But wouldn't they still have to pay self-employment tax too? Even with $40k net income, shouldn't that be more than $4k total tax between income tax and SE tax?

You're absolutely right about self-employment tax. Even with $40k net income, they would owe about 15.3% in self-employment tax alone, which would be around $6,120. Then they'd still owe some amount of income tax on top of that, even after taking the standard deduction.

That's a great point. For 2023, self-employed individuals could contribute up to $66,000 to a Solo 401(k) if they're under 50. Add in a maxed HSA contribution and some business expenses, and you could bring that taxable income way down legitimately.

Is there a cutoff for how far back you can claim refunds? I haven't filed for 6 years but had withholding the whole time.

Yes, there is a cutoff - it's 3 years from the original due date of the return. So for example, 2022 tax returns were due April 18, 2023, meaning you have until April 18, 2026 to claim any refund for that year. For 2021 returns, you have until April 15, 2025. Unfortunately for your situation with 6 unfiled years, you've likely lost the ability to claim refunds for the oldest 3 years, but you can still get refunds for the most recent 3 tax years if you're owed them.

This is 100% accurate. I work at a tax resolution firm and we help people with 10+ years of unfiled returns regularly. The IRS is far more reasonable than people think as long as you're making an effort to comply. They're not interested in sending people with regular jobs to prison.

I haven't actually tried asking my company about this. Is there a specific way I should approach this conversation with HR? I'm not sure if they have an official policy, but it makes sense that they should help cover these costs since they're not providing an office space.

I'd suggest starting with an email to your manager or HR outlining your home office expenses related to work. Be specific about costs like increased utilities, internet requirements for work, and any furniture or equipment you've purchased to do your job effectively. Frame it as a question about whether the company has an accountable plan or stipend program for remote workers, rather than demanding reimbursement. Many companies have these policies but don't publicize them well. If they don't have a formal policy, this could prompt them to create one, especially if other remote workers have similar needs.

This is really helpful! I'm in California - does anyone know if CA allows home office deductions for W-2 employees? I've been working remote for 2 years and haven't claimed anything because I thought it wasn't allowed anywhere.

Where can you find these Certified Acceptance Agents? Are they at all H&R Blocks or is it a special place you need to go to?

Not all H&R Block locations have Certified Acceptance Agents (CAAs), but many do - you need to call and ask specifically. You can also find a complete list of CAAs on the IRS website by searching "IRS certified acceptance agent list" which shows all authorized agents by location. Some CAAs only work with certain types of clients though (like some only help businesses, others only help individuals), so make sure to ask if they handle individual ITIN applications when you call. Most charge a fee on top of any tax preparation services, usually around $50-100 for document verification, but it's worth it to avoid sending original documents.

Yes, you should notify the IRS when you switch from an ITIN to an SSN. Complete Form 8996 "Reconciliation of ITIN and SSN" and send it to the address on the form. You should file future tax returns with your SSN only and reference your previous ITIN on the form.

That's a good idea! I didn't even think to check my spam folder. I just found the notification email from February 1st buried in there. Clicked the link and got my form downloaded right away. Thanks everyone for the help! Between checking my spam folder and learning about those services if I need them in the future, this has been super helpful.

This is what I had to do last year. The transcript doesn't give you the actual form but at least tells you the amount and who reported it, which you can use on your tax return. The IRS "Get Transcript" online service is faster than mailing the form if you can verify your identity.

Good point about the online Get Transcript service being faster. I always forget that's an option since I had trouble verifying my identity in their system. The transcript does give you the box 1 amount (gross distribution) which is often all you need for basic tax filing if you know the distribution code. But you're right that it's not a replacement for the actual form if you need all the detailed breakdown.