My experience is that different tax software handles Line 38 very differently. After using FreeTaxUSA for years, I switched to TaxAct and suddenly had an estimated tax penalty where FreeTaxUSA never showed one. Then switched to an accountant who calculated it yet another way. The trick is Form 2210 which calculates the penalty has different methods that can be used. Some software automatically uses the "short method" which might not apply the penalty in certain cases, while accountants often use the regular method which is more accurate but can result in higher penalties.

I've had a similar experience with FreeTaxUSA missing the estimated tax penalty! What I discovered is that FreeTaxUSA actually does calculate Form 2210, but it only applies the penalty if you explicitly tell it you made estimated payments during the year. If you leave the estimated payment fields blank (which many people do if they didn't make quarterly payments), the software assumes you qualify for an exception and doesn't calculate the penalty. Your accountant is definitely doing the right thing by including it. The penalty exists to encourage people to pay taxes throughout the year rather than waiting until April. If you consistently owe more than $1,000 at filing time, you should either increase your withholding or start making quarterly estimated payments to avoid the penalty entirely. Don't stress too much about the previous years - if the IRS hasn't contacted you, they may have missed it too or the amounts were small enough that they didn't pursue it. Focus on getting it right going forward!

Has anyone else just given up on FreeTaxUSA for international student situations? I switched to Sprintax last year after dealing with this exact problem and it was worth the extra money. They have all the tax treaty options built right in and handle both 1040 and 1040-NR situations.

I just went through this exact situation last month! As a Thai student who recently switched from non-resident to resident filing status, I can confirm that the Schedule 1, Line 8z approach mentioned by Zoe is correct. Here's exactly what I did in FreeTaxUSA: 1. First, I reported my scholarship income normally in the "Education" section 2. Then I went to "Deductions & Credits" → "Other Income and Adjustments" 3. Found Schedule 1 and entered the treaty exemption amount as a NEGATIVE number on Line 8z 4. In the description field, I wrote "Tax Treaty Exemption - Article 21, Thailand-US Treaty" 5. I also attached a brief statement explaining which treaty article applied and the amount being excluded The key thing I learned is that FreeTaxUSA doesn't have a dedicated treaty section like TaxAct's 1040-NR forms, but the Schedule 1 method achieves the same result. My return was accepted without issues and I got the full treaty benefit. One tip: make sure you have your treaty article number ready. For Thailand-US treaty, Article 20 covers students and Article 21 covers other education-related income. Check which one applies to your specific situation!

Does anyone know if I can still claim the American Opportunity Tax Credit if my parents claim me as a dependent? My dad is insisting that since he claims me, HE gets the education credit, not me. But I'm the one who will be paying back the student loans...

I went through almost the exact same situation last year and completely understand the panic! The good news is that you likely did everything correctly. When you take out student loans to pay for qualified education expenses, the IRS treats this as if YOU paid those expenses - because ultimately, you're the one responsible for repaying the debt. So yes, you can absolutely claim education credits based on your 1098-T even though the tuition was paid with loans rather than out-of-pocket. However, I noticed in the comments that your 1098-T only has Box 2 filled out (amounts billed) rather than Box 1 (amounts paid). This is super common but means you need to be extra careful. You should only claim credits for the amount that was actually PAID during the 2024 tax year, not just what was billed. Check your student account statement to see exactly how much was paid in 2024 - this might be different from the $14,500 shown in Box 2 if some payments were made in different years or if there are payment plan timing differences. As long as you used the correct "paid" amount rather than just copying Box 2, you should be fine. Don't stress too much - this is one of the most confusing parts of student taxes and you're definitely not alone in feeling overwhelmed by it!

Just wanted to add one important thing - if your dependent kid has any investment income (like a custodial account or savings interest), the rules get more complicated. If they have both earned income (W2) AND investment income over $1,150, you might have to deal with the "kiddie tax" where some of their investment income is taxed at YOUR tax rate.

If your daughter is in college, don't forget to look into education credits when you file your taxes! Even though her W2 goes on her return, you can claim the American Opportunity Credit or Lifetime Learning Credit on YOUR return if you're claiming her as a dependent and paying her tuition. That's worth up to $2,500 depending on your situation!

Has anyone tried contacting Cash App support about this? I'm having the same QBI calculation issue and wondering if they're aware of the bug where it doesn't update when expenses change.

I've been dealing with QBI calculations for years as a freelance web developer, and I can confirm that Cash App's automatic calculation often gets it wrong, especially with the recalculation issue you mentioned. Here's what works for me: First, calculate your QBI manually using your Schedule C net profit as the starting point. For freelance graphic design work like yours, your QBI should generally equal your Schedule C profit (total income minus business expenses) with a few potential adjustments. The key adjustments to watch out for: - If you have any guaranteed payments or W-2 wages from the business, subtract those - If you have investment income mixed in with business income, that needs to be separated out - Self-employment tax deduction and health insurance deductions don't affect QBI - those are separate Since you're in a service business, also be aware that if your taxable income exceeds $182,050 (for 2023 taxes), phase-out limitations start applying to your QBI deduction. My advice: Calculate it manually first, then override whatever Cash App shows. I use a simple spreadsheet to track this each year so I don't have to rely on buggy software calculations.