I've heard about these but always wondered - if you're young (like under 40), doesn't this approach lock up a TON of your money until retirement age? What if you want to access some of that cash before 59.5 years old?

You're right to consider the access limitations. With a defined benefit plan, you're committing to regular contributions that you can't easily access before retirement without penalties. However, there are some strategies to work around this. One approach is to combine it with a "cash balance plan" variation, which can provide more flexibility. Additionally, you can look into Substantially Equal Periodic Payments (SEPP) under IRS Rule 72(t) which allows penalty-free early withdrawals if structured correctly. Some business owners also balance their retirement contributions - putting enough in the defined benefit plan to get significant tax savings while keeping other funds more accessible.

Be really careful with this advice. The IRS has been cracking down HARD on offshore structures for domestic businesses. If you don't have legitimate international operations and clients, this could get you in serious trouble. I knew someone who tried something similar and ended up with massive penalties and an audit that lasted 2+ years.

12 How does the interest work though? Like if I'm paying interest to my own account, isn't that just moving money from one pocket to another?

7 The interest works in your favor actually. When you pay interest on a 401k loan, that interest goes back into your own account. So yes, you're essentially paying yourself, which is much better than paying interest to a bank or credit card company. The interest rate is typically prime rate plus 1-2%, so around 6-8% currently. This money gets added to your 401k balance, so in a way, it forces you to contribute a bit extra to your retirement. The only real "cost" is the potential investment growth you miss out on for the money while it's out of your account.

9 Do medical bills count for avoiding the penalty? I have some medical debt I'm trying to clear.

Is Form 8843 filed together with the 1040NR or is it submitted separately? And what's the deadline?

Form 8843 is submitted with the 1040NR if the student is also filing a tax return. If they don't need to file a tax return (no income), then Form 8843 is sent by itself to the IRS. The deadline is the same as the regular tax deadline - April 15th (or the extended deadline if they file for an extension). Just make sure they keep copies of everything they submit since international students often need tax filing records for visa renewals or future immigration applications.

THIS. The athletic scholarship issue is so important. My university got in trouble because they weren't properly withholding on athletic scholarships for international students. The housing and meal portions are considered taxable income.

I think you're right. I got a big promotion last year and our withholding never got adjusted. Is there a specific amount I should put for additional withholding on the W-4? And will I get penalized for having paid so little throughout the year?

You should use the IRS Tax Withholding Estimator on their website to calculate the exact amount for additional withholding. With your income level, you might consider putting an additional $500-700 per paycheck depending on your pay frequency. You might face an underpayment penalty if you didn't pay at least 90% of your tax liability during the year or 100% of last year's tax (110% if your income was over $150,000). The penalty isn't usually huge, but it's better to avoid it by making an estimated tax payment now if you can. You can make an estimated payment for 2025 using Form 1040-ES to help reduce any potential penalties.

I used H&R Block online and it was pretty straightforward. There's a specific section for unemployment compensation where you enter the 1099-G info. Make sure you're looking at box 1 on the form for the total unemployment amount and box 4 for any federal withholding.

Does this still apply if the old house was vacant for the last month of 2022? We moved out completely but it didn't sell until 2023, so it was just sitting empty for December 2022.

Yes, it absolutely still applies even if the house was vacant. The mortgage interest deduction is based on ownership of a qualified residence, not occupancy. As long as you owned the home and it was either your primary residence or second home for some portion of the year, you can deduct the interest you paid. The IRS actually allows for temporary absences (even if you're not physically living there) as long as the home is not rented out during that period. So your vacant house in December still qualifies for the mortgage interest deduction on your 2022 taxes.

I used TurboTax last year for a similar situation and it had a specific section where you could enter multiple mortgage interest statements. Look for something like "I have more than one mortgage" or "Add another 1098 form" option. It should be somewhere after you enter the first 1098. For the $750k limit, the software should automatically calculate this if you enter all your mortgage information correctly, including the date each mortgage originated and the original loan amounts.

Thanks for the suggestion! I looked again and found a tiny "Add another property" button I completely missed before. Now I see where to enter both properties. Still confused about the $750k limit though - I guess I'll just trust the software to calculate it correctly.