That's really helpful! I didn't know about Form 8843 potentially affecting health insurance requirements. She does have some coverage from her home country that her parents pay for, but we weren't sure if that was relevant for US tax purposes. Do you know where specifically on Form 8962 I should look for the provisions you mentioned about income below 400% of poverty level? Her income is definitely well below that threshold.

Look at the instructions for Form 8962, specifically the "Repayment Limitation" section. There's a table that shows the maximum amount someone has to repay based on their income as a percentage of the federal poverty line. For someone making less than 200% of the poverty line (which sounds like your friend's situation), the maximum repayment amount is capped at $325 for individual filers in 2024. The Form 8843 connection is a bit complex, but essentially if she qualifies as an exempt individual for substantial presence test purposes, that status sometimes affects marketplace eligibility. Have her check with her university's international student office - they often have tax specialists who understand these specific situations for international students.

I used FreeTaxUSA for a similar situation last year and it handled the 1095-A with partial year coverage much better than TurboTax did. It asked clearer questions about why there were zeros in certain months and calculated everything correctly. The Form 8962 reconciliation worked perfectly even with the weird mid-year changes.

Thanks for the suggestion! I might give FreeTaxUSA a try instead. TurboTax kept giving me error messages when I entered zeros for some months but values for others. It seemed like it wasn't designed to handle these unusual situations that are actually pretty common for international students.

This is super helpful! Can you use these credits every year or only in the year you hire someone? And do the accommodations have to be specifically for that employee or can they be general accessibility improvements?

The WOTC is only available for the first year of employment (and potentially the second year for certain veterans and long-term family assistance recipients). For the Disabled Access Credit, you can claim it every year you make eligible accommodations, up to the annual limit. The accommodations don't have to be for a specific employee - they can be general accessibility improvements that help multiple employees or customers. Things like wheelchair ramps, accessible restrooms, or adaptive technology can all qualify. The Barrier Removal Deduction similarly can be claimed whenever you make qualifying improvements to remove physical barriers. It's not tied to a specific employee but rather to making your business more accessible overall.

That's disappointing but makes business sense I guess. Do you at least promote people from those entry-level positions into better roles once they're hired? Or are they just stuck in low-wage jobs?

Wait, there's a way to see what forms have been sent to the IRS under your SSN before you file? How do you access that? That would be super helpful.

Not all tax software has this feature, but many do now. In TurboTax, there's a "Tax Data Verification" section where you can import forms the IRS has received. H&R Block has something similar called "Tax Identity Shield" where you can review reported forms. The most comprehensive way is to create an account on the IRS website and request a "Wage and Income Transcript" which shows all information returns (W-2s, 1099s, etc.) reported to the IRS. The only downside is that current year information might not be fully updated until summer, so it's most helpful for catching things you missed the previous year.

Did you have to pay a penalty too? I'm in a similar situation and wondering what the damage will be...

Does FreeTaxUSA handle investment sales with basis reporting? That's where I got stuck with another budget option last year and had to upgrade.

Yes, FreeTaxUSA handles investment sales with basis reporting really well. I had about 20 stock transactions last year with various purchase dates and it handled everything smoothly without making me upgrade. The interface for entering the information is straightforward - you can either enter transactions manually or import a spreadsheet if your broker provides one. Much better than my experience with other budget options that either couldn't handle investments or required upgrading to a premium tier.

I tried Free File last year and it was confusing because there were multiple options. How do you know which one to pick?

This is terrible advice. Tax evasion is tax evasion regardless of the amount. And with the IRS getting additional funding, they're increasing audit rates. Why risk penalties and interest over $367? Plus, as others mentioned, with proper deductions it might actually HELP their tax situation to report it.

You're absolutely right, and I shouldn't have framed it that way. Tax compliance isn't optional based on what you think you can get away with. I think I was trying to address the reality of what many people do, but that doesn't make it right or advisable. With proper deductions, reporting this income could indeed result in a benefit rather than a liability, and the peace of mind of being compliant is worth a lot more than any perceived "savings" from omitting income.

Is that self-employment tax still required if you have a loss after expenses? Like if my mileage deduction is more than I earned?