That's a really good point about currency risk that I hadn't considered! Do you know if there are any tax-efficient ways to manage currency conversion when sending money back to the US? I'll still have some student loans and a car payment in USD.

There aren't specific tax advantages for currency conversion, but you might want to look into services like Wise (formerly TransferWise) or OFX for better exchange rates than banks offer. The conversions themselves aren't tax events unless you're actually trading currencies as investments. For your US debts, you might consider keeping a US bank account open and periodically transferring larger sums to minimize conversion fees, rather than monthly smaller transfers. Some expats also maintain US credit cards for US-based recurring payments while living abroad, which can simplify things.

This is so important and often overlooked! I worked in Canada for 7 years and then moved back to the US. When I applied for Social Security benefits, they initially calculated without my Canadian work history. I had to specifically request they consider the totalization agreement, which increased my monthly benefit by about $300!

Terrible advice. If you wait for a CP2000, they'll charge you interest from the date the tax was due, and possibly penalties too. Plus it could affect your credit score. Always better to fix your own mistakes proactively.

You're right, that was bad advice. I wasn't thinking about the interest and penalties. Thanks for the correction. I've always filed amended returns immediately when I discover errors and it's definitely the better approach. The peace of mind alone is worth it.

Actually, that's outdated info! The IRS now allows e-filing of Form 1040-X for tax years 2019 and later through most tax software. Made the process way faster when I had to amend last year.

But isn't it still worth claiming even if it's small? I always thought you should take every credit you qualify for, no matter how small. Plus doesn't it help establish a pattern of claiming it for future years?

Yes, it's technically worth claiming because every dollar counts. Even if it's just $5-29 back, that's still money you're entitled to. And you're absolutely right that it helps establish the habit of claiming the credit in future years when your contributions will hopefully be larger. I didn't mean to suggest skipping it entirely - just providing perspective on the time/value tradeoff. If you're using tax software, it should handle Form 8880 pretty easily, making it definitely worth the few minutes to enter your contribution. My main point was to focus on increasing those retirement contributions going forward, as that's where the real value is long-term.

This is a really important point! I actually qualified for the Savers Credit last year but didn't get anything from it because I already had zero tax liability after my other deductions and credits. Spent all that time filling out Form 8880 for nothing.

How much did it end up costing to fix the mistakes? I'm trying to weigh the cost of hiring a pro versus doing it myself.

The direct cost to fix the mistakes wasn't huge - about $350 for a tax professional to prepare and file the amended returns. However, the real cost was the time and stress. It took almost 6 months to get everything sorted out with the IRS, including several follow-up letters and clarifications. The bigger issue was that I had to explain to family members why we received unexpected IRS notices, which was uncomfortable and made me look incompetent. Looking back, I would have gladly paid the $800-1200 that a professional would have charged originally to avoid all that hassle. Trust taxation has some unique rules that most DIY software doesn't explain well, even if it technically supports the forms.

Huge difference! A revocable living trust typically doesn't require a separate tax return at all - the income is usually just reported on the grantor's personal return (Schedule E). The trust you're describing is likely what's called a "grantor trust" for tax purposes. What OP is describing sounds like irrevocable trusts that are separate taxpaying entities requiring Form 1041 returns. Those are much more complex.

Would moonlighting at an urgent care for even just a few shifts count for this? I'm in a similar situation (different professional liability insurance though) and wondering if even just a few thousand in 1099 income would help establish the business intent.

Yes, moonlighting at an urgent care as a 1099 contractor would absolutely help establish business intent. Even just a few shifts generating a couple thousand dollars would create a much stronger case that you were genuinely engaged in business activity related to the insurance expense. The key is making sure you're actually classified as an independent contractor (receiving a 1099) rather than a part-time employee (W-2). As long as you have some legitimate 1099 income from medical work, you'll be in a much better position to justify the large deduction on Schedule C.

Thank you so much for this insight! I hadn't even considered the self-employment tax angle. The more I think about it, the more I'm leaning toward filing Schedule C with the full expense. I actually do have some very minimal income (around $3K) from chart reviews I did while transitioning between jobs. That should help establish business intent, right? I'm thinking I'll use some combination of the advice here - documenting everything thoroughly, including my correspondence with the locums company about credentialing, and making sure I'm prepared in case of an audit. The tax savings between Schedule C vs. effectively no deduction on Schedule A is just too significant to ignore.