are you sure they can handle non-resident forms like 8843 and 1040NR? I thought most free tax services only covered basic resident returns.

You're right to be cautious about VITA for non-resident returns. Not all VITA sites have volunteers certified in the Foreign Student and Scholar module. You need to specifically ask if they have volunteers trained on 1040NR and international student issues. I'd call ahead and ask if they have experience with international student taxes. Some university-based VITA programs are better equipped for this. The one at UCLA specifically mentions helping international students, so check if there's a university-hosted VITA site near you rather than a community one. Hope the code works for you!

This actually works! I just called them, explained that I'm a broke grad student and that my university used to offer a code but doesn't anymore. The customer service person was super understanding and gave me a 20% discount. They said they have some discretion for hardship cases. Thanks for the tip!!

I've never heard of the QBI deduction! How do I know if I qualify for that? And can I really still set up a retirement account for last year even though we're already in the new year?

Most self-employed individuals with income under $170,050 (single) or $340,100 (married) for 2024 qualify for the full QBI deduction. It's basically a 20% deduction on your net business profit. The tax software should calculate it automatically, but make sure it knows your business is a qualified trade or business. Yes, you can absolutely still set up and fund a retirement account for last year! For SEP IRAs, you can establish and contribute until your tax filing deadline, including extensions. So potentially as late as October 15th! Solo 401(k)s need to be established by December 31st of the tax year, but you can still contribute to them until your tax filing deadline. This is one of the best tax-saving strategies for self-employed people.

This is exactly right. I've been self-employed for 5 years and it still hurts every time. The other thing to remember is that half of your self-employment tax is deductible on your 1040, which helps a little bit at least.

That breakdown really helps me understand! So I'm essentially getting hit twice on my business income - once with the self-employment tax and then again when it's added to my regular income for income tax purposes. No wonder the number seemed so high! I appreciate the simple explanation. Now I see why people talk about the importance of tracking every possible business expense. Every dollar I can legitimately deduct from my gross business income helps reduce both tax calculations.