Hit a major snag... it may be over

[Maxx121 14]

I will just be glad when this whole process is over and i can just look back and say to my cathy: WoW thats a memory there

[soulprovider915 4]

What you did will work, there is no question of that. I never doubted that and I do not disagree and I did not disagree with the fact that it "would work".

Your lack of knowledge of how it works cost you a lot of money. You gave up legitimate business expenses and costs to raise your "bottom line" and therefore what appears on line 22 of the 1040. In so doing you paid 15% self employment tax on every dollar you COULD have written off, not to mention income tax at whaever rate you pay. A lack of knowledge could cost someone thousands of dollars. I would suggest you consider an amended return and get your money back. Be prepared for an audit if you do so.

You can make these decisions for yourself, of course, and you can justify the expense as "worth it". For my money it is far more "worth it" ti=o have that money for the use of my fiancee/wife and family. Advising it to others because you do not know is not a good idea and those people should know there IS an alternative to paying thousands of dollars in self employment tax. Continuing to argue the point in the knowledge of experience that there IS another way is not a service to the people you are answering.

I was self employed for the year before I had our first (visa) interview. I made less than $6,000 (line 22) for that year. I considered the same thing you did but asked around here at VJ, studied the rules and basically spent a few months researching it before filing my taxes for 2007. Then I went with the lower (correct) number. I had also changed my method of doing business so I made myself an employee of my company, rather than being a sole proprietorship, PLUS I was "hired" by one of my former clients 6 months before my I-134 was signed (but still after the previous tax year) I have since worked with many other visa applicants in the same situation. (self employed) In every case, the income stated for the previous year WAS NOT AN ISSUE. I have heard that there are a few consulates that do put more emphasis on last year income, Thailand comes to mind. I have not worked with anyone using a consulate where the last year was given any signifigance. It is not an issue in London. I have advised several people using the London consulate. Oddly enough, even Casa Blanca is fairly easy in this regard (and nothing else!)

The OP could also incorporate her business tomorrow and hire herself as an employee and state her income from her job as an employee. She should consult with her tax person before doing this but it is possible.

There are NO disadvantages to being self employed IF you do things properly and to your advantage, not the IRS's My wife and two sons are here and I have several thousand additional dollars in the bank

If you go Corporate aren't you now going to pay your accountant much more for the year plus corporate income taxes? Even if you dump the income for the previous year, don't you still have to cross the poverty mark for the current year? Either way you'll still have to claim above the 125% mark or show that you're working towards it if it's earlier in the current year or the whole previous year. Maybe it's different for England than Ecuador. I don't know of too many Brits illegally coming to America. The Guayaquil consulate told me that I must bring the previous year's taxes to show steady income. Keep in mind I operate with no tax ID only my social. I don't even have a DBA.