Just want to share my experience - I'm from India (no tax treaty) and was really confused by the 1042-S my university sent me. I thought I only needed to worry about my W-2. I used TurboTax at first (big mistake for international students!) and it didn't even ask about 1042-S. Later used Sprintax which properly handled both forms. Bottom line: The 1042-S showed additional withholding my university had already taken from my scholarship that covered room and board (the portion exceeding tuition was taxable). By including it, my tax bill dropped by $275. Definitely include your 1042-S!

Yes, you absolutely need to include your 1042-S form regardless of whether your country has a tax treaty with the US. The 1042-S reports income and withholding for nonresident aliens, and this applies to all international students on F-1 visas who are considered nonresident aliens for tax purposes. The drop in your tax liability from $653 to $378 when you added the 1042-S is exactly what should happen - this form is showing withholding that was already taken from your income but wasn't captured on your W-2. Your university likely issued the 1042-S for scholarship or fellowship income that exceeds qualified education expenses, which is taxable but has different withholding rules than regular wages. Since this is your first time filing US taxes, I'd strongly recommend double-checking that there's no duplicate reporting between your W-2 and 1042-S. Make sure the total income reported on both forms doesn't exceed what you actually earned. If everything looks correct, definitely include both forms in your filing - the IRS expects to see all income reported to them, and the 1042-S has already been sent to the IRS with your information.

Pro tip: Keep a PDF copy of your filed return AND a screenshot of your payment confirmation. The IRS "Where's My Refund" tool doesn't help much when you owe money, but the IRS online account is super helpful for this situation. It usually updates within a week to show your payment.

Just a heads up - if this is your first time owing instead of getting a refund, double check that you don't need to make estimated tax payments for 2025. I made this mistake and got hit with an underpayment penalty the following year 😩

Just a tip from my experience - if you file as "Married Filing Separately" without getting an ITIN for your spouse this year, but later decide you want to amend to "Married Filing Jointly" after getting their ITIN, you CAN do this! You have 3 years from the original filing deadline to file an amended return.

I was in almost the exact same situation two years ago - J1 visa with a J2 spouse who had no SSN or ITIN and zero income. Here's what I learned: The key decision is whether the potential tax savings from filing jointly justify the hassle of getting an ITIN for your spouse. Since you mentioned having just one W2, if your income is relatively modest, the difference between the MFS standard deduction ($13,850) and MFJ standard deduction ($27,700) could save you significant money. However, getting an ITIN can take 6-11 weeks during tax season, and you'd need to mail your original passport or certified copies along with Form W-7. If you're not comfortable mailing your passport, you can visit an IRS Taxpayer Assistance Center, but appointments are hard to get. For your first year, I'd honestly recommend starting with MFS to get your return filed on time, then consider getting the ITIN for next year when you have more time to plan. You can always amend later if the tax savings are worth it, but at least you won't miss any deadlines while waiting for ITIN processing. Also, make sure you're claiming any applicable tax treaty benefits - many J1 visa holders from certain countries can exempt part of their income for the first few years.

Don't forget that your 1098-T might not show the correct amount for AOTC purposes! Many schools report tuition billed in Box 2 rather than tuition paid in Box 1. For AOTC, you need to claim based on amounts paid in 2022, not amounts billed. So if you paid spring 2022 tuition in December 2021, that technically wouldn't count for 2022's AOTC calculation. Similarly, if you prepaid some 2023 expenses in December 2022, those would count for 2022 taxes.

As someone who went through this exact situation, I can confirm you're eligible for the AOTC! Since you were enrolled as an undergraduate for the first part of 2022 and completed your degree within the traditional 4-year timeframe, you definitely qualify. The key thing to remember is that the AOTC is based on your status at the beginning of the tax year and during qualified enrollment periods. Your spring 2022 semester counts as undergraduate education, so those expenses are AOTC-eligible. Make sure you keep your records straight - only include expenses from your undergraduate program (tuition, required fees, and course materials from January-May 2022) when calculating the AOTC. Your graduate school expenses from August onward would only qualify for the Lifetime Learning Credit, but since you can only claim one education credit per student per year, you'll want to calculate which option gives you the better benefit. In most cases, the AOTC's higher credit amount ($2,500 vs $2,000) and partial refundability makes it the better choice. Good luck with your taxes!

Don't forget about state taxes in all of this! Some states have their own additional self-employment taxes or different rules for retirement plan contributions. I made this mistake a few years ago and ended up with a surprise state tax bill because I only focused on federal tax planning.

This is exactly the kind of complex tax situation where having all the details straight is crucial. Based on what everyone has shared, it sounds like your brother is in a good position to significantly reduce his tax burden through the Solo 401k strategy. One additional consideration - since he's dealing with both severance income and new consulting income, make sure to factor in the timing of when the consulting payments were actually received versus earned for cash accounting purposes. If some of the $168,750 was invoiced but not yet received by year-end, that could affect both his self-employment tax calculations and his available contribution room for the Solo 401k. Also, with that level of income, he might want to consider whether a SEP-IRA could be more advantageous than a Solo 401k in his specific situation. While Solo 401k generally offers more flexibility, the administrative requirements can be more complex, especially if he's planning to continue growing his consulting business. The advice above about getting direct IRS clarification is spot on - with this much money involved and the complexity of mixed income sources, having official confirmation of the calculations could save him from costly mistakes down the road.