Understanding Dual Contributions: Korean National Pension vs. U.S. FICA

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Understanding Dual Contributions: Korean National Pension vs. U.S. FICA Navigating social security systems across borders can be confusing—especially for employees working between Korea and the U.S. A recurring question is: Can someone pay into both Korea’s National Pension and U.S. FICA (Social Security and Medicare taxes) at the same time—and what happens if they do? This post breaks down how the Korea–U.S. Totalization Agreement works, what “coverage” means, and the consequences of dual contributions. 1. The Totalization Agreement at a Glance πŸ‡°πŸ‡·πŸ‡ΊπŸ‡Έ Since 2001, the Korea–U.S. Totalization Agreement has coordinated social security coverage between the two countries. Its primary goal is to: Prevent double taxation of social security contributions on the same income during the same time period Protect future benefit rights for cross-border workers Key principles: At any given time, only one country’s social security system applies to your wages C...
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πŸ“† Day 9: Common Mistakes First-Time Filers Make

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 πŸ“† Day 9: Common Mistakes First-Time Filers Make

Avoid These Tax Pitfalls & File with Confidence

Filing your taxes as a first-time business owner feels like stepping into a maze of deadlines, forms, and deductions. But don’t worry—many of the mistakes new filers make are easy to avoid once you know what to look out for.

Here’s a breakdown of the most common missteps and how to sidestep them.

❌ Mistake #1: Mixing Business & Personal Expenses

It’s tempting to swipe one card for everything—but it clouds your financials.

✅ Solution: Open a dedicated business bank account and only use it for business transactions. Clean books mean easier deductions and fewer audit risks.

❌ Mistake #2: Forgetting Quarterly Estimated Taxes

Waiting until April can cause sticker shock—and penalties.

✅ Solution: If you expect to owe more than $1,000 in taxes, mark your calendar for quarterly payments (April, June, September, January). Use IRS Form 1040-ES or talk to a CPA to set your targets.

❌ Mistake #3: Not Tracking Deductions Year-Round

That cozy coffee shop meeting counts—if you record it.

✅ Solution: Use a simple spreadsheet, app, or planner insert to log deductible expenses like mileage, home office use, subscriptions, and meals tied to business.

❌ Mistake #4: Filing Late or Incorrect Entity Type

Missing deadlines or mislabeling your business type (sole prop vs. LLC vs. S-Corp) can delay processing or trigger penalties.

✅ Solution: Know your deadline! March 15 for S-Corps, April 15 for most others. Double-check your entity type when using tax software or hiring a preparer.

❌ Mistake #5: Ignoring Self-Employment Tax

First-time freelancers often forget that Social Security and Medicare taxes aren't withheld.

✅ Solution: Plan for self-employment tax (~15.3%) by including it in your estimated payments. Consider an S-Corp election if you're earning consistently and want to optimize payroll.

🧾 A CPA’s Quick Tip

Keep a folder or digital album labeled “Tax Year 2025”. Drop receipts, screenshots, invoices, and mileage logs into it all year. You’ll thank yourself in April.

πŸ“Œ Final Thought

Tax filing doesn’t have to be scary—it just needs a plan. By avoiding these common mistakes, you set the stage for smoother returns, smarter deductions, and stronger business habits.

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