That's actually a really smart approach I hadn't considered! Did you have to push hard to get them to agree to it, or were they pretty understanding once you explained the situation?

They were surprisingly understanding. I just explained that for tax and professional liability reasons, I needed these workshops classified as paid professional services rather than volunteer work. I suggested a nominal fee ($75 per workshop in my case, which was about 25% of my normal rate for that time). They actually appreciated the more professional arrangement because it also clarified expectations on both sides. We created a simple addendum to my existing contract that specified exactly what these workshops would cover and what materials I'd provide. Having skin in the game made them value the workshops more, and it gave me actual income to report rather than trying to figure out complex tax deductions.

This is an important distinction! The IRS treats marketing expenses and regular business expenses somewhat differently. If these workshops are actually part of your contractual obligations, then all related expenses would be straightforward business expenses. Check your contract carefully to see if there's any language about community outreach or professional education being part of your duties. If so, you might have a stronger case for deducting related expenses.

Thanks for clarifying! That makes sense. Do you know if there's a sample of the new form available somewhere online that shows the exact layout? Would be nice to see what I'm going to be dealing with.

Yes, the IRS has published draft versions of the new K-1 forms on their website. If you go to IRS.gov and search for "2023 draft forms" you should be able to find it. They usually have PDF versions of all the draft forms with instructions. The final version might have some minor changes, but the draft will give you a good idea of the new layout and where to find the guaranteed payments section.

The new K-1 format actually improves the reporting of foreign income and taxes. Instead of lumping foreign taxes into a single box with a statement, the new format breaks out foreign income by country and provides clearer reporting of the foreign taxes paid. This should make calculating your foreign tax credit much easier. There's a new specific section for international tax matters that provides more granular information. You'll see a country-by-country breakdown rather than having to decipher sometimes confusing supplemental statements. This is especially helpful if you have income from multiple countries since you can more easily track which income relates to which foreign tax.

That's such a relief to hear! The supplemental statements were always inconsistent between my different partnerships. Having it directly on the form with a standard format will make things so much clearer. Thanks for the info!

The gift was definitely under $5k, so nowhere near that threshold! I hadn't even thought about tax treaties between countries. Is there an easy way to check that?

You can find tax treaties on the IRS website under "Tax Treaties" - they have a page listing all countries with tax treaties with the US. For Ecuador specifically, there are some provisions but they mostly relate to income earned from working, not scholarships or grants. Given the small gift amount and the fact that all scholarship money went to qualified expenses, your cousin is almost certainly in the clear with no filing requirements.

This is correct! Form 8843 isn't technically a tax return but a statement that nonresident aliens (including students) should file to document their presence in the US. It's pretty simple to fill out and doesn't require any calculations.

Omg that makes so much sense explained that way! So basically neither payroll system knew my "true" tax bracket because they only saw part of my income. Is there any way I could have prevented this during the year?

Exactly! You've got it. To prevent this in the future, you have a few options: You can fill out a new W-4 form and give it to your employer. On line 4(c), you can specify an additional amount to withhold from each paycheck. Calculate approximately how much you're short for the year and divide by your remaining paychecks. Another option is to check your withholding midway through the year using the IRS Withholding Estimator tool online. It helps you see if you're on track and suggests adjustments. Some people in this situation also make quarterly estimated tax payments directly to the IRS to cover the shortfall, but adjusting your W-4 is usually simpler.

This is good advice but the W-4 form doesn't have a "withhold at higher single rate" box anymore. They completely redesigned the W-4 in 2020. Now you need to use the "Multiple Jobs" worksheet or just put the additional amount on line 4(c).

Is there any way to get an extension on the January 31st deadline? I'm dealing with a backlog of paperwork from several properties and might need extra time.

There's no extension available for furnishing 1099s to recipients - that January 31st deadline is firm. However, you can request a 30-day extension for filing with the IRS by submitting Form 8809 (Application for Extension of Time to File Information Returns). The catch is that the extension only applies to filing with the IRS, not to giving the forms to your recipients. So you'd still need to get the 1099s to the brokerages and contractors by January 31st, even if you get extra time to submit to the government. And the Form 8809 needs to be filed BEFORE the original due date - you can't request it after you've already missed the deadline.

I tried FIRE last year and it was NOT user-friendly at all. Felt like I was using software from 1995. I ended up going with TaxAct's 1099 filing service instead - cost me about $15 but saved hours of frustration.