I went through a very similar situation with my MPF withdrawal in 2022 when I moved from Hong Kong to the US. Based on my experience and what my tax advisor told me, here are a few key points: The timing of when you received the funds (January 2024) is what matters for tax purposes, not when you applied or when your employer made their final contribution. So this will be reported on your 2024 tax return. One thing I wish I had known earlier - make sure you get a detailed breakdown from your MPF provider showing your personal contributions vs. employer contributions vs. investment gains. The portion that came from your own mandatory contributions (money that was already taxed in Hong Kong) might be eligible for some relief, though the rules are complex. Also, don't forget about the Foreign Bank Account Report (FBAR) requirements if your Hong Kong accounts exceeded $10,000 at any point during the year. The MPF account itself might need to be reported even if it's now closed. I'd strongly recommend getting professional help from someone who specializes in US expat taxes, especially for your first year filing as a US resident. The interaction between Hong Kong taxes you may have paid and US tax obligations can get tricky.

One important thing to keep in mind is the timing of your tax residency status change. Since you moved to the US in December 2023, you'll want to confirm whether you were considered a US tax resident for any part of 2023 (which could affect reporting requirements for that year) versus starting fresh as a US resident in 2024 when you actually received the MPF funds. The substantial presence test or green card test will determine your exact tax residency start date. If you were already a US tax resident in December 2023 when your employer made that final contribution, it could potentially affect how you report things, even though you didn't receive the money until January 2024. Also, since Hong Kong doesn't tax MPF withdrawals when you permanently leave, you won't be able to claim any foreign tax credits to offset the US tax liability on this distribution. This makes it even more important to properly categorize which portions of your withdrawal might qualify for different tax treatment. I'd definitely echo the advice about getting professional help for your first year - the intersection of changing tax residency, foreign retirement account distributions, and potential FBAR reporting requirements creates a lot of complexity that's worth getting right from the start.

This whole discussion has been really enlightening! I'm in a similar boat with friends from several countries sending me money through PayPal F&F for various shared expenses - mostly for our online gaming group subscriptions and occasionally when I help them get items that aren't available in their countries. What's been most helpful is seeing the consistent advice that the IRS focuses on the actual nature of these transactions rather than the PayPal category used. Since these are legitimate cost-sharing arrangements with real friends (not business transactions), they fall into the personal transfer category that isn't taxable income. I particularly appreciate all the practical documentation suggestions - from simple phone notes to keeping screenshots of group conversations. It makes sense to have some basic records showing the context of these payments, even though they're clearly personal transfers. One thing I'm curious about though - for those who mentioned consulting tax professionals about this, did you find significant variation in their advice, or was there pretty consistent guidance that genuine friend-to-friend cost sharing isn't taxable? I'm considering reaching out to a CPA just to have professional confirmation for my own peace of mind, especially since my friend group does this fairly regularly throughout the year. Thanks to everyone for sharing their experiences and advice - this has definitely reduced my anxiety about what I now realize are perfectly normal personal transfers between friends!

This discussion has been incredibly thorough and helpful! As someone who regularly receives PayPal F&F payments from international friends for gaming subscriptions and occasional item purchases, I was getting worried about potential tax implications. The consistent message throughout this thread is really reassuring: the IRS cares about the substance of transactions, not which PayPal button was clicked. Since these are genuine cost-sharing arrangements and reimbursements between actual friends (not business activities), they're personal transfers that aren't taxable income. What I found most valuable were the practical documentation suggestions - keeping simple records like screenshots of group conversations about shared expenses, receipts showing actual costs, and basic notes about payment purposes. This creates a clear trail showing these are legitimate personal transfers without overcomplicating the record-keeping. The international aspect doesn't change anything for small personal amounts, and the PayPal reporting threshold changes that everyone discusses are really targeting business operations, not friends splitting Netflix subscriptions or shipping costs. Miguel, based on your description of gaming cost splits and snack shipping reimbursements with actual friends, you're dealing with textbook personal transfers. The amounts you mentioned ($200-300 every few months) across multiple friends for legitimate shared expenses clearly fall into non-taxable territory. Thanks to everyone who shared their experiences - it's great to see such a supportive community helping each other navigate these questions responsibly!

Based on what you've described, I'd definitely recommend setting that $3,200 aside for at least 6 months to be safe. The IRS does have automated systems that continue checking returns even after refunds are issued, and questionable deductions are one of the things they look for. If you're genuinely unsure about those deductions, you might want to consider filing an amended return to correct any mistakes before the IRS potentially finds them. It's always better to fix errors proactively rather than wait for them to catch it - you'll avoid penalties and the stress of dealing with IRS notices. The good news is that if they were honest mistakes and not huge amounts, you're looking at paying back the incorrect refund plus interest, not massive penalties. But yeah, definitely don't spend that money until you're confident everything was filed correctly!

You're smart to be thinking about this now! From my experience, amended returns typically take 16-20 weeks to process, though it can vary depending on complexity and IRS workload. The sooner you file it, the sooner you'll have peace of mind. When you file Form 1040X (amended return), you'll need to explain what you're changing and why. If you end up owing money, you can pay it with the amendment to avoid additional interest charges. If you're not sure exactly what needs to be corrected, you might want to consult with a tax professional or use one of those AI review services others mentioned to identify the specific issues before filing the amendment. The key is being proactive - the IRS looks more favorably on taxpayers who catch and correct their own mistakes versus those who get caught later during an audit.

Be very careful about this arrangement - there are several red flags here that could get you in trouble with the IRS. The combination of cash payments, using your own crew, and working for the same employer in dual roles needs to be handled extremely carefully. First, the "substantially different work" test is critical. Your contractor work must be genuinely different from your employee duties, not just the same work done at different times. If you're doing similar construction work, the IRS might view this as your employer trying to avoid payroll taxes on overtime or additional regular work. Second, regarding your helpers - if you're providing equipment and directing their work, they're likely YOUR employees, not subcontractors. This means you'd need to handle payroll taxes, workers' comp, and all employer obligations. Many people miss this and face significant penalties. The cash payment preference is concerning. While not illegal if properly reported, it often indicates the employer wants to keep things "off the books." Make sure you get proper documentation (1099-NEC) and report ALL income. I'd strongly recommend getting professional tax advice before proceeding. The potential for worker misclassification issues, unreported income problems, and employment law violations could be very costly. Consider whether the extra income is worth the compliance complexity and potential risks.

You've received some excellent advice here, but I want to emphasize one crucial point that could save you from serious legal trouble: the IRS has been cracking down hard on "sham contractor" arrangements, especially in construction. The fact that your boss prefers cash payments and you'd essentially be doing construction work (just at different times) raises major red flags. The IRS doesn't just look at when you work - they examine whether the work is truly independent contracting or if it's just a way to avoid overtime and payroll taxes. Here are the key tests the IRS uses: - Do you have the right to control HOW the work is done? (Sounds like yes) - Are you economically dependent on this employer? (You're already their employee) - Is this work integral to their business? (Construction work for a construction company - yes) If you fail these tests, the IRS could reclassify all your "contractor" payments as employee wages, meaning your boss owes back payroll taxes, penalties, and interest. Worse, if they try to claim you were responsible for the taxes, you could be stuck with a massive bill. Before you proceed, I'd strongly recommend having your boss consult with an employment attorney or tax professional. Many employers think they can just call someone a contractor, but the legal requirements are strict. Getting this wrong isn't just expensive - it can result in criminal charges for willful misclassification. Consider asking for overtime pay or a raise instead. It's much cleaner legally and financially.

Percentage-based fees used to be more common years ago, but they're now considered unethical by professional organizations like the NAEA (National Association of Enrolled Agents). There are still some preparers who do this though, especially in communities where people aren't familiar with standard industry practices. It's not technically illegal in most states, but it's definitely a warning sign of a preparer who might bend rules to inflate refunds.

Your instincts are absolutely right to be concerned. I've been doing taxes professionally for over 15 years, and percentage-based fees are a major red flag in our industry. It's one of the first things we learn NOT to do in legitimate tax preparation courses. The biggest issue is that it creates what we call a "perverse incentive" - the preparer makes more money by inflating your refund, regardless of whether those inflated deductions are actually legitimate. I've seen too many cases where clients got audited years later and had to pay back thousands in incorrect refunds, plus penalties that sometimes doubled the original amount owed. If your cousin is serious about this field, encourage him to look into proper certification like becoming an Enrolled Agent or getting training through the IRS Volunteer Income Tax Assistance (VITA) program. These programs emphasize ethical practices and would teach him legitimate fee structures - either flat fees based on form complexity or hourly rates. That's how he can build a sustainable, ethical practice that actually helps people instead of putting them at risk.