Has anyone successfully used their ITIN instead of an SSN for the TikTok verification? I'm not a US citizen but live here on a visa, and I'm stuck on the verification page.

As someone who works in tax preparation, I want to emphasize that using your SSN for TikTok's Creator Fund verification is completely legitimate for minors. The key thing to understand is that a TIN (Tax Identification Number) is just the umbrella term that includes SSNs, ITINs, and EINs. For your 17-year-old brother, he should use his SSN as his TIN. When he starts earning from the Creator Fund, he'll need to track that income and report it on his tax return if it exceeds the filing threshold. Even if it doesn't, it's good practice to file anyway since TikTok will likely send him a 1099 form. One important consideration: if he expects to earn over $400 from TikTok this year, he'll owe self-employment tax on that income, which means he should consider making quarterly estimated tax payments to avoid penalties. This is something many young creators don't realize until tax time. The Montana LLC idea is definitely unnecessary and creates more complexity than it solves. Keep it simple and legitimate with his SSN!

I've been following this thread with great interest since I'm dealing with a very similar situation. My single-member LLC had unexpected growth in 2022, and like you, I got hit with a substantial tax bill that could have been significantly reduced with S-Corp treatment. Based on everything I've researched and the excellent advice shared here, the key points seem to be: 1) This IS possible under Revenue Procedure 2013-30, but it's not as simple as just filing an amended return 2) You need BOTH Form 8832 (entity classification election) AND Form 2553 (S election) 3) The "reasonable cause" statement is absolutely critical - document everything showing you intended to minimize taxes legally 4) Timeline matters - you generally have 3 years from filing date or 2 years from payment date to amend I'm curious though - for those who've successfully gone through this process, how did you handle the self-employment tax aspect? One of the biggest advantages of S-Corp status is avoiding SE tax on distributions, but I'm wondering if the IRS scrutinizes reasonable salary amounts more closely when you're making a retroactive election. Also, did anyone run into issues with state tax authorities? My state (California) has its own S-Corp election requirements, and I'm not sure if they automatically follow the federal late election or if I need to file separate state forms. Thanks to everyone who's shared their experiences - this thread has been incredibly valuable!

I've been through a similar situation and want to add a few practical considerations that might help with your decision-making process. While the technical aspects have been well covered here (Rev. Proc. 2013-30, Forms 8832 and 2553, reasonable cause statements), there are some financial realities to consider before diving in: 1) **Professional fees can add up quickly** - Between CPA fees for the complex filings, potential attorney consultation, and ongoing S-Corp compliance costs (payroll processing, additional tax returns), you could easily spend $5,000-$10,000 in the first year alone. Make sure your potential tax savings justify these costs. 2) **Payroll complexity** - If your retroactive election is approved, you'll need to establish reasonable compensation for 2022 and handle the payroll tax implications. This often means setting up payroll systems retroactively and potentially owing additional employment taxes that weren't previously required as an LLC. 3) **State compliance varies wildly** - Some states make this process relatively straightforward, while others (looking at you, California and New York) have their own complex requirements that don't always align with federal elections. 4) **Documentation timeline** - Start gathering your supporting documentation now. Business bank statements showing consistent profitability, any communications about business growth or tax planning, and records of when you first learned about S-Corp benefits will all strengthen your reasonable cause argument. The tax savings can definitely be worth it (I saved about $22k over two years), but go in with realistic expectations about the complexity and costs involved. It's not a magic bullet, but it can be a valuable strategy if executed properly.

I'm dealing with this same frustrating situation with my daughter's tennis scholarship. The "unearned income" classification is such a misnomer when these kids are essentially working full-time between practice, conditioning, travel, and competition just to maintain their scholarships. One thing that helped us was requesting a detailed breakdown from both the financial aid office AND the compliance office at her university. They were able to specify which portions of her scholarship went toward required equipment, training materials, and even some facility usage fees that could be classified as qualified educational expenses rather than room and board. We also discovered that some of the mandatory team travel expenses (like transportation to competitions) could be excluded from the taxable portion since they weren't providing personal benefit to her - they were requirements for her athletic program participation. The kiddie tax still hurts, but getting these reclassifications reduced her taxable scholarship amount by about $2,800. Every bit helps when you're dealing with these ridiculous tax implications on what should clearly be "earned" income!

This whole system is so backwards! My son has a wrestling scholarship and we're dealing with the exact same frustration. He's literally risking injury every single day, maintaining strict weight requirements, following intense training schedules, and could lose everything if his performance drops - but somehow that's "unearned" income according to the IRS. What really gets me is that if he had a regular part-time job making the same amount, it would be considered earned income and taxed at his lower rate instead of ours through the kiddie tax. But because it's tied to his athletic performance and scholarship requirements, suddenly it's "unearned." The logic makes zero sense. We ended up having to pay significantly more in taxes because of this classification, even though he's working harder than most adults I know. Has anyone found any workarounds or ways to minimize the tax impact beyond the equipment reclassification strategies mentioned above?

Just a heads up - make sure the financial institution that issued the 1099-R has your correct address and personal info. I had a similar inherited IRA situation last year but never received the 1099-R because it went to my dad's old address. Ended up with a CP2000 notice from the IRS and had to sort it out after the fact. Also, keep records of when you closed the account and withdrew the funds. The IRS sometimes gets confused with inherited IRAs when the distribution code doesn't match what they expect to see.

I went through something very similar when I inherited my father's 401(k) that was rolled into an IRA. A few additional things to keep in mind: First, make sure you have documentation showing you were the proper beneficiary. Sometimes the IRS will ask for proof of your relationship to the deceased and confirmation that you were designated as the beneficiary on the account. Second, if your grandmother had already started taking Required Minimum Distributions (RMDs) before she passed, there might have been a remaining RMD for that year that needed to be satisfied. Since you withdrew the entire amount, this shouldn't be an issue, but it's worth knowing for future reference. Finally, consider the timing of when you report this income if you're planning to get married next year. Since you're filing as single this year, your tax brackets will be different than if you were married filing jointly. The $7,200 might actually be taxed at a lower rate this year depending on your other income sources. The distribution code 4 is definitely correct and will save you from the early withdrawal penalty. Just double-check that TurboTax is calculating your tax correctly - the software should automatically recognize the code and not apply the 10% penalty.

One thing to be really careful about with C Corp wind-downs is the accumulated earnings tax (Section 531). If the IRS determines that you've been accumulating earnings beyond the reasonable needs of the business just to avoid dividend distributions, they can hit you with a penalty tax on top of everything else. This is especially relevant for single-shareholder C Corps that have been inactive but sitting on retained earnings. For your specific situation with $25K in loan repayments and $10K in E&P, document everything meticulously. The IRS will want to see that the loans were legitimate business transactions with proper terms from the start. If you're planning to wind down completely, consider doing it in phases over multiple tax years to spread out the tax impact rather than taking everything in one year and potentially pushing yourself into higher tax brackets. Also, don't forget about state tax implications - some states have their own rules about C Corp distributions and dissolutions that might differ from federal treatment.

One thing I'd add to this excellent discussion is to consider the timing of when you actually receive the loan repayment funds versus when you take the dividend distribution. The IRS looks closely at the substance over form, so if you're taking both transactions simultaneously or very close together, they might view it as one large distribution rather than separate transactions. I'd recommend clearly documenting the loan repayment first, wait a reasonable period (maybe a quarter or two), then handle the dividend distribution separately. This creates a cleaner paper trail and reduces the risk of the IRS challenging the characterization of your transactions. Also, since you mentioned this is essentially a wound-down operation, make sure you're not triggering any personal holding company tax issues if you have significant passive income. With inactive C Corps, sometimes rental income or investment income can create unexpected tax complications that are separate from your distribution planning.