That's a good point! I did confirm with my plan administrator that they accept IRA rollovers, but I'll double-check there aren't any special restrictions. Our 401k plan actually has pretty decent investment options (Vanguard institutional funds with low expense ratios), so I'm not too worried about that part. The main goal is clearing out the pre-tax money so I can do backdoor Roth contributions without dealing with the pro-rata rule mess every year.

Glad to hear you've already checked on the rollover acceptance! That's great that your plan has good investment options too - that makes the decision much easier. You're absolutely right to focus on clearing out the pre-tax money for clean backdoor Roth contributions. The pro-rata rule calculations are a pain to deal with annually. I've had clients who avoided backdoor Roth conversions for years simply because they didn't want to deal with the paperwork complexity of having mixed funds.

This varies by 401k plan, so you'll need to check your specific plan documents. Most plans that have minimum balance requirements apply those rules to all money in the plan, including rollovers. The $5,000 threshold is pretty common. However, they typically can't "cash you out" of rollover funds the same way they might with small employer contribution balances. Instead, if your balance falls below their minimum, they might roll it to an IRA automatically rather than sending you a check. If you're actively employed and making contributions through payroll, you'll likely stay above any minimum threshold naturally as your contributions come in.

Thanks for the suggestion! How did you find your EA? Did you just google local tax professionals or is there a specific directory I should look at?

I found mine through the National Association of Enrolled Agents directory (naea.org). You can search by location and even by specialties like "back taxes" or "IRS representation." I'd recommend calling at least 3-4 of them for quotes and asking specifically about their experience with unfiled returns. Some will also offer free initial consultations where they can give you a ballpark estimate of what you might owe before you commit to hiring them.

This is a really important point. The failure-to-file penalty is 5% of unpaid taxes per month up to 25%, while failure-to-pay is only 0.5% per month. So filing even if you can't pay saves you 4.5% per month!

Thanks for sharing your experience from the management side. Do you think I should start reporting my tips to my employer anyway, even though he specifically told us not to? I'm worried about creating conflict but also don't want to be part of something illegal.

I would absolutely start reporting your tips properly despite what your boss says. Create a simple spreadsheet or use a tip tracking app to document everything. Then submit a monthly tip report to your employer (you can find Form 4070 templates online) and keep a copy with proof of submission. If your boss pushes back, you can simply say that you're following IRS requirements to protect yourself. Frame it as something you need to do for your own tax compliance rather than suggesting he's doing something wrong. Most importantly, document everything in case questions arise later. The reality is that the IRS holds both parties responsible, but you can protect yourself by following proper reporting procedures even if your employer doesn't.

Do you have to report credit card tips too? I thought those were automatically tracked since they go through the POS system. My manager only tells us to track cash tips.

Thanks for the suggestion! I didn't know about the Taxpayer Advocate Service. Do you know how long it typically takes to get an appointment with them? I'm trying to figure out if that would be faster than just mailing in the amended return at this point.

When I contacted them in February last year, it took about 10 days to get an appointment. However, for urgent issues like filing problems, they sometimes have expedited options. I'd recommend calling them first to explain your specific situation. Even if there's a wait, they can often give you preliminary guidance over the phone that might help with your immediate e-filing problem. In my case, they were able to tell me exactly what information the IRS system was looking for, which helped me e-file successfully before my actual appointment.

Free File Fillable Forms don't support Form 1040-X (amended returns) for e-filing. I tried that route last year and ended up having to use TaxSlayer instead. The IRS is weirdly selective about which forms can be e-filed through which systems.

Thanks for the suggestion, but I just checked and unfortunately it looks like Free File Fillable Forms don't support amended returns for e-filing. Seems like my options are either trying another tax software or just mailing it in.

Are you saying I should just avoid French investment options entirely? That seems extreme just to avoid some paperwork. Are there any decent investment options that are compatible with both French and US tax systems?

I'm not saying avoid French options entirely, but you should be selective. The main investments to avoid are foreign mutual funds and similar pooled investments that get classified as PFICs. Look into individual stocks, bonds, or ETFs that are listed on US exchanges even if bought through a French broker (though finding one that accepts US citizens can be challenging). Some French banks have created US-compliant investment products specifically for Americans living in France. Another option is to use a US brokerage while living abroad. The paperwork is much simpler for US tax purposes, though you'll still need to report the investment income on your French taxes. The US-France tax treaty prevents double taxation in most cases.

This isn't relevant to the OP's situation. They said they were born in France and have lived there their whole life. There's no prior state residency to worry about.