I went through this exact same situation last year with about $25 in stock profits. After reading through all the comments here, I decided to call the IRS directly (yes, it took forever to get through). The agent told me something that might help clarify things for everyone: The key isn't the profit amount - it's whether your broker reported the cost basis to the IRS on your 1099-B. Look at your 1099-B form and check if there's basis information included. If it shows "basis reported to IRS" or has the cost basis filled in, then the IRS already has all the information they need and you likely don't need Form 8453. However, if your 1099-B shows the sale proceeds but NOT the cost basis (common with older accounts or certain types of trades), then yes, you need to send Form 8453 with documentation regardless of the tiny profit amount. For my $25 situation, it turned out my broker HAD reported the basis, so I didn't need to send anything extra. Check your 1099-B first before assuming you need to mail anything!

This is really helpful information from everyone! I'm dealing with a similar situation but with crypto trades instead of stocks. Made about $45 in profits from some Bitcoin trades last year and my tax software is also telling me I need Form 8453. From what I'm reading here, it sounds like the key is whether the exchanges reported my cost basis to the IRS. Most crypto exchanges don't provide 1099-B forms like stock brokers do - they usually just give you a 1099-K or their own transaction summary. Does anyone know if the same "basis reported to IRS" rule applies to cryptocurrency transactions, or do crypto trades automatically require the Form 8453 documentation regardless of the amount? I'm trying to figure out if I can avoid mailing in 20+ pages of crypto transaction records for such a small gain.

Does anyone know if this works the same way for multiple attorneys? I had both a main attorney and a specialized employment attorney that my main attorney brought in. The fee split between them was complicated but came to about 40% total.

I went through this exact situation two years ago with an employment discrimination settlement. One thing I wish someone had told me earlier is to also keep detailed records of any costs beyond just the attorney fees - things like filing fees, expert witness costs, or court reporter fees if your case had depositions. These additional litigation costs can also be deductible as part of your case expenses. My attorney's final statement broke down not just their fee but also $3,200 in other case costs that I was able to deduct. Make sure when you request that detailed letter from your attorney that you ask them to itemize ALL costs related to your case, not just their legal fees. Also, if any part of your settlement was specifically for punitive damages, that portion might have different tax treatment, so make sure your settlement agreement clearly states what each portion of the payment covers.

One thing nobody mentioned - check if your work qualifies as a "permanent establishment" under Article 7 of the US-Belgium tax treaty. If it does, different rules might apply. This bit me when I was contracting with a US company from Sweden.

Dont forget about social security! The US and Belgium have a totalization agreement that prevents double taxation on social security. You'll probably pay into the Belgian system only since you live there permanently, but you need to get a certificate of coverage from Belgian authorities.

Based on your situation with both spouses being self-employed and one business operating at a loss, here are some key points that might help: First, confirm you're maximizing business deductions for both businesses. Even though one operated at a loss, proper documentation of that loss can offset other income. Make sure you're capturing all legitimate expenses - office supplies, equipment depreciation, mileage, professional development, etc. For the profitable business, health insurance premiums paid for self-employed individuals ARE deductible before calculating SE tax (this is different from regular IRAs). If you're paying for health insurance out of pocket, this could directly reduce your $2,400 SE tax burden. Also consider if you qualify for an HSA - those contributions can also reduce SE tax, not just income tax. The retirement accounts (Traditional IRA, SEP IRA, Solo 401k) will help with income tax but won't directly touch that SE tax. However, since you already got your income tax to zero with the saver's credit and Roth contributions, focusing on SE tax reduction through health insurance deductions and maximizing business expenses is probably your best bet. Document everything carefully - the IRS scrutinizes self-employed deductions more closely than W-2 situations.

Great question! I went through the exact same confusion last year. Here's what I learned the hard way: You're absolutely right that retirement accounts like Traditional IRAs, Roth IRAs, and even SEP IRAs don't directly reduce self-employment tax - they only help with income tax. SE tax is calculated on your net business income before any retirement deductions. However, there are a few strategies that CAN directly reduce SE tax: 1. **Health insurance premiums** - If you're paying for health insurance as a self-employed person, these premiums are deductible BEFORE calculating SE tax (not just income tax). This could be significant savings. 2. **HSA contributions** - Similar to health insurance, if you have a qualifying high-deductible health plan, HSA contributions reduce SE tax too. 3. **Maximize business expenses** - Every legitimate business deduction (equipment, supplies, home office, mileage, professional development) reduces your net business income, which directly lowers SE tax by about 15.3%. Since your husband's business was profitable and yours operated at a loss, make sure that loss is properly documented to offset other income. Also double-check that you're capturing ALL legitimate business expenses for both businesses. The retirement accounts are still worth maxing out for income tax purposes, but for that $2,400 SE tax, focus on health insurance deductions and business expenses. Good luck with your Vanguard call!

Just wanted to update everyone - I have PNC with a DDD of 3/14 and still nothing as of 4pm EST. Starting to worry since everyone else seems to be getting theirs. Filed through TurboTax on 1/28, accepted same day. My transcript shows code 846 with the 3/14 date but no deposit yet. Anyone else with PNC still waiting or should I be concerned at this point?

Same situation here! PNC with DDD of 3/14, filed through FreeTaxUSA on 1/30. Usually get my refunds 2 days early but nothing yet as of 4:30pm. My transcript shows the 846 code too. Starting to wonder if PNC is having delays this year or if it's just taking longer than usual. Really hoping it hits tonight or first thing tomorrow morning. The anticipation is killing me! Will definitely update when mine comes through.