That's a good point! Do you know if there's a resource where I can look up which countries have tax treaties with the US? Most of my artists are from Japan, South Korea, and a few from the UK.

The IRS has a complete list of tax treaties on their website. Japan, South Korea, and the UK all have tax treaties with the US, which is good news for you! For these countries, you still need the W-8BEN, but the artists might qualify for reduced withholding rates or exemptions depending on the specific treaty. This is another reason to make sure you get those forms completed properly - they allow the artists to claim treaty benefits if applicable.

What happened with the CP2000? Did you have to pay penalties or just provide the documentation after the fact?

4 I always forget about accounting for deductions on the W-4! Do you just use last year's deduction total when filling it out or do you need to estimate the current year? And where exactly on the new W-4 do you put this info?

21 You'd use Step 4(b) on the new W-4 form to list deductions beyond the standard deduction. I typically start with last year's deductions and adjust if I know something significant will change. For example, if you normally take a standard deduction but will itemize this year due to a large medical expense or new mortgage, you'd calculate the difference between your expected itemized deductions and the standard deduction, then put that amount on line 4(b). Just be conservative with your estimates to avoid underwithholding penalties.

9 This is really good advice about adjusting for mid-year changes. When I updated my W-4 last June, I had to account for the over-withholding from January-May. The calculator on the IRS site actually helps with this - it asks when you're making the change and adjusts accordingly.

What exactly counts as "significant revenue drops"? Our ERC provider said we qualified because we had a 17% drop in one quarter of 2020 compared to 2019. Is that enough or did we get bad advice?

For 2020, businesses needed to show at least a 50% reduction in quarterly gross receipts compared to the same quarter in 2019 to qualify under the revenue decline test. For 2021, that threshold was lowered to a 20% reduction. If you were told you qualified with only a 17% reduction in 2020, that's definitely incorrect for the revenue decline test. You may still have qualified under the suspension of operations test if government orders significantly limited your business, but the revenue test would not apply at 17% for 2020. This is exactly the kind of misrepresentation the IRS is currently targeting.

Unfortunately this is becoming common. Several of these ERC mills have vanished overnight as scrutiny increases. You might want to file a complaint with the FTC and your state attorney general's office. If they've truly disappeared, you could be dealing with a complete scam rather than just aggressive tax advice.

I had the exact same experience with eBay! Got a 1099-K for 2021 with around $7k in sales but nothing for 2022 with about $8k. I asked their support chat and they just sent me a link to a help article that didn't actually answer the question. Did you figure out what to do? I'm just reporting all income anyway but worried about inconsistencies triggering an audit.

I never got a satisfactory answer from Etsy, but I did some research and found that some states like Massachusetts, Vermont, and a few others had already implemented lower thresholds ($600) before the federal change was proposed. My guess is that either you or I moved states between 2021 and 2022, or the platforms changed how they determine which state's rules apply. I'm doing the same thing - reporting all income regardless of whether I got a form. My accountant confirmed that's the right approach and said inconsistencies in receiving forms shouldn't trigger an audit as long as you're properly reporting all your income.

That's correct. For 2022 tax filing (what you're filing now in 2023), the threshold remained at $20k AND 200 transactions for federal purposes. Some states have lower thresholds, which is why some people might receive a 1099-K even if they don't meet the federal threshold. For 2023 tax year (what you'll file in 2024), the threshold was originally supposed to drop to $600 with no transaction minimum. However, the IRS has actually announced ANOTHER delay for this implementation. So for 2023, the threshold will remain at $20k AND 200 transactions at the federal level. The $600 threshold is now scheduled to take effect for tax year 2024 (filing in 2025), but there's always the possibility of additional delays. Some tax software may not have been updated with the most recent delay announcement.

Wow, that's super helpful! My program requires us to buy specific software that costs like $600 per year and it's not included in the tuition. Does that count too? And do I need to get some kind of proof from my school that it's required?

Yes, required software for your program absolutely counts as a qualified education expense! Since it's required for your coursework, that $600 can be added to your total qualified expenses on Form 8863. For documentation, keep the receipt for the software purchase and ideally something showing it was required - like the course syllabus, program requirements list, or an email from your professor. The IRS doesn't require you to submit this documentation with your return, but you should keep it in case you're ever audited. Having the syllabus or program requirements that specifically mentions the software is the best proof.

This is a good point! But doesn't the school usually require payment before the semester starts? My university always wants payment in December for spring classes.