Figuring out if I receive US income?
I believe the answer is no, since your income from royalties and app sales would fall under FDAP income. (another conformation of this would be the fact that Apple and Google requested a W8-BEN form from you and not a W8-ECI form) Generally, All income EXCEPT FDAP income (fixed or determinable annual or periodical income) are ECI income.  FDAP income includes income from interest, rent, dividends etc. IRS link to a list of all Income classified under FDAP below:- https://www.irs.gov/individuals/international-taxpayers/fixed-determinable-annual-periodical-fdap-income https://www.irs.gov/pub/irs-pdf/iw8eci.pdf (page 3 - under effectively connected income)
You need to clarify with Bob what your agreement is. If you and Bob are working together on these jobs as partners, you should get a written partnership agreement done by a lawyer who works with software industry entity formation. You can legally be considered a partnership if you are operating a business together, even if there is nothing in writing. The partnership will have its own tax return, and you each will be allocated 50% of the profits/losses (if that's what you agree to). This amount will be reported on your own individual 1040 as self-employment income. Since you have now lost all the expense deductions you would have taken on your Schedule C, and any home office deduction, it's a good idea to put language in the partnership agreement stating that the partnership will reimburse partners for their out-of-pocket expenses. If Bob is just hiring you as a contractor, you give him your SSN, and he issues you a 1099, like any other client. This should be a situation where you invoice him for the amount you are charging. Same thing with Joe - figure out if you're hiring him as an independent contractor, or if you have a partnership. Either way, you will owe income and self-employment tax on your profits. In the case of a partnership, the amount will be on the K-1 from the partnership return. For an independent contractor who's operating as a sole proprietor, you report the income you invoiced for and received, and deduct your expenses, including independent contractors that you hired, on your Schedule C. Talk to your tax guy about quarterly estimated payments. If you don't have a tax guy, go get one. Find somebody people in your city working in your industry recommend. A good tax person will save you more money than they cost. IRS Circular 230 Notice: Please note that any tax advice contained in this communication is not intended to be used, and cannot be used, by anyone to avoid penalties that may be imposed under federal tax law. If you don't receive a W2, there are 2 scenarios you should consider: If you have reason to believe that scenario 1 is accurate, then you could file your taxes based on the last valid paycheck you received. If you have reason to believe that scenario 2 is accurate, then you need to do some extra math, but fortunately it is straight forward. Simply treat your final paychecks as if the gross amount of your check was equal to the sum of your taxes paid, and the net amount of the check is $0. This way your income will increase by the proper amount, and you will still receive credit for the taxes paid. This should work out cleanly for federal and state taxes, but will likely result in an overpayment of FICA taxes. You can use form 843 to receive a refund of excess FICA taxes. As a side note, I'd recommend spot checking the YTD numbers on your last paychecks against previous paystubs to make sure there wasn't any fuzzy math going on when they realized they were going out of business. "I finally found it! Johnson Controls International PLC FORM 8-K/A (Amended Current report filing) Filed 10/03/16 for the Period Ending 09/02/16 from http://investors.johnsoncontrols.com/financial-information/johnson-sec-filings, says on page II-6: (my emphasis for the relevant paragraph) On September 2, 2016, Johnson Controls and Tyco completed their   combination pursuant to the Agreement and Plan of Merger (the “Merger   Agreement”), dated as of January 24, 2016, as amended by Amendment No.   1, dated as of July 1, 2016, by and among Johnson Controls, Tyco and   certain other parties named therein, including Jagara Merger Sub LLC, an   indirect wholly owned subsidiary of Tyco (“Merger Sub”).   Pursuant to the terms of the Merger Agreement, on September 2, 2016,   Merger Sub merged with and into Johnson Controls with Johnson Controls   being the surviving corporation in the merger and a wholly owned,   indirect subsidiary of Tyco (the “merger”).   Following the merger, Tyco changed its name to “Johnson Controls   International plc.”  Immediately prior to the merger and in connection   therewith, Tyco shareholders received 0.955 ordinary shares of Tyco   (which shares are now referred to as “combined company ordinary shares”)   for each Tyco ordinary share they held by virtue of a 0.955-for-one   share consolidation. In the merger, each outstanding share of common   stock, par value $1.00 per share, of Johnson Controls (“Johnson Controls   common stock”) (other than shares held by Johnson Controls, Tyco and   certain of their subsidiaries) was converted into the right to receive   either the cash consideration or the share consideration (each as   described below), at the election of the holder, subject to proration   procedures described in the Merger Agreement and applicable withholding   taxes.   The election to receive the cash consideration was undersubscribed. As a   result, holders of shares of Johnson Controls common stock that elected   to receive the share consideration and holders of shares of Johnson   Controls common stock that made no election (or failed to properly make   an election) became entitled to receive, for each such share of Johnson   Controls common stock, $5.7293 in cash, without interest, and 0.8357   combined company ordinary shares, subject to applicable withholding   taxes.   Holders of shares of Johnson Controls common stock that elected to   receive the cash consideration became entitled to receive, for each such   share of Johnson Controls common stock, $34.88 in cash, without   interest, subject to applicable withholding taxes.   In the merger, Johnson Controls shareholders received, in the aggregate,   approximately $3.864 billion in cash. Immediately after the closing of,   and giving effect to, the merger, former Johnson Controls shareholders   owned approximately 56% of the issued and outstanding combined company   ordinary shares and former Tyco stockholders owned approximately 44% of   the issued and outstanding combined company ordinary shares. This answers what actually happened in the transaction; as far as my cost basis in the new JCI, it's a little more obscure; on page II-7 it says: For pro forma purposes, the valuation of consideration transferred is   based on, amongst other things, the adjusted share price of Johnson   Controls on September 2, 2016 of $47.67 per share and on page II-8: Johnson Controls adjusted share price as of September 2, 2016 (2): $47.67 (2) Amount equals Johnson Control closing share price and market   capitalization at September 2, 2016 ($45.45 and $29,012 million,   respectively) adjusted for the Tyco $3,864 million cash contribution   used to purchase 110.8 million shares of Johnson Controls stock for   $34.88 per share. and both agree with the information posted at http://www.secinfo.com/dpdtb.w6n.2n.htm#1stPage (R66 Merger Transaction Fair Value of Consideration Transferred (Details)) which I can't seem to find on an ""official"" website but it purports to post from the SEC EDGAR database.    So for each share of JCI, it had a fair value of $47.67 prior to the acquisition, and transformed into $5.7293 in cash, plus 0.8357 of ""new"" JCI shares with a basis of $47.67 - $5.7293 = $41.9407. Stated in terms of ""new"" JCI shares, this is $50.1863 (=$41.9407/0.8357) per ""new"" JCI share. (I'm not really 100% sure of this calculation though.)  I also found JCI's Form 8937 which states Fair market value generally is the price at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of the facts. U.S. federal income tax law does not specifically prescribe how former JCI shareholders should determine the fair market value of the Tyco ordinary shares received in the merger.  One possible method of determining the fair market value of one Tyco ordinary share is to use the average of the high and low trading prices on the date of the merger, which was $45.69. Other methods for determining the fair market value of Tyco ordinary shares are possible. Former JCI shareholders are not bound by the approach described above and may, in consultation with their tax advisors, use another approach.   as well as similar text on the IRS website: One possible method of determining the fair market value of one Tyco ordinary share is to use the average of the high and low trading prices on the date of the merger, which was $45.69. Using this figure, former JCI shareholders that elected to receive shares in the merger would receive cash and Tyco ordinary shares worth approximately $43.91 per share of JCI common stock exchanged in the merger (assuming no cash received in lieu of fractional shares)." We were booming for 5 years straight. We netted 2 million one year and the rest 1.5 million. I fired my office manager with a 2 week notice. Trying to be nice giving him a 2 week notice rather than throw him out. He went behind my back and ruined all my relationships with my customers and partnerships with other companies.  I had to start at square one. I went from making theses 7 figure incomes to scraping by. Most of my money is invested into real estate so I didn't wanna sell right away. It was a good move I contacted my old clients some understood some wanted nothing to do with me. I started taking the shitty jobs no one wanted. I was running around all over trying to get as much work as possible. Now I'm not back to 7 figures but I hit a comfortable 200k net-income. I'm slowly getting back up there it's been 3 years. You just have to keep pushing and keep an open mind. Don't make the same mistake twice. "Without divulging too many specifics.  Net income is 73k.  Total income is 136k.  Filed as an S-Corp.  Using Quickbooks to classify expenses etc.  I know its not much information but I don't know what to look out for, like ""whoa, net income is 73k, you gotta spend that!""  I have a CPA but isn't offering much in the terms of ""help"" and ""explanation"".  Thanks for your time!" Yes sir, been there did that.  Now a Roth account is considered income if you it pull out. It is your money and you have to report if you pull it out. FYI, open a savings account, and put it in that so if you need it this will not happen. "If a person is not a U.S. citizen and they live and work outside the U.S., then any income they make from a U.S. company or person for services provided does not qualify as ""U.S. Source income"" according to the IRS.  Therefore you wouldn't need to worry about withholding or providing tax forms for them for U.S. taxes.  See the IRS Publication 519 U.S. Tax Guide for Aliens." No, it would not show up on the income statement as it isn't income. It would show up in the cash flow statement as a result of financing activities.