8 Oh my gosh I think I made this exact mistake last year! I earned about $7,000 from my summer job and my campus job combined, and I thought that meant my parents couldn't claim me. But I was a full-time student... so does that mean they actually could have claimed me? Should we file an amendment?

22 You're right that you might have misunderstood the rules. For full-time students under 24, the income limit is much higher, and the $4,500 limit doesn't apply in the same way. Your parents likely could have claimed you if they provided more than half your support, regardless of your $7,000 earnings. Whether you should amend depends on several factors. First, check if your parents actually claimed you on their return last year. If they didn't, there might not be a conflict to resolve. If there is a discrepancy, you should consider amending if it would result in a meaningful tax benefit for your family overall. The lookback period for amendments is generally three years, so you have time to correct it if needed.

16 I used TurboTax last year for a similar situation (19, college student). Their questionnaire is decent but not great for more complicated situations. If your situation is straightforward, the free version will work, but they'll try to upsell you if you have education credits. Honestly, I'd recommend using the IRS Free File options instead - same questionnaire style but completely free. TurboTax charged me an extra $40 halfway through when I needed to add a form for my scholarship.

Thank you for mentioning this! I had no idea about the First Time Penalty Abatement program. Do you know if I would still qualify even though they had already levied my bank account years ago?

Unfortunately, since they've already taken collection actions like bank levies, you probably won't qualify for First Time Penalty Abatement. That program is typically for taxpayers who haven't had prior issues. However, you might still qualify for abatement under "reasonable cause" if you can demonstrate that your failure to file and pay was due to circumstances beyond your control - things like serious illness, inability to obtain records, or certain types of hardship. The anxiety and depression you mentioned might actually help your case, especially if you have any documentation from a healthcare provider.

That's terrible advice. Don't raid retirement accounts to pay tax debt! The IRS payment plans have relatively low interest rates compared to the long-term growth you're giving up. Plus you'll pay penalties on top of taxes for early withdrawal.

Thanks for sharing your experience! What exactly is an Acceptance Agent and how do I find one in Warsaw? Also, did ETH Denver (or equivalent in your case) actually agree to the extension when you asked?

An Acceptance Agent is someone authorized by the IRS to verify identification documents for ITIN applications. They can certify your original documents so you don't have to mail them to the IRS. You can find a list of international agents on the IRS website - search for "acceptance agents abroad" and filter for Poland. The tech competition in my case did agree to a 45-day extension. They were understanding once I showed them documentation that I had started the TIN application process. I found that being transparent about the timeline and keeping them updated regularly made them more willing to work with me. I sent them the receipt from the Acceptance Agent as proof that I had actually started the process, which helped a lot.

That's not correct advice at all. State ID numbers are completely different from federal taxpayer identification numbers and aren't recognized for federal tax treaty purposes. Either your cousin misunderstood what happened or the organizers made a mistake. Using a state ID in place of a TIN on W-8BEN could actually create bigger problems down the road when the IRS reviews the withholding.

Wait really? I've never heard of state gift taxes before. I live in California and give my kids money every year. Do I need to be filing something with the state? Now I'm worried I've been doing this wrong for years...

You don't need to worry about California - they don't have a state gift tax. Connecticut is currently the only state with a specific gift tax. Previously, Tennessee had one but they phased it out. However, some states do have inheritance taxes that the recipient might pay, though these typically exempt immediate family members and have various thresholds. For regular gifts to your kids in California, there's no additional state filing requirement beyond what's required federally (which is nothing if you're under the annual exclusion amount).

This is really helpful! My daughter is starting college next year and my parents want to help. Does this mean they could pay her tuition directly to the school AND give her gift money up to the limit without any tax issues? Would this work for her dorm costs too or just tuition?

Yes, your parents can absolutely pay your daughter's tuition directly to the educational institution AND still give her up to the annual gift exclusion amount ($17,000 for 2024) with no gift tax consequences! This is a great strategy for education funding. For the second question, the unlimited education exclusion typically covers tuition only, not room and board/dorm costs or books. Those additional expenses would need to come from either the regular cash gift (within the annual exclusion amount) or other resources. The IRS is quite specific that the education exception only applies to direct tuition payments to qualifying educational institutions.

I use the simplified method for my Etsy shop and it's so much easier than tracking all those expenses. But remember you still need a space that's EXCLUSIVELY for business use. I converted a small closet (about one-sixth of my apartment's square footage) to store inventory and take product photos, and I only claim that area.