3 Has anyone used TurboTax's W2 import feature? I'm wondering if I should just wait for my official W2 to use that or if I should manually enter everything from my paystub.

Great question! I've been through this exact situation multiple times. Your last pay stub can give you a pretty good estimate, but there are definitely some key differences to watch out for. The main numbers like gross wages, federal/state taxes withheld, Social Security, and Medicare should be very close between your final paystub and W2. However, your W2 will likely include additional reporting that doesn't show up on regular paystubs: - Box 12 codes for things like 401k contributions, health insurance premiums, dependent care assistance - Taxable fringe benefits that get added at year-end - Any stock compensation or bonuses that were processed after your last paycheck - Corrections to previously reported amounts One thing I always tell people - if you're just trying to get a rough idea of whether you'll owe or get a refund, your paystub numbers are usually close enough for planning purposes. But definitely wait for the actual W2 before filing, since the IRS will have the official numbers and any discrepancies could cause processing delays. Your employer should have W2s to you by January 31st, so hopefully not much longer to wait!

I ran into this same issue and my accountant explained it this way: think of them as completely different transactions that just happen to involve the same account type. A Roth CONVERSION is taking money that was already in a tax-advantaged retirement account (Traditional IRA) and moving it to a different type of tax-advantaged account (Roth IRA). You already got the tax deduction when the money went into the Traditional IRA, so now you pay tax when converting to Roth. A Roth CONTRIBUTION is taking money from your regular bank account (money you've already paid income tax on) and putting it into a Roth IRA. There are strict annual limits on contributions ($7k-$8k depending on age).

Just want to add one more important point that helped me when I was in a similar situation - make sure you keep really good records of your Roth conversion for future reference. The $250K you converted will now grow tax-free in the Roth IRA, and when you eventually take distributions in retirement, you won't owe any tax on the growth. But you need to track the "basis" (the amount you already paid tax on through the conversion) versus any future growth. Also, remember the 5-year rule - even though your wife is 59, the converted amount has its own 5-year waiting period before it can be withdrawn penalty-free if needed. Each conversion has its own 5-year clock. This is different from regular contributions which have more flexible withdrawal rules. TurboTax should generate the proper forms (like Form 8606 if applicable) to track all this, but definitely save copies of everything including the 1099-R and your completed return for your records.

Dont forget about the kiddie tax if your children have substantial unearned income (like interest or dividends over $2,300). This can get complicated since it might get taxed at the parents' rate. My daughter had some investments from her grandparents that triggered this and it was a nightmare to figure out!

Just to add another perspective - don't forget that even though your kids need to file their own returns, you can still help them through the process since they're minors. I'd recommend using this as a teaching opportunity to show them how taxes work. For your daughter's W-2 income, it's pretty straightforward - she'll likely get a refund if any taxes were withheld. For your son's cash income, make sure he starts keeping better records going forward (dates, amounts, who paid him) since he'll need to report this as self-employment income on Schedule C. One tip: if your son's self-employment income puts him over $400, he'll owe self-employment tax (Social Security and Medicare taxes) even if he doesn't owe income tax. This is often surprising to parents! The good news is at his income level, it won't be much, but it's something to budget for. Also consider having them set aside a small percentage of future earnings for taxes so they're not caught off guard next year.

Has anyone successfully e-filed with this W-2/1042-S combination? I tried using H&R Block's software and it kept giving me errors when I entered the 1042-S information. Wonder if TurboTax or TaxAct handle it better or if I just need to file a paper return.

I'm dealing with this exact same situation right now! Working in the US for half the year then remotely from Germany. One thing I learned that might help others - make sure to check if your employer properly applied the tax treaty withholding rate on your 1042-S. The standard 30% withholding can often be reduced under tax treaties. For example, the US-Germany treaty allows for reduced rates on certain types of employment income. If your employer didn't apply the treaty rate, you can still claim the benefit when filing your return, but it means waiting longer for your refund. Also, keep really good records of which days you worked where. The IRS can be picky about the physical presence test for treaty benefits, especially if you're claiming reduced withholding rates. I created a simple spreadsheet tracking my location each workday just to be safe. Has anyone had luck getting their employer to retroactively apply the correct treaty withholding rate, or do you pretty much have to wait until tax filing to get the difference back?

Don't forget to complete Form 8833 if you're claiming treaty benefits! I made this mistake my first year as a resident alien.

@Ellie Simpson - I went through almost the exact same situation! Also forgot to update my bank after becoming a resident alien and got a 1042-S instead of a 1099-INT. FreeTaxUSA handled it just fine in my experience. When you get to the income section, look for "Foreign Income" or "Other Income" - there should be a specific option for 1042-S forms. Just enter the information exactly as it appears on your form (the $780 interest amount and the income code which is probably "01" for interest). The main thing is NOT to report it as 1099-INT income since they're different forms with different tax implications. Since no tax was withheld, you won't get any withholding credits, but you'll still need to pay regular income tax on the $780. Definitely submit that W-9 to your bank ASAP so you get proper 1099-INT forms next year. Most banks will process the change pretty quickly once you submit the form. One tip: double-check if your home country has a tax treaty with the US that might affect how this income is taxed. Some treaties provide benefits for interest income that could save you money, though you might need additional forms if you claim those benefits.